History of problems

The rationale behind FDA's strong action against McNeil and its leaders may have to do with the fact that McNeil's facility shutdown and product recalls are just the latest in a string of regulatory compliance failures. The May hearing before the House Oversight and Government Reform Committee did little to improve J&J's image. The only good news for the company is that FDA agreed no one had died as a result of taking the recalled adulterated products, and that McNeil's violations probably did not represent a major risk to public health.

Instead of convincing legislators that it was taking forceful action to solve its quality control problems, however, the company faced even more criticism from members of Congress. Committee Chairman Edolphus Towns (D-NY) raised questions about a "phantom" recall of the painkiller Motrin in 2008, a company strategy apparently designed to avoid an official public recall of certain Motrin products experiencing dissolution problems. McNeil hired an outside firm to retrieve thousands of convenience-size packages of the drug from retailers' shelves. When FDA discovered what was going on, it insisted on an actual recall, explained FDA's Sharfstein, adding that the agency felt the incident reflected poorly on the company.

To make sure that FDA's message was reaching top J&J executives, FDA took what Sharfstein described as an "extraordinary step" of holding a meeting with senior executives from the parent company as well as from McNeil to spell out the agency's concerns. At this meeting in February 2010, FDA officials questioned J&J's oversight of McNeil, noting that its subsidiary failed to report material information to FDA, misstated product risks and benefits, and took a reactive—not proactive—approach to product quality problems. FDA expressed its concerns about "whether the company's corporate culture was appropriately focused on product quality issues," Sharfstein added.

Despite efforts to address these issues, McNeil continued to experience manufacturing and quality problems. A product recall in March 2010 was caused by defective bottles and labels. And when McNeil found particulates in some of its products, along with other manufacturing and quality problems, it shut down the Ft. Washington facility and launched a recall of some 136 million bottles of children's medicines. Although the company initially expressed optimism about quickly correcting its problems, J&J acknowledged in June that the Pennsylvania plant would not reopen this year. The long-term shutdown affects products that generate more than $600 million in annual sales and prompted negative financial assessments on Wall Street. The company also expanded its recall to include additional over-the-counter products made in Puerto Rico.

At the same time, House Oversight Committee Chairman Towns moved to schedule a second hearing to query J&J chairman William Weldon directly about the company's manufacturing problems and phantom recall activity. Weldon sent a substitute to the May hearing, claiming he was still recuperating from back surgery. But Towns and his colleagues want to hear directly from Weldon as to the nature of and responsibility for the company's violations and compliance missteps. After the May hearing, Towns complained that J&J was not cooperating with the committee's investigation, and suggested he might issue subpoenas or take other action to obtain complete information.