Johnson & Johnson on Tuesday raised its sales and profit forecasts for the year on the strength of third quarter earnings that beat Wall Street expectations.
The pharmaceutical company, reporting financials for the first time since splitting off its consumer health arm, now expects its sales to grow by between 7.2% and 7.7% in 2023 on an adjusted operational basis, up from a range of 6.2% to 7.2% given in August.
Reported sales are expected to be around $83.8 billion for the year, J&J said.
J&J’s separation of its consumer unit, now a publicly traded independent company called Kenvue, has focused its business around its prescription drug and medical device products. Overall, sales from the two divisions grew by nearly 7% year over year in the third quarter, with medical device growth outpacing that of pharma.
Excluding J&J’s COVID-19 vaccine, which is now little used worldwide, pharma sales growth was stronger, due in particular to better-than-expected performance from J&J’s immune disease drug Stelara. The nearly 15-year-old injectable medicine faces new competitors in diseases like psoriasis, Crohn’s and ulcerative colitis, including from new pills like AbbVie’s Rinvoq.
J&J expects patents protecting Stelara in the EU to expire by mid next year, but doesn’t yet foresee biosimilar competitors entering the U.S.
The company also saw growth from new cancer medicines like its multiple myeloma cell therapy Carvykti, which brought in $152 million in sales during the third quarter. Sales of mainstay myeloma medicine Darzalex also continued to grow, albeit a little less strongly than analysts had predicted.
J&J also revealed it is restructuring its orthopedics business within the medical device unit, and plans to exit less profitable markets and product lines.
The company’s earnings report is the first from a large pharmaceutical company for the third quarter. Its financials are often viewed as a bellwether of sorts for the rest of the sector. Yet they follow a few days after Pfizer sharply cut its revenue forecasts on lower-than-expected demand for its COVID products, disclosing plans to reduce costs and lay off staff.
Roche reports third quarter earnings on Thursday.