Johnson and Johnson

Johnson & Johnson is a 144 000 employee broad-based healthcare company providing products from baby oil and Band-Aids, to medical devices and pharmaceuticals

Employees: 144,000

Revenue: $94.9 bn for FY2022

HQ Location: New Brunswick, New Jersey, US

What they do:

• Largest and broad product range healthcare company

• Three business units: Pharmaceutical, MedTech and Consumer Health

• 29 platforms/products with over $1bn in annual sales

Their vision and priorities:

• Enterprise: focus on achieving near-term financial targets, maintaining high quality standards, and continuing to invest for long-term value creation.

• Pharmaceutical: Expect to deliver above-market growth in near and long term through portfolio maximisation and R&D investment

• MedTech: Continue to focus on improved execution through market share momentum and enhanced cadence of innovation

• Consumer Health: Deliver science-backed innovation and digital, consumer-centric solutions while advancing toward the creation of a successful new standalone industry leader. A priority for 2023 is to complete the successful creation of their new consumer health company, Kenvue.

Their Financial and Business Goals

• To operate as a 2-sector company, dedicated to competitive performance, both in Pharmaceutical and MedTech. This change will enable them to become simpler, faster, and more focused.

• In Pharmaceutical, to continue to deliver top-line growth annually, while driving towards $60 billion in revenue by 2025.

• In MedTech, with the acquisition of Abiomed, they plan to maximize the commercial opportunity for recently launched innovations, continuing to advance the Abiomed pipeline and prioritize investment in higher growth segments of their markets.

Three things to know right now

• Joaquin Duato is the new CEO

  Mr. Joaquin Duato is to assume the additional position of Chairman, effective in January 2023. Mr. Duato succeeds Mr. Alex Gorsky, who will step down from his role as Executive Chairman following a brief transitional period.

• Johnson & Johnson Completes Acquisition of Abiomed

  They completed the acquisition of Abiomed, Inc. Abiomed is now part of Johnson & Johnson and will operate as a standalone business within Johnson & Johnson’s MedTech segment.

• Progress was made in the separation of Kenvue.

  Significant progress has been towards the separation of Kenvue. They have begun operating their consumer business as a company within a company, and are pursuing an IPO as a potential step in the separation.

What does each business unit do?

Consumer Health Products

This business unit manufactures products to us as consumers including:

• Self Care - medicines for allergies, pain relief, and colds

• Skin Health and Beauty - cleansers, sun protection and moisturisers

• Essential Health - Band Aid, mouth washes and sanitary products

Med Tech

The business unit produces medical devices and products for the healthcare profession including:

Orthopaedics - products for surgery including operating room products and accessories

Surgery - developing products that allow surgeons to operate safely

Interventional Solutions - products that help patients with heart rhythm disorders and neurovascular care

Vision - products focused on eyesight

Pharmaceutical Products

This business unit researches and develops medical drugs and treatments including

• Vaccines

• Heart care

• Infectious diseases

• Neuroscience

• Oncology (cancer treatments)

Their financial calendar

Q1: January-March - Earnings 18th April 2023

Q2: April-June - Earnings 18th July 2023

Q3: July-September - Earnings 17th October 2023

Q4: September-December - Earnings 18th January 2024

Next Earnings Report:

Around 18th April 2023

Findings from the latest annual report

“Our full year 2022 results reflect the continued strength and stability of our three business segments, despite macroeconomic challenges,”

Joaquin Duato, Chairman of the Board and Chief Executive Officer

• In Worldwide Consumer Health Sales- sales decreased by 0.5% but increased operationally by 6.5%. ($15billion).

• In Worldwide Pharmaceutical Sales -sales increased by 1.7% or 6.7% operationally ($ 52.6 billion).

• Worldwide MedTech Sales - sales increased by 1.2% or 6.4% operationally ($27.4 billion)

Positives from the last earnings report (Q4):

• Worldwide Sales - Operational sales grew by 0.9%. In the U.S., sales increased by 2.9%.

• Consumer Health Sales - Sales of $3.8 billion increased by 1%, with an increase of 10.9% in the U.S. Results were primarily driven by strategic price increases, growth due to a strong cough, cold, and flu season, and growth in NEUTROGENA as well as strong new product introductions in Asia Pacific and Latin America.

• Pharmaceutical Sales - Excluding the COVID-19 vaccine sales, worldwide operational sales growth increased 3.9%, U.S. operational sales growth increased 2.4%, and outside the U.S. operational sales growth increased 6%. Pharmaceutical growth, excluding the COVID-19 vaccine, was driven by their key brands and continued uptake in their recently launched products

• MedTech Sales - sales growth of 7.1% in the U.S. driven by commercial execution, strong new product introduction performance as well as COVID-19 procedure recovery in many parts of the world.

Challenges from the last earnings report(Q4):

• Worldwide Sales - were $23.7 billion for the fourth quarter of 2022, a decrease of 4.4% versus the fourth quarter of 2021. In regions outside the U.S., reported sales declined 11.5% with currency negatively impacting the reported results.

• Consumer Health Sales -Outside of the US there was a decline in sales of 5.8%. Due to continued supply constraints in the U.S., COVID-19 impacts in China, portfolio simplification, and the suspension of personal care product sales in Russia.

• Pharmaceutical Sales - sales of $13.2 billion decreased by 7.4%, with declines of 0.6% in the U.S. and 14.9% outside of the U.S. mainly due to losing exclusivity with some products, competitive pressures, and a suppressed market due to COVID-19.

• MedTech Sales - sales of $6.8 billion decreased by 1.2%, with a decline of 8.6% outside of the U.S. due to the impact of volume-based procurement, COVID resurgence in China as well as supply constraints, predominantly in vision.