Parker Waichman LLP

Zicam Recall Blamed for Matrixx Loss

Matrixx Initiatives, the maker of recently recalled Zicam Nasal Cold Remedies, reported a larger-than expected first quarter loss of $22.8 million, or $2.49 per share. In a press release, the company blamed the fallout from the Zicam debacle for the disappointing results. Earlier this summer, the U.S. Food & Drug Administration (FDA) warned consumers not […]

Matrixx Initiatives, the maker of recently recalled <"https://www.yourlawyer.com/topics/overview/Zicam">Zicam Nasal Cold Remedies, reported a larger-than expected first quarter loss of $22.8 million, or $2.49 per share. In a press release, the company blamed the fallout from the Zicam debacle for the disappointing results.

Earlier this summer, the U.S. Food & Drug Administration (FDA) warned consumers not to use three Zicam nasal cold remedies. The agency said it had received 130 reports of anosmia—loss of sense of smell—in people who had used the product. Following the FDA alert, Matrixx Initiatives recalled two of the products: Zicam Cold Remedy Nasal Gel and Zicam Cold Remedy Swabs. The company had already withdrawn Zicam Cold Remedy Swabs, Kids Size, the third product named by the FDA.

At the same time, the FDA issued a Warning Letter to Matrixx. In the letter, the FDA said Matrixx had failed to inform it of 800 anosmia reports linked to the recalled cold remedies. Matrixx has admitted that it did not pass along those reports to the FDA, but has maintained that its legal counsel advised it was not required to forward those reports to the agency. In the Warning Letter, the FDA warned the firm that the products cannot be marketed without agency approval and also stated that the three Zicam nasal remedies did not include adequate warnings about the risk of loss of sense of smell.

Since the Zicam recall, the company has been named in several class action lawsuits filed by people who blame the nasal remedies for their loss of smell. It also faces a class action lawsuit filed by investors that stems from the recall.

Matrixx is now reporting that revenues for the first quarter of fiscal year 291fell 18.7% year-over-year to $6.92 billion, falling short of analyst estimates of $8.96 million. The company took a $9 million charge from the Zicam recall, and a goodwill impairment charge of $23.9 million related to the recall.

“The FDA Warning Letter has had a material adverse impact on our business and generated significant publicity. The recall of two of our best-selling products has required us to take impairment charges, record reserves for customer returns, and withdraw our sales and earnings guidance for the year,” Matrixx acting COO Bill Hemelt said a statement. “In addition, there has been an increase in legal activity on several fronts associated with this issue, including plaintiff attorneys soliciting for clients alleging anosmia due to our products; class action complaints alleging advertising and consumer fraud; and a class action securities lawsuit alleging public disclosure violations.”

What Our Clients Say About Us
We have worked with thousands of clients and we appreciate them and their positive reviews. Here are just a few recent client reviews...
5 Star Reviews 150
I have been conversing via phone, text and email with Tina Morace and I am very happy with her service. Tina, is professional, courteous, attentive and respectful. Any time I have had a question or needed information, Tina has replied promptly and with all of the information I need.
Ray Nugent
a month ago
5 Star Reviews 150
Parker Waichman LLP is a very Professional and knowledgeable in the work that they do. They worked tirelessly in bringing my case to a Great outcome. I am satisfied with their work and I recommend their services. Thank You Benita Rollis for your hard work and dedication. YOU MADE IT HAPPEN FOR ME.
Pamela Wilkes
4 months ago
5 Star Reviews 150
Thanks to Waichman LLP for winning my case and Joarge Peniche for his work
Adrian Rubi
a year ago

Why Choose Us to Help You?

We Take Care of Everything
Your situation is stressful enough: Let us take on the deadlines, paperwork, investigation, and litigation. We'll handle every detail so you don't have to worry.
No Recovery = No Legal Fees
We work on a contingency-fee basis, meaning that we only get paid from a portion of your settlement or jury award. If you don't get compensation, you owe us nothing.
Decades of Experience
Your situation is stressful enough: Let us take on the deadlines, paperwork, investigation, and litigation. We'll handle every detail so you don't have to worry.
Respected by Our Peers
Judges, insurance adjusters, and fellow attorneys all speak highly of our skills, and we've earned numerous accolades, including a flawless rating from AVVO.
We Have Many Locations To Serve You
We have the experience and the skilled litigators to win your case. Contact us and speak with a real attorney who can help you.
Long Island – Nassau
Parker Waichman LLP
6 Harbor Park Drive
Port Washington, NY 11050
Long Island – Suffolk
Parker Waichman LLP
201 Old Country Road – Suite 145
Melville, NY 11747
New York
Parker Waichman LLP
59 Maiden Lane, 6th Floor
New York, NY 10038
Queens
Parker Waichman LLP
118-35 Queens Boulevard, Suite 400
Forest Hills, NY 11375
Brooklyn
Parker Waichman LLP
300 Cadman Plaza West
One Pierrepont Plaza, 12th Floor
Brooklyn, NY 11201
New Jersey
Parker Waichman LLP
80 Main Street, Suite 265
West Orange, NJ 07052
Florida
Parker Waichman LLP
27299 Riverview Center Boulevard
Suite 108
Bonita Springs, FL 34134
Nationwide Service
Parker Waichman LLP
59 Maiden Lane, 6th Floor
New York, NY 10038