Johnson & Johnson has taken some costly beatings in court this year. And it could get worse. Just last week, a jury ordered J&J to pay $8 billion for wrongfully pushing doctors to prescribe the antipsychotic drug Risperdal. While the amount the company pays for the verdict will probably be significantly less, it came on the heels of billions more in 2019 court losses or settlements from damage claims involving baby powder, opioid painkillers and artificial hips.
The health-care giant still faces at least 100,000 lawsuits alleging injuries from those products and others, including vaginal-mesh devices and the diabetes drug Invokana, company filings to regulators show. Analysts say the cost of resolving those cases may reach $20 billion, and J&J’s handling of the various litigations is likely to spark questions when the company reports results on Tuesday.
Shares of J&J are down 12 per cent from a peak, partly because there’s no end in sight for liability costs. Concern over litigation will be “an overhang on the shares for the foreseeable future,” with the company already discounted in value to reflect at least $20 billion of exposure, Chris Schott, an analyst at JPMorgan Chase & Co., said in a report. J&J shares were down 0.3 per cent to $130.97 at 10:42 a.m. in New York.
Read EquityPandit’s Nifty Outlook for the Week