J&J CEO Gorsky commits to OTC plant tied to recalls
A consent decree and a $100 million investment to upgrade its key OTC plant have not led Johnson & Johnson ($JNJ) to give up on its Fort Washington, PA, operations, CEO Alex Gorsky told investors today.
The company is "absolutely committed" to resolving manufacturing problems at its McNeil Consumer Healthcare division's Fort Washington plant and two other facilities and getting its products back on retail shelves, The Philadelphia Inquirer reports.
McNeil in 2011 signed the FDA consent decree after two years in which J&J recalled tens of millions of consumer products, including its popular Tylenol products, that were manufactured at three plants. J&J closed and is gutting its Fort Washington facility and has said it will invest more than $100 million to retool it. Improvements also are being made at plants in Lancaster, PA, and Las Piedras, Puerto Rico.
The upgrades have taken longer and have cost more than the company initially projected. Gorsky said today that the company has met all of the milestones set by the FDA for eventual re-certification of the Fort Washington plant, The Philadelphia Inquirer reports. "We are taking a prudent approach to production volume," he said, referring to the plants in Lancaster and Las Piedras, which had to scale back production as upgrades are made. The company has said it hopes to have the Fort Washington plant back online by at least next year.
Gorsky's remarks came as he discussed the company's 2012 fourth-quarter earnings. According to Reuters, J&J had a profit of $2.57 billion, or 91 cents a share, up from $218 million, or 8 cents a share, a year earlier. When special charges were excluded, it reported adjusted earnings of $1.19 a share, up from $1.13. Revenue increased 8% to $17.56 billion.
J&J consent decree cost felt at the pharmacy