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Katie Thomas J&J Coverage

Katie Thomas NYT J&J Coverage

Drug Prices Keep Rising Despite Intense Criticism
Apr 26, 2016 | New York Times
By Katie Thomas

From the campaign trail to the halls of Congress, drug makers have spent much of the last year enduring withering criticism over the rising cost of drugs.
Document Claims Drug Makers Deceived a Top Medical Journal
Mar 1, 2016 | New York Times
By Katie Thomas

It is a startling accusation, buried in a footnote in a legal briefing filed recently in federal court: Did two major pharmaceutical companies, in an effort to protect their blockbuster drug, mislead editors at one of the world’s most prestigious medical journals?
F.D.A. Asks If Faulty Blood Monitor Tainted Xarelto Approval
Feb 22, 2016 | New York Times
By Katie Thomas

The Food and Drug Administration is investigating whether a faulty blood-testing device may have compromised the results of a clinical trial that led to the approval of Xarelto, a blockbuster anticlotting drug that has been prescribed to millions of Americans since it arrived on the market in 2011.
Eager to Opine on the Toughest Calls in Medical Ethics
May 7, 2015 | New York Times
By Barry Meier and Katie Thomas

Arthur Caplan is not a medical doctor, but he has made a successful career offering his opinion to physicians, institutions and the news media about doctors and how they should act.
Company Creates Bioethics Panel on Trial Drugs
May 7, 2015 | New York Times
By Katie Thomas

Johnson & Johnson has appointed a nationally known bioethicist to create a panel that will make decisions about patients’ requests for potentially lifesaving medicine, responding to an emotional debate over whether companies should allow desperately ill people to have access to the drugs before they are approved.
Johnson & Johnson Will Make Clinical Data Available to Outside Researchers
Jan 15, 2015 | New York Times
By Katie Thomas

The health care giant Johnson & Johnson has agreed to make detailed clinical trial data on its medical devices and diagnostic tests available to outside researchers through a collaboration with Yale University, making it the first large device manufacturer to systematically make such data public.
Johnson & Johnson Praised for Taking Uterine Surgery Tools Off Market
Jul 31, 2014 | New York Times
By Katie Thomas

Johnson & Johnson, which has come under withering criticism for its response to problems with some of its medical devices, won cautious praise from critics on Thursday for its decision to withdraw three products used in uterine surgery because of a risk of spreading cancerous tissue, only months after the safety issue became widely known.
Arkansas Court Reverses $1.2 Billion Judgment Against Johnson & Johnson
Mar 20, 2014 |
By Katie Thomas

The Arkansas Supreme Court reversed a $1.2 billion judgment against Johnson & Johnson on Thursday, finding that the state attorney general erred by suing under a law that applied to health care facilities, not drug companies.
The ‘No More Tears’ Shampoo, Now With No Formaldehyde
Jan 17, 2014 | New York Times
By Katie Thomas

SKILLMAN, N.J. — The only hint that something is different inside millions of bottles of Johnson’s Baby Shampoo arriving on store shelves are two words: “Improved Formula.”
J.&J. to Pay $2.2 Billion in Risperdal Settlement
Nov 4, 2013 | New York Times
By Katie Thomas

Johnson & Johnson has agreed to pay more than $2.2 billion in criminal and civil fines to settle accusations that it improperly promoted the antipsychotic drug Risperdal to older adults, children and people with developmental disabilities, the Justice Department said on Monday.
New Recalls by Johnson & Johnson Raise Concern About Quality Control Improvements
Sep 12, 2013 | New York Times
By Katie Thomas

After years of struggling to improve its image after major quality lapses, the consumer giant Johnson & Johnson announced two recalls of well-known products in the space of a week, raising questions about the extent to which it has moved on from its past problems.
Johnson & Johnson Profit Rises on Strong Prescription Sales
Jul 16, 2013 | New York Times
By Katie Thomas

Johnson & Johnson reported on Tuesday that its earnings more than doubled in the second quarter of this year, buoyed by strong sales of prescription drugs and an influx of cash from the sale of its stake in the Irish drug manufacturer Elan.
F.D.A. Approves a New Diabetes Drug From J.&J.
Mar 29, 2013 | New York Times
By Katie Thomas and Andrew Pollack

The Food and Drug Administration on Friday approved the first of a new class of medicines to treat diabetes.
Europe Says Drug Makers Paid to Delay a Generic
Jan 31, 2013 | New York Times
By James Kanter and Katie Thomas

BRUSSELS — European antitrust officials on Thursday accused the drug giants Johnson & Johnson and Novartis of colluding to delay the availability of a less expensive generic version of a powerful medication often used to ease severe pain in cancer patients.
F.D.A. Advisory Panel Votes to Approve Diabetes Drug
Jan 10, 2013 | New York Times
By Katie Thomas

A federal advisory panel voted 10 to 5 on Thursday to approve a diabetes drug that could be the first in a new class of drugs in the United States to treat the disease, although several members raised concerns about potential cardiovascular risks and its use in people whose kidneys are impaired.
F.D.A. Approves Drug for Resistant Tuberculosis
Dec 31, 2012 | New York Times
By Katie Thomas

The Food and Drug Administration announced on Monday that it had approved a new treatment for multidrug-resistant tuberculosis that can be used as an alternative when other drugs fail.
Johnson & Johnson Names New Chairman
Nov 30, 2012 | New York Times
By Katie Thomas

William C. Weldon, the chairman of Johnson & Johnson, is stepping down at the end of this year and will be succeeded by Alex Gorsky, the current chief executive, the company announced Friday.
James E. Burke, 87, Dies; Candid Ex-Chief of Johnson & Johnson
Oct 1, 2012 | New York Times
By Katie Thomas

James E. Burke, whose leadership of Johnson & Johnson during the Tylenol poisonings in the 1980s is regarded as a textbook example of how to handle a public relations crisis, died on Friday at a health care facility near New Brunswick, N.J. He was 87.
J.&J. Names Outsider to Run Its Troubled Consumer Unit
Sep 13, 2012 |
By Katie Thomas

Johnson & Johnson named an outsider on Thursday to fill a top leadership role overseeing its troubled consumer health unit, a break from the company’s longstanding tradition of promoting executives from within.
Johnson & Johnson Unit Settles State Cases Over Risperdal
Aug 30, 2012 | New York Times
By Katie Thomas

Johnson & Johnson announced Thursday that its pharmaceutical unit had reached a $181 million consumer fraud settlement with 36 states and the District of Columbia over its marketing of Risperdal, an antipsychotic drug.
Johnson & Johnson to Remove Formaldehyde From Products
Aug 15, 2012 | New York Times
By Katie Thomas

Johnson & Johnson, which makes a range of personal care products like baby shampoo, acne cream and antiwrinkle lotion, announced plans Wednesday to remove a host of potentially harmful chemicals, like formaldehyde, from its line of consumer products by the end of 2015, becoming the first major consumer products company to make such a widespread commitment.
F.D.A. Expedites Review of New Uses for Anticlotting Drug
Jul 9, 2012 | New York Times
By Katie Thomas

The Food and Drug Administration has agreed to give priority status to its review of three new uses for the anticlotting drug Xarelto, Johnson & Johnson announced Monday.
Johnson & Johnson Unit to Halt Urinary Implants
Jun 5, 2012 | New York Times
By Katie Thomas

Johnson & Johnson’s Ethicon division will stop selling four types of mesh implants used to treat urinary incontinence, the company announced in a letter to judges overseeing two large groups of lawsuits filed by women who claim the devices caused serious injury.
F.D.A. Panel Votes Against Expanding Use of an Anticoagulant
May 23, 2012 | New York Times
By Katie Thomas

A federal advisory panel narrowly recommended against expanding the use of the Johnson & Johnson drug Xarelto on Wednesday, saying concerns over dangerous bleeding outweighed evidence that the drug helped reduce the risk of blood clots in patients with serious heart problems.
After Recalls and Missteps, J.&J.’s New Chief Confronts Critical Challenges
Apr 25, 2012 | New York Times
By Katie Thomas

Johnson & Johnson needs to rethink the way it brings drugs to market, expand its reach into global markets and rebuild consumer confidence by returning recalled brands to pharmacy shelves, the incoming chief executive, Alex Gorsky, said in an interview Wednesday.
Popular J.&J. Drugs May Not Return Until 2013
Apr 17, 2012 | New York Times
By Katie Thomas

Efforts to fix manufacturing problems at three Johnson & Johnsonplants are taking longer than expected, meaning that some popular over-the-counter consumer brands may not return to store shelves until next year, company executives said Tuesday.
J.&J. Fined $1.2 Billion in Drug Case
Apr 11, 2012 | New York Times
By Katie Thomas

A judge in Arkansas ordered Johnson & Johnson and a subsidiary to pay more than $1.2 billion in fines on Wednesday, a day after a jury found that the companies had minimized or concealed the dangers associated with an antipsychotic drug.
J.&J.’s Next Chief Is Steeped in Sales Culture
Feb 23, 2012 | New York Times
By Katie Thomas

Alex Gorsky, the newly named chief executive of Johnson & Johnson, shares a crucial biographical detail with William C. Weldon, the man he is succeeding. Both got their starts as pharmaceutical sales representatives, a notoriously grueling job that — because it demands stamina, charisma and a near devotion to making the sale — has become a crucible for future drug company executives in recent years.
J.& J. Chief to Resign One Role
Feb 21, 2012 | New York Times
By Katie Thomas and Reed Abelson

William C. Weldon, who presided over Johnson & Johnson during one of the most tumultuous periods in its history, will step down as chief executive in April, the company announced Tuesday.

Katie Thomas NYT J&J Coverage

Drug Prices Keep Rising Despite Intense Criticism

Apr 26, 2016 | New York Times

By Katie Thomas

From the campaign trail to the halls of Congress, drug makers have spent much of the last year enduring withering criticism over the rising cost of drugs.
It doesn’t seem to be working.
In April alone, Johnson & Johnson raised its prices on several top-selling products, including the leukemia drug Imbruvica, the diabetestreatment Invokana, and Xarelto, an anti-clotting drug, according to a research note published last week by an analyst for Leerink, an investment bank. Other major companies that have raised prices this year include Amgen, Gilead and Celgene, the analyst reported.
Makers have raised prices on brand-name drugs by double-digit percentages since the start of the year, according to interviews with executives at Express Scripts and CVS Caremark, two major drug-benefit managers. And a report last week by the research firm IMS Health found that in 2015, list prices for drugs increased more than 12 percent, in line with the trend over the five previous years.
“It used to be the drug companies only took one price increase a year,” said Dr. Steve Miller, chief medical officer at Express Scripts. “Now what they’re doing is taking multiple price increases multiple times a year.”
That scrutiny on pricing is likely to continue on Wednesday with the Senate testimony of J. Michael Pearson, the chief of Valeant Pharmaceuticals International, which has come to be viewed as an industry pariah after profiting for years on drastic price increases on old drugs. Mr. Pearson, who is stepping down as chief next month, has been subpoenaed to testify before the Senate Special Committee on Aging, which is investigating the drug-pricing issue.
List prices do not tell the full picture. Much like the inflated room rates posted on the back of a hotel door, drug list prices don’t show the rebates and other discounts that insurers and pharmacy-benefit managers demand from manufacturers, who are increasingly being forced to compete with other drug makers and to offer better deals, which lowers drugs’ effective cost.
In fact, the same report by IMS Health that found that list prices rose 12 percent last year also found that the net price growth — what insurers and employers actually pay for drugs — went up a far more modest 2.8 percent, one of the lowest increases in years.
But one of the cruelties of drug pricing is that the burden falls most heavily on those least able to pay it. Uninsured patients often must pay the list price of a drug, and an increasingly large share of insured customers are being asked to pay a percentage of the list price.
“It’s sort of embedded in the health care system that the price is never the price, unless you’re a cash-paying customer,” said Adam J. Fein, president of Pembroke Consulting, a management advisory and business research company. “And in that case, we soak the poor.”
Some of the difference in prices is the result of actions taken by pharmacy-benefit managers like CVS Health, which manage drug plans for insurers. They have become more sophisticated in recent years, leading to better discounts from drug companies. They cite successes like the major discount that Gilead, the maker of an expensive new hepatitis C drug, conceded after AbbVie released a competing product. And sales of expensive new cholesterol-lowering drugs, called PCSK9 inhibitors, have been sluggish, in part because insurers have placed numerous restrictions on their use.
“I think we’ve upped our game,” said Dr. Troyen Brennan, chief medical officer of CVS Health. “It’s much more dynamic and much more fast-paced, and I think that like us, the other P.B.M.s are responding much more rapidly.”
So if drug makers’ list prices aren’t representative of the true cost of a drug, why risk negative publicity by raising them? Many rebates and other discounts are tied to a percentage of the list price, which means a higher list price still yields more profit. And not every insurer and pharmacy-benefit manager is as sophisticated as the top players, so manufacturers can profit on the margins.
“The structure of the system is such that the only way they can get any increase in prices is to raise the list price by a very high percent,” said Mr. Fein. “It’s kind of baked into the system, and it’s so complicated, you can’t really unwind it without blowing up the entire health care system.”
Some of the most recent price increases may also be happening because drug makers are hoping to profit while they can, before congressional or other actions prevent them from doing so, said Geoffrey Porges, the author of the Leerink analysis.
“When you see this type of very aggressive pricing action across many products, then you start to scratch your head and say, is this the industry preparing for a more challenging price environment?” he said. “There’s just a general fear of the unknown.”
Drug makers say that, despite the intense focus on their industry, drug costs account for only around 10 percent of health care spending, an amount that has remained relatively steady over time.
“Obviously there’s a lot of variables that are used in determining what the appropriate prices are in any product,” said Dominic Caruso, the chief financial officer of Johnson & Johnson. “We price our products very responsibly, and in fact the list price increases that we’ve taken have been consistently below our competitive set over the last five years.”
Even though insurers and pharmacy-benefit managers are keeping drug prices in check in some areas, they are losing the battle in others, especially in areas like multiple sclerosis or cancer treatment, where a host of new drugs have recently entered the market with little competition.
“That’s where the real angst in the marketplace is,” said Dr. Miller. Specialty drugs, which are complex products that typically treat serious, chronic illnesses, now account for 33 percent of all drug spending even though they treat about 1 to 2 percent of all patients, Dr. Miller said.
“Pharma is looking at these lower numbers and saying, ‘We’re not as bad as you’re hearing in the marketplace,’” Dr. Miller said. But he said actual drug costs were still rising. “The main point is this is still faster than your income is growing. You’re falling further and further behind, and it’s not sustainable.”

