BD (Becton, Dickinson and Company) (NYSE: BDX) has reached an agreement to resolve the vast majority of its existing hernia litigation. The settlement amount, which is confidential, is within the company’s current product litigation reserve and will be paid out over a multi-year period. This settlement will not change BD’s cash flow goals or capital allocation strategy.
The aggregate amount payable pursuant to this settlement is already recorded as a liability within BD’s consolidated balance sheet and will not result in an incremental charge to the company’s consolidated income statement. The multi-year payment structure was part of the company’s cash flow planning process and was included in its previously communicated free cash flow goals and capital allocation strategy.
The settlement does not include any admission of liability or wrongdoing, and BD continues to dispute the allegations in these matters. The company will continue to vigorously defend itself in cases not resolved through this agreement.
The hernia mass tort litigation represents a large majority of BD’s total product litigation reserve. BD believes this agreement is in the best interest of all parties and is structured to eliminate uncertainty for all stakeholders related to the settled cases.
As of the date of the announcement, BD has more than 70,000 employees and a presence in virtually every country, partnering with organizations around the world to address some of the most challenging global health issues. As a result of these announcements, the company's shares have moved -0.7% on the market, and are now trading at a price of $238.04. For more information, read the company's full 8-K submission here.
