Healthcare Giant faces $5.5 Billion Blow over Baby Powder Cancer Claims

Around 76,000 claims are expected to be covered across federal and state courts. The agreement will only take effect if it gains approval from 95% of eligible claimants. The long legal fight placed J&J’s iconic baby powder product under intense scrutiny. While the company consistently denied that its talc products cause cancer, it has agreed to settle the claims to move beyond years of courtroom battles and focus on its healthcare operations.

Under the proposed agreement, J&J is expected to pay around $3 billion in 2027, followed by additional payments in 2028. The total financial impact could climb even higher, with plaintiffs’ lawyers estimating the payout may eventually exceed $7 billion, depending on the number of participating claimants.

The agreement covers almost all remaining talc-related lawsuits, including cases consolidated in federal court in New Jersey and other state-level claims. It follows earlier settlements involving allegations that J&J talc products were connected to mesothelioma.

The legal battle produced series of dramatic developments, with J&J securing several courtroom victories, including successful challenges to expert witnesses and rulings that questioned evidence presented by plaintiffs. Despite those wins, the company opted for a settlement to bring greater certainty to the dispute.

J&J also ended sales of its talc-based baby powder in the United States in 2020, replacing it with a cornstarch-based formula. The company’s previous attempts to resolve the litigation through bankruptcy proceedings involving a subsidiary were rejected by courts.

Unlike those earlier bankruptcy efforts, the latest settlement would address only existing claims and would not shield the company from future lawsuits. Lawyers involved in the negotiations said the agreement could speed up compensation, with payments potentially reaching claimants within 18 months instead of stretching over years of further litigation.