US healthcare giant Johnson & Johnson has beaten market expectations with its fourth-quarter results, turning in strong earnings and double-digit sales growth, but full-year performance hit by special items.

For the quarter, net earnings climbed 9.5% to $2.4 billion, as sales jumped 16.6% to $16 billion on a very strong international performance and a 5% boost from currency effects.

Global sales of the group’s pharmaceuticals grew 7.5% to just under $6.4 billion, on impressive performances by the antiepileptic and migraine agent Topomax (topiramate), which soared 23.3% to $652 million, the anti-inflammatory Remicade (infliximab), up 16.4% to $908 million, and its antipsychotics franchise, jumping 15% to $1.2 billion.

On the downside, turnover of the anaemia therapy Procrit/Eprex (epoetin alfa) tumbled 20.3% to $628 million, on continued fears over cardiovascular safety for the entire erythropoiesis-stimulating class of drugs and problems regarding Medicare reimbursement in the US.

Johnson & Johnson’s medical diagnostics and devices unit also did well during the quarter, booking growth of 11.3% to just shy of $5.8 billion. Sales increases were achieved across the board, including by the Lifescan line of blood glucose monitoring and insulin products, which jumped 18.6% to $643 million, helping to buffer a 9.7% drop in turnover to $868 million from Cordis, which markets the drug-coated stent Cypher, on a contracting market.

Full-year sales up 15%...
For the full year, worldwide sales jumped 15% to $61.1 billion, primarily on stellar growth by the consumer segment, which saw turnover rocket 48.3% to $14.5 billion.

Revenues from the medical devices and diagnostics segment grew 7.2% to $21.7 billion in 2007, representing an increase over the prior year of 7.2%, while pharma sales were up 6.9% at $24.9 billion.

During the year, growth of the pharmaceuticals division was again spurred by the antipsychotic franchise (+12.3% to $4.7 billion), Topomax (+21% to $2.5 billion), Remicade (+10.4% to $3.3 billion); the attention-deficit hyperactivity disorder therapy Concerta (methylphenidate; +10.5% to $1.0 billion); and the anti-infective Levaquin (levofloxacin; +7.6% to $1.6 billion). But again, results took a hit from lower sales of Procrit, which fell 9.3% to $2.9 billion, due to the decline in the market.

… but earnings down 4.3%
Despite the strong sales, however, net earnings still dropped 4.3% to $10.6 billion, or $3.63 per share, after being dragged down by a long list of special items, including a $528 million restructuring charge. Excluding these extraordinary items, the group’s earnings jumped 8.6% to $12.1 billion, or $4.15 a share.

Commenting on the results, William Weldon, chairman and chief executive of the group, said: “Despite challenges in certain markets, our broad base of businesses allowed us to achieve solid results in 2007, building on our foundation of long-term profitable growth…It was a year of significant progress in our pipeline”.

For 2008, the company has called for earnings of $4.39 to $4.44 per share, which excludes the impact of in-process research and development charges or other special items.

Johnson & Johnson’s stock closed down 1.54% yesterday on the New York Stock Exchange, but was on the rise again in after-hours trading last night.