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Document Claims Drug Makers Deceived a Top Medical Journal

Mar 1, 2016 | New York Times

By Katie Thomas

It is a startling accusation, buried in a footnote in a legal briefing filed recently in federal court: Did two major pharmaceutical companies, in an effort to protect their blockbuster drug, mislead editors at one of the world’s most prestigious medical journals?
Lawyers for patients suing Johnson & Johnson and Bayer over the safety of the anticlotting drug Xarelto say the answer is yes, claiming that a letter published in The New England Journal of Medicine and written primarily by researchers at Duke University left out critical laboratory data. They claim the companies were complicit by staying silent, helping deceive the editors while the companies were in the midst of providing the very same data to regulators in the United States and Europe.
Duke and Johnson & Johnson contend that they worked independently of each other. Bayer declined to comment. And top editors at The New England Journal of Medicine said they did not know that separate laboratory data existed until a reporter contacted them last week, but they dismissed its relevance and said they stood by the article’s analysis.
But the claim — that industry influence led to the concealing of data — carries echoes, some experts said, of an earlier era of drug marketing, when crucial clinical data went missing from journal articles, leading to high-profile corrections and a wave of ethics policies to limit the influence of drug companies on medical literature.Continue reading the main storyRELATED COVERAGEF.D.A. Asks If Faulty Blood Monitor Tainted Xarelto Approval FEB. 22, 2016Antidepressant Paxil Is Unsafe for Teenagers, New Analysis SaysSEPT. 16, 2015
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“It just feels like it’s a real ethical breach,” said Dr. Lisa Schwartz, a professor of medicine at Dartmouth, of the failure to include the lab data in the letter. “If you know the direct answer to this question, then how can you not provide it to be able to give insight?”
Xarelto, which is sold in the United States by Johnson & Johnson and overseas by Bayer, had nearly $2 billion in United States sales last year and is the best seller in a new category of drugs seeking to replace warfarin, an older blood thinner. The two companies hired the Duke Clinical Research Institute to run a three-year clinical trial involving more than 14,000 patients that led to Xarelto’s approval by regulators. But those results have come under scrutiny since September, when the companies notified regulators that a blood-testing device used in the study had malfunctioned.
The trial compared the number of strokes and bleeding events experienced by patients taking Xarelto with those of patients using warfarin. The concern is that the faulty results may have led doctors to give patients the wrong dose of warfarin, which could have favored Xarelto.
Last month the Duke researchers published an analysis in The New England Journal of Medicine and concluded that the problems with the device did not change the trial’s results.
But some in the medical community questioned their findings because their method required them to essentially guess which groups of patients were more likely to be affected by the malfunctioning device.
A better way to evaluate the device, other researchers said, would be to compare the device readings with test results that were done at a central laboratory. Investigators did that at two points in the trial, drawing blood from more than 5,000 of the patients who took warfarin and sending the samples for testing. The blood was taken 12 and 24 weeks after patients enrolled in the trial.
But the Duke researchers made no mention of the lab data in their letter. In an interview, journal editors said they did not know about the lab data until last Tuesday, when a reporter for The New York Times asked them about it.
“At the time we published the letter, we didn’t know that it existed,” said Dr. Jeffrey M. Drazen, editor in chief of The New England Journal of Medicine.
Dr. Drazen disputed the lawyers’ claim that the editors had been misled about the data, and said it was not relevant to the letter that was published.PhotoThe blood-thinning drug Xarelto.CreditJanssen Parmaceuticals, via Associated Press
Last week, lawyers in the case against Johnson & Johnson and Bayer filed a legal brief in federal court in New Orleans, asking a judge to unseal documents in the case, which involves more than 5,000 lawsuits filed by patients and their families who claim they were harmed by Xarelto. Of those, 500 involve patient deaths.
In a footnote, the lawyers said that during the process of vetting the Duke researchers’ letter, a peer reviewer asked about the existence of lab data that would allow a comparison with the device’s readings.
“Despite being provided this opportunity to respond to the peer reviewers,” the lawyers said, the “defendants remained silent on this point, thereby misleading the NEJM.”
Dr. Drazen confirmed that a peer reviewer, whose identities are kept confidential, had asked about such data, but said the editors had rephrased the question to ask whether such data was available throughout the course of the trial. Duke then answered no, he said.
The letter’s three authors, two from Duke and one affiliated with the University of Edinburgh in Scotland, declined to comment, as did a spokesman for Duke.
Dr. Drazen questioned the value of comparing lab results taken at only two points during the trial, noting that people’s blood-clotting levels can vary greatly over time. “There’s so much variation among people that it probably wouldn’t be clinically informative,” he said.
However, he said, the Duke researchers had since agreed to conduct an analysis of the lab data.
Dr. Drazen also said that the editors had not been in contact with either Johnson & Johnson or Bayer. A spokeswoman for Johnson & Johnson said the analysis by Duke was conducted independently of the company. Although a company employee serves on the trial’s executive committee, she said he recused himself “from the conduct of the reanalysis, the drafting of the research letter, and provided no feedback before it was submitted.” Bayer declined to comment.
In a previous statement, Duke said it had conducted its research separately from the two companies. But this fall, Bayer submitted an analysis to the European Medicines Agency that was nearly identical to the approach used by the Duke researchers, comparing the outcomes of patients who had specific medical conditions with outcomes of those who did not. And the legal document filed last week cites a document obtained from one of the companies that describes the peer-review process.
Some experts say this case is reminiscent of other instances in which drug companies concealed or altered drug-trial data in medical journals. In 2005, for example, The New England Journal of Medicine published a rare Expression of Concern after it learned that researchers had failed to include three heart attacks in a study of the painkiller Vioxx, made by Merck, which has since been withdrawn from the market. In that case, editors learned that data had been deleted from the trial manuscript two days before it was submitted to the journal.
Such controversies led to changes in the way that journal articles are published. Authors are now required to disclose their outside financial interests and the role that drug companies played in articles’ publication.
Several researchers said they were surprised that Duke and the editors at the journal did not see value in comparing the lab data, especially since Bayer and Johnson & Johnson have submitted such information to regulators in Europe and the United States.
“I think it’s always important to make sure that you have all the information to answer the scientific question before publication,” said Dr. Rita F. Redberg, a cardiologist who is also editor of the medical journal JAMA Internal Medicine.
Less than a week after the Duke letter was published, the European Medicines Agency released its own report, which contained analyses using the independent lab comparisons. The agency concluded the device most likely did not affect the trial’s outcome, but it did find that the device was highly inaccurate.
Dr. Steven Nissen, a cardiologist at the Cleveland Clinic, served on the Food and Drug Administration advisory panel that voted to approve Xarelto in 2011. He was one of two members who voted against the drug. He expressed doubt that any after-the-fact analysis would give doctors and patients answers. “Given the fact that the device was inaccurate, there is no way anybody can tell you what would have happened in the trial,” he said.

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F.D.A. Asks If Faulty Blood Monitor Tainted Xarelto Approval

Feb 22, 2016 | New York Times

By Katie Thomas

The Food and Drug Administration is investigating whether a faulty blood-testing device may have compromised the results of a clinical trial that led to the approval of Xarelto, a blockbuster anticlotting drug that has been prescribed to millions of Americans since it arrived on the market in 2011.
The agency has asked the drug’s manufacturer, Johnson & Johnson, detailed questions about whether there was evidence that the device was malfunctioning while the trial was underway, according to a legal brief filed in federal court on Monday by lawyers for patients and their families who say they were injured by the drug. The lawyers also cited internal company documents that they said showed doctors were complaining to the trial leadership during the course of the study.
The clinical trial, known as Rocket AF, was led by Dr. Robert M. Califf, currently President Obama’s nominee for head of the Food and Drug Administration. It involved more than 14,000 patients worldwide and took place from 2006 to 2010.
Xarelto, which is also known by its scientific name, rivaroxaban, is one of a new class of drugs that are seen as a replacement for warfarin, a cumbersome 60-year-old drug used to prevent strokes in people with a heart-rhythm disorder known as atrial fibrillation. Warfarin requires careful monitoring of a patient’s diet and drug regimen, and frequent blood tests to ensure that is working. If patients receive too little of the drug, they could experience a stroke. But if they receive too much, their lives could be threatened by catastrophic bleeding.Continue reading the main storyRELATED COVERAGEF.D.A. Deals Setback to Catalyst in Race for Drug Approval FEB. 17, 2016Under Pressure, F.D.A. Adds Measures on Opioid Abuse FEB. 4, 2016F.D.A. Issues Zika Virus Guidelines for Blood Supply FEB. 16, 2016
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Questions about the trial have been stirring since last fall, when Johnson & Johnson and Bayer, which sells Xarelto overseas, notified regulators that the device that was used in the trial had been recalled in 2014 because it was understating patients’ risk of bleeding. The device, the INRatio sold by Alere, was used in the trial to help doctors gauge whether patients were getting the right dose of warfarin. The trial compared the number of strokes and bleeding events experienced by patients taking Xarelto to those of patients who were given warfarin.
Regulators are looking at whether the malfunctioning device might have led doctors to give patients the wrong dose of warfarin, which could have led to additional bleeding episodes and given an unfair advantage to Xarelto.
This month, researchers with the Duke Clinical Research Institute, which oversaw the trial, published their own analysis in the New England Journal of Medicine and concluded that the faulty device did not affect the trial’s outcome. A few days later, an analysis by the European Medicines Agency, the F.D.A.’s European counterpart, came to the same conclusion.
But rather than settling the matter, the analyses have raised additional questions and have come under harsh criticism from some medical experts. The Duke researchers, for example, never mentioned the existence of central laboratory tests — taken at two points during the trial — that could have been used to assess whether the device’s readings were accurate. And the analysis released by the European drug agency, while it did include those readings, was done by the companies themselves and not by independent statisticians.
“There are so many questions that are yet unaddressed,” said Dr. Harlan M. Krumholz, a cardiologist and director of the Yale University Open Data Access Project, which has an agreement with Johnson & Johnson to make the company’s data from clinical trials available to outside researchers. He has asked the company for access to the trial data, he said, and the company has agreed — but Bayer has refused.
Dr. Krumholz called on Alere to release more information about its device. “We do not know why the device did not work well,” he said.
In a statement, a spokeswoman for the F.D.A. said that while the agency was looking into the issue, it had not changed its recommendations for the drug, which “provides an important health benefit when used as directed.”
A spokeswoman for Alere declined to comment, and a representative for Duke referred to an earlier statement detailing the results of its reanalysis.PhotoXarelto, an anticlotting drug that has been prescribed to millions of Americans since 2011.CreditJanssen Parmaceuticals, via Associated Press
Johnson & Johnson said the INRatio device was selected because it was F.D.A.-approved and easy to use. It said it was not informed of the device recall until last September, when it and Bayer “acted with urgency, diligence and in the best interests of patients and prescribers.” The company said that it has provided answers to the questions the F.D.A. asked and that the analysis published in the New England Journal of Medicine confirmed the safety and efficacy of the drug.
A spokesman for Bayer said the company was confident in the results of the trial and dismissed the issue as being driven by plaintiffs’ lawyers, saying, “They have cherry-picked testimony and documents divorced from any context.”
Dr. Califf is the former director of the Duke Clinical Research Institute, which conducted the trial, and served as the study’s co-chairman. He has since left Duke and is now a deputy commissioner of the F.D.A. Dr. Califf, who did not respond to an email, has no role in the inquiry into the Rocket AF trial, the F.D.A. has said. The Senate was expected to vote Tuesday on whether to confirm his nomination as head of the agency.
Just as the trial was getting underway in 2006, the INRatio was facing scrutiny by the F.D.A. In 2005 and 2006, the agency sent warningletters to HemoSense, then the manufacturer of INRatio, claiming that the devices were generating “clinically significant” erroneous values and that the company, which was later acquired by Alere, was not properly investigating the complaints.
In 2014, Alere recalled the INRatio monitors, saying that they might provide inaccurate results.
However, the connection to the Rocket trial was not made public until this past fall, when a journalist for the British Medical Journal began asking the companies about it. A spokesman for Johnson & Johnson told the journal that the company had been unaware of the recall. The revelation led to the reanalysis by the Duke researchers as well as inquiries by the European Medicines Agency and the F.D.A.
But while the European agency concluded that the trial outcome was not affected by problems with the device, the F.D.A. appears to be taking a closer look, asking pointed questions about whether the company had evidence that the device was malfunctioning during the trial and what actions it took, according to the legal document, which was filed with Judge Eldon E. Fallon in the Eastern District of Louisiana.
The legal motion filed on Monday also cited internal emails that, the lawyers said, showed that some doctors were questioning the accuracy of the device while the trial was underway. The lawyers said so many concerns were raised about the device that a special program was set up to investigate the malfunctions, but none of these details were provided to the F.D.A. when Johnson & Johnson responded to the agency this month.
The Rocket trial has previously come under criticism. In 2011, the F.D.A.’s medical reviewers recommended against approval of Xarelto, citing concerns that the patients receiving warfarin during the trial were being poorly managed, which could give an unfair advantage to Xarelto.
An outside advisory committee later voted to approve the drug — although several members cited reservations — and the agency allowed it to go on the market. It has since become the best-selling drug in its class, bringing in $1.9 billion in the United States in 2015, according to Johnson & Johnson.
Some said the fact that Xarelto has been on the market since 2011 gave them faith in the safety of the product. “The real world has already made the case for this drug,” said Dr. Jürgen vom Dahl, a German cardiologist who served as an investigator in the trial, who said he did not recall encountering any problems with the device.
Dr. vom Dahl also said that he and his German colleagues have wondered whether Dr. Califf’s F.D.A. nomination was playing a role in the renewed questions about the trial. “We don’t know what is real science, and what is more politics,” he said.
But others say that plenty of questions remain, and that they are disheartened by a seeming reluctance by Duke, Johnson & Johnson and Bayer to be forthright about the problem.
“It depends on where you put the flashlight,” said Robert Powell, a clinical pharmacologist who has worked in the drug industry, as well as for six years at the F.D.A. “I think they were directing people away from the problem.”

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Eager to Opine on the Toughest Calls in Medical Ethics

May 7, 2015 | New York Times

By Barry Meier and Katie Thomas

Arthur Caplan is not a medical doctor, but he has made a successful career offering his opinion to physicians, institutions and the news media about doctors and how they should act.
Dr. Caplan, who holds a doctoral degree from Columbia University in the history and philosophy of science, is a professor of medical ethics at NYU Langone Medical Center, part of New York University. But Dr. Caplan, who is 65 and was raised in Framingham, Mass., is best known to peers and the public for assessing moral issues inherent to biomedical endeavors such as clinical trials, organ donations, blood banking and gene therapy.
He has long been an advocate of disclosures to patients about the risks and benefits of participating in studies of new drugs and has pushed for doctors to disclose the financial benefits they receive from drug and medical-device makers.
On Wednesday, Johnson & Johnson announced Dr. Caplan would help it develop a program through which desperately ill patients could get experimental drugs as a last-chance treatment.
In that role, he will assemble a panel of doctors, ethics experts and patient advocates to review so-called compassionate use requests from patients for unapproved drugs and decide which ones to approve.
It is the type of issue that raises the moral, medical and legal questions that have attracted Dr. Caplan throughout his career. He first became interested in medical ethics while a graduate student, and soon after finishing his studies, he joined the Hastings Center, a research institute in Garrison, N.Y., that focuses on bioethics, eventually becoming its associate director.
He said his interest in bioethics began at age 7, when he came down with polio in what he said was one of the last major outbreaks nationwide. Although the case was not serious, the virus left him temporarily paralyzed, and his time in the hospital got him thinking about big questions, such as why doctors were not more open with children about their medical care, and “why can’t they fix everything?”
He said an interest in how society should deal with medical shortages has been a theme throughout his career, beginning in the 1970s, when kidney dialysis was in short supply, and into the 1980s, when questions about who should be given an organ transplant rose to prominence. Dr. Caplan said he worked in the 1980s with Al Gore, then a senator, to help develop what became a national organ sharing network.
After that, he ran a biomedical ethics program at the University of Minnesota for several years. He also spoke out about the exploitation of poor and minority patients in medical studies such as the infamous Tuskegee experiments, in which black patients infected with syphiliswere left untreated — to test the progress of the disease — without their knowledge.
“Informed consent is a privileged man’s protection,” Dr. Caplan said at a medical ethics symposium in 1991. “It is not going to work as well for someone who is poor and uneducated and for whom the researcher may have prejudice and contempt. It works best for those who are educated enough to know to demand it.”
In 1994, he left Minnesota for a post at the University of Pennsylvania in Philadelphia, where he stayed for two decades. His arrival there coincided with an explosion of interest in genetics and the use of gene therapies.
In 2000, after the death of a teenage patient, Jesse Gelsinger, during a gene therapy trial at the University of Pennsylvania, Dr. Caplan was sued along with several researchers involved in the trial by Mr. Gelsinger’s family, who claimed he was had not been informed of its risks. Dr. Caplan, who had provided advice on the study’s ethics, was subsequently dropped from the case.
Dr. Caplan has also served as an adviser to the Clinton administration and the Defense Department, and as chairman of numerous study panels formed by international organizations and professional groups.
He frequently basks in attention from reporters who, on a day when a big medical story breaks, instinctively telephone him, knowing that he will quickly return that call with a useful quote and appealing observation.
“My sense is that he is just about willing to comment on anything if asked,” said Dr. Michael Carome, director of the health research group at Public Citizen, an advocacy group in Washington.
At times, he has clashed with colleagues over ethical questions.
In 2013, Dr. Carome and Dr. Caplan differed in their positions on a controversial clinical trial, in which a federal agency found that several universities had failed to properly inform families about the serious potential risks to their premature babies. Dr. Carome and his group said the universities had behaved improperly; Dr. Caplan defended the study in an article he was a co-author of in The New England Journal of Medicine.
Dr. Carome said he felt Dr. Caplan had not adequately researched the issue. “He was voicing opinions and making judgments without being adequately informed about what the research involved,” Dr. Carome said. “He puts the weight of his reputation behind a topic, and people accept and believe what he says.”
Dr. Caplan noted that his views on the topic appeared in a prestigious, peer-reviewed medical journal. “I mean, that’s about as good an endorsement as you’re going to get,” he said.
The same interest drives his current project with Johnson & Johnson, he said. “Trying to come up with something that is at least fairer, that’s been a big issue for me.”

