Johnson and Johnson’s JNJ (NYSE) longtime CEO, Bill Weldon remains on the hot seat. The numerous problems J and J has had with recalls and manufacturing oversight through its huge network of subsidiaries particularly its McNeil Consumer Healthcare firm continues to plague the firm and particularly the firm’s CEO. Weldon will be testifying later today before a House Congressional Committee. All eyes will be on weldon today to see how he responds to the criticism the firm has faced for its response to the continuing problems at McNeil as well as other parts of the firm. Despite the recall related problems, J and J overall has continued to remain very profitable but J and J more than most drug firms has relied on its reputation as a means for success all these years. Investors and analysts are beginning to question whether Weldon’s response to the problems were adequate. More importantly whether he managed the crisis sufficiently to protect the firm’s reputation. According to piece by Johanna Bennett in Barron’s Blog entitled J and J Reputation on the Line,
… a recent survey by CLSA analyst David Maris indicates that the company’s reputation among mothers and doctors may need a Band-Aide.
When 136 mothers and 50 pediatricians and general practitioners were asked to rate J and J’s formerly unassailable reputation before and after the recalls on a scale of one to 10 (1=horrible and 10=perfect), J andJ’s score fell 26% from an eight to a 5.9, according Maris.
And for some respondents, the recalls have permanently dented their regard for the the health care titan.
Weldon has a difficult task ahead of him before Congress and his shareholders. Despite his long reputation for fine management his survival as CEO may be an uphill battle as this problem continues to have legs. Stay close to the news on this one.