Bausch & Lomb CEO Steps Down, 2 Years after Renu with MoistureLoc RecallJan 24, 2008 | Parker Waichman LLP
The Bausch & Lomb CEO who oversaw the Renu with MoistureLoc recall debacle has stepped down. Last year, under Ronald Zarella, who served as Bausch & Lomb CEO since 2001, the company was sold to private equity firm Warburg Pincus of New York City. The sale ended Bausch & Lomb's almost 70-year run as a publicly traded company.
According to the Rochester Democrat & Chronicle, Zarrella will be replaced by Gerald M. Ostrov, who most recently was group chairman of Johnson & Johnson's Worldwide Vision Care division. Ostrov left that position in 2006.
Bausch & Lomb has still not recovered from the 2006 Renu with MoistureLoc recall. Renu with MoistureLoc had been linked to Fusarium Keratitis, a rare eye infection that has the potential to cause blindness. The company pulled Renu with MoistureLoc from Asian markets in February 2006, and did the same in the U.S. in April, before finally issuing a worldwide recall on May 15, 2006.
As of June 30, 2006, the Centers for Disease Control (CDC) had confirmed 164 cases of Fusarium Keratitis. The same report said that those infected with Fusarium Keratitis were 20 time more likely to have used the Renu with MoistureLoc solution. The CDC report determined that bad hygiene habits among users were not to blame for the infections, but that the contact lens solution appeared to have poor disinfectant qualities.
In October of 2006, the FDA issued a warning letter to Bausch & Lomb, criticizing the company for not reporting nearly three dozen infections linked to Renu with MoistureLoc that occurred before sales of the product were suspended. The letter also cited the company for numerous violations found during a May inspection of its Greenville, South Carolina manufacturing plant.
Bausch & Lomb now faces hundreds product liability lawsuits stemming from the Renu with MoistureLoc recall. Analysts have estimated that Bausch & Lomb could face potential liabilities of as much as $1 billion over lawsuits stemming from the Renu with MoistureLoc debacle, although some have predicted that the amount will be much higher. The Renu with MoistureLoc recall also has been blamed for a 20% percent drop in the company’s 2006 profits.
When Zarella announced the sale of Bausch & Lomb to Warburg Pincus in 2007, he said it was hoped the move would help the company “comeback from the difficulties of last year”, - he clearly meant the Renu with MoistureLoc recall. But as a result of the acquisition, Bausch & Lomb ceased to be a publicly traded company, a status it held for over 69 years.