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Company Creates Bioethics Panel on Trial Drugs

May 7, 2015 | New York Times

By Katie Thomas

Johnson & Johnson has appointed a nationally known bioethicist to create a panel that will make decisions about patients’ requests for potentially lifesaving medicine, responding to an emotional debate over whether companies should allow desperately ill people to have access to the drugs before they are approved.
The move, to be announced by the company on Thursday, is believed to be the first of its kind in the industry and, given the size and influence of the drug maker, could inspire other companies to follow suit. It comes as a small but growing number of patients with terminal illnesses have sought the right to obtain drugs still in the testing phase that show promise for treating their diseases.
Some of the requests have become highly publicized cases on social media, where family members and advocates have lobbied the companies on patients’ behalf — often to no avail because drug makers fear that doing so would interfere with clinical trials, or, in the case of the Ebola outbreak, that they have too little available. The issue, which involves fundamental questions of fairness and equal access to care, has become so intense that more than a dozen states have taken up legislation to speed the process.
Johnson & Johnson said the bioethicist, Arthur L. Caplan of New York University, who has written extensively about the issue of experimental drug availability — known as “compassionate use” — would oversee an independent panel of doctors, ethicists and patient advocates that will review requests for access to a limited array of experimental medicines and decide how Johnson & Johnson should respond.Continue reading the main storyRELATED COVERAGEEager to Opine on the Toughest Calls in Medical Ethics MAY 7, 2015RECENT COMMENTSKevin Friese May 8, 2015
Remember - over 90% of drugs fail in phase three trials. EIther because they are useless, are dangerous, or both. Sometimes a zero percent...Lam May 8, 2015
Please give a chance to patients with terminal illness. A hope of survival is the most precious thing to all human beings. Although it may...Girish Kotwal May 8, 2015
The pilot program will be funded by the company, which will have no influence on the panel’s decisions, Johnson & Johnson said, adding that payments will go directly to the university. Dr. Caplan will not be paid for his work in the program.
Dr. Caplan, who has argued that the industry needs a fairer, more consistent system for deciding whose requests should be granted, said he was intrigued when company executives approached him about the idea. “If we could structure this right, this would be a chance to not just complain about what’s wrong, but maybe to suggest a way forward,” he said in an interview.
Drug companies have been granting emergency access to their unapproved drugs since the AIDS epidemic of the 1980s, when the Food and Drug Administration set up a process to help desperate patients get experimental treatments. The F.D.A. typically signs off on use of unapproved drugs, but not until the company agrees.
But saying yes is not so simple: Manufacturers often have a limited supply of such treatments, leading to anguished decisions over who should be given the products. The unproved drugs also might not work, or could even cause harm. And the time and resources involved in granting access to such drugs could delay efforts to get them approved for a much wider population of needy patients, especially at smaller companies. In the case of the Ebola epidemic, last year the F.D.A. allowed the makers of ZMapp, an experimental treatment, to be used on a handful of patients, but the company quickly exhausted its limited supply.
“There’s no stock answer — yes or no, black or white,” said Richard Klein, director of the F.D.A.’s patient liaison program. “Maybe you can take that responsibility off the company.”
There is no reliable data on how many requests pharmaceutical companies receive, but the F.D.A. grants nearly all of them. In the 2014 fiscal year, the agency approved 1,873 requests from companies to grant what it calls “expanded access,” an 85 percent increase over the 2010 fiscal year, when it approved 1,014 requests.
Some patients and their families have started campaigns on social media sites like Twitter and Facebook to try to shame companies into granting their request. In 2014, the family of Josh Hardy, a 7-year-old boy suffering from a life-threatening infection, appealed to followers on Facebook and Twitter after Chimerix, a company that was developing an experimental antiviral treatment, turned down their request.
Within days, supporters bombarded the company and its top executives with thousands of calls, emails and Twitter messages pleading for relief.
Chimerix quickly announced that it had set up a 20-patient clinical trial that Josh and similar patients would be able to enroll in. Josh responded to the treatment and is said to be doing well.
“It used to be you would call your local news and try to beg them to cover you,” Dr. Caplan said. “Now you build this giant Twitter thing and you make the media come to you.”
But that has only created a new kind of inequality. “The social media side is now driving attention, but it only does for those who know how to use it,” he said.
The problem, some say, is that drug makers have inconsistent approaches.
“Too often with these sorts of scenarios, it’s handled in different ways in different companies, and even within the same company, different people may have different results,” said Dr. Aaron S. Kesselheim, an associate professor of medicine at Harvard Medical School and Brigham and Women’s Hospital who recently wrote about compassionate use in The New England Journal of Medicine. Johnson & Johnson’s program, while limited, “might be a model for how we could move forward,” he said.
Several states have recently passed so-called Right to Try laws, which seek to sidestep F.D.A. approval of the process. But critics of the bills, which are also pending in other states, point out that the major roadblock is not the F.D.A. but the companies themselves, which still must grant permission.
Not all social media campaigns have succeeded. The family of Nick Auden, a father of three with advanced skin cancer, went public in 2013 seeking to persuade Merck and Bristol-Myers Squibb to reverse their decisions denying Mr. Auden access to then-experimental cancertreatments that were in late-stage clinical trials. Mr. Auden had been accepted into a trial for Merck’s drug, but was later disqualified after being hospitalized for a partial bowel obstruction.
The family gathered 500,000 signatures on an online petition, thousands of followers on Facebook and even the support of celebrities like the British comedian Ricky Gervais.
But their efforts were not successful and Mr. Auden died in November 2013. ”It was horrendous to fight the cancer, as well as to fight for compassionate use,” said Amy Auden, Mr. Auden’s wife. Ms. Auden said she was aware of the complex ethical issues in approving such requests, but added: “I think each of them can be addressed if companies were to turn their mind to it, and address it as part of their business model. But I know they don’t want to play God.”
She applauded Johnson & Johnson’s move and said she hoped other companies would follow suit.
Four months after Mr. Auden’s death, Merck approved an expanded-access program for patients who could demonstrate a critical need for its drug, now called Keytruda, and it was approved by the F.D.A. last September and hailed as a breakthrough for melanoma patients.
Merck said it had expanded access to the drug only after the company could provide adequate supply to patients — before that, it said, all supplies were allocated to the clinical trials then underway. Merck said it provided early access to Keytruda to more than 3,800 patients worldwide. Its policy for approving any requests for unapproved drugs is based on several factors, including the severity of a patient’s condition, whether the treatment is likely to help and whether the patient has exhausted all other options.
“Merck is dedicated to making our medicines available to all patients who may benefit from them as soon as possible,” a spokeswoman, Pamela Eisele, said in a statement.
Officials at Johnson & Johnson said that they had not kept track — until now — of how many compassionate use requests the company received, but that it probably fielded at least 100 requests a year for unapproved drugs to treat everything from cancer to infectious diseases.
Dr. Joanne Waldstreicher, the chief medical officer at Johnson & Johnson, said patients were responding to the fact that her company — and others — were developing breakthrough drugs with a real potential to save lives.
New cancer drugs like Keytruda, for example, are harnessing the body’s immune system to attack cancer cells and yielding encouraging results. Johnson & Johnson’s experimental treatment for multiple myeloma, daratumumab, is also generating excitement. It is currently in late-stage clinical trials.
“This comes at a time when innovation in science offers great potential for patients, great promise,” Dr. Waldstreicher said. “We believe there is a continued need for processes that are both fair and objective and, most important, patient-centered.”
The company has not yet said which treatments will be included in the program, but Dr. Caplan said the list would include no more than two or three drugs initially, although it could be expanded if it is deemed a success. Patients would receive the treatment free if their request was approved.
Drug companies often waive payment for drugs in such cases because they are permitted to charge only manufacturing and other direct costs of the product. Because the market prices of drugs are often many times higher, some companies pay for a drug rather than make its cost public, Dr. Caplan and others have said.
Even if drug costs are covered, patients could be responsible for other expenses, such as the cost for a doctor to administer the drug or provide other care related to the treatment. Insurance companies do not always cover those costs for experimental drugs, said Mark Fleury, a policy expert at the American Cancer Society Cancer Action Network.

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Johnson & Johnson Will Make Clinical Data Available to Outside Researchers

Jan 15, 2015 | New York Times

By Katie Thomas

The health care giant Johnson & Johnson has agreed to make detailed clinical trial data on its medical devices and diagnostic tests available to outside researchers through a collaboration with Yale University, making it the first large device manufacturer to systematically make such data public.
The announcement came on the same day that the Institute of Medicine, of the National Academy of Sciences, called on all sponsors of clinical trials to share detailed study data with outside researchers and recommended that such data be made available within 30 days of a product’s approval.
The dual developments are part of a broader shift toward making clinical trial data more publicly available and follows years in which the industry resisted calls to share its research with outsiders, claiming such moves would expose trade secrets and violate patient privacy.
Medtronic, another large device maker, had previously allowed Yale to evaluate data on a controversial spinal treatment, but the agreement with Johnson & Johnson is the first time a device manufacturer has made data available in a systematic way.
Johnson & Johnson agreed last year to work with Yale to share data about its drugs, and added devices and diagnostics to the agreement to deepen its commitment, Dr. Joanne Waldstreicher, the chief medical officer of Johnson & Johnson, said in an interview Tuesday. “We really believe that to advance science and to advance medical care, we wanted to take the next step,” she said.
Several researchers who have called for more openness in the past said they welcomed the announcements by Johnson & Johnson and the Institute of Medicine, but added that they would be watching closely to see how the initiatives were carried out.
“I’m very enthusiastic about this, and I hope that it will come to fruition in a way that’s really meaningful,” said Diana Zuckerman, president of the National Center for Health Research, a nonprofit research and policy group. However, she said, “the devil is always in the details on this stuff.”
She and others said they were disappointed that Johnson & Johnson’s agreement does not include most products that are now on the market because it applies only to those approved since the beginning of 2014. She also noted that, because the Food and Drug Administration does not require that all medical devices undergo clinical trials before they are approved, the available data on these devices will be limited.
The agency does not require such studies for devices that manufacturers argue are updated products similar to previously approved devices. The flawed metal-on-metal artificial hips once sold by Johnson & Johnson — which led to serious injuries in patients and cost the company billions of dollars in legal settlements — were approved through the less stringent approval process.
“It will be fascinating to see what data are actually available,” Ms. Zuckerman said.
One example of a product for which data will be newly available is the Thermocool Smarttouch catheter, which is used to help treat patients with a heart arrhythmia known as atrial fibrillation. The product was approved in 2014.
Dr. Waldstreicher said the company would consider requests to study data for older devices. “If there’s an important medical question or an important public health question, we would absolutely be open to considering those requests,” she said.
The announcements on Tuesday follow years of pressure by advocates and researchers to persuade companies to share so-called patient-level clinical trial data, where personally identifiable information has been removed. For years, companies published summaries of the results of their trials in medical journals, but did so selectively and often did not make public studies that did not place their products in a positive light. But in recent years, that has begun to change.
“I think what’s remarkable is that we are now seeing very basic principles of the responsible conduct of research — which should best serve society — becoming mainstream by a whole range of organizations, including industry,” said Dr. Harlan M. Krumholz, a longtime advocate for data transparency who is director of the Yale University Open Data Access project, which is overseeing the Johnson & Johnson collaboration.
In a policy that takes effect this year, the European Medicines Agency, which oversees drug approvals in Europe, will publish detailed study data for every newly approved drug, and the American and European pharmaceutical trade groups have issued policies favoring data sharing. But adoption by individual companies has been sporadic, and their policies on making their data public vary widely.
The report by the I.O.M. seeks to standardize policies on data sharing, setting out specific timelines for when such information should be made public. It recommends that all sponsors of clinical trials publish detailed trial data within 18 months of completion of the study, or within 30 days of the product’s approval, whichever comes later. If a company decides to abandon development of a product, it should also make the full results of those trials available within 18 months. It also set out guidelines for how such sharing should occur, recommending that all requests for access be approved by an independent review panel that includes members of the public.
“The rapidly changing landscape of clinical trials and the movement toward greater transparency create a need to establish professional standards and set expectations of how to share clinical trial data,” Victor Dzau, president of the Institute of Medicine, said in a statement.
“An open data movement is really gaining momentum, but many people are still hesitant,” said Dr. Victor Dzau, president of the Institute of Medicine. “We need to develop a culture that supports data sharing, and we need to provide incentives and develop trust.”
In a statement, Jeffrey K. Francer, the senior counsel of the Pharmaceutical Research and Manufacturers of America, said the industry trade group supported the Institute of Medicine’s efforts.
Dr. Lisa Schwartz, a professor of medicine the Geisel School of Medicine at Dartmouth, said she welcomed the recommendations but noted that while the I.O.M. is influential, it has no power of enforcement.
“Clearly not everybody is going to listen,” she said. “But even if a lot of people listen, it seems like we’re still better off than we were before.

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Johnson & Johnson Praised for Taking Uterine Surgery Tools Off Market

Jul 31, 2014 | New York Times

By Katie Thomas

Johnson & Johnson, which has come under withering criticism for its response to problems with some of its medical devices, won cautious praise from critics on Thursday for its decision to withdraw three products used in uterine surgery because of a risk of spreading cancerous tissue, only months after the safety issue became widely known.
Some experts continued to debate the medical value of the devices. A handful of other, smaller companies sell similar products.
The Ethicon unit of Johnson & Johnson said Wednesday that it was asking hospitals to return three types of power morcellators, devices that are commonly used in uterine surgery to remove fibroids by cutting the tissue into tiny pieces and extracting them through small incisions. In April, the Food and Drug Administration recommended that doctors stop using the procedure after the agency concluded that the risk of spreading cancer was higher than previously thought. That led Johnson & Johnson to announce that it would suspend sales and marketing of its products while it studied the issue, but it stopped short of withdrawing them from the market.
In a letter sent to health care providers, Ethicon asked that hospitals return three models of power morcellators made by the company: the Gynecare Morcellex and Gynecare X-Tract tissue morcellators, as well as the Morcellex Sigma tissue morcellator system.
About 50,000 operations a year involve power morcellation of tissue containing fibroid tumors, according to the F.D.A.
Some critics said they were pleasantly surprised that Johnson & Johnson acted as quickly as it did. “The company has had a rather abysmal track record on the public health front of ethical breaches in the last few years, so this is good that they’re doing this,” said Diana Zuckerman, president of the National Center for Health Research, a public health advocacy group that has criticized the company in the past over its safety record, especially concerning pelvic mesh implants. Dr. Zuckerman owns stock in Johnson & Johnson and her father, now retired, worked for many years in quality control at the company. Speaking of the decision on the power morcellators, she said, “At least it goes back to an earlier time when the company was seen as doing the right thing.”
The move comes as some in the gynecology field continue to disagree about the usefulness of power morcellators. Although the risk of spreading cancer through this procedure has been previously known, it was long believed that the chances for spreading cancer were lower, ranging from 1 in 10,000 to 1 in 500. In April, the F.D.A. concluded that the risk was closer to 1 in 350.
Still, some doctors cautioned against vilifying the procedure, saying that power morcellation allows minimally invasive surgery that, if carefully done, can be a better choice for some women. Without morcellation, more women will have to undergo serious abdominal surgery, which carries the risk of infection, bleeding, pain and blood clots. “These are things that people also die of,” said Dr. Barbara Goff, director of gynecological oncology at University of Washington. “So my concern is that we aren’t looking at this in balance.”
That medical debate is the reason Prof. Erik Gordon, who teaches business at the University of Michigan and has previously criticized the company for its safety record, said he was surprised that it acted as quickly as it did. “This is one of those things where it’s enough up in the air that you might have expected Johnson & Johnson to say, well, we’re going to keep it on the market because the evidence is inconclusive,” he said. “But that’s not what they did.”
Mr. Gordon and others wondered whether Johnson & Johnson may have moved more quickly in this case after previous product recalls and withdrawals led to billions of dollars in legal settlements and bad publicity.
Last fall, the company announced it would pay $2.5 billion in compensation to an estimated 8,000 patients who had to have their all-metal hip implants removed and replaced, and more lawsuits were pending worldwide. Internal company documents from 2011 estimated that the implants would fail within five years in 40 percent of the patients who received it.
Johnson & Johnson is also facing more than 30,000 lawsuits involving its pelvic mesh implants, which it withdrew from the market in 2012. The devices, which treat urinary incontinence and a condition called pelvic organ prolapse, have been linked to pain and serious injuries.
Matthew Johnson, a spokesman for Ethicon, said the company’s decision to withdraw the power morcellators had nothing to do with safety issues involving other products. “Every situation is unique and evaluated independently of each other,” he said.
Johnson & Johnson does not report sales of its power morcellation products. While it dominates the market in power morcellators, they account for only a small share of its total revenue. The handful of other companies that sell such devices did not return calls for comment.
What sets the morcellation issue apart from the pelvic mesh and artificial hip cases, said Dr. Hooman Noorchashm, is the fact that the consequences can be so deadly. Dr. Noorchashm, helped draw national attention to morcellation last December after The Wall Street Journal published an article about his wife, Dr. Amy Reed, who developed advanced cancer last fall after a hysterectomy that used morcellation.
“People are being killed,” he said. “Of course they have to act responsibly.”

