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updated 3/10/2011 6:32:51 PM ET 2011-03-10T23:32:51

Federal officials said Thursday that the consumer health unit of Johnson & Johnson will be barred from resuming operations at a Pennsylvania manufacturing plant linked to millions of bottles of defective medicines until it meets quality standards.

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The Food and Drug Administration said it signed a formal consent decree with the company designed to improve operations at three manufacturing sites linked to multiple recalls of medications last year, including Children's Tylenol, Benadryl and Motrin.

The FDA said J&J's McNeil Consumer Healthcare unit violated the law in its production of medications and would be subject to fines of up to $10 million annually if it did not comply with the decree.

The agreement, filed in the U.S. District Court for Eastern District of Pennsylvania, requires J&J to destroy all recalled drugs that have been returned to the company within 30 days. The decree also sets strict deadlines for arranging third-party contractors to inspect the plants and recommend improvements.

The facilities named under the agreement are in Las Piedras, Puerto Rico; Lancaster, Pa; and Fort Washington, Pa.

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J&J said in a statement that it will continue operating the plants in Las Piedras and Lancaster as it implements the FDA plan.

The company's Fort Washington, Pa.-plant will remain closed until it has been inspected and certified by an outside inspector and the FDA. The plant produced most of J&J's liquid cold medications before it was closed last April. FDA inspectors cited the facility for a slew of problems including releasing medicines with the wrong doses of active ingredient and contamination with bacteria or tiny metal shards.

J&J has issued 20 recalls since September 2009 covering over-the-counter medicines like Children's Tylenol and Benadryl, plus contact lenses and hip replacements.

In its last quarter the New Brunswick, N.J.-based company reported a 12 percent drop in profit, as sales were squeezed by a weak economy, pricing pressures and recalls that have kept many popular nonprescription medicines off store shelves. Sales of the company's over-the-counter medicines fell more than 19 percent last year.

Copyright 2011 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

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