PG Procter and Gamble Co

SLOUGH, England—The gates guarding Reckitt Benckiser Group PLC's headquarters were plastered with pictures of dying and injured babies on Wednesday. Inside, a South Korean firefighter whose 5-year-old son had died waited to meet with Reckitt's chief executive.

Dukjong Kim's son was one of more than 100 people, mainly pregnant women and infants, known to have been killed in South Korea by Reckitt's humidifier disinfectant Oxy Sac Sac. Mr. Kim stood alongside lawmakers and representatives of other victims, all of whom had flown in from Seoul to demand an apology from CEO Rakesh Kapoor.

"I sincerely apologize for the injury and deaths of Korean consumers" caused by Reckitt's disinfectant, Mr. Kapoor said in a statement Wednesday. He offered his "deepest sympathy" for "the pain and the irreparable damage suffered by many families."

Reckitt's problems began to surface five years ago, with the unexplained deaths of four pregnant women in South Korea who had used humidifiers. The products are widely used there due to the country's dry winters. Sac Sac—which Reckitt got with its 2001 acquisition of a Korean company—wasn't sold outside of South Korea.

In late 2011, the Korea Centers for Disease Control and Prevention released the results of a study: Animal inhalation tests showed a causal link between humidifier disinfectants and a growing number of lung injuries. The agency ordered a recall of the disinfectants.

The Korean government so far has confirmed 189 deaths and 506 injuries from humidifier disinfectants, connected to Reckitt as well as other companies.

While South Korea made up just 1.5% of Reckitt's sales last year, the impact of the humidifier disinfectant deaths has been outsized. Reckitt in July reported a 19% drop in first-half profit amid a £ 300 million ($389.7 million) charge in compensation for those killed or injured by the disinfectant, a rare bump for the otherwise high-performing company.

Reckitt warned that annual sales would be at the lower end of its previously given range and that more charges could follow.

In South Korea, leading retailers have removed all products of Reckitt, which owns such brands as Durex condoms and Dettol hand wash, from their shelves in the wake of burgeoning anger around the disinfectant deaths.

"Practically we have nothing selling in South Korea," Mr. Kapoor said in a July meeting with reporters in London.

The backlash comes as South Korea cracks down on foreign companies including Volkswagen AG and Novartis AG amid mounting public anger over a government perceived as prioritizing big business over people. The humidifier-disinfectant deaths in particular have had far-reaching impacts, inciting calls for new U.S.-style laws or punitive damages that would slap companies with huge fines.

In an unusual move, Procter & Gamble Co. opened its Cincinnati research center to more than 40 Korean journalists in July. South Korea is P&G's third-largest air-care market, and the company reacted after seeing "concern over a variety of air-freshener and air-care products" that was "sparked by the Reckitt case," a P&G spokeswoman said.

Reckitt recalled its disinfectant products in 2011 but commissioned Seoul National University, Hoseo University and Korea Conformity Laboratories to test its humidifier disinfectant, and privately hired two researchers from the universities as consultants. The Korean prosecutors' office alleges Reckitt rejected test results showing its products were unsafe, bribed the two researchers to manufacture favorable results and ignored toxicity warnings about its product from a German expert in 2000.

"Our review so far indicates that our people followed an approach to the testing which they believed was lawful," a Reckitt spokeswoman said. "We do not believe that any of our employees intended to influence improperly the outcomes of the testing."

Prosecutors have since highlighted the role of the Korean company that made polyhexamethylene guanidine phosphate, or PHMG, the ingredient found to be toxic. Other Korean companies making disinfectants also have come under fire.

But Reckitt—which dominated about 47% of the humidifier-disinfectant market and 70% of the market for ones that used PHMG—has borne the brunt of the public's anger. The company didn't run safety tests on Sac Sac despite labeling it in 2003 as "safe for children" and said its manufacturers didn't test the product either. A Reckitt spokeswoman said verifying safety information, which regulators didn't require, "was not part of RB's standard operating procedure."

The mounting outrage, which comes after prosecutors in January beefed up the team investigating the deaths, has forced the company to make an abrupt about-face from its yearslong strategy of interacting with victims solely through a court-approved mediation process.

"We followed a legally led strategy," Mr. Kapoor said in July. "We started on a path which was inadequate, which was slow, which did not reach the right level of response, and I think what we have said is we need to try a completely different solution."

Reckitt in May hired crisis-communications firm FleishmanHillard Fishburn to help it tackle the issue. It has put £ 6 million ($7.8 million) into a humanitarian fund and has earmarked up to 1 billion Korean won, or about $895,000, for a victim's death or severe disability. The company in July established a board committee aimed at monitoring ethics, compliance and corporate social responsibility and says it plans to upgrade its safety and quality-management systems.

Critics say the compensation isn't enough and that the company's apologies, coming five years after its products were tagged as toxic, ring hollow.

Reckitt has "deceived customers and disrespected life for more than 15 years," read a flier pasted to the company's gates. The flier was signed "Victims' mom and dad."

Min Sun Lee and Alastair Gale in Seoul contributed to this article.

Write to Saabira Chaudhuri at saabira.chaudhuri@wsj.com

(END) Dow Jones Newswires

September 21, 2016 14:25 ET (18:25 GMT)

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