Johnson & Johnson
) recently provided an update on its pharmaceutical business. The
company is looking to strengthen its pharma product portfolio and
plans to file for approval of more than 10 new products and more
than 25 line extensions in the next 4 years.
According to IMS Health, the worldwide pharma market, which
was worth about $963 billion in 2012, is slated to grow about
4.5% per annum to approximately $1.2 trillion by 2017. Moreover,
IMS Health reported that Johnson & Johnson's pharma business
was the fastest growing in the US, Europe and Japan in 2012.
The company has also almost doubled its footprint in emerging
markets in the last five years. Johnson & Johnson intends to
continue working on strengthening its pipeline in Japan as well
Johnson & Johnson spent about $7.7 billion on research and
development in 2012. The company's main focus areas include:
Neuroscience; Cardiovascular and Metabolism; Immunology; Oncology
and Infectious Diseases/Vaccines.
Key candidates in the Neuroscience segment include fulranumab
(osteoarthritic pain), esketamine (phase II for
treatment-resistant depression) and an every-three-month
formulation of Invega Sustenna (phase III ongoing for
schizophrenia with results expected in late 2014).
Within the Cardiovascular and Metabolism segment, the company
is looking to expand the labels of Xarelto and Invokana.
Sirukumab, a key candidate in the Immunology pipeline, which
has delivered products like Remicade, Simponi and Stelara, is
being studied for rheumatoid arthritis and lupus nephritis.
Johnson & Johnson is also working on expanding Remicade's
label into post-operative Crohn's disease. Meanwhile, Simponi is
currently under review in the EU for ulcerative colitis and
rheumatoid arthritis (IV formulation) in the US and is being
evaluated for juvenile idiopathic arthritis and axial
Finally, Stelara is under review for psoriatic arthritis and
is being evaluated for additional indications like Crohn's
disease, pediatric psoriasis and rheumatoid arthritis.
The Oncology pipeline has candidates like daratumumab
(refractory multiple myeloma), ibrutinib (mantle cell lymphoma,
chronic lymphocytic leukemia, Waldenström's macroglobulinemia,
follicular lymphoma) and siltuximab (Castleman's disease). Zytiga
is a notable successful launch in the company's oncology
The key candidate in the Infectious Diseases and Vaccines
pipeline is hepatitis C virus (HCV) treatment, simeprevir, which
is currently under regulatory review in the US. The company is
also seeking approval in the EU and Japan.
Johnson & Johnson's new product launch track record has
been good with new product sales accounting for 17% of total
pharma sales in 2012, up from 9% in 2009. The company expects new
products to account for almost 50% of total pharma sales by
The company's target of filing for approval of more than 10
new products and more than 25 line extensions by 2017 should help
lessen the impact of the genericization of key products in the
Johnson & Johnson's Pharmaceuticals business, which posted
sales of $25.4 billion in 2012, accounted for 39% of the
company's total revenues.
Johnson & Johnson currently carries Zacks Rank #3 (Hold).
Right now, companies that look well-positioned include
Salix Pharmaceuticals, Ltd.
). All three are Zacks Rank #1 (Strong Buy) stocks.
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