Johnson & Johnson will mark the end of an era this spring when longtime CEO Bill Weldon steps down as the top executive of the largest health care company in the world. The change comes as the company struggles to regain its standing after more than two dozen product recalls, including top brands such as Tylenol, since September 2009 for problems such as foul smelling medicine bottles and contaminated drugs to defective and dangerous medical devices.
As Weldon sat at the helm, the company’s financial performance slumped. While profits more than doubled to $65 billion last year, product recalls cost the company more than $1 billion, and shares tumbled from nearly $72 in 2009 to $48, and have yet to pull out of the $60 range.
Weldon has tried to reassure investors and the public in general that problems were under control, but the recalls kept coming. Last week the company issued yet another recall, this time on more than a half million bottles of infants’ Tylenol, due to complaints from consumers who reported difficulty using the dosing system included in the packaging.
Several executives who worked under Weldon have left since 2009, and some analysts say that Weldon’s departure is a long time coming. The chief executive officer has consistently said he would not leave the company unless asked to do so by the board of directors. Weldon has been at Johnson & Johnson for 41 years, having worked his way up to the top office.
Weldon’s replacement has not yet been announced, but some speculate that Alex Gorsky, vice chairman and head of the company’s medical devices and diagnostics unit, will be tapped for the post. Interesting, considering Gorsky’s unit is currently involved in a massive recall of the DePuy Orthopaedics hip replacement device.