Johnson & Johnson Facing Big Legal Costs Over Risperdal Lawsuits, Other Drug and Device Litigations

Published on March 7, 2017 by Laurie Villanueva

Johnson & Johnson is facing increasing legal costs from Risperdal lawsuits and other litigations involving the company’s drugs and medical devices. According to a report from the Financial Times, product liability claims naming Johnson & Johnson as a defendant increased by 28,300 filings in 2016, while costs associated with these cases spiked by 480%.

Johnson & Johnson has advised its investors that these legal proceedings are unlikely to have an impact on the company’s overall financial health. However, resolving claims could have a material effect on earnings in some quarters.

Significant Johnson & Johnson Litigations

Per a recent filing with the U.S. Securities and Exchange Commission (SEC), 104,700 product liability lawsuits had been filed against Johnson & Johnson as of January 1, 2017. More than 18,000 of those cases center on the antipsychotic Risperdal, the majority of which were filed on behalf of men and boys who allegedly developed gynecomastia (excessive breast growth) due to its side effects. Several gynecomastia plaintiffs have been awarded significant financial damages at trial, with verdicts ranging from $500,000 to $70 million. Confidential settlements have been reached in a small number of cases.

According to the Financial Times, Johnson & Johnson still faces more than 54,000 lawsuits involving transvaginal mesh products used to treat stress urinary incontinence and pelvic prolapse. Another 2,000 lawsuits involve devices included in the 2010 ASR hip replacement recall announced by Johnson & Johnson’s DePuy Orthopaedics subsidiary.

A metal-on-metal version of DePuy’s Pinnacle Hip Replacement System is at the center of 9,400 cases. So far, three Pinnacle claims have gone to trial in a multidistrict litigation now underway in the U.S. District Court, Northern District of Texas. Johnson & Johnson emerged victorious after the first trial, which concluded in October 2014. Last March, however, five plaintiffs were awarded a total of $500 million at the conclusion of the second trial. A third trial concluded in December after another Texas jury ordered the companies to pay a total of $1 billion in compensatory and punitive damages to a group of six plaintiffs. In both cases, however, the Court reduced punitive damages awarded to plaintiffs.

More than 16,000 lawsuits have been filed on behalf of individuals who allegedly suffered serious internal bleeding due to the anticoagulant Xarelto. The majority of these claims have been centralized in the U.S. District Court, Eastern District of Louisiana, where the first Xarelto trials are scheduled to get underway in April.

Finally, Johnson & Johnson has been named a defendant in more than 3,000 lawsuits involving the alleged association between talcum powder and ovarian cancer. Just last week, a Missouri jury cleared the company of liability in a case involving a 56-year-old woman who claimed that Johnson’s Baby Powder was responsible for her ovarian cancer diagnosis. However,  three other Missouri talcum powder trials went the way of plaintiffs last year, with juries ordering  Johnson & Johnson to pay compensatory and punitive damages totaling almost $200 million.

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