In the past decade, pharmaceutical giant Johnson & Johnson has faced a seemingly endless stream of product liability lawsuits. From 2013 to 2016, the company has paid out more than $5 billion to resolve pending legal claims. In the first quarter of 2016, Johnson & Johnson reported on their 10-Q an increase in U.S. lawsuits from 76,400 to 82,200 for the past year, alone. According to Johnson & Johnson, the company currently faces around 3,000 pending suits regarding its DePuy ASR XL Acetabular system and DePuy ASR Hip Resurfacing System; 8,900 pending Pinnacle Acetabular Cup System suits; 49,300 pending pelvic mesh suits; 12,500 pending Risperdal suits; 7,100 pending Xarelto suits; and 1,400 pending talcum powder suits.
Reflecting on the rising number of lawsuits filed against the company, commentators have cited a multitude of factors working together to cause the increase. First and foremost, the sheer size of the company makes it a target to plaintiffs looking for a large payoff. Johnson & Johnson, which is a common household name worldwide, is also a very attractive opponent for plaintiffs’ attorneys who are mainly interested in making headlines and generating publicity in order to drum up new business. Additionally, through its solid reputation as a caring, patient-oriented company, which is seemingly cemented into the minds of the public, Johnson & Johnson has the luxury of risking bad press in order to fully litigate suits—something smaller companies would be more hesitant to do, fearing bad press would hurt business.
However, despite the almost constant barrage of plaintiffs’ verdicts that Johnson & Johnson has faced in the past decade, the company, along with its 250(+) subsidiaries, is still a major player in the pharmaceutical industry and is the number one seller of health care products. In the first quarter of 2016, Johnson & Johnson reported that it beat earning expectations and the value of their stock shares increased by .29%. However, financial analysts have opined that in order for Johnson & Johnson to maintain this moment of financial prosperity, it must experience an extended period without recalls.
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