Johnson & Johnson: Pipeline, Products, Performance, Potential

Pharmaceutical company intelligence reports from Espicom provide a full review of the company's activities together with five-year sales forecasts for its key products. The company's financial performance is covered in-depth, from its latest results to a complete analysis of its latest full fiscal year and an outlook for the future. A section on company strategy covers mergers, acquisitions and divestitures, key agreements, products and R&D. An overview of key products and R&D is followed by a comprehensive review of the company's product portfolio and research and development pipeline by therapeutic area. In addition, supplementary appendices provide more in-depth information on financials, agreements and corporate events.

Johnson & Johnson operates in nearly all markets worldwide and has developed a substantial infrastructure consisting of over 230 companies active in all fields of healthcare. In 2008, J&J achieved record levels of revenue in excess of US$63 billion, with the largest of its three business segments, Pharmaceuticals, reporting over US$24 billion in sales. The Consumer and Medical Devices segments reported revenue increases during this period.

The major pharmaceutical growth drivers were Topamax, Concerta and Remicade. However, within our forecast period all of these products bar Remicade are predicted to experience significant sales declines related to patent expiries and generic competition. Other top selling products such as Risperdal/Risperdal Consta, Duragesic, Procrit, Floxin, Levaquin and Aciphex are expected to report reduced sales by 2013.

These threats to sales and growth have placed considerable pressure on J&J's pharmaceutical R&D efforts, although the company has had some recent developmental successes:

• During 2006 and 2007, J&J's anti-infective franchise was rejuvenated following the approvals of Doribax for bacterial infections and Prezista and Intelence for the treatment of HIV. J&J continues to invest in this therapeutic area, with two more potential future growth drivers in late-stage development in the pipeline.
• Following on from the success of Remicade, J&J is developing two new immunology therapies (golimumab and ustekinumab), both of which are expected to make strong contributions to company performance within the medium term.
• Traditionally, J&J has focused on the development of CNS treatments. In 2007, the company launched Invega, a new treatment for schizophrenia. With all key products in this therapeutic area expected to lose patent protection in the next few years, the launch of Invega was invaluable in maintaining J&J's position in this field.

Historically, the Consumer segment has been the smallest of J&J's three core businesses. However, in December 2006, the company completed the acquisition of Pfizer's Consumer Healthcare Business for US$17 billion. This purchase should see the Consumer segment compete more effectively with Medical Devices and Diagnostics and Pharmaceuticals segments. Within Pharmaceuticals, J&J can expect a difficult transition period as older, non-patented products, are replaced with new compounds. The bolstering of the Consumer segment should help overshadow these difficulties in the short-term. Furthermore, J&J has both in its pipeline and in its most recent product launches, the assets to achieve growth and strong sales in the medium- to long-term.