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Arkansas Court Reverses $1.2 Billion Judgment Against Johnson & Johnson

Mar 20, 2014 |

By Katie Thomas

The Arkansas Supreme Court reversed a $1.2 billion judgment against Johnson & Johnson on Thursday, finding that the state attorney general erred by suing under a law that applied to health care facilities, not drug companies.
The judgment, one of the largest in history for a state fraud case, was imposed in 2012 after a jury concluded that Johnson & Johnson had improperly marketed and concealed the risks of Risperdal, an antipsychotic drug. Arkansas had sued the company, accusing it of violating the state’s Medicaid fraud law and its deceptive trade practices act.
Johnson & Johnson appealed the penalty and on Thursday, in a unanimous decision, the court concluded that the verdict and judgment should be reversed because the law does not apply to drug makers like Janssen, the company’s pharmaceutical unit. “Janssen is indisputably not a health care facility,” Associate Justice Karen R. Baker wrote in the majority opinion. Three of the court’s seven justices dissented on other points, although they agreed to reverse the judgment.
Representatives for Johnson & Johnson said they were pleased with the decision and stood by the safety and efficacy of their drug, used to treat patients with schizophrenia and bipolar disorder.
In a statement, Dustin McDaniel, Arkansas’s attorney general, said he believed the State Legislature gave his office the authority to pursue penalties against companies like Johnson & Johnson. “I am disappointed that the court viewed the law differently,” he said.
Prosecutors had accused the company of hiding the risks associated with Risperdal. Side effects can include weight gain, an increased risk of diabetes and, in older patients, an increased risk of stroke.
The court reversed and dismissed the case involving violations of the state’s fraud law, for which the company had been fined $1.19 billion. It also reversed an $11 million penalty for violations of the deceptive trade practices act, but sent that claim back to the lower court.
Johnson & Johnson has defended its marketing practices involving Risperdal for years, with mixed success. In January, the Louisiana Supreme Court threw out a $258 million judgment, saying state prosecutors did not present enough evidence that the company had improperly marketed the drug. South Carolina’s Supreme Court is considering an appeal in a similar case that resulted in a $327 million fine.
But in November, the company agreed to pay more than $2.2 billion in criminal and civil fines to settle federal claims that it had improperly sold the drug to older adults, children and people with developmental disabilities. In that case, federal officials claimed that the company played down the drug’s risks to elderly people, and marketed it to children even though, at the time, it did not have approval to do so.
Thomas M. Melsheimer, a Dallas lawyer who represented a whistle-blower in a Risperdal case in Texas that resulted in a $158 million settlement, said pharmaceutical companies had become increasingly successful at prevailing in such drug marketing cases at the state level.
“There’s a big question about whether off-label marketing cases are on life support,” Mr. Melsheimer said, adding that many state laws were primarily designed to police the actions of health care providers like doctors, not necessarily drug companies. “If you’re trying to shoehorn off-label claims into a fraud case or a consumer-protection case, that can be really challenging,” he said. “And in Arkansas, it ended up being fatal.”

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The ‘No More Tears’ Shampoo, Now With No Formaldehyde

Jan 17, 2014 | New York Times

By Katie Thomas

SKILLMAN, N.J. — The only hint that something is different inside millions of bottles of Johnson’s Baby Shampoo arriving on store shelves are two words: “Improved Formula.”
The shampoo has the same amber hue, the same sudsy lather and — perhaps most important — the same familiar smell that, for generations of Americans, still conjures memories of childhood bath time.
What’s different about the shampoo, and 100 other baby products sold by Johnson & Johnson, isn’t so much about what’s been added; it’s what’s missing. The products no longer contain two potentially harmful chemicals, formaldehyde and 1,4-dioxane, that have come under increasing scrutiny by consumers and environmental groups.
In response to consumer pressure two years ago, the company pledged to remove both chemicals from its baby products by the end of 2013, and this month, it said that it had met that goal. The reformulated products are making their way to store shelves around the world and will replace existing products over the next several months.
The move is the first step in a companywide effort to remove an array of increasingly unpopular chemicals from its personal care products, and is the biggest yet by a major consumer products manufacturer.
Johnson & Johnson has also promised to remove such chemicals, and others, from all of its consumer products by 2015, including popular brands like Neutrogena and Clean & Clear.
In doing so, the company is navigating a precarious path, investing tens of millions of dollars to remove the chemicals while at the same time insisting that they are safe.
The company is responding, executives said, to a fundamental shift in consumer behavior, as an increasingly informed public demands that companies be more responsive to their concerns, especially when it comes to the ingredients in their products.
The complex effort carries both risks and rewards for the health care giant — it requires difficult re-engineering of some of Johnson & Johnson’s most beloved brands, but success in the marketplace could serve as a much-needed boost to a company that has been battered by a series of embarrassing quality lapses and product recalls.
Cathy Salerno, the vice president of research and development for the company’s consumer products division in North America, said she had seen consumer attitudes change significantly over the last decade.
When Johnson & Johnson acquired Aveeno, the natural skin care company, in 1999, it polled customers about their interest in the brand’s ingredients. The answer demonstrated little consumer concern about the details — customers wanted the company to keep it simple. “They’re telling us the opposite now,” she said.
Other manufacturers are also responding to these concerns. This fall, Walmart announced that it would eventually require suppliers to reduce or eliminate 10 chemicals from cleaning and personal care products.
Target has said it would monitor suppliers’ use of potentially harmful chemicals, then give incentives to companies that use safer chemicals. Procter & Gamble has promised to eliminate phthalates and triclosan, whose safety has also been questioned, by the end of this year.
Environmental groups disagree with the safety claims that Johnson & Johnson makes about the chemicals it is removing, and say they wish the company would be more forthright about the hazards. Nevertheless, they praised the company for keeping its commitment.
“A lot of companies say they’re going to do something, but in this case Johnson & Johnson actually did what they were going to do,” said Janet Nudelman, director of program and policy at the Breast Cancer Fund and the co-founder of the Campaign for Safe Cosmetics, which pushed Johnson & Johnson on the chemicals.
Even before their removal, customers would not have found formaldehyde or 1,4-dioxane listed on bottles because they aren’t technically ingredients.
Formaldehyde, which has been identified by government scientists as a carcinogen, is released over time by preservatives, like quaternium-15. And 1,4-dioxane, which has been linked to cancer in animal studies, is created during a process used to make other ingredients mild — important for a company that has sold billions of bottles of baby shampoo on its “No More Tears” claim.
Johnson & Johnson has removed the preservatives that release formaldehyde, and said it has reduced the levels of 1,4-dioxane to very limited trace amounts, from one to four parts per million.
Johnson & Johnson executives are quick to note that formaldehyde occurs naturally in many products — a person’s exposure to formaldehyde in an apple, they claim, is greater than it is in 15 bottles of baby shampoo. And 1,4-dioxane is found in their products at levels low enough to be safe.
An outside analysis by the Campaign for Safe Cosmetics published in 2009 found that the levels of 1,4-dioxane in many of the company’s baby products were already at the target levels. But Heather White, executive director of the Environmental Working Group, a part of the Campaign for Safe Cosmetics, said there was not enough information to know the long-term effects of these chemicals, and there was mounting evidence that cumulative exposure can be dangerous.
“Will a kid get cancer because there’s formaldehyde in their shampoo?” Ms. White asked. “We don’t know the answer to that. But why is there a carcinogen in their shampoo? When in doubt, take it out.”
Taking it out, however, has not been simple. In remaking its baby products, Johnson & Johnson’s scientists had a delicate task before them: how to remove the chemicals in question without compromising some of the company’s most iconic brands.
“There was a lot of angst about it,” recalled Ms. Salerno, who was one of the executives who oversaw the team of close to 200 people who worked for two years on the project. “Our people in the marketing department were adamant that they wanted the exact same product.”
But as the scientists set to work, they discovered that replacing the problem ingredients often led to a chain reaction of unintended consequences. One new preservative led to a snow-globe effect, with particles settling at the bottom of the bottle. But the fix for that turned the shampoo from a golden honey color to a dull brown. Another change turned the consistency to water.
The team thought it had successfully reformulated the Head-to-Toe wash and even held a dinner to celebrate. But their hopes were dashed when the normally clear wash turned cloudy, and they were forced to start over. “I remember the shrimp was great,” Ms. Salerno said. “Two days later, we saw that.”
The challenges continued: Two products were scrapped when they failed a skin test in adults, an initial step before they are tested on babies. Altogether, the team vetted 2,500 raw ingredients and tested 12 to 18 versions of each product before seeking the opinion of 74,000 consumer volunteers.
Mostly, the task was to make the change as invisible as possible. “If you can’t tell the difference, then we did our job,” said Trisha Bonner, principal scientist for Johnson & Johnson’s consumer products.
The team’s next step is removing another type of preservative, parabens, from their baby products, and removing those and additional chemicals from their adult products.
Ms. Salerno and others say they sometimes get frustrated at critics who promote the idea that natural ingredients are inherently better. “I like to remind people that poison ivy is natural,” Ms. Salerno said.
But she said that the concerns of their customers, especially those related to health and safety, could not be ignored. “This lands right at the heart and soul of what Johnson & Johnson is about, so we really had to take this very seriously,” she said.
“I tell people, in 28 years with this company, this is by far the most challenging project I’ve ever worked on,” Ms. Salerno said. “But it’s a real point of pride.”

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J.&J. to Pay $2.2 Billion in Risperdal Settlement

Nov 4, 2013 | New York Times

By Katie Thomas

Johnson & Johnson has agreed to pay more than $2.2 billion in criminal and civil fines to settle accusations that it improperly promoted the antipsychotic drug Risperdal to older adults, children and people with developmental disabilities, the Justice Department said on Monday.
The agreement is the third-largest pharmaceutical settlement in United States history and the largest in a string of recent cases involving the marketing of antipsychotic and anti-seizure drugs to older dementia patients. It is part of a decade-long effort by the federal government to hold the health care giant — and other pharmaceutical companies — accountable for illegally marketing the drugs as a way to control patients with dementia in nursing homes and children with certain behavioral disabilities, despite the health risks of the drugs.
The settlement, which requires the approval of a federal judge, will also resolve accusations that the company inappropriately promoted two other drugs, the heart-failure drug Natrecor and Invega, a newer antipsychotic drug.
Much of the conduct highlighted in the case, which for Risperdal extends from 1999 through 2005, occurred while Alex Gorsky was vice president for sales and marketing and later president of the company’s pharmaceutical unit, Janssen. Mr. Gorsky became chief executive of Johnson & Johnson last year. Risperdal, which has lost its patent protection, was once one of the company’s best-selling drugs.
In a news conference announcing the settlement, Eric H. Holder Jr., the United States attorney general, said the company’s practices “recklessly put at risk the health of some of the most vulnerable members of our society — including young children, the elderly and the disabled.”
As part of the settlement, Johnson & Johnson has agreed to plead guilty to a criminal misdemeanor, acknowledging that it improperly marketed Risperdal to older adults for unapproved uses. It did not admit to wrongdoing for the civil portion of the settlement, which involves claims that the company promoted the drug’s use in children and the developmentally disabled, as well as accusations that it paid kickbacks to doctors and pharmacists in exchange for writing more prescriptions. The company will pay criminal fines and forfeiture of $485 million and civil penalties of $1.72 billion. The civil settlement also resolves similar accusations brought by 45 states.
Johnson & Johnson said on Monday that it stood by the safety and efficacy of Risperdal and was trying to put the chapter to rest. “This resolution allows us to move forward and continue to focus on delivering innovative solutions that improve and enhance the well-being of patients around the world,” Michael Ullman, the company’s vice president and general counsel, said in a statement.
But some called into question the extent to which the company could move on, given that Mr. Gorsky was now chief executive. “Stockholders and patients will pay the price for the fraud,” said Patrick Burns, co-director of Taxpayers Against Fraud, an advocacy group for corporate whistle-blowers. “Mr. Gorsky, however, gets to keep his job at Johnson & Johnson and all his bonuses.” Mr. Burns has called on federal officials to hold executives more directly accountable in such cases.
Ernie Knewitz, a spokesman for Johnson & Johnson, noted that the misdemeanor charge was being entered on behalf of the company and no individuals were charged with wrongdoing. “Mr. Gorsky has been an outstanding Johnson & Johnson leader for more than 20 years,” he said.
Johnson & Johnson officials tried to expand the market for Risperdal to older dementia patients soon after the drug was approved in 1993 to treat symptoms of psychiatric disorders, according to federal court filings. The drug, whose generic name is risperidone, was primarily tested in schizophrenia patients, and the Federal Drug Administration repeatedly rejected efforts by the company to expand the drug’s use to older dementia patients, according to the filings.
But Johnson & Johnson, federal officials said, actively pursued the market for geriatric patients. The company created a dedicated sales force, ElderCare, to promote the drug and others to doctors who primarily treated older patients.
The drug, the company claimed, could address symptoms that made treating these patients a challenge, especially in a nursing home setting, including agitation, confusion, hostility and impulsiveness. The company’s sales brochures highlighted these symptoms and minimized the fact that the drug was approved to treat schizophrenia, according to federal documents.
Federal officials said the company knew that Risperdal posed serious health risks for older adults, like an increased risk of strokes, but it played them down. The drug’s label was later updated to warn against the use of the drug in older patients with dementia.
During this period, Risperdal was among the company’s top-selling drugs. In 2004, for example, Risperdal brought in $3.1 billion in sales, accounting for about 5 percent of Johnson & Johnson’s total revenue that year, according to company filings.
Johnson & Johnson was not the only company marketing drugs to older dementia patients and the long-term care facilities where they were treated. Within the last five years, federal officials have reached similar agreements regarding Zyprexa, made by Eli Lilly; Seroquel, made by AstraZeneca; and Depakote, by Abbott, which is now AbbVie.
Federal prosecutors also say, as part of the civil settlement, that Johnson & Johnson promoted the use of Risperdal in people with mental disabilities and children, even though the company did not receive F.D.A. approval to market to children until 2006. Janssen told its sales representatives to visit child psychologists and mental health facilities that mainly focused on children, promoting the drug as a safe treatment for disorders like attention deficit hyperactivity disorder and obsessive-compulsive disorder, the government said.
Johnson & Johnson knew that children were susceptible to certain health risks from taking Risperdal, including the possibility that boys could develop breasts through elevated production of the hormone prolactin, federal officials said.
Monday’s announcement is the latest in a series of large settlements involving pharmaceutical companies and allegations of improper marketing. Last year, the British drug maker GlaxoSmithKline reached a settlement of $3 billion over the marketing of several drugs, and in 2009, Pfizer settled with the government for $2.3 billion in a deal involving the painkiller Bextra, which is no longer on the market.
“As a group these have kind of sent a message to the pharmaceutical industry that this kind of widespread fraud and disregard for F.D.A. regulations isn’t going to be tolerated,” said David Stone, a lawyer on a team representing the four whistle-blowers who sued to bring the Johnson & Johnson accusations to light. They will share a reward of $112 million from the federal portion of the settlement. Still, Mr. Stone said, the incentives to commit wrongdoing remain. “The more they can expand market share, the more money they make.”

