J&J talc report could hurt brand image in popular Indian market
Johnson & Johnson’s talcum powder sales and its brand may take a hit in India amid reports that the product could contain cancer-causing asbestos. Investigations have begun at some of its factories in the country.
“I’m angry, shocked and sad to hear such reports,” said Chaitra Devarhubli in Mumbai, who had been using the powder for her one-year-old baby up until she heard the news reports about the talc. “Being a mother, it’s terrifying that I have been using such a product for my baby,” she said.
A report by Reuters claimed that J&J knew for decades its baby powder could contain asbestos, prompting its market value to plunge by more than $40 billion in a day. Its share price has lost nearly 14 per cent of its value since the report came out.
On Wednesday, the company said that a “few of our facilities” in India were visited by the Central Drugs Standard Control Organisation (CDSCO) and local food and drug administrations’ regulatory authorities in some states. “We are fully co-operating with them by providing tests and samples,” J&J said in a statement emailed to The National.
The company has denied the allegations. J&J insists that its “baby powder is asbestos-free and does not cause cancer” and that it is “compliant with regulatory standards and requirements in India and will continue to work with the regulatory authorities”.
CDSCO and India’s ministry of health did not respond to requests for comments.
The crisis deepened on Wednesday in the United States when a Missouri court rejected the company’s bid to overturn a $4.7bn verdict awarded to a group of women who blamed asbestos in the baby powder for causing ovarian cancer.
The manager at one pharmacy chain in Mumbai, speaking on condition of anonymity, said that its stores were still selling the full range of J&J products. Sales of the goods were going to be affected by the reports, he said. If there were problems with the products, authorities “would take action” and ban the powder, he added.
Otherwise, he said most shops in India were unlikely to remove the goods from their shelves.
Such a ban would be a blow to J&J. The company has been in India for seven decades, with its baby powder being the first product it brought into the market in the country, according to its website.
J&J employs more than 3,500 people across its consumer healthcare, medical devices and pharmaceuticals divisions in India.
N Chandramouli, the chief executive of TRA Research, a brand insights consultancy in India, said there will be major repercussions for J&J.
“Naturally, there will be investigations that follow, but the damage to the brand has already been done,” says Mr Chandramouli.
“This news puts doubts on the values and morals of Johnson & Johnson. This is not about Johnson & Johnson baby powder, but about all of Johnson & Johnson. They have lost the trust of millions of people.”
One of those people who now has concerns about its goods is Vaibhav Pande in Delhi, who said that his family had been using the talc products for two decades, but after reading the news, he is “looking for other options”.
He added that he is “taking the reports with a pinch of salt”, until there is firm evidence.
“Authorities should check the truth and if something wrong emerges, strict action should be taken.”
Some have not just lost trust in the brand.
“Such an old brand like Johnson & Johnson, if harmful, I wonder if other baby products from other companies would be equally bad or worse,” said Ms Devarhubli.