Johnson & Johnson has been a trustworthy company for many years. They pride themselves on keeping people healthy at every age and stage of life. However, their credibility was questioned after an enormous number of consumers reported that their talcum-based baby powder caused ovarian cancer. This issue caused negative publicity for the company and added a long-term damage on the brand. After decades of Johnson & Johnson falsely misleading consumers and the FDA about the impact of asbestos-contaminated talc on public health, thousands of affected consumers are seeking justice after developing cancer.
Ethical theories would analyze Johnson & Johnson’s actions in diverse ways. An Individualist would say that Johnson & Johnson did not maximize profits for the business within the law because they failed to inform the public and their stakeholders about the scientific findings of their baby powder. A Utilitarian would say that Johnson & Johnson is unethical because of the consequences of their mistakes. They knew that talcum caused cancer and posed as a risk to the consumers, but they continued to sell the product anyways. A Kantian would view Johnson & Johnson as unethical because they manipulated their consumers for many years. By selling their talcum-based powder without proper safety protocol, they were evidently implementing bad will. Under the Virtue Theory, Johnson & Johnson is considered unethical because they exhibited many bad character traits. Proving that they do not care about the safety and health of their consumers. Johnson & Johnson needs to focus its resources on testing their product, reestablishing their values, and monitoring product safety in order to portray empathy for the consumers. Above all, Johnson & Johnson needs to have open relationships with consumers and stakeholders for the sake of reinstating their brand and ensuring good ethics.
Ethics Case Controversy
In 2018, a Missouri appeals court upheld a jury verdict that Johnson & Johnson’s talcum-based baby powder caused ovarian cancer in twenty-two women. The Missouri Court of Appeals also reduced the total damages from $4.69 billion to about $2.1 billion that Johnson & Johnson was ordered to pay. This verdict was the biggest award of damages in a series of lawsuits over the safety of Johnson’s Baby Powder. The series of lawsuits also resulted from another talc-containing powder, Shower to Shower, that Johnson & Johnson used to sell. As of March, more than 19,000 plaintiffs had filed talcum-powder lawsuits against Johnson & Johnson in U.S. courts. The plaintiffs alleged that talc-containing powders caused ovarian cancer in women who used it for feminine hygiene for years. Others said that inhalation of the powder caused a rare cancer called mesothelioma, which affects the lining of the lungs. Their lawyers also have alleged in some cases that the talcum powder contained asbestos, a naturally occurring mineral linked to mesothelioma. In the Missouri Case, six of the twenty-two women died from ovarian cancer before the trial and five more after it ended.
On the other hand, Johnson & Johnson is continuing to state that their talc-based powder “is safe, doesn’t contain asbestos, and didn’t cause cancer in people who used it.” As a result of the talcum-powder verdicts and negative publicity over this issue, Johnson & Johnson’s reputation started to decline, and stock prices rose 0.1%. In 2019, Johnson & Johnson recalled about 33,000 bottles of its baby powder after the U.S. Food and Drug Administration said a laboratory test found a small amount of asbestos in one bottle. Johnson & Johnson said, “it issued the recall out of an abundance of caution and said subsequent testing of the same bottle and lot by different labs found no asbestos.” In May, they stated that they will stop selling talc-containing baby powder and continue to sell a cornstarch-based version of Johnson’s Baby Powder in the U.S. and Canada.
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Johnson & Johnson’s Baby Powder Showing Talc as an Ingredient |
Johnson & Johnson has been selling talcum-based baby powder since 1894. However, America’s litigation-friendly legal system subjected the company to an abundance of baby-powder lawsuits, making it too expensive to sell in the U.S. The first wave of lawsuits alleged that the product caused ovarian cancer – a claim the best medical science doesn’t support. A January study in the Journal of the American Medical Association followed more than 250,000 American women for 11 years and found no significant ovarian-cancer risk associated with talcum-powder use. The Centers for Disease Control and Prevention does not list talc as an ovarian-cancer risk. The Food and Drug Administration has consistently found insufficient evidence to mandate an ovarian-cancer warning label on talcum powder.