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New Recalls by Johnson & Johnson Raise Concern About Quality Control Improvements

Sep 12, 2013 | New York Times

By Katie Thomas

After years of struggling to improve its image after major quality lapses, the consumer giant Johnson & Johnson announced two recalls of well-known products in the space of a week, raising questions about the extent to which it has moved on from its past problems.
The company’s pharmaceutical unit, Janssen, informed doctors and patients on Wednesday that it was recalling one lot of Risperdal Consta, an injectable antipsychotic treatment, after routine testing turned up evidence of mold.
And last week, Johnson & Johnson recalled 200,000 bottles of liquid Motrin for infants because they may contain tiny particles of plastic.
In both cases, the recalls involved products or ingredients that were made by outside companies.
Risperdal Consta, a long-acting version of the pill form of Risperdal that is typically administered in a doctor’s office or clinic, is made by the company Alkermes, based in Ireland. It referred all questions to Johnson & Johnson.
McNeil Consumer Healthcare, the over-the-counter division at Johnson & Johnson, said the plastic particles in Motrin — which were about the size of a poppy seed — originated at a third-party manufacturer of Motrin’s active ingredient, ibuprofen. The company did not name the manufacturer.
The company said in both cases that the risk to patients was low and it had received no reports of serious harm.
Still, some experts said the two recalls, announced over such a short span, raised questions about how well the company has improved its oversight after a string of manufacturing problems threatened its image as one of the world’s most trusted brands. The company has recalled everything from Tylenol to contact lenses and artificial hips in recent years, and is operating under a consent decree with the Food and Drug Administration in which it has promised to overhaul production at three manufacturing plants. One plant, in Fort Washington, Pa., has been closed since 2010.
“Even the most careful company is occasionally going to have a recall,” said Erik Gordon, who teaches business at the University of Michigan and follows the pharmaceutical industry. But given Johnson & Johnson’s history, he said, the recalls indicate “they’re not there yet. They have not repaired the damage that was done to Johnson and Johnson’s quality control infrastructure.”
Ernie Knewitz, a spokesman for Johnson & Johnson, said the company had been working to improve quality by creating a single, streamlined supply chain and shifting focus to the early detection of potential problems. This heightened attention, he said, has led to several product recalls. He added, “Our goal is to minimize recalls, and yet when we recall a product, we are acting in the best interest of the consumers of our products.”
Johnson & Johnson has worked hard to repair its image and returned some of its best-known over-the-counter brands to the market. It named a new chief executive, Alex Gorsky, to replace William C. Weldon, who had been criticized for focusing too much attention on cost-cutting and too little on quality. Mr. Gorsky, a longtime company executive, has said he would place fixing the quality problems among his highest priorities.
Johnson & Johnson officials said over the summer that they plan to return three-quarters of the company’s over-the-counter brands to pharmacy shelves by the end of the year, and that they are meeting the F.D.A.’s requirements under the consent decree.
But even as it has sought to move past its difficulties, the company has continued to encounter problems. In May, the company recalled Children’s Tylenol in South Korea after discovering that levels of the pain reliever’s active ingredient, acetaminophen, were too high. Then, a month later, it recalled millions of packs of birth-control pills in Latin America, Europe and Asia after finding that one of the hormones in the pills was not releasing properly into the body. Other company recalls this year include blood glucose meters and some versions of the personal lubricant K-Y Jelly.
Some manufacturing experts said that the recent recalls may indicate that Johnson & Johnson is being extra cautious. The company estimates that only about 5,000 units of Risperdal Consta out of the original 70,000 in the lot remain unused, and said the risk to patients from the mold, which is commonly found in the environment, was low. In the case of Motrin for infants, the plastic particles were detected in another lot of the same product — one-half fluid ounce bottles of Concentrated Motrin Infant Drops, in “Original Berry Flavor” — which was not distributed. The company said it was recalling the three lots that were distributed out of “an abundance of caution.”
“Maybe a company under less scrutiny would choose to wait these out as opposed to issuing a voluntary recall,” said John Gray, an associate professor at the Fisher College of Business at Ohio State University. Mr. Gray formerly worked in operations management at the consumer-products company Procter & Gamble, and focuses his research on pharmaceutical manufacturing quality. “Given everything that’s happened, I would expect that Johnson & Johnson has a pretty heavy focus on quality right now.”

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Johnson & Johnson Profit Rises on Strong Prescription Sales

Jul 16, 2013 | New York Times

By Katie Thomas

Johnson & Johnson reported on Tuesday that its earnings more than doubled in the second quarter of this year, buoyed by strong sales of prescription drugs and an influx of cash from the sale of its stake in the Irish drug manufacturer Elan.
The health care giant reported earnings for the second quarter of $3.8 billion, or $1.33 a share, compared to $1.41 billion, or 50 cents a share, during the same period last year. Excluding one-time costs, the company’s earnings were $1.48 a share, which exceeded Wall Street estimates of $1.39. Johnson & Johnson’s stock closed even on Tuesday, at $90.40.
Company executives said revenue benefited from strong sales of drugs like Remicade and Simponi, which treat autoimmune disorders like rheumatoid arthritis; the prostate cancer drug Zytiga; and Xarelto, an anticoagulant.
Worldwide sales of pharmaceutical products increased by nearly 12 percent, to $7 billion, compared with the same quarter last year. Sales of over-the-counter products, like Tylenol, Motrin and Listerine, were also strong, executives said.
Total sales — including products like medical devices and baby oil — were $17.9 billion for the second quarter, an increase of 8.5 percent over the same period last year.
Much of Johnson & Johnson’s success can be attributed to the breadth of its business, said Derrick Sung, an analyst for Bernstein Research.
“The quarter provided yet another reminder of the benefits of a diversified model and evidence that fundamental improvement across the three divisions continues to play out,” he wrote in a note to investors.

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F.D.A. Approves a New Diabetes Drug From J.&J.

Mar 29, 2013 | New York Times

By Katie Thomas and Andrew Pollack

The Food and Drug Administration on Friday approved the first of a new class of medicines to treat diabetes.
The drug, Invokana, will be sold by Johnson & Johnson and treats patients with type 2 diabetes in a new way, by causing blood sugar to be excreted in the urine. Many existing drugs work by affecting the supply or use of insulin.
“We continue to advance innovation with the approval of new drug classes that provide additional treatment options for chronic conditions,” Dr. Mary Parks, who oversees drugs for metabolic diseases at the F.D.A., said in a statement.
Invokana will have a wholesale price of $8.77 per tablet, with one tablet taken daily. Johnson & Johnson said the price was competitive with that of some other diabetes drugs.
Clinical trials of more than 10,000 patients showed that Invokana improved patients’ blood-sugar levels and also led to weight loss and reductions in blood pressure. But the drug, whose generic name is canagliflozin, also has potentially serious side effects. The clinical trials revealed some signs of elevated stroke risk and a small increase in patients’ experiencing heart attacks within the first 30 days of taking the medicine. The drug also was shown to raise LDL, or “bad” cholesterol levels, although it also raised the level of HDL, or “good” cholesterol.
However, an F.D.A. spokeswoman said Friday that the significance of those findings was unclear, and the label of the drug includes no warnings about heart attacks or strokes. The F.D.A. is requiring Johnson & Johnson to conduct five post-marketing studies, including a clinical trial to determine more definitively if the drug increases those risks.
The F.D.A. said the drug’s most common side effects were vaginal yeast infections and urinary tract infections.
In January, an F.D.A. advisory panel voted 10 to 5 in favor of approval. But panel members called on Johnson & Johnson to closely monitor patients enrolled in long-term safety studies. Some of the members said they did not think the drug should be prescribed to people with moderate kidney disease.
The drug wasn’t as effective in such patients, and they were at a higher risk for the negative side effects, compared to people with normal kidney function. Invokana is not recommended for patients with severe kidney disease.
An estimated 26 million Americans have type 2 diabetes, and many of the medications on the market come with side effects like weight gain and hypoglycemia, or a dangerous drop in blood sugar. Patients taking Invokana experienced fewer episodes of hypoglycemia than those taking another diabetes drug, glimepiride, or Amaryl, but a similar number as patients taking the drug sitagliptin, or Januvia.
Invokana is in a class of drugs called SGLT2 inhibitors. They block the action of the sodium-glucose co-transporter 2, which puts sugar removed from the blood by the kidneys back into the bloodstream.
Last year, the Food and Drug Administration rejected another drug in that class, dapagliflozin from Bristol-Myers Squibb and AstraZeneca, because of safety concerns, including a possible increased risk of breast and bladder cancers. But it was approved in Europe in November under the name Forxiga.
Johnson & Johnson is also seeking approval in Europe for Invokana, which it licensed from Japan’s Mitsubishi Tanabe Pharma.
Wall Street analysts have predicted that Invokana could be a good seller for Johnson & Johnson. Lawrence Biegelsen, of Wells Fargo, estimated early this year that the drug could bring in $111 million in 2013, with sales increasing to $667 million by 2016.

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Europe Says Drug Makers Paid to Delay a Generic

Jan 31, 2013 | New York Times

By James Kanter and Katie Thomas

BRUSSELS — European antitrust officials on Thursday accused the drug giants Johnson & Johnson and Novartis of colluding to delay the availability of a less expensive generic version of a powerful medication often used to ease severe pain in cancer patients.
The case focuses on monthly payments that a Netherlands-based subsidiary of Johnson & Johnson made to Sandoz, a unit of the Swiss company Novartis. While the companies have said the payments were legitimate, the European Union’s antitrust chief said on Thursday that the money probably changed hands to keep lower-cost versions of the drug, called fentanyl, off the market in the Netherlands. At issue were transdermal patches that deliver the drug through the skin.
European authorities are “determined to fight undue delays in the market entry of generic medicines,” Joaquín Almunia, the European competition commissioner, said in a statement on Thursday.
Agreements to delay the introduction of generic drugs have come under heightened scrutiny in both Europe and the United States in recent years, with regulators on both sides of the Atlantic concluding that such deals are anticompetitive. In the United States, the Supreme Court is scheduled to take up the issue in March. Typically, such arrangements are a result of patent disputes between brand-name and generic drug makers, although no such dispute was mentioned in the most recent case involving Johnson & Johnson and Novartis.Continue reading the main story
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“From our perspective in the United States, we hope to have a real resolution of this issue with the Supreme Court this term,” said Jay Lefkowitz, a lawyer who has represented several drug companies in such cases. But because many companies sell their products around the world, “this is something that people are taking note of, for sure.”
Fentanyl is widely used in Europe and the United States, typically paid for by government-provided health plans or, in many cases in the United States, by private insurance. Although the pricing of such drugs is usually negotiated behind closed doors, generic versions are typically much cheaper.
Mr. Almunia warned pharmaceutical companies against practices that raised costs for European governments, squeezed by austerity and an economic slowdown, which must buy medicines for state-supported health care plans. It is “important to make sure that pharmaceutical companies do not free-ride our welfare state and health insurance systems, especially in this period of constraints on public spending,” he said.
A goal of European authorities has been to increase patient access to less costly medicines as name-brand drug patents worth tens of billions of euros expire. The end of a drug’s patent protection — typically after as long as 25 years in Europe — can hurt a pharmaceutical company’s bottom line but benefits governments and private insurers by lowering their costs.
Patent expirations also open opportunities for generic competitors, which is why in some cases drug makers have been accused of paying generic competitors to delay bringing their products to market.
A preliminary investigation by Mr. Almunia’s office found that the Johnson & Johnson unit in the Netherlands, Janssen-Cilag, made the payments to stop Novartis from selling generic fentanyl skin patches in the Netherlands for more than a year, from July 2005 until December 2006. That kept prices artificially high, according to the European Commission, the European Union’s administrative body that enforces antitrust law. Mr. Almunia’s office would not disclose the amount of money that Janssen-Cilag paid to Sandoz, nor would officials indicate whether the investigation would go beyond the Netherlands.
Both companies will have the chance to formally respond to the accusation.
A spokesman for the Johnson & Johnson subsidiary said in a statement that the company had acted properly. “Janssen continues to believe that these arrangements were legitimate,” the spokesman, Stefan Gijssels, said on Thursday. “Janssen supports a sustainable health care system, where patients have access to both innovative and generic drugs,” he said.
Sandoz said in a statement that it and Novartis “operate to the highest of standards and take the position of the commission seriously.” It also indicated that it and Novartis would seek to rebut the accusations made by the commission by using their “rights of defense as provided for in the process.”
The case is the latest in a series of actions by authorities in Europe and the United States to crack down on so-called pay-to-delay tactics by pharmaceutical companies and comes at a time when the biggest name-brand drug makers are losing billions of dollars in sales to generic competition as best-selling drugs lose their patent protection.
United States regulators have argued for years that such arrangements were anticompetitive. But the pharmaceutical companies have argued that the deals in question were simply legal settlements over patent disputes that helped the companies avoid costly litigation.
The deals typically unfold as part of the peculiar requirements of the federal law governing generic-drug approval, known as the Hatch-Waxman Act. Under that law, generic companies typically seek approval to make a copycat drug before the patent expires because the first company to challenge the patent’s validity wins the right to exclusively sell its version for 180 days. The brand-name company often then challenges the generic company’s right to make the drug, contending the patent is valid.
In recent years, the companies have tended to settle their litigation by agreeing to let the generic company begin selling the drug before the patent expires — but not as quickly as the generic company would originally have liked.
Federal regulators say the practice is illegal when it involves a payment from the brand-name company to the generic company to keep a product off the market. But pharmaceutical companies have argued that the settlements actually bring generics to market earlier because the agreements usually allow the generic companies to begin selling their products before the drug’s patent would normally have expired.
Michael A. Carrier, an antitrust and patent expert who is a professor at Rutgers School of Law, Camden, said both brand-name and generic drug makers win in such situations because the brand company gets to sell its patented drug for longer without any competition while the generic drug maker receives a generous payment to stay out of the market.
“That’s why we’ve seen these agreements in the U.S., and that’s why we’ve seen these agreements in Europe,” said Mr. Carrier, who has filed an amicus brief in the Supreme Court case arguing against such deals on behalf of more than 100 law, economics and business professors. “It’s just the consumer that winds up footing the bill.”
Several federal circuit courts have upheld the arrangements. But last July, the United States Court of Appeals for the Third Circuit in Philadelphia ruled they were anticompetitive. And despite the controversy over the practice, a report released in January by the Federal Trade Commission found that the popularity of these settlements increased significantly in 2012, to 40 deals from 28 in 2011.

