'Shocking' conditions at Tylenol plant

NEW YORK (CNNMoney.com) -- The quality and safety violations that led to the shutdown of a Tylenol plant were extremely serious, and could lead to tough action by regulators on drugmaker Johnson & Johnson.

"It's absolutely shocking," said David Lebo, a professor of pharmaceutical manufacturing at Temple University in Philadelphia, referring to the Food and Drug Administration's May 6 inspection report on the facility in Fort Washington, Penn., operated by Johnson & Johnson's McNeil division.

"This inspection report is pretty close to being the worst I've seen. It suggests that basically the FDA found an issue with almost every system at the plant," said Lebo, who had previously worked for Johnson & Johnson's pharmaceutical sourcing group in 2002. Lebo said he left that job after nine months because the work required too much travel.

On May 1, McNeil recalled some 50 children's versions of non-prescription drugs, including Tylenol, Motrin and Benadryl. Johnson & Johnson (JNJ, Fortune 500) has suspended production at the plant.

The FDA report listed 20 violations, which include 46 consumer complaints on the recalled products. Johnson & Johnson has not revealed details of those complaints.

However, Congress has opened an investigation into the recall, and lawmakers have given both Johnson & Johnson and the FDA a May 17 deadline to hand over details about the consumer complaints and any other FDA inspection reports on the Fort Washington facility.

On Friday, the House Committee on Oversight and Government Reform announced that it would hold a hearing on May 27 to examine the recall. The panel said it had invited J&J Chief Executive William Weldon to testify.

The most damning, according to Lebo, was the charge that the plant "does not maintain adequate laboratory facilities for the testing and approval (or rejection) of components of drug products."

The report also said that McNeil failed to follow up on 46 consumer complaints received from June 2009 to April 2010 "regarding foreign materials, black or dark specks." Neither the FDA nor Johnson & Johnson would provide more details about the complaints.

"When you get consumer complaints you want to make sure you at least investigate them," said Albert Wertheimer, professor of health economics at Temple University.

The FDA also said that lack of proper controls in the manufacturing process led to some batches of infant's Tylenol being "superpotent," or having too much of some ingredients.

Also, the report noted that employees at the plant were not trained in current good manufacturing practices. The FDA inspectors further detailed dusty and filthy conditions at the plant, including "incubators with a large amount of visible gray and brown dust/debris, large hole in the ceiling and thick dust covering the grill inside a filtered cabinet."

In addition, the FDA said some drums used to transport raw materials to the Fort Washington facility were contaminated with a bacteria identified as B. cepacia.

Johnson & Johnson maintains that those contaminated drums never reached its plant and all finished products tested negative for the bacteria.

According to the Centers for Disease Control and Prevention (CDC), B. cepacia poses little medical risk to healthy people. However, those with certain health problems like weakened immune systems or chronic lung diseases, particularly cystic fibrosis, may be more susceptible to infections with B. cepacia.

It was unclear what action the FDA would take next, but the agency has said that it is considering a full range of actions.

One option is to shut down the plant completely. Wertheimer said that would be a tremendous blow to Johnson & Johnson. "The company would lose an enormous amount of market share in the over-the-counter drugs category," he said.

Another option is that the FDA could issue a consent decree. McNeil would be able to continue production at the plant, but would have constant third-party inspection. "It's a very expensive settlement for a drugmaker," said Lebo.

David Rosen, who worked at the FDA for 14 years and now advises major pharmaceutical companies on FDA regulation and compliance, agreed. "This is a very serious situation for the company," he said. "Having repeated recalls will cause reputational and trust damage for J&J," he said.

The latest recall is Johnson & Johnson's fourth in the past 7 months.

In November 2009, the company recalled five lots of its Tylenol Arthritis Pain 100 count with the EZ-open cap product due to reports of an unusual moldy, musty, or mildew-like odor that led to some cases of nausea, stomach pain, vomiting and diarrhea.

In December, McNeil expanded that recall to include all available product lots of Tylenol Arthritis Pain caplet 100 count bottles with the red EZ-open cap.

In January, McNeil recalled an undisclosed number of containers of Tylenol, Motrin and other over-the-counter drugs after consumers complained of feeling sick from an "unusual" odor.

J&J spokesman James Freeman would not comment on how long the facility will remain shut.

However, in a statement emailed to CNNMoney.com, the company said it will not restart operations until "we have taken the necessary corrective actions and can assure the quality of products made there."

Freeman also declined to comment on the number of employees at the plant or whether the workers are still on payroll.