On January 8, Eastern Time, Bloomberg quoted informed sources as saying that Johnson & Johnson (NYSE: JNJ) has preliminarily agreed to pay about $700 million (about 5 billion yuan) to settle an investigation by more than 40 U.S. states into its baby powder. Johnson & Johnson was accused of not warning of the health risks that the product’s ingredients could cause, thereby engaging in misleading marketing.

The informed sources said that the settlement agreement will allow Johnson & Johnson to avoid potential lawsuits, which accuse Johnson & Johnson of hiding the risk of various cancers that the asbestos in its powder could cause. Johnson & Johnson and representatives of the attorneys general of the U.S. states are still finalizing the specific terms of the agreement, but have already agreed on the approximate total compensation amount.

Johnson & Johnson’s spokesperson Clare Boyle did not immediately comment on the latest $700 million settlement on Monday (January 8), Eastern Time. But according to a spokesperson for Florida Attorney General Ashley Moody, investigations into Johnson & Johnson’s baby powder causing cancer are still ongoing in multiple U.S. states, and these investigations “have not reached a settlement agreement.” Moody has been in charge of Johnson & Johnson’s investigation and settlement negotiations.

Bloomberg reported that the settlement agreement is part of Johnson & Johnson’s strategy, which aims to curb the growing number of lawsuits over its baby powder product, which focus on Johnson & Johnson’s concealment of the product’s health risks.

According to a document submitted by Johnson & Johnson to the U.S. Securities and Exchange Commission (SEC) in October last year, 42 U.S. states and the District of Columbia have launched a “joint investigation into the company’s baby powder product marketing”, including several states’ attorneys general, such as Arizona and North Carolina, who have asked Johnson & Johnson for further disclosure.

As of present, Mississippi and New Mexico have filed lawsuits against Johnson & Johnson’s baby powder marketing practices.

Johnson & Johnson is the world’s largest health care product manufacturer, and its baby powder is one of its best-selling products. However, since 2014, the company has been involved in a long legal battle over its baby powder’s alleged carcinogenicity.

Bloomberg reported that Johnson & Johnson is currently facing more than 50,000 lawsuits, most of which are filed by women with ovarian cancer, but also some with mesothelioma (a cancer related to exposure to asbestos).