J&J says area plant on schedule to reopen

Recalled products from J&J's closed McNeil unit in Ft. Washington.
Recalled products from J&J's closed McNeil unit in Ft. Washington. (Bloomberg)
Posted: April 18, 2013

Though its Fort Washington plant is still being repaired, and overall profit fell 10.6 percent to $3.5 billion in the first quarter of 2013, Johnson & Johnson said Tuesday that it has put more Tylenol and Motrin on store shelves in the United States through its McNeil Consumer Healthcare unit.

"We are pleased with results in our consumer division, with over-the-counter sales in the U.S. up 14 percent," J&J chief financial officer Dominic Caruso said in a conference call with stock market analysts.

J&J's consumer division includes products from outside the domain of the McNeil Consumer Healthcare unit, which has its headquarters and idle factory in Fort Washington, Montgomery County. J&J is based in New Brunswick, N.J., and it has multiple divisions in the Philadelphia region.

Besides the facilities in Fort Washington, McNeil Consumer Healthcare also has plants in Lancaster and in Las Piedras, Puerto Rico. Those plants are operating under closer scrutiny because of production problems that led to dozens of recalls and the Fort Washington closure in 2010.

"We had a rollout of products in the marketplace," Caruso said of better sales, "and we had a quote 'healthy' cold and flu season, from our perspective."

When more people get colds and suffer from the flu, health-care companies such as J&J sell more prescription medicine and over-the-counter products.

As for McNeil, employees show up every workday in Fort Washington. J&J is spending $100 million on repairs at the factory portion of the facility, which the U.S. Food and Drug Administration and a federal judge must approve before production can resume.

Caruso did not update the timetable for Fort Washington production to start again, but previous estimates were late 2013 or early 2014. A company spokesman later confirmed that remains the timetable.

Caruso said the company hoped to have about 75 percent of products back to shelves by the end of 2013.

"We'll do what we can to invest behind the brands," Caruso said of advertising and promotion that would follow resumption of reliable supplies.

Quarterly profit was hurt in part because J&J took a $600 million charge to deal with litigation and the integration of Synthes, the medical-device manufacturer in West Chester that J&J acquired in June for $19.7 billion.

J&J faces thousands of lawsuits related to hip and vaginal mesh implants, along with investigations regarding how it marketed its antipsychotic drug Risperdal. J&J is also adjusting to reimbursement changes through state Medicaid systems.

Synthes sales helped J&J, but Caruso said the company did not expect big increases in health-care spending.

"Hospitals," he said, "are predicting lower levels of procedure volume."


Contact David Sell

at 215-854-4506 or dsell@phillynews.com,

or follow on Twitter @phillypharma.

Read his blog at www.philly.com/phillypharma.

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