Johnson & Johnson aims to make up for revenue lost from its planned consumer split by filing 14 novel therapies in coming years and expanding its existing portfolio, the drugmaker said Thursday.
The company, set to emerge as “the new J&J” in 18 to 24 months when a just-announced spin-off of its consumer unit is finalized, won’t have iconic over-the-counter brands like Band-Aid bandages and pain med Tylenol to fall back on any longer.
As J&J focuses on pharmaceuticals and medical devices, the loss of the consumer division — a $14 billion per year business — is particularly troubling, given that its older pharma meds are about to come under assault from a wave of patent expiries.
How will it make up the shortfall? During a pharmaceutical business review this morning, EVP and worldwide chair of J&J’s pharmaceuticals unit Jennifer Taubert said the company plans to file 14 new drugs, each with blockbuster potential — and a handful with a $5 billion ceiling — over the next four years.
Among the top pipeline assets are the amivantamab-plus-lazertinib combination, for non-small cell lung cancer; the anticoagulant milvexian, which J&J is co-developing with Bristol Myers Squibb; cilta-cel, a CAR-T cell therapy for multiple myeloma; and monoclonal antibody nipocalimab, for autoantibody-driven diseases. A chunk of the value will come from in-licensing of external compounds and other partnering deals.
Also on tap are 36 product expansions, the 10 largest of which will achieve peak annual sales of more than $1 billion, Taubert said. Think additional indications, new formulations and combo regimens.
Eight of J&J’s currently marketed medicines are forecast to grow by double-digits, with 14 exceeding sales of $1 billion, she added, among them cancer meds Darzelex and Imbruvica and ulcerative colitis drug Tremfya.
J&J spent $9.6 billion on R&D in 2020 — “more than 100% more than what we spent on sales and marketing,” Taubert noted. It’s an investment level which the company is planning to maintain, according to news reports.
All of this adds up to a compound annual growth rate of “at least” 5% through 2025, she said. That would outpace the global pharma market, which will grow by just 3% annually over that period, per J&J estimates.
“By 2025, we expect to be a $60 billion pharmaceutical company,” Taubert said, adding that the planned growth can “more than offset” impacts from potential losses of exclusivity on the older drug brands.
Nevertheless, patent expiries have been chipping away at sales of megablockbusters — such as Remicade, previously J&J’s top seller. The immunology infusion saw its first biosimilar rival in 2016, although the company kept competition from Pfizer’s copycat med at bay through aggressive contracting. Remicade’s replacement, biologic drug Stelara, is expected to lose exclusivity in the 2025/2026 timeframe.
After the planned split from its consumer business, the biggest brand shakeup in J&J’s 135-year history, the slimmed-down organization won’t be as broadly based as it is today. It will not, for instance, be able to fall back on its OTC underpinning to weather ups and downs in the other two business segments.
CEO Alex Gorsky reiterated during the business review that he anticipates the spin-off will leave the biopharma and med-device businesses in a better position.
“We always asked and challenged ourselves if a broad-based approach… truly met the best long-term needs of all of our stakeholders,” he said. “While this approach undoubtedly served us well for decades, we believe the consumer environment today now demands a different kind of focus on innovation and agility.”