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F.D.A. Advisory Panel Votes to Approve Diabetes Drug

Jan 10, 2013 | New York Times

By Katie Thomas

A federal advisory panel voted 10 to 5 on Thursday to approve a diabetes drug that could be the first in a new class of drugs in the United States to treat the disease, although several members raised concerns about potential cardiovascular risks and its use in people whose kidneys are impaired.
The drug, canagliflozin, is being developed by Johnson & Johnson and is part of a new group of drugs that lowers blood sugar by causing blood sugar to be excreted in the urine. Many existing treatments work by affecting the supply or use of insulin.
Clinical trials of more than 10,000 patients worldwide showed that the drug improved participants’ blood-sugar levels and also led to weight loss and reductions in blood pressure. The drug would be taken once a day to treat adults with Type 2 diabetes, a disease that affects an estimated 26 million Americans.
But even the members who voted in favor of approval raised concerns about potentially serious side effects and called on Johnson & Johnson to closely monitor patients who are enrolled in long-term safety studies. Some of the doctors said they did not think the drug should be prescribed to people with moderate kidney disease.
A study of this group of people showed that the drug wasn’t as effective as it was for those with normal kidney function even though the moderate group was more at risk for negative side effects. The drug is not recommended for patients with severe kidney disease.
Other concerns included signs of elevated stroke risk and a small increase in patients experiencing heart attacks and other cardiovascular problems within the first 30 days of taking the medicine. The drug was also shown to raise LDL, or “bad” cholesterol levels, although it also raised the levels of HDL, or “good” cholesterol.
“In the end, I found myself weighing a lot of ‘maybe’ benefits versus a lot of ‘maybe’ risks,” said one panel member, Edward W. Gregg of the Centers for Disease Control and Prevention, who voted against approval.
Still, others said the drug showed enough benefits that it merited approval, and expressed hope that the Food and Drug Administrationcould address such concerns by requiring Johnson & Johnson to include appropriate warnings with the drug, which will be sold as Invokana if it is eventually approved. The agency is not required to follow the recommendations of its advisory committees, but it usually does.
Rebecca Killion, the panel’s patient representative, voted in favor of approval. “I think it particularly addresses concerns that patients have with respect to struggling with weight loss — which affects the progress of their disease — and the concern that all diabetic patients have about hypoglycemia,” she said.
Both weight gain and hypoglycemia, or a dangerous drop in blood sugar, are potential side effects in people taking other diabetes drugs and insulin. Patients taking canagliflozin experienced fewer episodes of hypoglycemia compared to those taking another diabetes drug, glimepiride, or Amaryl, but a similar rate compared to patients taking the drug sitagliptin, or Januvia.
Dr. Peter Stein, the diabetes disease area leader for Janssen, Johnson & Johnson’s pharmaceutical division, said he was “gratified” that the panel voted to approve the drug and said the company would continue to monitor patients for potential safety risks. “We have a strong belief that canagliflozin is a medication which really offers a new option for Type 2 diabetes patients,” he said.
A similar drug to canagliflozin — dapagliflozin from Bristol-Myers Squibb and AstraZeneca — was rejected by the F.D.A. last year because of safety concerns, including a possible increased risk of breast and bladder cancers. However, it was approved in Europe in November under the name Forxiga.
Wall Street analysts have predicted that the drug should bring in modest sales for Johnson & Johnson if it is approved. Lawrence Biegelsen, of Wells Fargo, has estimated that the drug could bring in $111 million this year if is authorized by the current agency deadline of March 29, with sales increasing to $667 million by 2016.

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F.D.A. Approves Drug for Resistant Tuberculosis

Dec 31, 2012 | New York Times

By Katie Thomas

The Food and Drug Administration announced on Monday that it had approved a new treatment for multidrug-resistant tuberculosis that can be used as an alternative when other drugs fail.
The drug, to be called Sirturo, was discovered by scientists at Janssen, the pharmaceuticals unit of Johnson & Johnson, and is the first in a new class of drugs that aims to treat the drug-resistant strain of the disease.
Tuberculosis is a highly infectious disease that is transmitted through the air and usually affects the lungs but can also affect other parts of the body, including the brain and kidneys. It is considered one of the world’s most serious public health threats. Although rare in the United States, multidrug-resistant tuberculosis is a growing problem elsewhere in the world, especially in poorer countries. About 12 million people worldwide had tuberculosis in 2011, according to Johnson & Johnson, and about 630,000 had multidrug-resistant TB.
A study in September in The Lancet found that almost 44 percent of patients with tuberculosis in countries like Russia, Peru and Thailand showed resistance to at least one second-line drug, or a medicine used after another drug had already failed.
Treating drug-resistant tuberculosis can take years and can cost 200 times as much as treating the ordinary form of the disease
“This is quite a milestone in the story of therapy for TB,” Dr. Paul Stoffels, the chief scientific officer at Johnson & Johnson, said in an interview. He said the approval was the first time in 40 years that the agency had approved a drug that attacked tuberculosis in a different way from the current treatments on the market. Sirturo works by inhibiting an enzyme needed by the tuberculosis bacteria to replicate and spread throughout the body.
Sirturo, also known as bedaquiline, would be used on top of the standard treatment, which is a combination of several drugs. Patients with drug-resistant tuberculosis often must be treated for 18 to 24 months.
Even as it announced the approval, however, the F.D.A. also issued some words of caution.
“Multidrug-resistant tuberculosis poses a serious health threat throughout the world, and Sirturo provides much-needed treatment for patients who have don’t have other therapeutic options available,” Edward Cox, director of the office of antimicrobial products in the F.D.A.’s center for drug evaluation and research, said in a statement. “However, because the drug also carries some significant risks, doctors should make sure they use it appropriately and only in patients who don’t have other treatment options.”
The consumer advocacy group Public Citizen opposed approval in a letter to the F.D.A. in mid-December, saying that the results of a limited clinical trial showed that patients using bedaquiline were five times as likely to die than those on the standard drug regimen to treat the disease.
“Given that bedaquiline belongs to an entirely new class of drugs, it is entirely feasible that death in some cases was due to some unmeasured toxicity of the drug,” the letter said.
Sirturo carries a so-called black box warning for patients and health care professionals that the drug can affect the heart’s electrical activity, which could lead to an abnormal and potentially fatal heart rhythm. The warning also notes deaths in patients treated with Sirturo. Nine patients who received Sirturo died compared with two patients who received a placebo. Five of the deaths in the Sirturo group and all of the deaths in the placebo arm seemed to be related to tuberculosis, but no consistent reason for the deaths in the remaining Sirturo-treated patients could be identified.
Doctors Without Borders and the Bill and Melinda Gates Foundation, both active in the fight against tuberculosis and other global diseases, applauded the F.D.A.’s decision.
Jan Gheuens, interim director of the TB Program for the Gates Foundation, called it a “long-awaited event” and said the fight against TB had not benefited from new drugs in the way H.I.V. had. Beyond the benefits of the drug itself, he said the quick approval process could be a model for other drugs sorely needed in the developing world.
He also suggested, however, that more trials should be conducted to get a better understanding of the side effects that led to the black box warning.
The F.D.A. approved bedaquiline under an accelerated program that allows the agency to conditionally approve drugs that are viewed as filling unmet medical needs with less than the usual evidence that they work. The drug’s approval was based on studies that showed it killed bacteria more quickly than a control group taking the standard regimen, but it did not measure whether in the end patients actually fared better on bedaquiline. Johnson & Johnson will conduct larger clinical trials to investigate whether the drug performs as predicted.
In a statement responding to Public Citizen’s letter, a spokeswoman for Johnson & Johnson said the company was committed to supporting appropriate use of Sirturo and would “work to ensure Sirturo is used only where treatment alternatives are not available.”
Dr. Stoffels said the hope was that other new tuberculosis drugs would also be approved that, when used in combination with bedaquiline, could shorten and simplify the current standard of treatment. “That is still a long time away,” he acknowledged, but “this is a first step in a new regimen for TB.”

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Johnson & Johnson Names New Chairman

Nov 30, 2012 | New York Times

By Katie Thomas

William C. Weldon, the chairman of Johnson & Johnson, is stepping down at the end of this year and will be succeeded by Alex Gorsky, the current chief executive, the company announced Friday.
Mr. Gorsky’s election as chairman of the board had been expected after he took Mr. Weldon’s place as chief executive in April. In a statement, Mr. Gorsky said he was honored to succeed Mr. Weldon as chairman. “Our financial strength, global reach and innovations that help people live longer, healthier lives are a proud legacy for Bill and a strong foundation for the future of Johnson & Johnson,” Mr. Gorsky said.
Mr. Weldon plans to retire in the first quarter of 2013, after a brief transitional period. He will then be eligible for $95.1 million in deferred and long-term compensation, as well as $48 million in pension payments, the company said.
His departure ends a 41-year career at Johnson & Johnson, one that began in 1971 as a pharmaceutical sales representative for the company’s McNeil unit. He became chief executive in 2002 and presided over one of the most tumultuous periods in the company’s history, including recalls of iconic products, manufacturing lapses and government inquiries that threatened to tarnish the name of one of the country’s most trusted companies.
The selection of Mr. Gorsky continued Johnson & Johnson’s tradition of hiring executives from within: like Mr. Weldon, he got his start as a sales representative and, at the time he was named chief executive, was head of the company’s medical devices division.
Since assuming Mr. Weldon’s role, he has said that he intends to expand Johnson & Johnson’s reach into global markets, rethink the way it brings new drugs to the market and return recalled brands to pharmacy shelves.

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James E. Burke, 87, Dies; Candid Ex-Chief of Johnson & Johnson

Oct 1, 2012 | New York Times

By Katie Thomas

James E. Burke, whose leadership of Johnson & Johnson during the Tylenol poisonings in the 1980s is regarded as a textbook example of how to handle a public relations crisis, died on Friday at a health care facility near New Brunswick, N.J. He was 87.
His death was confirmed by his son, James.
As Johnson & Johnson’s chairman and chief executive from 1976 until his retirement in 1989, Mr. Burke oversaw a vast expansion of the company, which now sells a variety of products like baby shampoo, prescription drugs and artificial hips. Sales tripled to $9 billion a year, and the company began doing business in many more countries.
But Mr. Burke is best known for his handling of the Tylenol crisis in 1982, when seven people in the Chicago area died after taking capsules of Extra-Strength Tylenol that had been laced with cyanide. In 1986, another poisoned capsule killed a woman in Yonkers. The crimes have never been solved.
The company spent more than $100 million recalling 32 million bottles of Tylenol capsules from store shelves in 1982, and even more on another recall in 1986. And Mr. Burke placed himself before news cameras and apologized.
In a news conference in 1986 announcing that Johnson & Johnson would stop selling its over-the-counter products in capsules, which could be tampered with, and switch to solid caplets, a reporter asked if Mr. Burke was sorry the company had not acted sooner. “Yes, indeed I am,” he said.
“That taught corporations a lesson about candor,” John F. Welch Jr., the former chairman and chief executive of General Electric, said on Monday in a telephone interview. “It was a huge legacy to leave: When you have a problem, deal with it openly, up front.”
Those who knew Mr. Burke said he thrived on lively debate and sought opinions wherever he went. Three days into the first Tylenol poisonings in 1982, he traveled to Vermont to visit his son for parents’ weekend at Middlebury College. His son said he had assumed that his father would be too busy to make the trip, but Mr. Burke insisted and took eight of his son’s friends out to dinner.
“He sat and he asked each one of them, ‘If you were me, what would you do?’ ” James Burke, who is an independent film producer, recalled on Monday. “He asked everybody he could think of what would be the right thing to do, and then took what made sense to him and his values.”
Within months in 1982, Johnson & Johnson had returned Tylenol to the market in new, tamper-resistant packaging — the scare prompted Congress to pass antitampering legislation — and it took just one more year before the company recovered its position as the top-selling over-the-counter pain reliever.
James Edward Burke was born in Rutland, Vt., on Feb. 28, 1925, a son of James and Mary Barnett Burke. He grew up in Slingerlands, N.Y., a small town outside Albany.
During World War II, Mr. Burke was an ensign in the Navy. He earned a bachelor’s degree in economics in 1947 from the College of the Holy Cross in Worcester, Mass., and continued on to Harvard Business School, graduating in 1949.
After a stint as a sales representative for Procter & Gamble, Mr. Burke went to work at Johnson & Johnson in 1953 as a product director.
Over the next two decades, Mr. Burke took on increasingly important roles as a marketing executive on the consumer side of the company’s business. He became vice president of marketing in 1964. In 1973, he became president of Johnson & Johnson, and three years later he was named chairman and chief executive.
After his retirement, Mr. Burke became chairman of the Partnership for a Drug-Free America, a position he held until 2005. He also served on the boards of the Robert Wood Johnson Foundation and the Carnegie Institution of Washington and on the Chairman’s Council of the Metropolitan Museum of Art.
In 2000, President Bill Clinton awarded Mr. Burke the Presidential Medal of Freedom, the nation’s highest civilian award, for his business leadership and his antidrug efforts.
Mr. Burke was a longtime resident of Princeton, N.J. Besides his son, he is survived by his wife of 31 years, Didi; a daughter, Clo Burke; a sister, Phyllis Burke Davis; and four grandchildren.

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J.&J. Names Outsider to Run Its Troubled Consumer Unit

Sep 13, 2012 |

By Katie Thomas

Johnson & Johnson named an outsider on Thursday to fill a top leadership role overseeing its troubled consumer health unit, a break from the company’s longstanding tradition of promoting executives from within.
The new executive, Sandra E. Peterson, will serve as the group worldwide chairwoman and will be responsible for overseeing consumer companies, information technology and the global supply chain, Johnson & Johnson said in a statement. Ms. Peterson, who will start in December, is now the chairwoman and chief executive of Bayer CropScience, a division of the German pharmaceutical company Bayer.
Johnson & Johnson declined to make Ms. Peterson available for interviews. She will serve as a member of the executive committee, which shares in the day-to-day management of the company.
“Sandi Peterson is an experienced global leader known for her strategic thinking and proven track record in growing businesses,” Alex Gorsky, Johnson & Johnson’s chief executive, said in a statement. “She brings 25 years of experience to her new role, which will draw on her expertise in building fully integrated global businesses, and focusing on growth.”
Mr. Gorsky is himself new to the job, having taken over in the springfrom the previous chief executive, Bill Weldon. He becomes chief at a critical time for the company, when it is struggling to rebuild its reputation as one of the world’s most trusted brands after a series of product recalls, manufacturing problems and government inquiries.
Ms. Peterson will be responsible for the company’s consumer units, which are responsible for some of Johnson & Johnson’s best-known products, like Band-Aid and Tylenol, but which are also still working to return popular brands to the shelves after a series of embarrassing recalls. Johnson & Johnson is under a consent decree with the Food and Drug Administration in which it has promised to overhaul operations at the three manufacturing plants that make its over-the-counter products.
The company has traditionally looked to its own ranks in selecting top executives, and its decision to hire an outsider was applauded by Erik Gordon, who teaches business at the University of Michigan and follows the pharmaceutical industry. “I think it’s a smart move,” he said. “Johnson & Johnson needs some fresh air in the executive suite.”
He said morale had suffered from what he described as a decade-long culture of valuing profits over quality. “Bringing somebody from the outside in who was not part of that culture and who did not earn her promotions by going along with that is a good thing,” he said.
Ms. Peterson, 52, has worked at Bayer since 2005, heading up the company’s diabetes divisions before taking a position as head of the CropScience unit. Before Bayer, she held positions at Medco, the pharmacy benefits manager, Nabisco and Whirlpool.

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Johnson & Johnson Unit Settles State Cases Over Risperdal

Aug 30, 2012 | New York Times

By Katie Thomas

Johnson & Johnson announced Thursday that its pharmaceutical unit had reached a $181 million consumer fraud settlement with 36 states and the District of Columbia over its marketing of Risperdal, an antipsychotic drug.
The company’s pharmaceuticals subsidiary, Janssen, has been under scrutiny for years over its promotion of Risperdal, which treats symptoms of bipolar mania and schizophrenia. State and federal authorities have said that Janssen promoted the drug for uses it did not have approval for, including dementia in elderly patients, bipolar disorder in children and adolescents, depression and anxiety. Prosecutors have also accused the company of minimizing or concealing the risks associated with the drug.
In resolving the allegations by the states, Janssen did not admit wrongdoing or that it violated the law and said it settled to avoid “unnecessary expense and a prolonged legal process.”
“We have chosen this path to achieve a prompt and full resolution of these state claims and to ensure we continue to focus on our mission of providing medicines to meet the significant unmet needs of many people who suffer from mental illness,” Michael Yang, president of Janssen, said in a statement Thursday.
The company’s decision to settle the cases with the states follows several other large state settlements and court decisions involving Risperdal. In April, a judge in Arkansas ordered it to pay more than $1.2 billion in fines. Last year, a South Carolina judge levied civil penalties of $327 million. Janssen is appealing the fines in both states. Two cases against Janssen in Pennsylvania and West Virginia were eventually dismissed.
New York’s attorney general, Eric T. Schneiderman, applauded the settlement in a statement Thursday. New York will receive nearly $9 million as part of the agreement. “This landmark settlement holds the companies accountable for practices that put patients in danger, and serves as a warning to other pharmaceutical giants that they must play by one set of rules,” Mr. Schneiderman said. Other states involved in the settlement include Florida, Pennsylvania, Colorado, Arizona and Texas. California and Kentucky, which were part of the negotiations, did not take part in the final agreement, said Terri Mueller, a spokeswoman for Janssen.
Ms. Mueller said Janssen officials had seen some of the filings made by state attorneys general Thursday and “our company strongly disagrees with many of the allegations and the characterization of the evidence in the state complaints.”
As part of the agreement, Janssen agreed not to make false or misleading claims about Risperdal and a related drug, Invega, and not to present conclusions from studies that are not scientifically sound. It also agreed to disclose payments that it makes to doctors and other health care professionals.
The announcement Thursday was not related to a larger pending settlement with the federal Justice Department over three whistle-blower lawsuits that also involve sales of Risperdal. Johnson & Johnson said earlier this month that it had reached an agreement in principle to settle those matters. The company said Thursday that agreement is still being completed.