An FDA determination that a product is safe doesn’t usually preclude litigation alleging otherwise. Between 2016 and 2018, five different juries in St. Louis returned verdicts totaling almost $5 billion. More-recent talcum-powder lawsuits have invoked a new theory of harm. Asbestos, once ubiquitous in-home insulation, has been definitively linked to the lung cancer mesothelioma – leading asbestos litigation to become the largest and longest-running mass tort in the U.S. Despite longstanding efforts by Johnson & Johnson and other manufacturers to eliminate asbestos entirely from consumer products, a small number of tests over the past five decades have detected some asbestos in talcum powder samples. As a result, asbestos lawyers have Johnson & Johnson as their latest deep-pocketed corporate defendant as other lawsuits bankrupted all the actual asbestos manufacturers long ago. |
Asbestos
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An executive at Johnson & Johnson said the main ingredient in its best-selling baby powder could potentially be contaminated by asbestos, the dangerous mineral that can cause cancer.
He recommended to senior staff in 1971 that the company “upgrade” its quality control of talc. Two years later, another executive said the company should no longer assume that its talc mines were asbestos-free. The powder, he said, sometimes contained materials that “might be classified as asbestos fiber.” Johnson & Johnson then demanded that the government block unfavorable findings from being made public. The company continuously defends the safety of its baby powder, saying that “it has never contained asbestos and that the claims are based on junk science.” Johnson & Johnson says that the lawyers in the cases have “cherry-picked” the memos, and that they instead conveniently show the company’s focus on safety. Several lab tests, some conducted in the past few years by plaintiffs’ lawyers, have found evidence of asbestos in talc. The link between asbestos and ovarian cancer was first reported in 1958, and in 2011, the International Agency for Research on Cancer said it was a cause. Johnson & Johnson’s efforts to mitigate the debate over its baby powder continue today. The company has sought to have documents used in court sealed, hired lawyers known for their work in crisis management and created a website to extol talc’s safety. |
Talc: Magnesium Silicate |
Talcum powder is made from talc, a mineral made up mainly of the element’s magnesium, silicon, and oxygen. As a powder, it absorbs moisture well and helps cut down on friction, making it useful for keeping skin dry and helping to prevent rashes. In its natural form, some talc contains asbestos, a substance known to cause cancers in and around the lungs when inhaled.
Researchers use two main types of studies to try to figure out if a substance or its exposure causes cancer: lab studies and studies in people. In most cases neither type of study provides enough evidence on its own, so researchers usually look at both lab-based and human studies when trying to figure out if something causes cancer. It has been suggested that talcum powder might cause cancer in the ovaries if the powder particles were to travel through the vagina, uterus, and fallopian tubes to the ovary. One of the problems with studying this issue is that ovarian cancer isn’t common. Correspondingly, even the largest studies done so far might not have been big enough to detect a very small increase in risk, if it exists. No increased risk of lung cancer has been reported with the use of cosmetic talcum powder. One study suggested genital talcum powder use may slightly increase the risk of endometrial (uterine) cancer in women who are past menopause. But other studies have not found such a link, therefore further studies are needed to explore this topic. Several national and international agencies study substances in the environment to determine if they can cause cancer. The International Agency for Research on Cancer (IARC) classifies the perineal (genital) use of talc-based body powder as “possibly carcinogenic to humans” based on limited evidence from human studies. The U.S. National Toxicology Program (NTP) has not fully reviewed talc (with or without asbestos) as a possible carcinogen. In the end, there is very little evidence at this time that any other forms of cancer are linked with consumer use of talcum powder. Until more information is available, people concerned about using talcum powder may want to avoid or limit their use of consumer products that contain it.
A series of decisions made in multiple courts across the country have gone against Johnson & Johnson in the talcum powder litigation. Most recently, on August 5th, 2020, a New Jersey state appeals court reinstated lawsuits dismissed four years ago that claimed Johnson & Johnson’s talcum powder products caused ovarian cancer. The lawsuits were revived after the New Jersey court determined that the plaintiffs’ experts’ opinions should not have been dismissed. In reversing the lower court’s 2016 decision, the appellate court found that Judge Nelson improperly assessed the experts’ credibility and did not scrutinize the methodologies underlying their conclusions that talc exposure can lead to ovarian cancer. This reversal reinstated hundreds of ovarian cancer cases against Johnson & Johnson in the Atlantic County Superior Court in New Jersey. In the past few years, numerous juries concluded that Johnson & Johnson’s talcum powder products caused ovarian cancer and issued multi-million and even multi-billion-dollar verdicts.
