Johnson & Johnson has set aside almost $9 billion to cover claims that its baby powder containing talc caused cancer, which is four times the amount it had previously reserved for this potential liability. As per the proposal announced on Tuesday, a J&J subsidiary will re-file for Chapter 11 bankruptcy and present a plan seeking court approval for one of the largest product-liability settlements in US history. The company will transfer $8.9 billion to the subsidiary, LTL Management, payable over the next 25 years. Previously, J&J had set aside $2 billion in October 2021. The proposed amount, which is being backed by over 60,000 parties that have filed lawsuits alleging harm from J&J talcum powder, does not represent an admission of wrongdoing, according to the company. The lawsuits against J&J claimed that its talcum powder caused users to develop ovarian cancer or mesothelioma, leading to a drop in the company’s sales of baby powder, forcing it to end sales of the product worldwide last year. J&J’s shares rose by 3% in after-hours trading on Tuesday following this announcement.

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