McNeil Consumer Healthcare is today announcing two actions related to its ongoing efforts to upgrade the quality of its manufacturing operations, and I wanted to share with you their statement:

McNeil Statement on Plan Submission

Today McNeil Consumer Healthcare has submitted to the FDA a comprehensive action plan on quality improvement. The submission details the next steps to be taken by McNeil to ensure that its operations meet the level of quality that consumers expect of us, and that we expect of ourselves.

McNeil looks forward to the FDA’s review of the plan and to working with the Agency moving forward. McNeil already has taken a number of significant steps to enhance quality, and is taking a systemic approach to strengthening quality through longer term improvements.

The plan addresses a number of areas, including:

• Assessment and improvement of management controls;
• Improvements in quality processes;
• Interim controls and the use of outside experts to provide additional product quality assurance while the plan is being finalized and implemented;
• Significant investment in manufacturing facilities, equipment, and laboratories, and;
• A comprehensive program to ensure sustainable compliance with regulatory and McNeil quality requirements.

McNeil is committed to taking whatever steps are necessary to improve quality and earn consumers’ trust.

Statement on Fort Washington Plant

Consistent with its commitment to improve quality across its manufacturing operations, McNeil Consumer Healthcare will make a significant investment in re-fitting its Fort Washington manufacturing facility with new equipment, and will reorganize the plant’s operations. As a result, McNeil anticipates that the plant will be out of service for a protracted period of time. Regrettably, McNeil will be reducing staffing levels at the facility.

About 300 of the over 400 positions at the Fort Washington manufacturing plant are being eliminated as a result of this difficult decision. Employees whose positions are eliminated will be offered transitional support for the next year, including outplacement assistance, career counseling and professional support services to help them find a new position. McNeil has continued to provide employees with regular pay and benefits since operations at the plant were suspended in April, and will continue to do so through at least mid-September, at which point they will receive a severance package based on years of service.

When the plant reopens, McNeil anticipates some new hiring, and will provide preferential consideration to previous employees who are qualified for the new positions. However, staffing levels at the reconfigured plant are expected to be substantially lower than they are today.

McNeil is taking steps to expedite production of many of the products that were previously produced at Fort Washington by utilizing other plants in the Johnson & Johnson manufacturing network. As previously announced, although most products are not likely to be available before the end of 2010, McNeil expects to continue to expand its capacity to produce these products through the end of the year and in 2011.

Today Colleen Goggins, Worldwide Chairman, Consumer Group, Johnson & Johnson, is appearing before the U.S. House of Representatives Committee on Oversight and Government Reform to discuss the recent McNeil recall of certain infants’ and children’s products. Here are some excerpts from her testimony:

All of the Johnson & Johnson family of companies realize that we have a responsibility to provide consumers with the highest quality products possible, and we have worked hard to fulfill that responsibility for more than a century. We are proud that our products help millions of people around the world improve their health and well-being. Across our organization, we believe our first responsibility is to the doctors, nurses, and patients, to mothers and fathers, and all others who use our products and services. In this instance, we have not lived up to that responsibility, and the recall is therefore a disappointment to our Chairman Bill Weldon, to me personally, and to the thousands of employees in the Johnson & Johnson family of companies.

The quality and process issues that we found at McNeil, those which led to the recall and others, are unacceptable. On behalf of McNeil and Johnson & Johnson, I apologize to the mothers, fathers, and caregivers for the concern and inconvenience caused by the recall. Johnson & Johnson embraces the work of this Committee, and we hope that today’s hearing will be an important step in furthering public understanding of the recall.

Consistent with our goal of furthering public understanding, it is critical that the public understand that the recall was not undertaken on the basis of adverse medical events. Unfortunately, there has been some confusion in the media with respect to this recall. I would like to stress, therefore, four key points. First, as the FDA noted last month, the health risks to consumers from the recalled products were remote. Second, McNeil has no indication of a serious adverse medical event caused by any of the issues referenced in the recall announcement. Third, no raw materials that tested positive for objectionable bacteria were ever used in the manufacture of McNeil’s pediatric products. And finally, McNeil rejected the products that it found had excess active ingredient.

For further details, click here to read the full testimony.

To help inform employees of the Johnson & Johnson family of companies, McNeil Consumer Healthcare today released a description of its plans to assess and address quality issues which precipitated the recent recall of certain McNeil infants’ and children’s liquid medicines and the suspension of production at the Fort Washington PA manufacturing facility on April 30. Last Friday, McNeil submitted materials to the U. S. Food & Drug Administration which outlined its actions and plans to help ensure quality moving forward, and address the FDA’s observations at the plant. And this Thursday, Colleen Goggins, Worldwide Chairman, Consumer Group will represent Johnson & Johnson before the U. S. House of Representatives Oversight and Government Reform Committee, which has called a hearing on the recall. The following is the description of McNeil’s plans:

McNeil is taking steps to bring its operation back to a level of quality that Johnson & Johnson demands of its companies, and that the public rightly expects of us, and that we expect of ourselves.