In April 2020, a New Jersey jury charged Johnson & Johnson with a $750 million verdict in punitive damages alleging their Baby Powder caused mesothelioma in four individuals. In September 2019, a jury in New Jersey awarded over $37 million in damages to four individuals who claimed they developed mesothelioma after being exposed to asbestos-contaminated Johnson & Johnson products. The Missouri Court of Appeals issued a verdict in July of 2018 ordering Johnson & Johnson to pay $4.69 billion, which was ultimately reduced to $2.1 billion in June 2020. The verdict noted that Johnson & Johnson’s talcum powder caused cancer in 22 women, and that the corporation failed to properly warn consumers of the potential negative effects of using talc. In April 2018, a New Jersey jury awarded a verdict totaling $117 million to an individual who claimed using Johnson & Johnson’s Baby Powder and Shower to Shower products caused his mesothelioma. |
Johnson & Johnson’s Baby Powder and Shower to Shower product |
In August 2017, a plaintiff was awarded $417 million by a California jury after claiming her use of Johnson & Johnson products for decades caused her ovarian cancer. In May 2017, a jury in Missouri awarded an individual $110 million in both compensatory and punitive damages. In October 2016, a Missouri jury awarded an individual $70 million in damages after she developed ovarian cancer from using Johnson & Johnson’s talc powder. In one of the first ovarian cancer verdicts against Johnson & Johnson back in February 2016, a Missouri jury awarded a late plaintiff’s family $72 million after the plaintiff passed away from cancer she claimed she developed after using their talc powder. After decades of Johnson & Johnson falsely misleading consumers and the FDA about the impact of asbestos-contaminated talc on public health, thousands of affected consumers are seeking justice after developing cancer.
Stakeholders
Johnson & Johnson holds their relationships with its stakeholders very highly. By being attentive and responsive to stakeholders, Johnson & Johnson can gain new insight that may advance business planning. This is achieved by listening to stakeholder feedback in areas they believe need improvement in, and by building trust with them through these interactive relationships. Johnson & Johnson engages with their stakeholders on a global, regional and local level to understand their expectations and how the company’s activities impact them. Some of their global, regional and local stakeholders include the Advanced Medical Technology Association, Consumer Healthcare Products Association, National Health Council (U.S.), and U.S. Chamber of Commerce. Johnson & Johnson also deploys a customer relationship management system to support consistency and visibility of engagement initiatives. The Food and Drug Administration (FDA) are also stakeholders in the talcum-powder recall. They are a part of the company’s ongoing testing and investigation to ensure their products are continuing to be safe for consumers. Individualism
Individualism is a business ethics theory that values the business, the owner’s choices, and business profits. This theory was created by Nobel-Prize winning economists Milton Friedman. Friedman states that “it is the aim and the responsibility of businesses to maximize their profits” (Salazar 17). In other words, owners of a business have an ethical responsibility to design business actions that maximize profits for the business but do so within the law.
An individualist would say that Johnson & Johnson did not maximize profits for the business within the law. They failed to inform the public and their stakeholders about the scientific findings of their baby powder, which resulted in the company losing a lot of money through lawsuits. The global recalls damaged the future of the product line. The negative publicity of the company also added a long-term damage on the brand. Therefore, it will be difficult for the owners of the company to recover financially. However, an individualist would not consider Johnson & Johnson’s actions as ethically wrong. The company replaced their talcum-based powder with cornstarch-based powder which will help them carry on with sales. The government on the other hand has the ethical responsibility to confirm a products safety. There are associations put in place that are supposed to enforce these safety standards before a product is placed on the market. Thus, an individualist cannot place this “blame” on Johnson & Johnson. Utilitarianism
Utilitarianism is another business ethics theory which values happiness of all conscious beings with the absence of pain. This theory was created by Jeremy Bentham in the 1800’s but was popularized by John Stewart Mill. Mill states that “they measure the costs and benefits of various actions and principles not just for their impact on one individual or one company, but rather for all beings who are affected by the actions proposed or taken” (Salazar 19). With that being said, owners of a business have an ethical obligation to design business actions that aim to maximize the happiness for all conscious beings in the long run.
