- On Tuesday, a Philadelphia jury ordered Johnson & Johnson pay $8 billion in punitive damages to a Maryland man, whose lawyers argued the big pharma illegally marketed its blockbuster antipsychotic drug, Risperdal, and downplayed the side effect that young men using it could grow breasts.
- The multi-billion dollar decision is the first Risperdal case in which the jury could consider punitive damages, following a court ruling last year that opened up that possibility for plaintiffs. J&J is facing lawsuits representing approximately 13,400 people with claims tied to Risperdal, according to the pharma's latest quarterly financial filing.
- J&J blasted the verdict in a Tuesday statement, calling it "grossly disproportionate," "excessive" and "unfounded." The Maryland man, Nicholas Murray, was previously awarded $680,000 in a compensatory award. Few punitive damages that exceed a single-digit ratio between those two figures are upheld upon appeals, with judges often lowering the amount, according to a legal expert cited by Reuters.
Johnson & Johnson's legal liabilities are spread across the corporation's wide product offerings, including its pharmaceuticals, medical devices and even its baby powder.
Combined, the company is facing lawsuits from more than 100,000 patients with direct claims of injuries from J&J's products, according to the company's latest regulatory filing. That figure only includes cases listed by J&J as "most significant," and doesn't include other lawsuits, such as the more than 2,000 suits from state and local governments over its marketing of opioids.
Last year, a jury said J&J must pay $4.69 billion to resolve claims brought by 22 women over cancer risks tied to its talcum powder, a verdict the company plans to appeal. And a couple months ago, an Oklahoma judge ordered the company pay $572 million for its role in contributing to the opioid crisis in the state.
The story of J&J's off-label marketing and subsequent legal maneuvering related to Risperdal (risperidone) was told in detail by journalist Steven Brill in a 15-part, 58,000-word report for The Huffington Post.
Brill's reporting recounted how J&J targeted the drug to elderly and children, despite label restrictions against those populations. By 2000, more than 20% of Risperdal prescriptions were going to children and adolescents, and the company also employed a salesforce, dubbed ElderCare, to market the drug to seniors, he reported.
J&J CEO and chairman Alex Gorsky managed the sales team for Risperdal during that time, before he was promoted to president of Janssen in 2001.
In 2013, J&J finalized settlements with the Justice Department and 45 states over federal investigations and state Medicaid claims on the drug, agreeing to pay roughly $2.2 billion in penalties.
At the time of Brill's reporting, the antipsychotic drug had earned more than $30 billion in sales for the company. And Gorsky, despite his involvement in overseeing Risperdal sales, was promoted to CEO in 2012, a year before the DOJ deal was finalized.
Shares in J&J dipped 2% by mid-day Wednesday in response to news of the verdict. J&J will report third quarter results next Tuesday, Oct. 15.