Inspectors found that Animas never reported to authorities on one complaint about a serious patient injury and delayed their reporting on two other incidents.  The patients affected were hospitalized with dangerously high blood sugar, respiratory failure, coma, and a life-threatening complication called diabetic ketoacidosis, caused by lack of insulin to break down blood sugar.

Erik Gordon, a professor and analyst at the University of Michigan’s Ross School of Business, said, “Any company can have one of these things pop up and smack them, and you can have a bad coincidence when two of them come and smack you three weeks apart.  But it’s not bad luck when you have this many.  The amazing thing is that Bill Weldon (Johnson & Johnson CEO) still has a job.”

The quality problems at the health giant have regulators and analysts bewildered.  This is at least the seventh Johnson & Johnson business to come under scrutiny in recent years.  The company set the standard for protecting public safety decades ago with a nationwide recall of Tylenol bottles that an unknown assailant had poisoned.  The corporate credo that is prominently displayed at the company’s headquarters stresses the company’s responsibility to the doctors, patients, and parents who use Johnson & Johnson products.

Johnson & Johnson has announced nearly 30 product recalls since September 2009.  The recalled products have included millions of bottles of Tylenol, Motrin and other nonprescription medicines, prescription drugs for seizures and HIV, faulty hip implants, and contact lenses.  The recalls have occurred for various reasons, including contamination with metal shards, glass particles, nauseating odors, and inaccurate levels of active drug ingredients.

The move comes in response to complaints about the potentially carcinogenic, formaldehyde-releasing preservative being used in the manufacturing of the company’s baby shampoos.  Quaternium-15 is added to cosmetics and toiletries to prevent contamination and spoiling, releasing formaldehyde to kill any bacteria in the product, and is considered to be a trigger for some skin allergies and cancers.

The Campaign for Safe Cosmetics first raised its concerns with the company in 2009.  Since then, Johnson & Johnson has been gradually phasing out the use of preservatives that release formaldehyde from its products intended for infants and children but provided a more concrete timetable in the letter from Mr. Weldon.  The company also makes Band-Aids, medical devices, and an array of prescription drugs.

The letter noted that Johnson & Johnson has begun providing “alternatives to formaldehyde-releasing preservatives and expect(s) to finish this process in our hundreds of baby products around the world within about two years, and sooner for our baby shampoos.”  The letter also stated that the trace amounts of formaldehyde found in the products pose little risk, saying that an entire bottle of baby shampoo creates a formaldehyde exposure equivalent to the amount a person would encounter “by eating an apple or pear, in which it occurs naturally.”

In the past two years, Johnson & Johnson has had to recall hundreds of thousands of packages of over-the-counter medicines due to quality-control lapses.  The recalls have harmed the company’s image and hurt its sales and earnings since late 2009.  Johnson & Johnson is revamping its factories under U.S. government supervision to correct the issues and restore the recalled products to retailers’ shelves.