First, even before the most recent recall was announced, McNeil retained an independent third-party expert to assist the Fort Washington facility in identifying immediate, interim, and long-term corrective actions that it needs to take. The third-party expert is a pharmaceutical consulting firm that has expertise in manufacturing and quality systems methodologies and practices.

Second, McNeil is improving processes and employee training in every part of the manufacturing and quality operations, and deploying new procedures and processes for the conduct of quality investigations.

Third, McNeil has also made significant organizational changes in order to augment the quality and operations leadership on the management team and in all McNeil facilities.

McNeil and its outside consultant are in the process of developing a comprehensive action plan on quality improvements, which McNeil will share with the FDA by July 15. The basic elements of the plan include the following:

Governance and management controls. Governance during the remediation period will include the establishment of a steering committee, which will include members of senior management, charged with guiding and overseeing remediation efforts across McNeil. Each plant will also have a remediation committee that will be responsible for implementing the plan for that plant and monitoring its effectiveness. Achieving long-term improved management control at each site is critical, and will require an evaluation and restructuring where needed of, among other things, the quality control unit, McNeil’s development and manufacturing governance processes, and its quality management systems.

Training and Culture of Compliance. McNeil is committed to reinforcing and enhancing the culture of compliance throughout the company. McNeil has already taken actions to set higher expectations of employees and to increase employee focus on identifying underlying causes and finding lasting solutions to issues that arise during daily operations. Further actions to address the culture of compliance under the comprehensive action plan will include strengthened “good manufacturing practices” training program, the development of a leadership training program and enhanced supervisor training, and the establishment of quality goals for all employees. McNeil also intends to implement measures to improve communications to and among personnel. Employees will be informed of the status of remediation and ongoing efforts on a regular basis through communications that enlist them in facilitating this transformation.

Full Assessment and Improvements. McNeil will conduct a full assessment of the processes, equipment, and facility in Fort Washington, and will assess McNeil’s other facilities as part of the plan. McNeil and Johnson & Johnson are fully committed to providing the training, resources and capital investment needed to provide sustainable improvement of quality systems.

Product Assessments. McNeil will conduct in-depth quality assessments for each product McNeil manufactures to ensure each product’s ability to meet specifications throughout its shelf life. Product assessments will review, among other things, testing results, stability data, investigation reports, out of specification findings, rejections, and process changes. McNeil will analyze whether additional controls are needed to support the release of products.

Communication with FDA and Interim Actions. McNeil will update the FDA about its progress implementing the plan at least once a month. McNeil also intends to use the support of a third party in making product release decisions during the first six months of operation. Third-party involvement may include review of investigations, complaints, completed batch records, and changes that have the potential to affect products or processes. McNeil is committed to continuing its cooperative and transparent dialogue with FDA.

These steps come on top of a series of important actions already taken, including an ongoing suspension of manufacturing operations at the Fort Washington manufacturing plant where the recalled products were made, and conducting extensive outreach to parents, caregivers and health care professionals to keep them informed about the recent recall.

Last week, Johnson & Johnson was advised that the U.S. House Committee on Oversight and Government Reform was planning to hold a hearing on May 27th on the recent McNeil Consumer Healthcare recall, at which Chairman and Chief Executive Officer Bill Weldon was invited to provide testimony. There have been some questions from the media about the company’s plans for the hearing, and I thought I’d pass on the statement we’ve been sharing with reporters:

I just wanted to share the following open letter from Chairman and Chief Executive Officer Bill Weldon about the recent recalls at our McNeil Consumer Healthcare company. He asked us to publish it by posting on JNJBTW:

Earlier today, the U.S. Food and Drug Administration issued a report describing manufacturing-related observations from inspections of the McNeil Consumer Healthcare facility at Fort Washington, PA related to the recent recall announcement and later held a press conference to go over their findings. In response, McNeil issued a public statement. You can read the entire statement, but I thought the following passage is important to note:

A complete list of the products involved and additional information about the recall can be found on their website, www.mcneilproductrecall.com or by calling 1-888 222-6036.

Last night, the McNeil Consumer Healthcare business of Johnson & Johnson announced the voluntary recall of certain lots of over-the-counter infants’ and children’s products. In their press release, the company said the following that explains why this is happening:

A complete list of the products involved and additional information about the recall can be found on their website, www.mcneilproductrecall.com or by calling 1-888 222-6036 (Monday-Friday 8 a.m. to 10 p.m. Eastern Time, and Saturday-Sunday 9 a.m. to 5 p.m. Eastern Time). Any adverse reactions may also be reported to the FDA’s MedWatch Program by fax at 1-800-FDA-0178, by mail at MedWatch, FDA, 5600 Fishers Lane, Rockville, MD 20852-9787, or on the MedWatch website at www.fda.gov/medwatch.

UPDATE: There have been some questions about refunds. I wanted you to know that at McNeil’s recall related website www.mcneilproductrecall.com – a product refund or coupon can be requested.

