McNeil, a Johnson & Johnson Subsidiary FDA Case Study

ABSTRACT This case study provides a detailed five-year review of one of Johnson & Johnson's important subsidiaries, McNeil Consumer Healthcare. The research presents summaries from the Food and Drug Administration (FDA) inspection reports, out-of-compliance findings, and warning letters for the period between 2007 and 2011. It also relies on a class action lawsuit and a judicial consent decree within this timeframe to further understand the relationship between Johnson & Johnson and McNeil. The case study focusses on problems in the manufacturing and quality assurance at McNeil, and how Johnson & Johnson may have exacerbated McNeil's production failures. Keywords: FDA, CAPA, cGMP, enforcement, warning letters, pharmaceuticals FOOD AND DRUG ADMINISTRATION CASE STUDY Monk v Johnson & Johnson et al. (2013) is often regarded as a world-class pharmaceutical corporation, noted for its quality consumer products. Yet during the five-year period from 2007 and 2011, one of its principal subsidiaries, McNeil Consumer Healthcare, underwent a series of massive product recalls. The Food and Drug Administration (FDA), which is the principal regulatory agency for the U. S. bio-pharmaceutical (BP) industry, has cited McNeil numerous times during this period for violations of its statutes. This places in question not only the reputation of Johnson & Johnson, but also whether their products are safe, effective, and manufactured in accordance with "cGMP," the current Good Manufacturing Practice (FDA, 2004a). As part of this case study, the research reviewed the FDA's judicial consent decree to close a McNeil manufacturing plant, and impose stringent external supervision. In addition, the researchers had access to public documents: congressional investigative transcripts about McNeil's recalls, and a class action lawsuit on behalf of Johnson & Johnson shareholders. The paper explores these documents to evaluate Johnson & Johnson's role in determining why McNeil's could not meet the FDA's cGMP standard (FDA, 2008b). The central question asked throughout this paper is, what part did Johnson & Johnson's management play in McNeil product recalls? Surprisingly, previous researchers have not fully investigated these events. The two main academic investigations of quality assurance (QA) in the pharmaceutical sector are Adis's risk studies (2007, 2008) of the PB industry, and Marcher and Nickerson's (2006) review of quality systems. Both were sector evaluations, rather than case studies. BACKGROUND: JOHNSON & JOHNSON CONSUMER HEALTHCARE Johnson & Johnson is a global conglomerate with a market capitalization of more than $160 billion. The company describes itself as the "Johnson & Johnson Family of Companies." It consists of four divisions: consumer, pharmaceutical, medical device and diagnostic. McNeil is an important Johnson & Johnson pharmaceutical subsidiary with two large manufacturing facilities: one at Las Piedras, PR and other at Ft. Washington, PA, which is also its headquarters. In 2004, McNeil had annual sales of US $2.1 billion and 2600 employees. Both sites are responsible for the manufacture, packaging and distribution of popular over-the- counter (OTC) products, including Tylenol and Motrin. The quality melt down at McNeil described in this study took place from 2007 to 2011. It is critical to note that in January 2007, Johnson & Johnson began its $16.6 billion acquisition of the Pfizer Consumer Healthcare business. Pfizer's product lines (Zyrtec, Listerine, Sudafed and Benadryl) became part of the Johnson & Johnson Healthcare Products Division of McNeil-PPC, Inc. McNeil faced the manufacturing challenge of incorporating Pfizer products, manufacturing processes, and employees. This was particularly true of the Ft. Washington and Las Piedras manufacturing sites where management was tasked with merging and integrating these new product lines cost-effectively, while maintaining pharmaceutical quality. …