J&J Feeling the Pain with Immodium – Another Recall
May 22nd, 2012 // 1:30 pm @ jmpickett
Just one month after becoming Johnson & Johnson ceo, Alex Gorsky is presiding over a product recall, the latest in an endless stream of such actions taken by the health care giant over the past two years. This time, the McNeil Consumer Healthcare unit, which has been responsible for the majority of recalls, is yanking 53,892 packages – or one lot – of Immodium, the over-the-counter medicine for diarrhea, gas, bloating and cramps.
Why? A McNeil spokeswoman tells us there was a “packaging issue†that may have allowed “a limited number of blister units†to be exposed to air, potentially robbing consumers of the full benefit of the medicine. Despite the flub, she maintains the Immodium track record is otherwise quite good – more than 2.75 million packages have been made over the past five months without any other difficulties (here is the recall info).
Nonetheless, the recall serves as a reminder of the systemic problems that have caused J&J to withdraw tens of millions of over-the-counter meds, contact lenses, epilepsy drugs and hip replacement devices, among other items. There have also been embarrassing shortages of Tampons and shampoos. Manufacturing gaffes have also led to an FDA probe and a consent decree; highly publicized congressional hearings; a closed plant and accompanying job losses; managerial changes; eroded consumer confidence; various lawsuits and hundreds of millions of dollars in lost sales.
The ongoing difficulties have been especially troubling for the McNeil business, which suffered a 2.4 percent drop in sales during the first quarter as every product segment in the unit experienced revenue setbacks. The tumbling financial performance was reported along with the not-so-surprising news that a Fort Washington, Pennsylvania, plant – which is being reborn – will not open until at 2014, more than a year later than J&J execs previously forecast (see this).
The continual setbacks led to regular calls for former ceo Bill Weldon to resign, although he stubbornly clung to a succession timetable that culminated in naming Gorsky, who previously ran the medical device and diagnostics business, to occupy the proverbial corner office. However, the change drew some criticism if only because Gorsky has been part of the same executive team that has presided over the companywide manufacturing and quality failures.
Last month, upon succeeding Weldon, who remains chairman, Gorsky held select media interviews in which he talked up his determination to overcome these problems and that doing so successfully is a key priority. He is now being tested. Meanwhile, perhaps he should be thankful that most Immodium has been manufactured without a glitch. If the number and pace of recalls do not end anytime soon, he may need that Immodium himself.