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Johnson & Johnson to Remove Formaldehyde From Products

Aug 15, 2012 | New York Times

By Katie Thomas

Johnson & Johnson, which makes a range of personal care products like baby shampoo, acne cream and antiwrinkle lotion, announced plans Wednesday to remove a host of potentially harmful chemicals, like formaldehyde, from its line of consumer products by the end of 2015, becoming the first major consumer products company to make such a widespread commitment.
The company had already pledged to remove certain chemicals from its baby products by 2013, but the latest announcement extended the program to its adult products, including well-known drugstore brands like Neutrogena, Aveeno and Clean & Clear.
“There’s a very lively public discussion going on about the safety of ingredients in personal care products,” said Susan Nettesheim, vice president for product stewardship and toxicology for the company’s consumer health brands. “It was really important that we had a voice in that.”
Environmental and consumer groups have for years pressured Johnson & Johnson and its competitors to remove questionable ingredients from their products.
“We’ve never really seen a major personal care product company take the kind of move that they’re taking with this,” said Kenneth A. Cook, president of the Environmental Working Group, one of the organizations that has been negotiating with company officials to change their practices. “Not really even anything in the ballpark.”
In 2009, the Campaign for Safe Cosmetics, a coalition that includes the Environmental Working Group, analyzed the contents of dozens of products for children and found that many items contained two substances of particular concern: formaldehyde and 1,4 dioxane. Consumers won’t find either listed on the back of their shampoos or lotions because neither is technically an ingredient.
Formaldehyde, which last year was identified by government scientists as a carcinogen, is released over time by common preservatives like quaternium-15 and DMDM hydantoin, which do appear on labels. And 1,4 dioxane, which has been linked to cancer in animal studies, is created during a process commonly used to make other ingredients gentler on the skin.
The company also plans to phase out other ingredients that have been linked to health problems, including phthalates, which have a variety of uses, like lessening the stiffening effects of hair spray; several fragrance ingredients; and triclosan, an antibacterial substance used in soaps. Johnson & Johnson will remove all parabens, a type of preservative, from baby products and some other parabens from its adult products.
Ms. Nettesheim said the project was a major undertaking and would require extensive spending on research and development to find suitable alternatives to the ingredients, most of which are common in the industry. She said new suppliers needed to be located and vetted, and testing was needed to ensure the replacements were also safe. The company declined to say how much the project would cost.
Then there’s the delicate task of tinkering with products that have been popular for generations. The company’s baby shampoo, for example, has been marketed for more than 50 years.
“Consumer acceptance is really important,” Ms. Nettesheim said. “It really doesn’t help you if you reformulate products and people don’t like it.”
Lisa Archer, director of the Campaign for Safe Cosmetics, said her group would continue to press other cosmetics and consumer-goods companies to follow Johnson & Johnson, including the Estée Lauder Companies, Procter & Gamble, Avon and L’Oreal.
In 2010, Procter & Gamble reformulated its Herbal Essences shampoos to limit the amount of 1,4 dioxane to only trace amounts, and its Tide laundry detergent came under scrutiny from some of the same groups because it contains small amounts of the chemical.
Tim Long, a senior science fellow at P.& G., said the company communicates openly with consumers about the ingredients it uses. All of its products meet regulatory requirements, he said.
In a statement, Estée Lauder said it adheres to stringent safety standards for all of its products and complies with regulations in every country in which its products are sold.
Johnson & Johnson’s decision requires the company to navigate a public relations tightrope, by portraying itself as willing to make extensive changes while simultaneously reassuring consumers that its existing products are safe. The endeavor’s success is even more critical because the company has experienced serious recalls and quality lapsesin recent years. On a new Web site that explains the changes to consumers, the company calls it “moving beyond safety.”
“Even though as a scientist I will sit here and tell you these things are perfectly safe,” consumers are worried about reports that call her conclusions into question, Ms. Nettesheim said. “I understand that and we can’t ignore that.”
Mr. Cook, of the Environmental Working Group, disagrees about the safety of the chemicals. But he agreed that there is avid interest in the ingredients on a shampoo bottle, noting that his group maintains a product safety database that has received hundreds of millions of page views. “This is them placing a bet that if they get out in front of this consumer interest, they’re going to win the marketplace,” he said.

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F.D.A. Expedites Review of New Uses for Anticlotting Drug

Jul 9, 2012 | New York Times

By Katie Thomas

The Food and Drug Administration has agreed to give priority status to its review of three new uses for the anticlotting drug Xarelto, Johnson & Johnson announced Monday.
The company is asking the agency to approve the drug to treat deep vein thrombosis and pulmonary embolism, and to prevent recurrence of both conditions. Under priority reviews, the F.D.A. tries to reach a decision in six months instead of the usual 10.
An estimated 900,000 people are stricken by deep vein thrombosis — a blood clot in a large, deep vein, such as a leg vein — or by pulmonary embolism, which occurs when one of those clots dislodges and travels to the lung. One third of those cases result in death, the company said.
“If approved for these indications, Xarelto has the potential to address critical unmet needs in treating patients with these serious medical conditions,” Dr. Paul Burton, vice president of the cardiovascular franchise at Janssen Research & Development, a unit of Johnson & Johnson, said in a statement.
The applications reflect the effort by pharmaceutical companies to compensate for the loss of revenue from best-selling drugs that have lost patent protection in recent years. One popular strategy is to squeeze as many uses as possible out of drugs that still have patent exclusivity.
Xarelto was approved in 2011 for two uses: to prevent blood clots in patients undergoing knee or hip replacement surgery and for people with a common form of heart arrhythmia known as atrial fibrillation. But efforts to expand the use of Xarelto have not been successful. In June, the F.D.A. turned down Janssen’s application to use Xarelto to help reduce the risk of heart attack and stroke in patients with a condition called acute coronary syndrome.
The decision was a blow to Johnson & Johnson and Bayer, which are developing the drug together. Approval could have helped the companies increase sales significantly by marketing to the estimated 1.2 million people who are discharged from hospitals each year with a diagnosis of acute coronary syndrome, a sudden loss of blood to the heart. An advisory panel in May concluded that concerns over dangerous bleeding outweighed the benefits in patients with the condition.
Because of that decision, Janssen officials also announced Monday that they would withdraw an application for another new use, one that would have reduced the risk of clots that form on stents. Coronary stents, intended to keep arteries open after blockages have been cleared, are implanted in about 1.5 million patients a year, Janssen said.
Xarelto and Pradaxa are part of a new class of anticoagulant drugs that are intended to replace warfarin, the current treatment standard for millions of people with atrial fibrillation. Warfarin is much less expensive than the new drugs but requires careful monitoring to avoid dangerous side effects.
Xarelto has trailed Pradaxa in sales, bringing in $29 million in the first quarter of this year, compared to Pradaxa, which tallied $209 million, according to IMS Health, a consulting firm.
Bristol-Myers Squibb and Pfizer are seeking approval for a third drug in the group, to be called Eliquis. But the F.D.A. has twice delayed making a decision on the drug, most recently in June, when it asked the companies for more information about its trial data.

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Johnson & Johnson Unit to Halt Urinary Implants

Jun 5, 2012 | New York Times

By Katie Thomas

Johnson & Johnson’s Ethicon division will stop selling four types of mesh implants used to treat urinary incontinence, the company announced in a letter to judges overseeing two large groups of lawsuits filed by women who claim the devices caused serious injury.
In a statement Tuesday, the company stressed that the move was not a recall, but was based on the products’ commercial viability “in light of changing market dynamics, and is not related to safety or efficacy.”
The announcement comes after years of controversy over the implants, which are used to treat incontinence caused by muscle weakening and a condition called pelvic organ prolapse, in which organs descend and press against the vaginal wall. The devices have been linked to serious injuries in women, including infections, pain and other complications. In 2008, the Food and Drug Administration warned that use of the implants was associated with complications but that the problems were rare. But between 2008 and 2010, the agency reported a fivefold increase in reports related to the use of the devices. In January, the F.D.A. ordered makers of the implants to study their risks in patients.
“This is very good news for women because it takes several products off the market that have harmed a lot of women,” said Diana Zuckerman, president of the National Research Center for Women and Families, a public health advocacy group. However, she said, “the bad news is that there are many other surgical meshes still on the market that are just as dangerous.”
Other device makers that also sell surgical mesh products include Boston Scientific, C. R. Bard and W. L. Gore & Associates. In a statement, a spokeswoman for Boston Scientific said the company believed that using such products “is and remains an important treatment option for patients.”
The four products Ethicon will discontinue are the Gynecare TVT Secur system, the Gynecare Prosima, the Gynecare Prolift and the Gynecare Prolift+M. Ethicon will stop selling the products over the next three to nine months, with a goal of ending sales worldwide by the first quarter of 2013. A spokesman for Ethicon declined to say how many women were implanted with the products.
Johnson & Johnson has undergone a series of product withdrawals and recalls in recent years, including the recall of artificial hips, contact lenses and other products, and the recent decision to end its line of drug-coated heart stents.

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F.D.A. Panel Votes Against Expanding Use of an Anticoagulant

May 23, 2012 | New York Times

By Katie Thomas

A federal advisory panel narrowly recommended against expanding the use of the Johnson & Johnson drug Xarelto on Wednesday, saying concerns over dangerous bleeding outweighed evidence that the drug helped reduce the risk of blood clots in patients with serious heart problems.
Xarelto is an anticoagulant drug that was approved last year to prevent blood clots in patients undergoing knee or hip replacement surgery and for people with a common form of heart arrhythmia called atrial fibrillation. Janssen, Johnson & Johnson’s pharmaceutical unit, is asking the Food and Drug Administration to allow the drug to also be used in patients with a condition called acute coronary syndrome in addition to the common treatment of aspirin plus clopidogrel, or Plavix.
Six members of the panel voted against approval, four voted for it and one abstained. The agency often, but not always, follows the advice of its outside experts. An F.D.A. staff reviewer had recommended that the panel approve the new use, saying that it significantly reduced the risk of cardiovascular death.
Several members expressed concern about the idea of adding a third drug to the two that are already the standard, aspirin and clopidogrel, and said the benefits of doing so did not outweigh the risks. Members of the panel also expressed concern that more than 15 percent of the study’s participants dropped out, calling into question the quality of the data.
“We really want to have very compelling evidence” that the drug helps patients, said Dr. Steven E. Nissen, chairman of the department of cardiovascular medicine at the Cleveland Clinic, who voted no.
He said that evidence of increased bleeding should not be taken lightly, and that when the bleeding was in the brain it could lead to irrevocable damage, a complication that he said some considered worse than death.
“It’s terribly unpleasant for the patient,” he said. “These bleeds are not trivial.”
In a statement, Dr. Paul Burton, the medical leader of the cardiovascular franchise at Janssen, said, “We appreciate the thoroughness of the committee’s review, and will ensure the questions raised today are addressed with the F.D.A.”
If ultimately approved by the agency, the expanded use could significantly increase sales of Xarelto. Janssen said 1.2 million patients were discharged each year from the hospital with a diagnosis of acute coronary syndrome. The syndrome occurs when a blood clot blocks a coronary artery and reduces the blood supply to the heart.

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After Recalls and Missteps, J.&J.’s New Chief Confronts Critical Challenges

Apr 25, 2012 | New York Times

By Katie Thomas

Johnson & Johnson needs to rethink the way it brings drugs to market, expand its reach into global markets and rebuild consumer confidence by returning recalled brands to pharmacy shelves, the incoming chief executive, Alex Gorsky, said in an interview Wednesday.
Mr. Gorsky, who is scheduled to take over formally during Johnson & Johnson’s annual meeting Thursday, did not lay out plans for major changes at the company, which has been troubled in recent years by a succession of product recalls, manufacturing problems and government inquiries.
He said he intended to build on the company’s long legacy of success. Still, he said, “I think we’re going to need to be bold, disciplined and decisive about how we go forward.”
Essential to the company’s future, he said, was a rethinking how it develops new drugs. “I think the markets are going to demand a higher bar around innovation and really making a difference for patients,” he said.
Les Funtleyder, a portfolio manager at Miller Tabak & Company, agreed that Johnson & Johnson’s research and development operation has been sluggish recently, failing to turn out as many profitable drugs and devices as it once did.
“It’s more of a question of steering it back to where it was,” said Mr. Funtleyder, whose fund owns the stock. “I’m not sure you need a total redo. You need a course correction.”
Mr. Gorsky also sees major opportunities in global markets. Already, 55 percent of Johnson’s sales come from overseas, but the company can do better, Mr. Gorsky said.
Developing markets, he said, are growing at three to five times the rate of markets like the United States and Europe. “And as more people move into the middle class, they represent even more of an opportunity,” Mr. Gorsky said.
There is no question that Mr. Gorsky, who is replacing William C. Weldon, has his work cut out for him. Consumer confidence in Johnson & Johnson, once one of the most trusted brands, has dipped in recent years as the company recalled dozens of products, including millions of bottles of children’s Tylenol and other medications, as well as artificial hips and other products.
Last week, company officials told analysts that efforts to fix the manufacturing problems that had caused the recalls of over-the-counter brands were taking longer than expected, and that some brands might not return to shelves until 2013.
Mr. Gorsky said Wednesday that the company has made changes to its supply chain and quality control procedures and that working with a third-party firm as well as the Food and Drug Administration was taking a long time. “We’re learning as we go through this process,” he said. “We believe we’re starting to see the benefits of some of that, but we still realize that there’s work that we have to do.”
When the products return to shelves, Mr. Gorsky said he was confident that customers would continue to buy them. He said this has already happened with some returning brands. “The events over the last couple of years have had a negative impact, but we’ve been, I think, encouraged by how resilient our brands and our company reputation has been,” he said.
Mr. Gorsky, who is 51, joined Johnson & Johnson as a sales representative in 1988. He ran the company’s pharmaceutical businesses in Europe, Africa and the Middle East, then left in 2004 to head the North American pharmaceuticals business at Novartis. He returned to Johnson & Johnson four years later.
Mr. Gorsky won the chief executive job over Sherilyn S. McCoy, who had led the pharmaceuticals and consumer groups, but resigned to become chief executive of Avon this week. Mr. Weldon will remain as chairman.
Manufacturing problems are not the only troubles that the company faces.
A judge in Alabama fined the company $1.2 billion over accusations that it had hidden and diminished the risks of Risperdal, an antipsychotic drug, and the company is facing similar lawsuits by state attorneys general across the country. The Alabama case is being appealed, and Mr. Gorsky declined to comment on the matter, citing the litigation.
He also declined to comment for similar reasons on his role in an artificial hip implant that has failed in thousands of patients, crippling some of them. Mr. Gorsky was head of the device and diagnostics group at the time that critical decisions were being made about the implants.
Although some have criticized Johnson & Johnson for hiring an insider to lead the company during a difficult time, Mr. Gorsky said he has a track record of taking decisive, sometimes counterintuitive, action. He described himself as a “realistic optimist” and cited as an example the company’s decision last year to stop making drug-coated heart stents.
Recent research has shown that stents were overused and that drugs might be a better alternative to avoiding heart attacks or strokes. At the same time, he said, he chose to expand the company’s orthopedics business by negotiating the deal to acquire Synthes, a medical device maker.
Of the decision on the heart stents, “I think that represents the kind of decisiveness that we’re going to need again, even in an area where I think that few would have felt that Johnson & Johnson would do that,” he said. “That’s the realist in me.”

