New cancer drugs help Johnson & Johnson edges past profit estimates

Pharma giant overcomes patent expiry of arthritis blockbuster Remicade and fallingmedical device sales

Johnson & Johnson reported slightly better-than-expected quarterly profit on Tuesday, helped by demand for its cancer drugs. Photograph: Mike Blake/Reuters

Johnson & Johnson reported slightly better-than-expected quarterly profit on Tuesday, helped by demand for its cancer drugs. Photograph: Mike Blake/Reuters

 

Johnson & Johnson reported slightly better-than-expected quarterly profit on Tuesday and pushed its full-year forecast higher, as demand for its cancer drugs Zytiga and Imbruvica helped offset falling sales of arthritis treatment Remicade.

Shares were unchanged in premarket trading, with the company forecasting adjusted 2018 earnings per share in the range of $8.13 and $8.18, marginally up from a previous range of $8.07 to $8.17.

Overall sales rose 3.6 per cent to $20.35 billion in the quarter, higher than the average estimate of $20.05 billion.

“This is exactly how we want to start the third earnings season,” BMO Capital Markets analyst Joanne Wuensch wrote in a note, referring to the overall sales number.

As Remicade faces increased competition and sales of medical devices and some consumer products weaken, J&J has been relying on its new cancer drugs as well as deals like the $30 billion purchase of rare disease specialist Actelion last year.

Sales of prostate cancer drug Zytiga surged ahead of analysts’ estimates, raking in $958 million in the quarter, compared with the consensus estimate of $795 million, according to Barclays.

Sales of Stelara, which is used to treat psoriasis and other autoimmune diseases, jumped 16.5 per cent to $1.31 billion, above the average estimate of $1.27 billion.

Remicade sales fell 16.3 per cent to $1.38 billion, but narrowly beat the consensus estimate of $1.36 billion.

Blood cancer drug Darzalex brought in sales of $498 million, missing the analysts’ average estimate of $510 million. Sales at the company’s medical device business marginally fell to $6.59 billion and missed expectations of $6.66 billion.

Excluding items, the company earned $2.05 per share compared with the forecast of $2.03 per share.

J&J’s chief financial officer Joseph Wolk said in a CNBC interview after the results that the company had agreed with a US government proposal requiring companies to include price of medicines in TV ads. – Reuters