Released November 22, 2021 | GALWAY, IRELAND
en
Written by Martin Lynch, European News Editor for Industrial Info (Galway, Ireland)--Johnson & Johnson (NYSE:JNJ) (New Brunswick, New Jersey) plans to separate its consumer health business into a new publicly traded company in order to focus more on its larger pharmaceuticals and medical devices business.
The move, which will take 18-24 months, mirrors a trend among the largest pharma companies in recent years, including Sanofi (NASDAQ:SNY) (Paris, France), Merck (NYSE:MRK), GlaxoSmithKline (NYSE:GSK) (GSK) (Brentford, England) and Pfizer (NYSE:PFE) (New York, New York). For additional information, see January 14, 2019, article--GSK and Pfizer Merging Consumer Health Businesses. The consumer business, which is expected to generate revenues of US$15 billion in the 2021 financial year, is home to well known products including Neutrogena, Aveeno, Tylenol, Listerine, Band-Aid and Johnson & Johnson's Baby Powder, which the company claimed are used by 1 billion consumers daily. The pharmaceutical and medical device business is expected to generate US$77 billion in revenues this year.
Joaquin Duato, announced recently as the successor to departing chief executive officer Alex Gorsky, will continue to lead J&J after the separation while leadership for the new company will be determined later.
"Our board and executive team have regularly evaluated Johnson & Johnson's portfolio of business over the years, asking whether a broad-based approach best meets the needs of our stakeholders," outgoing Chief Executive Officer Alex Gorsky told an investor call. "And while this approach has historically served us well, addressing the complexity of today's global healthcare and consumer environments now demands unprecedented innovation, focus and agility."
He added: "We believe that the New Consumer Health Company would be a global leader across attractive and growing consumer health categories, and a streamlined and targeted corporate structure would provide it with the agility and flexibility to grow its iconic portfolio of brands and innovate new products. We are committed to the success of each organization, as well as our company's more than 136,000 employees around the globe, who will remain the backbone of these businesses."
The company said the pharmaceutical business would continue to generate sustained "above market growth" by advancing its pipeline of products as well as focusing on key therapeutic areas, such as oncology and immunology as well as new therapeutic processes like cell and gene therapies. The Medical Devices business aims to accelerate its momentum across orthopaedics, interventional solutions, surgery and vision.
Incoming Chief Executive Officer Joaquin Duato commented: "This planned transaction would create two businesses that are each financially strong and leaders in their respective industries. We believe that the new Johnson & Johnson and the New Consumer Health Company would each be able to more effectively allocate resources to deliver for patients and consumers, drive growth and unlock significant value." The consumer company will comprise what J&J called "four $1 billion megabrands and 20 brands over $150 million," that command leading positions in Self Care (OTC), Skin Health and Essential Health, which includes baby care, feminine care, wound care and oral health.
Industrial Info Resources (IIR), with global headquarters in Sugar Land, Texas, six offices in North America and 12 international offices, is the leading provider of global market intelligence specializing in the industrial process, heavy manufacturing and energy markets. Industrial Info's quality-assurance philosophy, the Living Forward Reporting Principle, provides up-to-the-minute intelligence on what's happening now, while constantly keeping track of future opportunities. Follow IIR on: Facebook - Twitter - LinkedIn.
The move, which will take 18-24 months, mirrors a trend among the largest pharma companies in recent years, including Sanofi (NASDAQ:SNY) (Paris, France), Merck (NYSE:MRK), GlaxoSmithKline (NYSE:GSK) (GSK) (Brentford, England) and Pfizer (NYSE:PFE) (New York, New York). For additional information, see January 14, 2019, article--GSK and Pfizer Merging Consumer Health Businesses. The consumer business, which is expected to generate revenues of US$15 billion in the 2021 financial year, is home to well known products including Neutrogena, Aveeno, Tylenol, Listerine, Band-Aid and Johnson & Johnson's Baby Powder, which the company claimed are used by 1 billion consumers daily. The pharmaceutical and medical device business is expected to generate US$77 billion in revenues this year.
Joaquin Duato, announced recently as the successor to departing chief executive officer Alex Gorsky, will continue to lead J&J after the separation while leadership for the new company will be determined later.
"Our board and executive team have regularly evaluated Johnson & Johnson's portfolio of business over the years, asking whether a broad-based approach best meets the needs of our stakeholders," outgoing Chief Executive Officer Alex Gorsky told an investor call. "And while this approach has historically served us well, addressing the complexity of today's global healthcare and consumer environments now demands unprecedented innovation, focus and agility."
He added: "We believe that the New Consumer Health Company would be a global leader across attractive and growing consumer health categories, and a streamlined and targeted corporate structure would provide it with the agility and flexibility to grow its iconic portfolio of brands and innovate new products. We are committed to the success of each organization, as well as our company's more than 136,000 employees around the globe, who will remain the backbone of these businesses."
The company said the pharmaceutical business would continue to generate sustained "above market growth" by advancing its pipeline of products as well as focusing on key therapeutic areas, such as oncology and immunology as well as new therapeutic processes like cell and gene therapies. The Medical Devices business aims to accelerate its momentum across orthopaedics, interventional solutions, surgery and vision.
Incoming Chief Executive Officer Joaquin Duato commented: "This planned transaction would create two businesses that are each financially strong and leaders in their respective industries. We believe that the new Johnson & Johnson and the New Consumer Health Company would each be able to more effectively allocate resources to deliver for patients and consumers, drive growth and unlock significant value." The consumer company will comprise what J&J called "four $1 billion megabrands and 20 brands over $150 million," that command leading positions in Self Care (OTC), Skin Health and Essential Health, which includes baby care, feminine care, wound care and oral health.
Industrial Info Resources (IIR), with global headquarters in Sugar Land, Texas, six offices in North America and 12 international offices, is the leading provider of global market intelligence specializing in the industrial process, heavy manufacturing and energy markets. Industrial Info's quality-assurance philosophy, the Living Forward Reporting Principle, provides up-to-the-minute intelligence on what's happening now, while constantly keeping track of future opportunities. Follow IIR on: Facebook - Twitter - LinkedIn.
