Johnson & Johnson shares drop on report it knew of asbestos in baby powder
The decline in shares wiped off about $24bn from the company’s market capitalisation
Bengaluru — Shares of Johnson & Johnson (J&J) fell more than 6% on Friday, on track to post their biggest percentage drop in more than a decade, after Reuters reported that the pharmaceutical major knew that its baby powder was contaminated with cancer-causing asbestos.
The decline in shares wiped off about $24bn from the company’s market capitalisation and made the stock the biggest drag on the Dow Jones Industrial Average and S&P 500 indices.
J&J was found to have known about the presence of small amounts of asbestos in its products from as early as 1971, a Reuters examination of company memos, internal reports and other confidential documents showed.
The Reuters report also shows the company had commissioned and paid for studies conducted on its baby powder franchise and hired a ghostwriter to redraft the article that presented the findings in a journal.
J&J has been battling some 6,000 cases claiming its baby powder and Shower to Shower products cause ovarian cancer. The products have also been linked to mesothelioma, a rare and deadly form of cancer that affects the delicate tissue that lines body cavities.