More Heartburn From J&J's Natrecor

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Johnson & Johnson (NYSE: JNJ) announced last week that it will take a noncash charge of $440 million from a writedown related to a decline in sales of its acute heart failure drug, Natrecor.

Unfortunately, this charge is just one in a series of problems that Natrecor has caused the pharmaceutical giant.

Natrecor had so much potential; it was the only drug approved to treat shortness of breath in hospitalized patients with severe heart disease. But safety concerns have caused sales to languish, as doctors have been hesitant to prescribe it, opting instead for drugs including Sanofi-Aventis' (NYSE: SNY) LASIX and nitroglycerin made by Sciele Pharma (Nasdaq: SCRX).

After a study found that the drug was associated with an increased risk of kidney problems and increased mortality, J&J changed its packaging in 2005 at the direction of the FDA. Then last year the company announced it would start a large trial to further study the drug's efficacy and safety -- rarely a good sign for a drug already on the market.

It's not only the scientists who have been frustrated with Natrecor. Even the marketing department got into trouble with the FDA after it gave doctors pens and mouse pads with a picture of a distressed older patient in a hospital bed connected to a heart monitor and submerged up to his shoulders in water. This violated FDA promotional rules for reminder labeling, which is supposed to just remind doctors of the brand without making suggestions about appropriate patients or drug effectiveness.

Personally if I worked for the FDA, I would have let it slide figuring that the patient image was just an art-imitates-life depiction of Natrecor drowning.

The writedown is not a major issue for a company with $10.4 billion in income over the last four quarters, but it does show that J&J has a way to go before it can turn things around.

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