Email with a statement from Dr Benoit Soucy, Director of Membership and Professional services at the Canadian Dental Association.

The use of paraformaldehyde containing obturating materials in endodontics is an old controversy that will not go away, in spite of the accumulation of scientific evidence.  

The hope is that pastes containing 4% paraformadehyde or paraformaldehyde derivatives would allow for the provision of endodontic treatment in a safe, simplified fashion. It  has resulted in the introduction of a number of products based on the original recipe concocted by Dr. Sargenti in the  1950s under names such as N2 , Endomethosone and AH56.

The problem is that when it works, the Sargenti the technique works very well but when it does not, consequences are dramatic. The inescapable conclusion is that the risk is not worth the benefit and the use of paraformaldehyde containing pastes for endodontic purposes cannot be recommended

The evidence on paraformaldehyde is very well summarized in “Mishaps and serious complications in endodontic obturation”  by ALAN H. GLUSKIN published in Endodontic Topics, Volume 12, Issue 1, Page 52-70, Nov 2005. For your convenience, I have pasted the relevant excerpt below.

Paraformaldehyde:
The use of paraformaldehyde pastes depends on the acceptance of concepts and therapies related to the principles of mummification and fixation of pulp tissue (45). In 1959, Sargenti and Richter introduced a method for endodontic therapy that included filling the root canal system with a paraformaldehyde paste (N2). Sargenti and other proponents for a number of paraformaldehyde paste formulations have touted the consistent antimicrobial activity of the paste when used in endodontic therapy (46). Although traditional zinc oxide and eugenol sealers are used in conjunction with solid core materials such as gutta-percha, N2, RC2B, endomethosone, and other paraformaldehyde paste formulations are recommended as the sole-filling material, greatly increasing the volume of material used in the canal system. Thus, absorbability and toxicity are serious considerations with paraformaldehyde pastes. In a large number of reports published regarding paresthesia and other complications of the inferior alveolar nerve following penetration of root canal filling material into the mandibular canal, in most cases, damage to the nerve was specifically attributed to the highly irritating components of various paraformaldehyde pastes (47–53). Brodin (54) and other investigators (36, 55–59), have experimentally and convincingly demonstrated the neurotoxicity of these paraformadehyde compounds. Furthermore, Brodin et al. (60) have shown that N2, among other root-filling materials with paraformaldehyde as a component, produced permanent disruption of nerve conduction in vitro. Others have demonstrated the systemic distribution of radioactively labeled paraformaldehyde incorporated within formocresol in pulpotomized dogs (61). Disintegration products were found in periapical and periodontal tissues remote from the pulpal wound site. The radiolabeled paraformaldehyde was additionally found in blood, regional lymph nodes, kidney and liver. It had been recognized early on by researchers that every effort should be made to confine these materials to the canal (49, 55–57), as more and more clinical reports of extreme complications were published (36, 50, 53, 62).

Because of the higher risks associated with paraformaldehyde-containing endodontic materials, the use of N2 or similar type pastes are contraindicated as permanent injury risk is substantially less with traditional-filling materials. When a safer, less hazardous alternative therapy exists, it is unreasonable to elect an unsafe methodology. This fact is highly relevant because it is contrary to patient safety to require an individual to assume inherently more dangerous treatment risks that are reasonably avoidable, with safer and more predictable methodologies.

In a second email from Public Information Coordinator, dated 7/21/08. the CDA stated -

Thank you for contacting the Canadian Dental Association (CDA). I sincerely apologize for the delay in my response and I thank you for your patience.

CDA answers general inquiries about oral health care and dentistry, but does not provide research information, advice related to individual dental problems, conditions, diagnoses or proposed treatments. Regrettably, CDA does not have a position regarding Sargenti paste as we do not regulate dental materials.