n527  0159  12 Nov 82
BC-TYLENOL-11-12
    By Kathleen Behof
    (c) 1982 Chicago Sun-Times (Field News Service)
    Johnson & Johnson unveiled a triple-step safety-seal package for
Tylenol capsules Thursday as the company began a vigorous drive to
recapture its share of the pain-reliever market.
    In a closed-circuit television news conference with reporters in 29
cities, J&J officials said they were confident the public would
accept Tylenol in the tamper-resistant packages.
    James E. Burke, chairman and chief executive officer, also announced
that the company would replace all Tylenol capsules thrown away by
customers after the Chicago cyanide poisonings, without requiring
those customers to show proof of purchase.
    Beginning Nov. 21 in some cities and a week later in other areas,
advertising coupons worth $2.50 will be available for the purchase of
a Tylenol product.
    ''We have made an unequivocal commitment to rebuild this business
under the Tylenol name,'' Burke said. ''We consider it a moral
imperative as well as good business to restore Tylenol to its
preeminent position in the marketplace.''
    The pain reliever, made by J&J's McNeil Consumer Products Co.
subsidiary, had an estimated 37 percent of the analgesic market
before the Chicago deaths.
    Burke said the recall and destruction of Tylenol capsules, along
with the testing of the capsules, cost the company $100 million.
Tylenol capsules were recalled after bottles in the Chicago area were
found laced with cyanide in late September. Seven people died after
taking the poisoned capsules.
    Burke said the company never gave serious consideration to
introducing a Tylenol-like product under a new name, adding that such
a move would have been ''misleading.''
    Citing figures from a company survey that gave J&J the impetus to
reintroduce the product, Burke said 75 percent of regular Tylenol
customers would buy Tylenol in a tamper-resistant container.
    However, the survey also revealed that 80 percent of people who are
not regular users of Tylenol show little interest in ever using the
brand. ''Unless we can change that attitude,'' Burke said, ''we have
been deprived of the right to compete for that business.''
    The president of McNeil, David E. Collins, said he may meet with
Chicago Mayor Jane Byrne early next week to show her the new packages
and to discuss lifting Chicago's ban on the sale of all Tylenol
products. Burke said the company might have to make a special effort
to gain the confidence of customers in the Chicago area.
    ''When this poisoning occurred in your backyard, it's a little bit
more difficult for you to deal with the problem of coming back,''
Burke said. ''We have no doubts, however, that we will be able to
come back, and that's one of the reasons why Dave Collins is going
out to meet with the mayor.''
     Burke, who called the poisonings a form of terrorism, said the
company would absorb the cost of the new packaging, estimated to be
2.4 cents a package, as well as the costs of the recall. J&J will not
raise the price of Tylenol to cover those costs, he said. He also
said the new packaging was the best now available, although the
company would continue to investigate better tamper-resistant
packages. Tamper-resistant packages eventually will be produced for
all J&J's over-the-counter products, the company said.
    Burke said the tamper-resistant packages ''will start appearing on
store shelves in a few weeks and be in most stores by Jan. 1.''
    The new package contains three tamper-resistant steps. First, the
outer box has glued flaps that must be ripped open to get at the
bottle. Second, the bottle has a tight plastic neck seal that covers
the cap and neck of the bottle and must be torn to expose the
bottle's cap. Third, beneath the cap there is an inner foil seal that
also must be torn to reach the capsules.
    The new package is marked ''new safety sealed'' and a warning
printed on the box says: ''Do not use if safety seals are broken.'' A
bright yellow label on the bottle also warns consumers not to use the
capsules if the seals have been disturbed.
    Burke said stockholders have remained loyal to the firm, noting that
Wednesday's closing stock price of $45.75 was higher than the day
before the cyanide incidents began. The stock closed Thursday at
$47.12 1/2 for a gain of 1 3-8 on the day.
    ''Most shareholders invest in Johnson & Johnson for the longer
term,'' Burke said. ''We believe they are with us for the long-term.''
    Burke said company lawyers were examining the possibility that some
of the company's various insurance policies would cover some of the
losses incurred by the company.
    The free replacements and special coupon offers may cost between $30
million and $40 million, although a final figure will depend upon how
many customers take advantage of the offer, Burke said.
    J&J took a $50 million after-tax charge against third-quarter
earnings to cover the cost of recalling and destroying 22 million
bottles of capsules.
    END
    
nyt-11-12-82 0506est
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