Insurance Litigation

J&J’s Sustainability Business Model

Johnson & Johnson (J&J) likes to talk about its Credo, (Pronounced KRAY-doh, like PLAY- dough), its pledge to consumers, employees and shareholders.

The pledge was repeated by J&J CEO Alex Gorsky at the April 2017 annual shareholder’s meeting held in New Brunswick, New Jersey.

The health care giant likes to claim its upstanding ethics are what keeps the company profitable to the tune of $71 billion annually.

Its first responsibility is “to the doctors, nurses and patients, to mothers and fathers and all others who use our products and services.” It goes on to stress “high quality” in everything it does – in reducing costs, being responsible to employees who work with J&J around the world, and being good global citizens.

Finally, there is a responsibility to shareholders to keep profits in the black.

At the April gathering, held in the State Theater in downtown New Brunswick, a group of mesh-injured campaigners took to the street outside where busses let off employees and shareholders.

Their message and signs were clear – “J&J Hurts Women,” and “CEO Gorsky and Shareholders are Complicit.”  Images from an electron microscope of shredding polypropylene mesh showed it’s not inert once implanted into the body, whether to treat prolapse, incontinence or hernias.

Inside the theater, an invisible teleprompter helped CEO Gorsky and other executives deliver a predictable, rehearsed upbeat message of “sustainability” and “putting people first.”

Clearly, it would be easier to deliver that message without looking at the faces of the people across the street. But look at their faces they did. On the second floor of the theater, what appeared to be at least one large camera lens focused on the anti-J&J campaigners, chronicling their message, their signs, and their faces.

Consider that each woman represents about 5,000 others who couldn’t make it to New Jersey because their mesh injuries are too excruciating, or they have been rendered jobless disabled and broke.

There are more than 100,000 product liability lawsuits against J&J in the U.S. alone. There are thousands of other cases filed abroad in the UK, Australia, Israel, Canada and Scotland.

It became crystal clear why there is a media blackout on the consequences of using polypropylene mesh. A slickly produced video showed the J&J family of products including Tylenol, Motrin, Benadryl, Band-Aids, Aveeno, Neutrogena, Imodium, Roc, baby powder and products, and the list goes on and on.

Someone sitting nearby suggested no wonder we don’t hear about the problems in the media about J&J. Which media company is willing to bite the hand of the advertiser that supports its ever diminishing slice of the media pie?

As the presenters concluded their show, a senior counsel for J&J was asked – how can the company be sustainable when it has lost a series of high profile cases in court recently?

In December a $12.5 million product liability loss in the Hammons case in December 2015, was followed by a February 2016 $13.5 million loss for the J&J in the Carlino case.

The senior counsel cringed, probably because at that hour, about 58 miles south-west from New Brunswick, J&J had just suffered another loss in the Philadelphia Court of Common Pleas – the largest loss so far among pelvic mesh cases in that court – $20 million with $17.5 million in punitive damages.

That meant among three trials in one Philadelphia courtroom, J&J was facing $34.5 million in punitive damages alone.

In just a few weeks, in the pelvic mesh trial of Sharon Beltz, a Philadelphia jury would award her $2.1 million and become the fourth consecutive Philadelphia court pelvic mesh trial loss for J&J.

There are 182 additional pelvic mesh cases waiting in the Philadelphia Court of Common Pleas awaiting trial.

Can any company say those record losses represent sustainability?


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