"The transition to new management will hopefully help J&J focus on rectifying its manufacturing problems," said George Sillup, professor of pharmaceutical marketing at St. Joseph's University and a former J&J executive. But, Sillup notes, J&J is a huge operation with $65 billion in revenue, and reputations - good or bad - don't change quickly. "The concern with that is, once you start going wrong, you can't turn the battleship. That is very difficult to recoup."
The challenge is not only in the more well-known consumer divisions. J&J has issues in pharmaceuticals and medical devices.
One example is the antipsychotic drug Risperdal, J&J's third-best-selling prescription medication, which had sales of $1.6 billion in fiscal 2011.
J&J's subsidiary Janssen makes Risperdal. Gorsky, who started as a Janssen sales rep, was leading the company in the early 2000s when problems with the drug first came to light.
In January, the company paid $158 million to settle allegations - first made in Pennsylvania by whistle-blower Allen Jones - that the company illegally promoted Risperdal for unapproved use in children and adolescents, in part by paying Texas Medicaid officials to give it preferential treatment.
Such episodes would run counter to J&J's official credo that says the company's "first responsibility is to the doctors, nurses, and patients, to mothers and fathers and all others who use our products and services." After mentioning employees and communities, "our final responsibility" is to shareholders.
"After settlement was announced in the Austin courtroom, I had a brief, congenial conversation with J&J's corporate representative," Jones said last week when asked about the CEO change. "I asked him to please go back to his company and fix things - to try to make the J&J Credo mean something again. I sincerely hope that J&J has the same desire and that this is a step in that direction."
The litigation is not over, not by a long shot. J&J said last week in a filing with the Securities and Exchange Commission that the company started 2012 with 10,415 lawsuits pending, including 420 involving Risperdal. Besides other state battles, J&J said in the SEC filing, it is negotiating with the federal government to settle civil and criminal allegations of improper marketing. That bill might run beyond $1 billion. Then there are individual suits, 63 of which are being argued by Philadelphia lawyer Stephen Sheller's firm.
In court filings, Sheller has argued - unsuccessfully so far - that evidence of negative clinical data provided by J&J in discovery should be forwarded to the FDA with the idea that Risperdal would be pulled from the market because of negative side effects.
"I hope they've had an epiphany and will do the right thing," Sheller said of paying the plaintiffs, some of whom rely on taxpayer-funded Medicaid to provide health care, including for diabetes and gynecomastia (enlarged breasts in boys , which are some of the possible side effects of Risperdal.
Gorsky got the job in part because he was in charge of J&J's DePuy medical-device unit and was intimately involved in J&J's pending $21.3 billion acquisition of Synthes Inc., another device-maker, with several facilities in Chester County. Before J&J made the largest purchase in its history, Gorsky met several times with Synthes chairman Hansjorg Wyss in 2010 when Wyss was looking to sell his company. At the same time, Synthes was preparing to settle criminal and civil charges involving illegal human testing of one of its products, a bone cement.
DePuy is facing lawsuits over recalled replacement hips. Now, integrating Synthes with DePuy will not be easy, and the device market has been hurt by the recession in the United States and Europe.
J&J's challenges were the subject of a recent article in the online periodical
Knowledge@Wharton from the Wharton School of the University of Pennsylvania. The article's title: "Patients Versus Profits at Johnson & Johnson: Has the Company Lost Its Way?"
Gorsky holds an M.B.A. from Wharton.
In the article, a Wharton professor of legal studies and business ethics, Thomas Donaldson, gave J&J credit for taking steps to fix manufacturing plants, but said J&J managers were having to juggle a lot of balls.
Haldol won the trial hands down – one of several examples of Astrazeneca suppressing it’s own studies because they didn’t play well with their marketing strategy [PsychRights has a treasure trove of equally incriminating documents]. As we know, Seroquel went on to be FDA approved with extension for a variety of conditions. It’s now the most lucrative of the Atypical Antipsychotics, themselves the most lucrative drugs in the American pharmacopeia.
It’s been 15 years, and the damage from AstraZeneca’s deceit is still being felt…
previously reported here on RedOrbit.com, one of those three drugs, Qnexa, received approval from a panel of FDA advisors on Thursday by a 20-2 margin. That verdict placed Qnexa, a combination of the appetite suppressant phentermine and the anti-seizure and migraine drug topiramate that is manufactured by Vivus, one step closer to reaching the market. According to the Associated Press (AP , "topiramate is believed to make patients feel more satiated." When the medication was rejected previously, the FDA asked Vivus for additional clinical data on the drug's potential impact on major cardiovascular events and birth defects. Studies have also shown that topiramate use during pregnancy can increase the risk of birth defects, including oral clefts. One question the advisory committee considered is whether or not Vivus should be required to conduct a large new clinical trial before the medicine receives final approval, in order to determine whether the drug can increase a person's risk of heart attack. Vivus is requesting permission to conduct the study after receiving approval, in the hopes of avoiding additional delays which could last several years. "Many experts view the combination pill as the most promising of the new weight loss drugs, due to studies showing most patients lost nearly 10 percent of their weight -- the highest reduction reported with any recent diet pill," the AP wrote. A second ruling on the drug is expected by April 17, the news agency added. The other two medications up for approval are Orexigen Therapeutics' Contrave, a combination of an antidepressant and an anti-smoking drug believed to curb appetite, and Arena Pharmaceutical's lorcaserin, which stimulates serotonin receptors in the brain in order to make people feel fuller. The AP describes Contrave's results as "lackluster." Approximately 40% of those taking the medication losing 5% of their body weight -- barely allowing the medication to qualify as an effective weight loss pill under the FDA's minimum requirements, according to the wire service. There are also cardiovascular concerns surrounding Contrave, leading the FDA to order a 10,000-patient heart health study scheduled to be completed in two years' time. "Lorcaserin has faced the most severe safety questions from FDA, which rejected the drug in 2010 after raising concerns about cancerous tumors seen in rats who received the drug," the AP said. "Early this year Arena submitted new information evaluating the link between its drug and cancer. The FDA is scheduled to make a new ruling on the drug by June 27." --- On the Net:
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