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Popular J.&J. Drugs May Not Return Until 2013

Apr 17, 2012 | New York Times

By Katie Thomas

Efforts to fix manufacturing problems at three Johnson & Johnsonplants are taking longer than expected, meaning that some popular over-the-counter consumer brands may not return to store shelves until next year, company executives said Tuesday.
“It is difficult to accurately predict the speed of recovery, and as such we are in fact behind where we thought we might be as this point,” Dominic J. Caruso, chief financial officer of Johnson & Johnson, said during a conference call to discuss the company’s first-quarter earnings.
Johnson & Johnson entered into a consent decree with the Food and Drug Administration last year in which it promised to overhaul operations at three of its manufacturing plants after quality problems led several over-the-counter products, including Pepcid Complete and Children’s Tylenol, to be removed from shelves.
Others drugs, like eight-hour Tylenol and Simply Sleep, have not yet returned to the market. The decree covers one plant, in Fort Washington, Pa., that the company closed in 2010 and two others in Lancaster, Pa., and Las Piedras, P.R., that remain open under federal supervision.
In the call with analysts, Mr. Caruso said some brands could return to shelves this year, but others would most likely not be back until 2013. The closed plant in Fort Washington also would not probably reopen until the end of 2013, he said. Company officials had earlier estimated that the products would return to the market in 2012. He did not give a reason for the delays and said that the cost of the remediation efforts had increased.
“That was the biggest surprise because they had said one thing and it’s not necessarily clear why there is a change,” said Les Funtleyder, a portfolio manager at Miller Tabak & Company, which owns shares of Johnson & Johnson.
Sales of consumer products fell 2.4 percent compared with the first quarter of last year, partly because of lower production levels of the over-the-counter products after the consent decree, the company said. Over all, the company reported that its profit in the first quarter increased by 12.5 percent over the same period last year, driven by sales of drugs like Zytiga for prostate cancer and by currency adjustments related to the planned acquisition of the device maker Synthes, among other factors.
Mr. Caruso also said the company had not set aside money to pay for a $1.2 billion fine imposed last week by an Arkansas judge after a jury found Johnson & Johnson and a subsidiary had minimized the dangers associated with Risperdal, an antipsychotic drug. The company has said it plans to ask for a new trial and will appeal if that fails.
Mr. Funtleyder said it was surprising that the company had not set aside money to pay for a possible fine in the case, but that given their plans to appeal, Johnson & Johnson is unlikely to have to pay the bill anytime soon. And given the company’s sprawling profile — it sells everything from baby shampoo to artificial hips — Mr. Funtleyder said the company would weather the recent bad news. “It’s got a lot of stable businesses to offset some of this other stuff,” he said.

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J.&J. Fined $1.2 Billion in Drug Case

Apr 11, 2012 | New York Times

By Katie Thomas

A judge in Arkansas ordered Johnson & Johnson and a subsidiary to pay more than $1.2 billion in fines on Wednesday, a day after a jury found that the companies had minimized or concealed the dangers associated with an antipsychotic drug.
The fine, which experts said ranked among the largest on record for a state fraud case involving a drug company, is the most recent in a string of legal losses for Johnson & Johnson related to its marketing of the drug, Risperdal.
In January, Texas settled a similar case with the subsidiary, Janssen Pharmaceuticals, for $158 million. Last year, a South Carolina judge levied civil penalties of $327 million against Janssen, and in 2010, a Louisiana jury awarded nearly $258 million in damages.
The Arkansas Circuit Court judge, Tim Fox, issued a penalty of $1.19 billion for nearly 240,000 violations of the state’s Medicaid fraud law; he also fined the companies $11 million for violations of the state’s deceptive practices act.
The state’s attorney general, Dustin McDaniel, called the judge’s decision a “big win” for Arkansas. “These two companies put profits before people, and they are rightfully being held responsible for their actions,” he said in a statement.
The size of the fine calls into question the status of pending lawsuits filed by several state attorneys general against the companies, said Patrick Burns, a spokesman for Taxpayers Against Fraud, an advocacy group for whistle-blowers.
Given the decision in Arkansas, “the game has fundamentally changed,” he said. “Most attorneys general can do the math, and there’s no reason for any state to settle if they can win really big numbers in court.”
Mr. Burns said a proposed civil settlement between the companies and the Justice Department may also be called into question given the Arkansas case. Johnson & Johnson said in company filings that it has reached an agreement in principle with the federal government to settle a misdemeanor criminal charge related to marketing of Risperdal, but news reports have said that the Justice Department has rejected a proposed $1 billion settlement for the civil portion of the settlement and is seeking more money.
In a statement, Janssen said it would ask for a new trial or, if that failed, it would appeal. “The state did not show any Arkansas patient was ever harmed by using Risperdal,” the company said in its statement.
Prosecutors have accused Johnson & Johnson and Janssen of hiding the risks associated with Risperdal, which is approved to treat schizophrenia, bipolar disorder and behavior problems in teenagers and children with autism. Side effects can include weight gain, an increased risk of diabetes and, in older patients, an increased risk of stroke.
“They were trumpeting it as a miracle, breakthrough drug,” said Thomas Melsheimer, a lawyer who represented the whistle-blower in the Texas Risperdal case. Instead, he said, it was no better than cheaper generic alternatives. “It was grossly overpriced in relation to its qualities.”
Janssen has said it complied with all state laws and did not mislead doctors or patients about the risks of the drug.
In its 2011 annual report, Johnson & Johnson said it set aside money to pay for legal settlements or verdicts and did not expect the ultimate resolution of any Risperdal cases to affect the company in a material way.
The fine in Arkansas barely registered on Wall Street, where the company’s shares closed at $64.13, down 7 cents. At least one analyst speculated that the large fine would be reduced on appeal. Johnson has appealed the South Carolina and Louisiana decisions.
Johnson’s history with Risperdal is just one of several examples of government investigations into the marketing practices of pharmaceutical companies. In November, the British drug company GlaxoSmithKline announced that it had agreed to pay $3 billion to settle federal investigations into its sales practices for several drugs, including the diabetes drug Avandia.
In 2009, Pfizer settled for $2.3 billion over marketing of its painkiller Bextra. That same year, Eli Lilly pleaded guilty to criminal conduct involving its marketing of the antipsychotic drug Zyprexa and agreed to pay $1.4 billion in fines.
“Investors at this point have become inured to these large settlements,” said Les Funtleyder, a portfolio manager at Miller Tabak & Company, which owns Johnson & Johnson stock. “And you’ve seen it almost across all of pharma.”
If Wall Street is not moved, the public is increasingly fed up, as evidenced by the recent jury verdicts, said Erika A. Kelton, a lawyer in Washington who represented a whistle-blower in the Pfizer case involving Bextra. “I think it’s part of a bigger picture of a growing intolerance of pharmaceutical companies ignoring the rules of the road.”

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J.&J.’s Next Chief Is Steeped in Sales Culture

Feb 23, 2012 | New York Times

By Katie Thomas

Alex Gorsky, the newly named chief executive of Johnson & Johnson, shares a crucial biographical detail with William C. Weldon, the man he is succeeding. Both got their starts as pharmaceutical sales representatives, a notoriously grueling job that — because it demands stamina, charisma and a near devotion to making the sale — has become a crucible for future drug company executives in recent years.
Also like Mr. Weldon, Mr. Gorsky is a Johnson & Johnson insider who served during one of the most tumultuous periods in the company’s history, when there were manufacturing lapses, government inquiries and recalls affecting popular over-the-counter consumer products.
Mr. Gorsky served as head of the company’s medical device and diagnostics group at the same time that critical decisions were made about an artificial hip implant that has failed in thousands of patients, crippling some of them.
Their shared history has led some to speculate that not much will change when Mr. Gorsky takes over in April.
“As somebody steeped in J.& J. culture, I would be very surprised to see big changes,” said Les Funtleyder, a portfolio manager at Miller Tabak & Company who owns the stock. And even if Mr. Gorsky plans such changes, “It’s so big that it would take a very long time to move a big battleship like that.”
Mr. Gorsky declined to be interviewed. But in a statement on Tuesday, he said: “I’m honored that the board has placed such confidence in me, and I am also aware of the serious responsibilities that come with this office. Johnson & Johnson is a strong and extraordinary company with enormous opportunities to advance health and well being.”
Mr. Gorsky, who is 51, fits the mold of someone who once “carried the bag” — industry slang for working as a sales representative. He is known as a polished speaker and an intense yet likable manager who is a quick study when it comes to learning new topics. That skill may serve him well at Johnson & Johnson, which sells things as diverse as baby shampoo, Band-Aids and antipsychotic drugs.
“It’s the school of hard knocks,” said Nona Footz, who leads the health care practice at RSR Partners, an executive search firm. “You’re out there. You’re knocking on doors. You have very tough sales targets. You get a lot of exposure. You learn the business and then you’re promoted.”
But the ethos of the sales representative may not be what Johnson & Johnson needs right now, said Erik Gordon, who teaches business at the University of Michigan. “That culture was very much the Weldon culture writ large — we will make our numbers for the analysts, period,” he said. “And if that means we have to cut costs on things that affect quality, then by God, we’re going to make those numbers.”
By contrast, Mr. Gorsky’s main competitor for the chief executive job, Sheri S. McCoy, got her start at the company as a scientist in research and development.
As is typical for rising stars at large corporations, Mr. Gorsky held many jobs after starting with the company in 1988, including running Johnson & Johnson’s pharmaceutical businesses in Europe, Africa and the Middle East.
In 2004, Mr. Gorsky left the company to head the North American pharmaceuticals business at Novartis. He returned to Johnson & Johnson in 2008. In September 2009, he took over the medical device and diagnostic group.
It was a particularly tumultuous time for the company’s orthopedic unit, DePuy. Just a few weeks earlier, the Food and Drug Administration refused to let it sell one of its hip implants in this country because it had failed to meet regulatory standards. Meanwhile, complaints about that device and a companion version that was used in this country were mounting from doctors here and regulators abroad.
It is not known what role, if any, Mr. Gorsky played in DePuy’s decision not to disclose the F.D.A. action. But at the start of his tenure, DePuy decided to phase out the implants marketed as the ASR and shut a factory in England that made them.
DePuy recalled the ASR in August 2010, amid rising failure rates. But before then, DePuy executives repeatedly insisted that the ASR was safe. And Mr. Gorsky stated publicly in 2010 that the company had decided to drop it for business reasons, not safety concerns.
In a recently disclosed DePuy e-mail, a top executive wrote that the F.D.A. had refused to approve the device after seeing data showing it failing prematurely in significant numbers during company studies in patients.
Johnson & Johnson did not answer questions about whether Mr. Gorsky had known about the problems associated with the artificial hips. But his promotion to chief executive surprised Dr. Robert Hauser, a cardiologist and an advocate for improved safety of medical devices.
“I mean, come on. What is this?” Dr. Hauser said. “He’s been overseeing one of the major J.& J. quality issues and the board of J.& J. sees fit to name him the new C.E.O.”
Others dismissed the issue, saying it was unclear what knowledge Mr. Gorsky had had of the trouble with the hips. “It came out under his watch, but it had nothing to do with his watch,” said Lewis C. Pell, a medical devices entrepreneur who does business with the company and knows Mr. Gorsky.
Mr. Funtleyder, the portfolio manager, said Mr. Gorsky would face three challenges: fixing the problems at the plants that make over-the-counter products, ensuring that there are lucrative prescription drugs in development and addressing a global dip in consumer use of medical services. The company also must close its deal to buy Synthes, a medical device maker. Mr. Gorsky negotiated the acquisition.
Despite its troubles, the company has several new prescription drugs that have been selling well, including Zytiga, a prostate cancer drug. The company earned $218 million, or 8 cents a share, in the fourth quarter of 2011, an 89 percent drop from $1.9 billion, or 70 cents, a year earlier. The drop was largely caused by a $3 billion charge related to the recall of its artificial hips.

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J.& J. Chief to Resign One Role

Feb 21, 2012 | New York Times

By Katie Thomas and Reed Abelson

William C. Weldon, who presided over Johnson & Johnson during one of the most tumultuous periods in its history, will step down as chief executive in April, the company announced Tuesday.
Alex Gorsky, head of the medical device and diagnostics business, will take over as chief executive. Mr. Weldon will remain as chairman.
The news of Mr. Weldon’s retirement comes as Johnson & Johnson has struggled to emerge from a swarm of product recalls, manufacturing lapses and government inquiries that tarnished the name of a company that was once one of the nation’s most trusted household brands. In 2010, the company recalled millions of bottles of liquid children’s Tylenol and other medications, as well as tens of thousands of artificial hips and millions of contact lenses.
Much of the blame for Johnson & Johnson’s stumbles fell on Mr. Weldon, the son of a Broadway stagehand and seamstress who became chief executive in 2002 after spending his entire career at the company. Critics said the company’s once-vaunted attention to quality slipped under his watch. The company said in a statement that neither Mr. Weldon nor Mr. Gorsky was available for comment.
There was little doubt that Mr. Weldon, 63, was going to retire this year, said Erik Gordon, who teaches business at the University of Michigan. “I think what he really wanted to do is clean up his image,” Mr. Gordon said. “He didn’t want to leave at a time when it looked like he was being thrown out.”
Plans for Mr. Weldon’s exit became clear in December 2010, when the company promoted Mr. Gorsky and Sheri S. McCoy to vice chairman and vice chairwoman of the executive committee in what was seen as a race to succeed Mr. Weldon. There were other signs that Mr. Weldon planned to step down: over the past year he has sold more than one million shares of Johnson & Johnson stock; the sales earned him nearly $69 million.
In 2011, critics of Mr. Weldon, including a group of shareholders, complained of his compensation of about $30 million a year, saying it ignored his troubled leadership.
Mr. Gorsky, who is 51, was considered the favored candidate, said Les Funtleyder, a portfolio manager who owns the stock at Miller Tabak & Company. Mr. Gorsky is well-known by the company’s investors. “There is a comfort level with him,” Mr. Funtleyder said. Ms. McCoy will continue to lead the pharmaceuticals and consumer groups, the company said, but analysts said she may leave after having been passed over.
The ascension of Mr. Gorsky, who first joined Johnson & Johnson as a sales representative in 1988, continues the company’s 126-year tradition of hiring leaders from within. The medical devices division generates the largest amount of sales for the company, and it is expected only to grow with the acquisition last year of Synthes, a Swiss-American medical device maker.
“Alex and Sheri are two extraordinary leaders,” Mr. Weldon said in a statement Tuesday. “The future of Johnson & Johnson is in very capable hands.”
But Mr. Gordon said the board’s decision to hire another insider showed that it was not serious about changing the corporate culture that had created so many of its problems.
“I think it’s a big mistake,” he said.
In the wake of the product recalls, Mr. Weldon and the company went on the offensive, initiating a public relations campaign aimed at restoring consumer confidence and revamping quality controls to create a single framework for the company’s drug, medical device and consumer health care divisions.
“From Johnson & Johnson’s perspective, our response to this issue was the most responsible it could possibly be,” Mr. Weldon said in a telephone interview in 2010.
Even so, Johnson & Johnson has continued to struggle to put its troubles to rest. As recently as last week, the company announced it would recall about a half-million bottles of liquid Infants’ Tylenol because of a faulty dosing system.
Still, Mr. Weldon’s retirement comes as the company shows signs of improving, said Jeff Jonas, portfolio manager for Gabelli, which owns the stock for investors. “He’s wanted to stay and get through the worst of it,” he said.
Some products are back on the market, Mr. Jonas said, and the company has a well-defined plan with the Food and Drug Administration to bring the plant that was a source of many of the over-the-counter recalls up to federal standards. A drug to treat prostate cancer, to be marketed as Zytiga, was approved by the Food and Drug Administration last year, and the consumer business is recovering.
Mr. Jonas said the fact that Mr. Weldon plans to step down in April, during the company’s annual meeting, indicates that his departure was not abrupt. “The annual meeting is always a classic time to do the transition,” he said.
Johnson & Johnson’s stock closed at $65.04 Tuesday, having rebounded from a low of $57.50 a share over the last 12 months.

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