Saturday, July 17, 2010

Pharmalot: J&J Fires 300 Employees Over the Tylenol Recalls

Once again Ed Silverman in his Pharmalot blog continues to maintain the best insight and commentary on the never ending J&J Recall scandal.

In a July 15th blog, Mr. Silverman reports on J&J’s recent publicly released statement which included the announcement that they will fire 300 to 400 people who work in the Fort Washington, Pennsylvania McNeil plant. This is the site and headquarters where most of the quality-control problems were found and the managerial decisions were made.

Mr. Silverman’s Pharmalot commentary included:

· The healthcare giant submitted its long-awaited remediation plan to the FDA today - you know, the plan that is supposed to help Johnson & Johnson’s McNeil Consumer Healthcare unit get back on track after recalling tens of millions of over-the-counter pediatric medicines. And in a vague statement, J&J says one way to cope is to can 300 of the 400-plus people who work at the Fort Washington, Pa., plant where most of the quality-control problems were found and managerial decisions were made.

· The employees are being let go because it’s not clear when the plant will operate again. A J&J spokeswoman says the “best estimate” is the middle of 2011. Recently, J&J acknowledged that a few hundred million dollars in sales will be lost; the average annual sales of the products made at this plant over the last three years were about $650 million, although that remains a sliver of J&J consumer sales, which last year were $4.2 billion out of $16.5 billion total sales worldwide. J&J vows to expand capacity elsewhere to compensate for the shortages.

· There was no word, however, whether any senior McNeil execs are among those being shown the door, given that the McNeil unit is headquartered in Fort Washington. Take Peter Luther, who heads the unit. He allegedly recommended a recall of Motrin pills without notifying the FDA or the public.

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