Johnson & Johnson (NYSE:JNJ) shares popped on Wednesday, amid word the pharmaceutical giant will pay $6.5 billion to settle nearly all of the thousands of lawsuits in the U.S. claiming its talc-based products caused ovarian cancer.
The deal would allow J&J to resolve the lawsuits through a third bankruptcy filing of a subsidiary company, LTL Management.
It will begin a three-month voting period for claimants, in hopes of reaching a consensus on a settlement of all current and future ovarian cancer claims. About 99% of the talc-related lawsuits filed against J&J and its subsidiaries stem from ovarian cancer.
J&J said the remaining pending lawsuits relate to a rare cancer called mesothelioma and will be addressed outside of the new settlement plan.
The pharmaceutical giant said it has already resolved 95% of mesothelioma lawsuits filed to date.
The ovarian claims to be resolved by the Plan constitute 99.75% of the pending talc lawsuits against the Company and its affiliates in the United States.
The remaining pending personal injury lawsuits relate to mesothelioma and will be addressed outside of the Plan. The Company already has resolved 95% of mesothelioma lawsuits filed to date.
The State consumer protection claims will also be addressed outside the Plan; the Company already has agreements in principle to do so.
JNJ began the trading day up $4.62, or 3.2%, to $149.21.
