Johnson & Johnson Hit as Jury Awards 'Excessive' $8 Billion in Damages

The New York Times Finance 2 months ago

(Reuters) - Shares of Johnson & Johnson dipped 2% on Wednesday after a jury awarded $8 billion (6.55 billion pounds) in punitive damages to a man who accused the drugmaker of failing to warn that young men using its antipsychotic drug Risperdal could grow breasts.

Analysts called the amount excessive, particularly since the plaintiff, Nicholas Murray, had already won $680,000 in compensatory damages over his claims.

But several said that J&J's shares were now exposed to fears among investors that it would be hammered by further litigation costs as it battles other claims over Risperdal, its opioid treatments and talcum powder.

"It's definitely a disproportionate award," Bernstein analyst Lee Hambright said, noting that the FDA-approved label for the drug does mention breast growth as a side effect.

"(But) I think the stock reaction shows how sensitive investors are about litigation-related concerns for Johnson & Johnson."

Wells Fargo analyst Lawrence Biegelsen said the $8 billion figure will "almost certainly be reduced".

"The Supreme Court has said it should be a single digit ratio between compensatory and punitive damages," he said.

"The important number here is the compensatory damages."

J&J said the award was "grossly disproportionate with the initial compensatory award" and said it was confident it would be overturned.

The Philadelphia Court of Common Pleas verdict was the first in which a Pennsylvania jury had been able to consider awarding punitive damages in one of thousands of Risperdal cases pending in the state.

In 2013, Johnson & Johnson paid more than $2.2 billion to resolve civil and criminal investigations by the U.S. Department of Justice into its marketing of Risperdal and other drugs.

According to a recent filing, the company faces some 13,400 lawsuits tied to Risperdal, which allege the drug caused a condition called gynecomastia in boys, in which breast tissue becomes enlarged.

Risperdal was approved by the U.S. Food and Drug Administration in 2002 to treat schizophrenia, but was not cleared for use in children until 2006.

While the drug's label does note that gynecomastia was reported in 2.3% of Risperdal-treated patients in clinical trials involving 1885 children and adolescents, the lawsuits generally claim the company understated the risk. 

Johnson & Johnson is also among drugmakers named in lawsuits seeking to hold the pharmaceutical industry responsible for the nation's opioid crisis and in August was asked to pay $572.1 million to the state of Oklahoma for its role in fuelling the epidemic.

(Reporting by Tamara Mathias in Bengaluru; editing by Patrick Graham)


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One America News Network › Finance › 2 months ago
By Tamara Mathias (Reuters) - Shares of Johnson & Johnson dipped 2% on Wednesday after a jury awarded $8 billion in punitive damages to a man who accused the drugmaker of failing to warn that young
Reuters › Finance › 2 months ago
Shares of Johnson & Johnson dipped 2% on Wednesday after a jury awarded $8 billion in punitive damages to a man who accused the drugmaker of failing to warn that young men using its antipsychotic drug Risperdal could grow breasts.
CNN › 2 months ago
Johnson & Johnson will have to pay $8 billion in punitive damages after a man claims the company didn't warn young men that the drug Risperdal could grow breasts, a jury said Tuesday, according to Reuters.
The New York Times › Finance › 2 months ago
Johnson & Johnson must pay $8 billion (6.6 billion pounds) in punitive damages to a man who previously won $680,000 over his claims that it failed to warn that young men using its antipsychotic drug Risperdal could grow breasts, a Philadelphia jury...
New York Daily News › 2 months ago
On Tuesday, a Philadelphia jury decided that Johnson & Johnson must pay $8 billion in punitive damages to Nicholas Murray, who alleged in a lawsuit that a drug manufactured by the company caused him to grow breasts.
The Wall Street Journal › Finance › 2 months ago
A Philadelphia jury on Tuesday ordered Johnson & Johnson to pay $8 billion in damages to a man who said his use of J&J’s antipsychotic Risperdal caused enlarged breasts.
The New York Times › 1 month ago
A federal jury has found that an anti-abortion activist illegally secretly recorded workers at Planned Parenthood clinics and is liable for violating federal and state laws. The jury ordered him and others to pay nearly $1 million in damages.
Reuters › Finance › 2 months ago
Johnson & Johnson must pay $8 billion in punitive damages to a man who previously won $680,000 over his claims that it failed to warn that young men using its antipsychotic drug Risperdal could grow breasts, a Philadelphia jury said on Tuesday.
Business Insider › Finance › 2 months ago
A Philadelphia jury ruled Johnson & Johnson must pay $8 billion in damages to a man claiming the company didn't properly warn male consumers its Risperdal drug could prompt breast growth. The company's stock fell as much as 1.5% on Wednesday following...
UPI › Finance › 2 months ago
A Philadelphia jury has ordered healthcare giant Johnson & Johnson to pay $8 billion in damages to a Maryland man who developed female breast tissue after taking anti-psychotic drug Risperdal as a child.
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