J&J, Spinoff Failed to Flag Decongestant Issue in IPO, Suit Says

Johnson & Johnsonand its former consumer healthcare unit, now Kenvue Inc., misled investors in Kenvue’s initial public offering documents by omitting a long-simmering risk that the FDA would deem a nasal decongestant ingredient ineffective, an investor alleges.

Kenvue has traded below its $22-per-share IPO price in May since a Food and Drug Administration advisory committee found in September that scientific evidence doesn’t prove phenylephrine is effective when taken orally, shareholder Robert James Autrey says. He filed his proposed securities class action Thursday in the US District Court for the District of New Jersey.

Phenylephrine’s efficacy has been questioned since ...