Kanebo Has Settled With 17,000+ Consumers For Brightening Product Injuries
This article was originally published in The Rose Sheet
Executive Summary
Kao Corporation subsidiary offered an update June 9 on its probe into reported vitiligo-like symptoms in consumers who used its Rhododenol-containing skin-brightening products, which were recalled from Asian markets in 2013. More than 17,000 affected individuals have accepted settlement agreements to date.
Close to 12,000 consumers who experienced vitiligo-like symptoms as a result of using Rhododenol-containing skin-brightening products have fully or nearly recovered, but manufacturer Kanebo Cosmetics, Inc. continues to pay the price.
According to a June 9 release from the Kao Corporation subsidiary, 17,222 individuals – including a number who have fully or nearly recovered – have settled with the firm as of May 31, 2017.
Kanebo does not disclose how much the settlements have totaled in dollar terms, but according to reports in February, just 17 women who reached agreements with the firm were seeking roughly $3.2m in overall damages in Yokohama District Court. Their product liability suit was filed in June 2015.
The Japanese skin-care, hair-care and makeup company has been managing Rhododenol fallout since July 2013 when it voluntarily recalled from Asian markets more than 50 SKUs across at least a half-dozen brands due to reports from consumers who developed white blotches on their skin after using the products. (Also see "Kanebo Recalls Rhododenol-Based Skin Brighteners From Asian Markets" - HBW Insight, 15 Jul, 2013.)
Kao, which acquired Kanebo in 2006, subsequently restructured to merge the companies' safety-assessment and customer-relations functions as they began paying personal visits to consumers with alleged injuries, including depigmentation of the hands and face at varying levels of severity. (Also see "Kao Restructures To Improve Safety, Communications Amid Kanebo Recall" - HBW Insight, 14 Oct, 2013.)
Kao/Kanebo's legal troubles may not be over yet, as the investigation has confirmed vitiligo-like symptoms in 19,590 individuals to date, according to the update.
Kanebo has described Rhododenol, or 4-(4-hydroxyphenyl)-2-butanol, as a substance derived from the bark of the white birch tree that "confers strong brightening effects by suppressing the production of melanin in several stages."
Japan's Ministry of Health, Labor and Welfare approved Rhododenol as an active quasi-drug ingredient in January 2008. Kanebo products featuring the ingredient began rolling out to consumers thereafter.
Tokyo-based Kao, whose portfolio includes the Biore and Curel skin-care and cleansing lines, recorded fiscal 2016 net sales of approximately $12.82bn. In its fiscal 2017 first quarter, reported in late April, the firm booked net sales of roughly $3.03bn, up 3% compared with the prior-year period.
However, its beauty business declined 4%, and sales of skin- and hair-care products specifically fell 3% during the quarter. The firm's Chemical and Human Health Care units were standouts, advancing 14.7% and 10.7%, respectively, while Consumer Products sales were roughly flat for the quarter.
Reportedly, Kanebo introduced its first major new products in nearly a decade in late 2016, supported by a marketing campaign emphasizing the products' sensory attributes and aligning them with "natural" trends, presumably to distance the offerings from the powerful brightening products that continue to haunt the company and injured consumers.
Kao notes in its Q1 release that sales of the restaged brand began in Japan and other Asian markets during the quarter, but provides no further detail.