Boston, MA 06/06/2014 (wallstreetpr) – The year 2014 does not seem to be an easy one for the world’s biggest healthcare products maker Johnson & Johnson (NYSE:JNJ), at least going by the recent developments. While the company’s ability to generate profits is hard to dismiss, JNJ is somewhat under siege and may end up losing its profits in settling claims against its questionable business practices.
The company recently earned a financial slap in China for fixing prices of contact lenses. In Chicago, the company, alongside other big pharma, faces serious allegations that can lead to untold financial burden in the event of a settlement.
China cracking whip on foreign companies
China’s spirited effort to sanitize its corporate world is catching many foreign companies operating in the country on the wrong side. Johnson & Johnson (NYSE:JNJ) is the latest big international player in China that took a financial hit in the ongoing scrutiny by the communist nation. JNJ was fined $3 million alongside Bausch & Lomb for unfair business practices touching on contact lens price fixing.
Multinational companies in China such as Apple Inc (NASDAQ:AAPL), Wal-Mart Stores Inc (NYSE:WMT) and GlaxoSmithKline plc (ADR) (NYSE:GSK) have all drawn scrutiny from Chinese authorities or China state media for various reasons. At one point, it took the intervention of Apple Inc boss Tom Cook to apologize after Chinese state media claimed Apple Inc was arrogant and offered poor customer services.
No news is good news
If no news is good news, Johnson & Johnson (NYSE:JNJ) has bad news because its life in the news in the recent past is not what the company would admire. Jumping from one trouble to the next one is not the kind of development that makes the company and its shareholders comfortable. In Chicago, JNJ is among the five major drug companies accused of promoting addiction to opioids in the state. The others named in the damaging claims include Actavis, Purdue Pharma, Endo Health and Teva Pharmaceutical.
Johnson & Johnson (NYSE:JNJ) and its peers are accused of unjust enrichments, misleading adverts and insurance fraud to increase sales and bottom line while hurting the population in Chicago. Similar claims have been raised against the companies in California and it might as well become a trend.
