The U.S. Department of Health is preparing a report on the risks of taking Tylenol. Shares of the manufacturer collapsed

Shares of consumer health products maker Kenvue, spun off from Johnson & Johnson in 2023, fell nearly 10% in trading on Sept. 5. The sell-off was triggered by the news that the U.S. Department of Health under Robert F. Kennedy Jr. may link the development of autism to the use of the painkiller Tylenol during pregnancy. Analysts recall that it has not been possible to prove this link in the past, and consider investors' reaction excessive.

Shares of Kenvue, which produces the drug Tylenol, fell by 9.3% at the end of trading on September 5 after the publication of The Wall Street Journal. According to the publication, the U.S. Department of Health is preparing a report that may link the development of autism in children with the intake of Tylenol by mothers during pregnancy.

Tylenol is widely used as a painkiller, including recommended for pregnant women, Barron's notes. The drug's active ingredient, acetaminophen, is better known in Europe and the CIS as paracetamol.

"Until we release the report, any statements about its contents are nothing more than speculation," a DHS spokesperson told the WSJ.

"We continually evaluate the scientific evidence and continue to believe that there is no causal relationship between acetaminophen use during pregnancy and the development of autism," Kenvue said in a statement, as quoted by Barron's.

The company noted that the regulator (FDA) and leading medical organizations "agree on the safety" of the drug and its acceptability in pregnancy. The FDA's website says it has not identified "compelling evidence" that proper use of acetaminophen during pregnancy causes "adverse effects." However, the regulator recommends pregnant women consult a doctor before using the over-the-counter medication.

Kenvue doesn't release revenue figures for Tylenol sales separately, but analysts said the painkiller is one of the company's two biggest brands, along with its Neutrogena line of skincare products. Jefferies analysts wrote in June that Tylenol and Neutrogena account for more than 15% of the company's U.S. retail sales, according to Barron's.

BNP Paribas analyst Navann Tim called the sell-off in Kenvue shares excessive. "In our view, establishing causation will be extremely difficult," Tim noted. He recalled that a court in 2023 dismissed hundreds of claims about a possible link between acetaminophen and autism as scientifically unsubstantiated.

Excluding the Sept. 5 collapse, Kenvue shares are down 3.8% this year. The company has struggled as consumers cut back on spending amid an uncertain economy. Last quarter, Kenvue reported its largest decline in organic sales since separating from Johnson & Johnson.

This article was AI-translated and verified by a human editor