Johnson & Johnson Shares Drop 0.67% to 13-Month Low Amid Legal Challenges, Rejected Settlement

Johnson & Johnson’s shares hit a 13-month low on Monday, with the stock sliding 0.67% intraday to its weakest level since October 2025. The decline reflects mounting concerns over the company’s legal and reputational challenges, which have eroded investor confidence despite its long-standing dominance in the healthcare sector.

The pharmaceutical giant faces escalating legal risks tied to its talc-based products, with over 62,000 lawsuits alleging ovarian cancer and asbestos exposure. A recent rejection of its $8 billion settlement proposal by a U.S. bankruptcy judge has forced the company to confront litigation in state courts, where jury trials could yield larger verdicts. Critics argue the rejected settlement—part of a controversial “Texas two-step” strategy—was a bad-faith attempt to shield non-bankrupt subsidiaries from liability. The court’s decision has amplified uncertainty, with plaintiffs demanding accountability for decades of alleged asbestos contamination in talc products.

Historical corporate misconduct further clouds the outlook. An investigative exposé revealed systemic efforts to downplay health risks, including internal evidence of asbestos in baby powder dating to 1958. The company’s defense of talc products, despite mounting scientific evidence, has drawn sharp criticism. Similar patterns emerged in other sectors, such as the delayed warning labels on Tylenol and suppressed data on the cancer risks of its drug Procrit. These incidents highlight a corporate culture prioritizing profit over transparency, deepening public distrust.

Regulatory failures also play a role. The FDA’s reliance on industry-funded trials and reduced oversight has enabled Johnson & Johnson to market contentious products with minimal external scrutiny. Notable examples include the approval of aspartame and a high-dose fentanyl patch linked to fatal overdoses. These regulatory gaps have allowed the company to operate with limited accountability, exacerbating its legal and reputational vulnerabilities.

Public perception and investor sentiment remain strained. Despite discontinuing talc-based products in key markets, the company’s crisis management tactics—such as concealing evidence during past product safety incidents—have damaged its brand. Shareholders are increasingly skeptical of its ability to balance profit motives with public health responsibilities, particularly as litigation costs and reputational risks continue to rise. The stock’s recent performance underscores the growing demand for corporate accountability in an era of heightened regulatory and societal scrutiny.