Texas AG Ken Paxton has sued Johnson & Johnson and Kenvue, alleging they hid Tylenol’s pregnancy risks despite no proven scientific link.

Kenvue (NYSE:KVUE), the consumer healthcare spin-off from Johnson & Johnson, has experienced a significant decline in its stock price in recent months.

As the consumer health company battles claims from the Trump administration that its painkiller Tylenol is linked to autism, Kenvue will bring on Halvorson as its next marketing chief.

Texas Attorney General Ken Paxton is suing the makers of Tylenol over allegedly deceptively marketing the over-the-counter drug to pregnant women.

A potential legal headache for consumer healthcare giant Kenvue ( KVUE 8.36%) was causing pain for investors on Thursday. Such troubles tend to spook the market; hence the more than 13% sell-off of Kenvue across that trading session. The S&P 500 ( ^GSPC 0.53%), by comparison, did much better on the day with "only" a 0.6% decrease.

Kenvue Inc. (NYSE: KVUE) will announce its third quarter 2025 financial results before the market opens on November 6, 2025.

Canaccord said the headlines are likely to distract management and stall Kenvue’s operational turnaround, which had shown early progress earlier this year. The firm noted that Kenvue’s skin health and beauty segment, particularly Neutrogena, was improving, and cost savings followed its separation from Johnson & Johnson in 2023.

Renaissance Capital's bet on Kenvue is a bold one. The stock has performed poorly since the consumer health business spun off from Johnson & Johnson in 2023. At recent prices, the stock has lost about 45% of its value since its market debut a couple of years ago.

The consumer healthcare company currently trades at about 15x earnings multiple, which represents a 9.41% undervaluation versus the sector median of slightly above 16x. Kenvue also trades at about a 40% discount to the average company in the S&P 500 at nearly 24x earnings multiple.