The company took the decision to withdraw the Vicks Baby Balm line from store shelves at the end of December after two babies in France were reported to have developed the symptoms by health authorities.
However, no clear link has been established to the product and both P&G and the health authorities have emphasised that both babies were suffering from pre-existing medical conditions.
P&G spokesman Kurt Weingand told a Reuters reporter: "There's been no causal link reported between these two relevant health events and the coincidental use of baby balm,"
The French Regulatory Agency first brought the two medical cases to attention at the start of December, last year, alerting all relevant government authorities to what was perceived to be a potential medical hazard.
The authorities said that the balm, which contains both eucalyptus and camphor essential oils, had caused convulsions and cramping in the infants that had given rise to the need for medical treatment.
However the French health authorities considered the two babies' symptoms to be so severe they recommended that P&G withdraw the product from shop shelves, pointing out that the use of essential oils, particularly camphor, is not advised for children of less than thirty months.
The product guidelines recommend that the balm is used on infants over the age of three months and is used as a relaxing massage rubs to soothe discomfort in a variety of minor infant ailments.
After agreeing to the demands of the French authorities P&G took the decision to withdraw the product from all European markets to avoid confusion. It now says that the new formula will contain lower levels of essential oils.