Analyzing Johnson & Johnson's Bankruptcy Claim: Good Strategy or Bad Ethics?


Pharma giant Johnson & Johnson announced plans in November 2021 to split its pharmaceutical and medical devices divisions and its consumer products division into two publicly traded companies. The month prior, Johnson & Johnson also created a spin-off company which immediately filed for bankruptcy, a savvy but ethically dubious way of sidestepping the growing number of lawsuits against the company over its role in the opioid crisis and the alleged cancer-causing agents contained in its baby powder. This case covers J&J’s latest strategic maneuvers and asks students to discuss them through the lens of strategic management and ethics.

This case was prepared for inclusion in SAGE Business Cases primarily as a basis for classroom discussion or self-study, and is not meant to illustrate either effective or ineffective management styles. Nothing herein shall be deemed to be an endorsement of any kind. This case is for scholarly, educational, or personal use only within your university, and cannot be forwarded outside the university or used for other commercial purposes.

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