During the earnings call earlier today, Chairman and Chief Executive Officer Bill Weldon provided some further context around the recent recall announcement by McNeil Consumer Healthcare. In his remarks to financial analysts Bill provided a more detailed account of what the investigation entailed and the complexities of identifying the source of the odor, which I have reprinted here for those who are interested:

“We’re very conscious of the bar we set for ourselves and that consumers expect more from us than from others because of our history and reputation. Our recent consumer product recall and FDA warning letter were important reminders of this expectation and the vigilance it requires. I want to assure you we take these matters very seriously and nothing is more important to us than the health and safety of the people who use our products.

We are undertaking a thorough review of our procedures to ensure that we identify potential improvements we could make moving forward. We believe these and other actions we are taking will address the concerns that the FDA raised in its warning letter, and we are working in close consultation with them.

When McNeil Consumer Healthcare first received some complaints on a “musty” odor associated with our products in 2008, the company conducted a microbiological investigation to check for the presence of bacteria and mold, which would be consistent with the presence of the odor. No bacteria or mold was found and it was believed that the complaints were likely an isolated issue.

When similar complaint trends were identified in 2009, the company initiated further investigation and novel forensic testing. McNeil determined that the reported uncharacteristic odor was caused by trace amounts of a chemical byproduct originating from the treatment of wood pallets used to transport and store product packaging materials.
 
Subsequently, we initiated a voluntary product recall based on broad precautionary criteria, recalling numerous product lots that had not been the subject of any consumer complaints.

Even as we continue our investigation, we have taken additional actions beyond the recall to assure product quality. We have required suppliers who ship materials to our plants to discontinue the use of the type of wood shipping pallets associated with the recall. We are conducting full inspections of all materials coming into our facilities and have had outside experts evaluate our plants. We are confident in moving forward with production and we will continue to monitor and evaluate the situation and consult with the FDA.”

Since the news of the McNeil Consumer Healthcare recall was announced last week, some questions have come up about the timing of the recall in light of when the company first became aware of the complaints about a “musty” odor.

At JNJBTW we try, whenever possible, to provide additional perspective around activities that are taking place at Johnson & Johnson. Since I’ve now learned a few things about the McNeil Consumer Healthcare recall, I thought I would pass this information on to you.

When McNeil Consumer Healthcare first received some complaints of a “musty” odor in 2008, the company conducted a microbiological investigation to check for the presence of bacteria and mold, which would be consistent with the presence of the odor. No bacteria or mold was found and it was determined that the complaints were likely an isolated issue.

When similar complaint trends were identified in 2009, the company initiated further investigation and analytical testing and determined that the reported uncharacteristic odor is caused by trace amounts of a chemical called 2,4,6-tribromoanisole (TBA) – which, as the company explained in its press release, “can result from the breakdown of a chemical that is sometimes applied to wood that is used to build wood pallets that transport and store product packaging materials.”

McNeil Consumer Healthcare is continuing to investigate this complex matter. They’ve used very broad criteria for the recall and, out of an abundance of caution, they have recalled product lots that they believe have the potential to be affected, even if these lots have not been the subject of any consumer complaints. In addition, McNeil has required suppliers who ship materials to their plants to stop using the type of pallets associated with the recall. The company is also conducting a full inspection of all materials coming into its manufacturing facilities and has employed outside experts on TBA to inspect facilities and review procedures moving forward. McNeil is continuing to monitor and evaluate the situation and consult with the FDA.

As they learn more, I will try to keep you informed.

In the meantime, for those who are interested in obtaining additional information about the recall announcement, including the product lots involved, you should visit McNeil’s website, where they have posted their announcement and contact information for consumers.

I just wanted to make sure that those looking for last week’s announcement from Johnson & Johnson’s McNeil Consumer Healthcare company could get to their announcement and their information about the recall. As some of you may know, last week, in consultation with the U.S. Food and Drug Administration, McNeil Consumer Healthcare, Division of McNeil-PPC, Inc., a Johnson & Johnson company, announced a voluntary recall of certain over-the-counter products in North America, Central America and the Caribbean. For those interested in the details of this announcement, including the product lots involved, you should visit McNeil’s website, where they have posted their announcement and contact information for consumers. Rather than me explain what you should do if you have questions, I thought it best to provide what McNeil said in their release:

For these instructions or information regarding how to return or dispose of the product, consumers should log on to the internet at www.mcneilproductrecall.com or call 1-888-222-6036 (Monday-Friday 8 a.m. to 10 p.m. Eastern Time, and Saturday-Sunday 9 a.m. to 5 p.m. Eastern Time). Consumers who have medical concerns or questions should contact their healthcare provider. Any adverse reactions may also be reported to the FDA’s MedWatch Program by fax at 1-800-FDA-0178, by mail at MedWatch, FDA, 5600 Fishers Lane, Rockville, MD 20852-9787, or on the MedWatch website at www.fda.gov/medwatch.

You can also follow the latest news on the recall via the Twitter account McNeil created last week (which I tweeted about as well via @JNJComm) @McNeilRecall.

Last week’s release follows two previous recall announcements – the first on Nov. 5, 2009 when McNeil announced a recall of certain lots of Tylenol Arthritis Pain 100 Count bottles and the second on Dec. 18, 2009, when the company expanded the recall to include all lots of Tylenol Arthritis Pain 100 count with the E-Z open cap.