A Utilitarian would say that Johnson & Johnson is unethical because of the consequences of their mistakes. They knew that talcum caused cancer and posed as a risk to the consumers, but they continued to sell the product anyways. Despite having this knowledge, they acquired many lawsuits against them and caused cancer in more than twenty-two women. Some of the women died from ovarian cancer after using Johnson & Johnson’s baby powder. Thus, going against the utilitarianism’s view that businesses should maximize happiness of all conscious beings with the absence of pain. At the time, Johnson & Johnson was only thinking about the happiness of the owners of the company. Correspondingly, their decision to replace the talcum-based powder was purely for their own capital gain. In the hope that the new Johnson & Johnson baby powder puts an end to the lawsuits and deaths, their initial actions were unethical and morally wrong.
Kantianism
Kantianism is the most popular business ethics theory that values rational decision-making, autonomy of individuals, honesty and freedom. This theory originated in the late 18th century by Immanuel Kant. Kant is concerned with “the moral permissibility of the action and the moral worth in the motivation of the action. In this case, an action is rational and permissible if it meets certain standards (Categorical Imperative) which reflect respect for the autonomy and rationality of all people. The most important aspect of the Categorical Imperative is the “formulation of humanity.” This states that “it is wrong to use people as a mere means to get what you want. It disregards their rationality and freedom and usually it involves an attempt to manipulate them” (Salazar 22). In the end, the owners of a business should always act in ways that respect individuals and their choices. They must do so without lying, cheating, manipulating, or harming individuals.
A Kantian would view Johnson & Johnson as unethical because they manipulated their consumers for many years. They failed to tell the public that their baby powder contained talc. What’s worse is that they kept the public misinformed by sealing all evidence that proved this was true. By selling their talcum-based powder without proper safety protocol, they were evidently implementing bad will. Johnson & Johnson had the wrong intentions which led them to treat consumers as a mere means in order to obtain a profit. Again, illustrating Johnson & Johnson as acting wrongly and disregarding consumers rationality. Granted that they removed talcum-based powder from the market, they only did so for the benefit of their stakeholders not for their consumers. They are hoping that consumers trust that the new powder is safe to use despite the hesitance to believe in the brand again.
Virtue Theory
Virtue theory is a business ethics theory that differs from the previous three theories. The virtue theory values character traits that promote wellness or flourishing of individuals within a society. This theory was developed by the Ancient Greek philosopher, Aristotle. Aristotle says that in order to know whether a person is fulfilling his purpose and potential, we need to know exactly what they are. Thus, owners of a business have the ethical responsibility to “act so as to embody a variety of virtuous or good character traits and so as to avoid vicious or bad character traits” (Salazar 23).
Under the virtue theory, Johnson & Johnson is considered unethical because they exhibited many bad character traits. First, the company was dishonest with their consumers when cases of ovarian cancer rose. Again, they kept information regarding testing of the baby powder in an attempt to increase profit. This follows the second bad character trait that Johnson & Johnson showed which was greed. The company hid these documents regarding testing during several of their trials in order to win the cases. Illustrating that all they care about is maximizing profits so that owners and stakeholders can benefit as well. Proving that they do not care about the safety and health of their consumers. Finally, Johnson & Johnson acted very selfishly when they released the cornstarch-based powder so that sales can continue and the investigation into talcum-based powder can stop. Overall, Johnson & Johnson is not a virtuous company and does not aid flourishing of individuals within society.
Justified Ethics Evaluation
In my opinion, Johnson & Johnson acted very unprofessionally and unethically. In order to avoid this situation, the company should have had their baby powder tested by the FDA right away. Johnson & Johnson also should have taken their talcum-based baby powder off the market as soon as their first consumer sued them. If they knew talcum could possibly cause ovarian cancer, then warning labels should have been added to the bottles as well. Instead, Johnson & Johnson ignored the safety protocol and only cared about making a profit. Knowing this, the FDA should have been more involved and customer safety should have been their top priority as they claimed it to be.
Once Johnson & Johnson started to develop negative publicity, they unethically continued to withhold information from the public. They continuously stated that their baby powder was safe to use even though the number of consumers claiming they were diagnosed with cancer increased. It ultimately made it tough for Johnson & Johnson to defend their company virtues and morality. By replacing their talcum-based powder, it only proved that they were trying to cover up their mistake of putting their consumers safety at risk. In the end, their unethical business actions costed lives and made them untrustworthy all because they focused more on their own self-interest.
Company Action Plan
Due to their mistakes, Johnson & Johnson’s talcum-based baby powder is too expensive to sell in the U.S. Not only did their actions cost them business partners, but also uncertainty for the future of the business. As I had previously stated, Johnson & Johnson should have first had the FDA approve the product before selling on the market. Next, they should have put warning labels on the baby powder bottles stating that talcum is an ingredient that may cause ovarian cancer. With that being said, Johnson & Johnson could have resolved the issue right away by selling cornstarch-based baby powder in the first place. In doing so, they could have avoided the negative publicity and the overall uncertainty of their products.
