Johnson & Johnson may have planned phantom Tylenol recall

NEW YORK (CNNMoney.com) -- Johnson & Johnson, which recalled millions of children's Tylenol products earlier this year, may have known of problems and planned to quietly remove those drugs from store shelves months before the official recall, acccording to documents released by lawmakers Thursday.

Lawmakers and drug safety regulators have been investigating successive recalls of Tylenol and other over-the-counter drugs made by Johnson & Johnson's (JNJ, Fortune 500) McNeil Consumer Healthcare unit. In April, McNeil recalled 135 million bottles of children's and infant's Motrin, Tylenol, Benadryl and Zyrtec drugs for quality issues.

A subsequent Congressional investigation revealed that McNeil also tried to conduct a "phantom" recall of more than 88,000 Motrin tablets in June 2009. To conduct the clandestine recall, Johnson & Johnson hired subcontractor WIS to buy up products from store shelves without notifying consumers of the potential problems.

An e-mail dated June 30, 2009 from an executive at WIS indicates the companies were planning a secret recall of children's Tylenol:

"We are exploring another similar but potentially larger recall for July involving children's Tylenol. WIS will look to explore next week the potential quantities in 400 geographically dispersed stores to 'assess' the quantities on shelves ....this across mass, grocery, drug and convenience [stores]. (Wal-Mart (WMT, Fortune 500) is on the list.)"

"J&J could ask Inmar/WIS to move ahead on a scope to purchase product that would make our Motrin project look small." [Inmar is another subcontractor, and was involved in the Motrin recall.]

The e-mail was uncovered as part of the Committee on Oversight and Government Reform's ongoing investigation of Johnson & Johnson.

"This email raises at least two significant questions. First, was Johnson & Johnson's Mr. William Weldon considering conducting a phantom recall of children's medicine?" Committee chairman Edolphus Towns wrote in a letter to Weldon Thursday.

"Second, this email is dated June 30, 2009. Was Johnson & Johnson aware of problems with Children's Tylenol and other children's medicines months before it actually recalled these products?" he asked.

Weldon will get a chance to address these questions later this month. The Committee, which already held one hearing into Johnson & Johnson's drug recalls in May, announced a second hearing to be held on Sept. 30 and has invited Weldon to testify.

Weldon did not testify at the first hearing on May 27. The company was represented then by Colleen Goggins, the chief of its $16 billion consumer products group, which includes McNeil. Separately, Johnson & Johnson announced Thursday that Goggins would retire in May 2011.

Johnson & Johnson would not comment for this report.