The Johnson & Johnson company largely rejected a news report saying that the company knew for decades that there were traces of asbestos in their talkroom for infants
The report published on Friday by Reuters News Agency caused the company's stock to halt, and the company suffered its worst stock auction of 16 years.
Reuters cited documents released as part of a trial claiming that the product may be linked to ovarian cancer.
The New Jersey company has questioned such claims in court, and on Friday it qualified the Reuters report "Trendy, fake and inflammatory".
Fall in the bag
The shares fell by more than 9%, the strongest decline since 2002.
In his report, Reuters says there are documents showing that laboratories employed for advice found asbestos in J & J talk since 1957 and 1958.
Subsequent company reports and external laboratories gave similar results until the beginning of the 2000s.
Johnson and Johnson said in a statement on Friday that "Thousands of independent tests conducted by regulators and the world's leading laboratories have shown that our baby powder never had asbestos".
Despite what has been said by the company, the company is currently facing more than 10,000 trials, mostly for cases of ovarian cancer.