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J&J's Use of Contractors Probed as House Investigates `Phantom Recall'

U.S. lawmakers investigating whether Johnson & Johnson used a “phantom recall” to remove Motrin packages from the market without regulators’ knowledge asked the drugmaker if outside contractors were hired to buy other products in stores as well.

J&J, the world’s largest maker of health-care products, must provide a “detailed description” about the hiring of outside contractors or employees used to remove products from stores, the House Oversight and Government Reform Committee said in a letter released today. The committee also asked for all records related to the 2008 incident involving 88,000 packages of Motrin, an over-the-counter painkiller, that weren’t dissolving properly.

The letter marks an expansion of the House lawmakers’ inquiry, which previously focused on the April 30 recall of about 40 types of children’s medicines produced by J&J’s McNeil Consumer Healthcare unit at its Fort Washington, Pennsylvania, plant. The committee revealed May 27 that J&J hired contractors two years ago to buy large quantities of the defective Motrin that had been shipped for sale at gasoline service stations.

“I have referred to this as a ‘phantom recall,’ but unfortunately it is all too real and extremely troubling,” committee Chairman Edolphus Towns, a Democratic representative from New York, wrote in a letter dated May 28 to J&J Chief Executive Officer Bill Weldon.

The company will “respond appropriately to the committee’s request,” Jeffrey Leebaw, a J&J spokesman, said in an e-mail.

The committee also is seeking the names of the contractors used in the Motrin purchase effort, whose names are listed in a document provided by the committee only as “CSCS” and “WIS.”

J&J, based in New Brunswick, New Jersey, increased 46 cents, or 0.8 percent, to $58.76 at 4 p.m. in New York Stock Exchange composite trading. The shares have declined 8.6 percent since the recall was announced.

To contact the reporter on this story: Drew Armstrong in Washington at darmstrong17@bloomberg.net.

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