ETHICS OF JOHNSON & JOHNSON:

Preamble:

 Our Ethical Code for the Conduct of Research and Development is intended to
complement our Credo by providing more specific standards of conduct and
behavior for physicians, clinical research scientists and others who are
responsible for medical aspects of research and development.

 Our Ethical Code is intended to describe the principles that guide ethical
decision-making to ensure the safe use of our products, and the best interests of
our patients and their families, doctors, nurses and health care providers.

 It is envisioned to be the standard for addressing all ethical dilemmas regarding

research and its applications.

Our Ethical Code

 It is our fundamental responsibility to place the well-being of the patient first by

appropriately balancing risks and benefits and to ensure that the best interests of patients
and physicians who use our products receive utmost consideration.

 It is our responsibility to help ensure access to our products in the communities where we
develop them if the need for the product persists.

 It is our responsibility to apply Credo-based values and judgment regarding the design,
conduct, analysis and interpretation of clinical studies and results.

 It is our responsibility to adhere to the principles of good clinical practice.

 It is our responsibility to ensure all Company-based, medically relevant product

information is fair and balanced, accurate and comprehensive, to enable well-informed
risk-benefit assessments about our products.

 It is our responsibility to understand differences in values across cultures and to adapt our
behaviors in keeping with our ethical principles.

 It is our responsibility to challenge each other regarding medical and ethical concerns.

Ethical issues:
In 1986 J&J's biggest money making drug Haldol was coming off of patent, which meant that it
would soon be undercut by generic versions and they would be losing the enormous profit the drug
had brought them. So the company set out to find a new blockbuster drug which could be under
patent for years to come and came up with a drug they named Risperdal. This new drug was
extremely powerful, physically addictive, and had a litany of side effects, however it was very
effective in treating severe psychotic episodes in patients with bad mental conditions. Risperdal
would gain limited FDA approval in 1993, but only for severe psychotic disorders. This approval
meant that for J&J the drug was legally only marketable to about .05% of the population, which
greatly limited its ability to make money. The corporate executives at the company had visions of
selling the drug to 5-10% of the population, and through their actions they made it clear they were
going to do whatever they could to make this vision a reality.

On December 21, 2010 it was announced that Johnson & Johnson, the world’s largest health
products company, must defend a lawsuit claiming it misled investors about quality control-
failures at manufacturing plants that led to recalls of the popular over-the counter drug,
Motrin. Allegedly, top executives made misleading statements about details of the recalls
leading to stock losses after the true reasons for the recalls became public. McNeil Consumer
Healthcare has been facing numerous lawsuits as studies link Motrin to increased risk of
severe allergies such as Stevens Johnson Syndrome (SJS), and Toxic Epidermal Necrolysis.

2. Earlier in 2011, a lawsuit filed by a group of consumers alleging Johnson & Johnson’s
baby shampoo includes potentially cancer-causing chemicals was allowed to go forward,
according to federal court Judge Dennis Cavanaugh. The Judge based his decision to let the
lawsuit proceed on the presence of a single chemical ingredient found in the shampoo:
methylene chloride, which is banned by the Food and Drug Administration for use in
cosmetics.

3. In January 2011, it was announced that J&J might have to shell out up to $1 billion for
lawsuits concerning its subsidiary DePuy Orthopaedics and the metal-on-metal hip implants
that were found to shed minute metal particles into a patient’s bloodstream over time.
Lawsuits over the ASR implant have piled up across the country, accusing DePuy of
manufacturing a defective product, failing to warn patients and doctors of problems
with the implant and negligence in designing, manufacturing and selling the product.

It is worth noting that J&J hiked its product-liability reserves to $570 million at the end of
2010 and allotted $280 million for medical costs of patients directly affected by the recalled
hip implants.