Johnson & Johnson's DePuy Orthopaedics unit issued an extensive recall of its “metal-on-metal” hip replacement devices in 2010 after they shed metal fragments, causing disabling injuries. The corporation took quarterly charges of more than $3 billion, largely related to the recall of artificial hips, and gave a 2012 earnings forecast below analysts’ estimates on Tuesday. The recalled ASR model should not be confused with the Pinnacle metal-on-metal hip implant. The Pinnacle model has not been recalled but many lawsuits have been filed citing the same defects as the recalled model.
The fourth-quarter charges will allow money to be set aside for patients involved in the product liability MDL.
“The hip recalls worry me because their eventual costs are unknown,” said Jeff Jonas, an analyst at Gabelli & Company, who noted that the fourth-quarter charges included $800 million for medical costs of the recall. Johnson & Johnson has paid the costs associated with revision surgeries for many plaintiffs who have been injured by the ASR model. The corporation has not been so kind to those people who were implanted with the Pinnacle model.
The company forecast 2012 earnings of $5.05 to $5.15 a share, compared with the consensus Wall Street view of $5.21. Johnson & Johnson reported better-than-expected fourth-quarter earnings, helped by favorable taxes and sales of new prescription drugs. The company earned $218 million, or 8 cents a share, in the quarter. That compares with $1.9 billion, or 70 cents a share, a year earlier, when it also took charges for recalls of hip replacement devices.
Johnson & Johnson, which is based in New Brunswick, N.J., said global sales rose 3.9 percent in the quarter, to $16.26 billion, slightly below analysts’ target. Sometimes, the only way to make large corporations aware of the pain and damage they have caused to the public is by lawsuits that affect their bottom dollar. It appears the ASR MDL lawsuits are doing just that.
If you or a loved one have had hip replacement surgery and have been implanted with a defective DePuy hip, you may be entitled to compensation for medical bills, pain and suffering, lost wages and other injuries. Our firm is currently investigating claims for those people who have been implanted with DePuy hip replacement devices, both ASR and Pinnacle. If you would like a free case evaluation, please contact Booth Samuels toll free at 1-866-515-8880 or at booths@pittmandutton.com.
