US pharmaceutical giant Johnson & Johnson on Tuesday proposed to pay a nearly $9bn settlement to resolve years-long lawsuits it faces in North America that claim that the company’s baby powder and other talc-based products cause cancer.
The New Jersey-based company said the proposed settlement, which still needs court approval, "will equitably and efficiently resolve all claims arising from cosmetic talc litigation."
The company said it still believed the claims were "specious" but was hoping the new settlement offer would help conclude its legal battle.
The healthcare giant is facing more than 40,000 lawsuits from former customers who said that its talc-based baby powder caused cancer, including some who allege the product contained cancer-causing asbestos.
The company stopped US sales of its talc-based baby powder in 2020, citing "misinformation" that cut down the demand for the product, applied to prevent nappy rash and for other cosmetic uses, including dry shampoo. Last year, it announced plans to end sales globally.
Johnson and Johnson until then had sold baby powder for almost 130 years. It continues to sell a version of the product that contains cornstarch.
The company has been trying to resolve the lawsuits in bankruptcy court since 2021, after creating a subsidiary responsible for the claims.
Under a proposal announced Tuesday, a J&J subsidiary will re-file for Chapter 11 bankruptcy protection and seek court approval for a plan that would reportedly, result in one of the largest product-liability settlements in US history.
The $8.9 billion that the company would transfer to the subsidiary, LTL Management, would be payable over the next 25 years. The amount is up from the $2 billion that the New Brunswick, New Jersey, company set aside in October 2021.
The revised amount is being backed by more than 60,000 parties that have filed lawsuits alleging harm from Johnson and Johnson’s talcum powder, according to the company.
The lawsuits filed against the company alleged its talcum powder caused users to develop ovarian cancer, through use for feminine hygiene, or mesothelioma, a cancer that strikes the lungs and other organs.