Drugmaker Johnson & Johnson (JNJ) is planning to place liabilities from the Baby Powder litigation into a newly created business that would then seek bankruptcy protection, Reuters stated in a report.
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The litigation is related to allegations from tens of thousands of plaintiffs that its Baby Powder and other talc products contained asbestos and caused cancer.
During settlement discussions, one of J&J’s attorneys told plaintiffs’ lawyers that the company could pursue the bankruptcy plan, which could result in lower payouts for cases that do not settle beforehand, some of the people said.
In a statement to Reuters, J&J subsidiary housing the company’s talc products said, “Johnson & Johnson Consumer Inc. has not decided on any particular course of action in this litigation other than to continue to defend the safety of talc and litigate these cases in the tort system, as the pending trials demonstrate.” (See J&J stock chart on TipRanks)
Following the release of positive data regarding the company’s single-shot vaccine, Cantor Fitzgerald analyst Louise Chen on July 2 reiterated a Buy rating on the stock with a price target of $200 (19% upside potential from current level).
Chen is of the opinion that the newly announced data reveals that J&J’s innovation is underappreciated.
TipRanks data shows that financial blogger opinions are 95% Bullish on JNJ, compared to the sector average of 69%.
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