Federal officials said Thursday that the consumer-health unit of Johnson & Johnson would be barred from resuming operations at the Fort Washington factory linked to millions of bottles of defective medicine until it met quality standards.
The Food and Drug Administration said it had signed a formal consent decree with the company designed to improve operations at three manufacturing sites linked to multiple recalls of medication last year, including Children's Tylenol, Benadryl, and Motrin.
The FDA said J&J's McNeil Consumer Healthcare unit had violated the law in its production of medication and would be subject to fines of up to $10 million annually if it did not comply with the decree.
The agreement, filed in U.S. District Court in Philadelphia, requires J&J to destroy all recalled drugs that have been returned to the company within 30 days. The decree also sets strict deadlines for arranging third-party contractors to inspect the plants and recommend improvements.
In addition to Fort Washington, the facilities named under the agreement are in Lancaster and in Las Piedras, Puerto Rico.
J&J said in a statement that the Las Piedras and Lancaster plants would remain in operation as it implemented the FDA plan.
The Fort Washington plant closed in April and will remain shut until an outside inspector and the FDA have inspected and certified it, the company and FDA said Thursday. J&J has said the plant would not reopen at least until late this year.
The plant employed about 400 a year ago and produced most of J&J's liquid cold medications. FDA inspectors cited the facility for a slew of problems, including releasing medicine with the wrong doses of active ingredient and contamination with bacteria or tiny metal shards.
In testimony to Congress in September, J&J chief executive William C. Weldon said J&J was investing $100 million in upgrading the Fort Washington plant and other McNeil operations.
"When complete, it is fair to say that the Fort Washington facility will represent the state of the art in medicine production," Weldon said at the time. "The facility will not open until we are confident that we can make McNeil products to the high quality standards that the public, Congress, and the FDA rightly expect from us."
J&J has issued 20 recalls since September 2009 covering over-the-counter medicines such as Children's Tylenol and Benadryl, plus contact lenses and hip replacements.
In its last quarter, the New Brunswick, N.J., company reported a 12 percent drop in profit, as sales were squeezed by a weak economy, pricing pressures, and recalls that have kept many popular nonprescription medicines off store shelves. Sales of the company's over-the-counter medicine fell more than 19 percent last year.