Johnson & Johnson has posted a rise in pharmaceutical revenues, while profits have fallen on the back of hefty restructuring charges.
Group net earnings for the fourth quarter were down 18.7% to $2.21 billion, hit by an after-tax restructuring charge of $852 million, although turnover rose 9.0% to $16.55 billion. Worldwide pharmaceutical sales reached $5.99 billion, a rise of 5.4%, a healthy result given the effects of generic competition to key products.
Turnover from the antipsychotic Risperdal (risperidone) sank 32.3% to $193 million, as generic competition tore into US sales of the blockbuster (down 73.6% to just $24 million). However, the longer-acting form of the drug, Risperdal Consta, shot up 25.1% to $399 million.
The epilepsy drug Topamax (topiramate) was also hit by generics and brought in $192 million, down 71.8%. Worldwide sales of J&J’s anaemia therapy Procrit/Eprex (epoetin alfa) rose 2.9% to $576 million, though they fell 3.1% in the USA hurt by continued concerns over cardiovascular safety for the entire erythropoiesis-stimulating class of drugs.
The Alzheimer’s disease drug Reminyl/Razadyne (galantamine) climbed 7.8% to $110 million, though the USA contributed just $6 million to that total, while turnover from the attention-deficit hyperactivity disorder therapy Concerta (methylphenidate) jumped 36.1% to $381 million.
On the positive side, J&J’s biggest seller was once again the anti-inflammatory Remicade (infliximab), sales of which were up 28.4% to $1.14 billion, while Velcade (bortezomib), for the treatment of patients with multiple myeloma and mantle cell lymphoma, was up 35.1% to $281 million. Sales of the new HIV therapy Prezista (darunavir) leapt 92.5% to $179 million, while the company’s Risperdal follow-up Invega (paliperidone) contributed $106 million, up 11.6%.
As for J&J’s other divisions, medical devices and diagnostics sales reached $6.31 billion, an 11.8% increase, while turnover from the consumer division was up 10.2% to $4.25 billion.
Chief executive William Weldon said that “in a year of tremendous challenge, we maintained our long-term focus while delivering solid results”. Speaking on a conference call, he noted that 2009 saw first reported sales decline for J&J in 76 years but the results were better than expected given the “increasingly competitive business environment” and “unprecedented economic pressures around the globe”.
He noted that J&J has been more open to partnerships with other companies for developing and selling drugs, adding that this marks a different direction for the healthcare giant. Mr Weldon said that “if the right deal comes along, we’re doing to do it no matter what” when asked about making acquisitions that temporarily depress earnings and he also spoke about possible divestitures. The business is like “a snake shedding its skin”, he said, sometimes “we have replenish certain things and discard others”.