Johnson & Johnson’s current mission statement is “our credo stems from a belief that consumers, employees and the community are all equally important” (Johnson & Johnson). On the contrary, this mission statement is questionable due to their on-going controversy. Thus, a new mission statement is needed to ensure that they actually value the safety and future of their customers, employees and community. I propose that their new mission statement be “our credo stems from a belief that the safety and health of all consumers, employees and the community be our top priority built on honesty, compassion, and integrity.” This mission statement focuses on three points that lets the public know they are taking this issue seriously out of concern for their consumers and not just the profit they hope to gain back. In order to do so, Johnson & Johnson should market themselves as such.
Values:
· Honesty - in a company is as valuable as honesty in a person. It is important to be able to have trust and respect in a company that you deal with. It creates a positive atmosphere for all.
· Compassion - we understand what others are going through, we empathize with them, and we show them that we love and care for them. We selflessly want to do things to help them.
· Integrity - We uphold the highest standards of integrity in all of our actions. It promotes a professional culture in which individuals can depend on one another and treat each other with respect. We have no tolerance for politics, hidden agendas or passive-aggressive behavior.
· Customer Safety - Every effort will be made to ensure the safety of our Customers and team members. If an unsafe condition is noticed it is each and every team member’s responsibility to see it is resolved. We strive to exceed the expectations of our customers by anticipating, understanding and responding appropriately to their needs.
When a company states their mission and values, they need to not only state it but also prove that they will implement these changes. As one might say, actions speak louder than words. Therefore, Johnson & Johnson must put new systems in place to ensure their company will grow again. First, they should be in constant contact with the FDA ensuring that their products do not contain any ingredients that may cause another issue. Second, they need to hire someone who will monitor this communication with the FDA. Almost like a “checks and balances” type of system to oversee product safety. Lastly, they should implement a department that effectively collects data and suggestions from consumers or stakeholders. This is another way to ensure that everyone has a voice and place in the decisions of product safety. With these new policies, hiring of new employees will help the company flourish.
All things considered, Johnson & Johnson should look into remarketing their products due to the ethical difficulty they faced. This can be done through creating a new logo or new bottles the products are sold in. Although this may cost a lot, my plan will promote business profits and productivity. By implementing a new mission statement, values, policies, and marketing, Johnson & Johnson can reinstate their brand and ensure good ethics. Again, proving that their actions speak louder than words.
Magen L.
References
Copland, James R. “Opinion | Johnson & Johnson Takes a Powder.” The Wall Street Journal, Dow Jones & Company, 22 May 2020, www.wsj.com/articles/johnson-johnson-takes-a-
John. “Johnson & Johnson Mission Statement 2020: Johnson & Johnson Mission & Vision Analysis.” Mission Statement Academy, 11 June 2020, mission-statement.com/johnson-johnson/.
“Johnson & Johnson Position on Stakeholder Engagement.” 2020. PDF File.
https://www.jnj.com/about-jnj/policies-and-positions/our-position-on-stakeholder-engagement
“Johnson & Johnson Talcum Powder Litigation Continues to Grow.” Sullivan Papain Block McGrath Coffinas & Cannavo, P.C., www.triallaw1.com/johnson-johnson-talcum-powder-litigation-continues-to-grow/.
Loftus, Peter. “Missouri Court Cuts Talc-Powder Verdict Against J&J to $2.1 Billion.” The Wall Street Journal, Dow Jones & Company, 23 June 2020, www.wsj.com/articles/issouri-court-cuts-talc-powder-verdict-against-j-j-11592935876.
Rabin, Roni Caryn, and Tiffany Hsu. “Johnson & Johnson Feared Baby Powder’s Possible Asbestos Link for Years.” The New York Times, The New York Times, 15 Dec. 2018, www.nytimes.com/2018/12/14/business/baby-powder-asbestos-johnson-johnson.html?searchResultPosition=3.
Salazar, Heather. The Business Ethics Case Manual. n.d.
“Talcum Powder and Cancer.” American Cancer Society, www.cancer.org/cancer/cancer-causes/talcum-powder-and-cancer.html.
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