J&J declares share buybacks after shedding $50 billion in market worth

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Johnson & Johnson plans to repurchase $5 billion in shares after the corporate misplaced greater than $50 billion in market worth over two buying and selling days following a scathing information report Friday.

Reuters revealed an in-depth report that mentioned the corporate knew for decades its talc child powders contained asbestos and didn’t disclose it. The article drove J&J’s shares down 10 p.c for the day. It shaved almost $40 billion from its market value in what was their worst buying and selling day in additional than 15 years. The shares misplaced one other 2.9 p.c Monday.

In complete, J&J misplaced greater than $50 billion over the 2 buying and selling days.

“Based mostly on our continued sturdy efficiency and, extra importantly, the boldness now we have in our enterprise going ahead, the Board of Administrators and administration workforce imagine that the corporate’s shares are a gorgeous funding alternative,” CEO Alex Gorsky mentioned in a press release.

Practically 12,000 lawsuits accuse J&J’s talc child powder of inflicting mesothelioma, ovarian and different forms of cancers. Some juries have sided with J&J and others have been unable to succeed in verdicts. A Missouri jury in July ordered J&J to pay $four.69 billion in a case involving 22 ladies and their households. A choose affirmed the decision in August, and J&J vowed to attraction it.

The corporate has strongly denied the allegations within the Reuters story and has vigorously defended its talc child powder.

CEO Alex Gorsky advised clients in video posted on its web site and social media Monday that J&J stands behind its product. He mentioned if it wasn’t protected, it would not be on retailer cabinets. J&J has additionally began operating advertisements in newspapers and on information web sites with the tagline, “Science. Not sensationalism.”

The corporate mentioned repurchases could also be made at any time and have been at administration’s discretion.