Johnson & Johnson Offers $9bn to Settle Talc Lawsuits

Johnson & Johnson, one of the world’s largest healthcare companies, has offered to pay almost $9 billion to settle thousands of lawsuits in North America. The legal claims allege that the company’s talc-based products, including baby powder, can cause cancer. The figure is a significant increase over the $2 billion previously proposed by the company.

While Johnson & Johnson maintains that the claims are “specious,” it hopes that the new settlement offer will help bring an end to the legal battle. The proposed settlement has significant support from people connected to the case.

The company faces more than 40,000 lawsuits from former customers who claim that using its talc-based baby powder caused cancer. Some also allege that the product contained asbestos, a known carcinogen. Johnson & Johnson stopped selling the product in the US in 2020, citing “misinformation” that had hurt demand. Last year, it announced plans to end sales globally.

Before the decision to stop selling talc-based baby powder, Johnson & Johnson had sold the product for almost 130 years. It continues to sell a version that contains cornstarch.

The company has been attempting to resolve the lawsuits in bankruptcy court since 2021, after creating a subsidiary responsible for the claims. However, a bankruptcy court ruling found that the subsidiary was not in financial distress and could not use the bankruptcy system to settle the lawsuits.

Despite the ongoing legal battle, Johnson & Johnson has won a majority of the talc lawsuits against it. However, it has suffered some significant losses, including one in which 22 women were awarded a judgement of over $2 billion.

Erik Haas, the worldwide vice president of litigation for Johnson & Johnson, said that resolving the cases through the tort system would take decades and impose significant costs. He added that the proposed reorganisation plan was “more equitable and more efficient” and would allow claimants to be compensated in a timely manner.

Johnson & Johnson said it had commitments from around 60,000 current claimants to support the new settlement terms. The company’s decision to offer a higher settlement amount indicates its willingness to put an end to the ongoing legal battle.