J&J Baby Powder Given All Clear

Two weeks ago Johnson and Johnson announced that an FDA test had found a very minute trace (0.0002%) of asbestos in a batch of baby powder. The J&J share price dropped over 6%, wiping billions off of their market cap. Not to mention the repetitional damage and the costs involved in recalling the 'contaminated' batch. Last night, near the close of trading J&J announced that the FDA had done further tests, along with a plethora of tests done by two other independent labs, and all the tests showed zero asbestos. So why did the original test show something different? J&J explains below.

"In addition to using their standard preparation rooms, one of the laboratories deviated from their normal protocol by using an auxiliary room. In that auxiliary room, five samples were prepared, and three initially tested positive for asbestos. Upon this finding, the laboratory undertook an investigation and determined that a portable air conditioner in use during sample preparation in the auxiliary room was contaminated with asbestos. No asbestos was detected in any of the samples when prepared in the standard room."

Anyway, the J&J share price is now up 3.4% on the news. It might take a few days for the full share price value loss to be recovered though. As you were; onwards and upwards.