Cancerous baby powder may get the boot, thanks to Tulipshare
Activist investing platform has prompted a vote by Johnson & Johnson shareholders to bin the asbestos-containing talc.
Activist investor platform, Tulipshare, has won a campaign bid that means that shareholders of pharmaceuticals giant Johnson & Johnson must vote on whether to halt sales of its toxic talc-based baby powder.
Johnson & Johnson’s baby powder has been shrouded in ignominy since 2020, when it was shown to contain traces of asbestos – a carcinogen known to cause cancer with no safe exposure level.
The company discontinued sales of the product in North America amid falling demand and rising risk of litigation but continued to sell the product globally.
Since then, Johnson & Johnson has been forced to pay $2.1bn in damages to a group of women in the US claiming they had suffered ovarian cancer because of the product, and in 2022, the company resorted to a controversial bankruptcy strategy to cope with the 38,000 further legal claims against it.
The strategy, known as the ‘Texas two-step’, involves shifting claims onto the company’s subsidiary LTL Management LCC and could affect future claimants.
The Securities Exchange Commission (SEC) ruled in favour of Tulipshare’s proposal to bring the issue before shareholders at the annual general meeting (AGM) to vote on terminating sales of the product worldwide and replacing it with a safer alternative.
“Having our proposal on the ballot marks a momentous step in accountability,” said Antoine Argouges, CEO and founder of Tulipshare. “Retail investors have expressed interest in our Johnson & Johnson campaign as they are concerned about the consequences of a talc-based product on the shelves with its links to cancer.”
At the AGM, Johnson & Johnson’s top ten shareholders – which includes Blackrock, The Vanguard Group, State Street Global Advisors, Geode Capital Management, and Northern Trust Investments – will play a role in deciding whether the product is withdrawn from sales globally.
“This AGM provides the opportunity for all shareholders to have their say on what has been an enormous litigation crisis,” Argouges continued. “We hope to be joined by many shareholders and we welcome other like-minded retail investors to join our campaign and vote on the proposal during the AGM.”
Tulipshare is an activist investment platform that enables retail investors to make ethical change within publicly traded companies by collective shareholder action.
Where retail investors, with small number of shares in a company, would usually have little power to effect change over corporate governance, Tulipshare enables like-minded individuals to put coordinated shareholder pressure on companies to change the ways they conduct business.