Johnson & Johnson (J&J) reported strong second-quarter earnings, exceeding Wall Street estimates on robust drug sales. Key drivers included the cancer treatment Darzalex and the blockbuster psoriasis drug Stelara, which saw sales increase by 18.4% and 3.1% respectively. Despite the positive results, J&J faces challenges ahead, including biosimilar competition for Stelara and ongoing lawsuits related to its talc products.
The company’s pharmaceutical business is expected to continue growing, but biosimilar competition for Stelara is expected to impact sales growth in the second half of the year. J&J is confident in securing favorable insurance coverage for Stelara in the U.S. in 2025.
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The medical technology segment also saw growth, but sales of surgical devices declined from last year due to competition, supply constraints, and lower demand for bariatric procedures. J&J is confident in the long-term growth prospects of the medical device segment.
Despite these challenges, J&J remains optimistic about its overall financial performance. The company raised its 2024 sales forecast to $89.2-$89.6 billion. However, the resolution of the talc lawsuits remains a significant concern for investors.