J&J Fires 300 Employees Over The Tylenol Recalls

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layoffThe healthcare giant submitted its long-awaited remediation plan to the FDA today - you know, the plan that is supposed to help Johnson & Johnson’s McNeil Consumer Healthcare unit get back on track after recalling tens of millions of over-the-counter pediatric medicines. And in a vague statement, J&J says one way to cope is to can 300 of the 400-plus people who work at the Fort Washington, Pa., plant where most of the quality-control problems were found and managerial decisions were made.

The employees are being let go because its not clear when the plant will operate again. A J&J spokeswoman says the “best estimate” is the middle of 2011. Recently, J&J acknowledged that a few hundred million dollars in sales will be lost; the average annual sales of the products made at this plant over the last three years were about $650 million, although that remains a sliver of J&J consumer sales, which last year were $4.2 billion out of $16.5 billion total sales worldwide. J&J vows to expand capacity elsewhere to compensate for the shortages.

There was no word, however, whether any senior McNeil execs are among those being shown the door, given that the McNeil unit is headquartered in Fort Washington. Take Peter Luther, who heads the unit. He allegedly recommended a recall of Motrin pills without notifying the FDA or the public, according to Bloomberg News, which reported he wrote an e-mail to employees telling them to proceed with a “market withdraw of Motrin…Let’s make this happen ASAP.” J&J denied the interpretation and has maintained the FDA was informed, although the agency disputed that.

And what has J&J accomplished thus far? Its statement today was vague:

the plan given the FDA addresses “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.” What is significant? A J&J spokeswoman declined to say.

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