J&J reiterates 2025 sales goal despite looming Stelara exclusivity loss, global economic challenges

Johnson & Johnson is doubling down on a mid-decade pharma sales goal, and it’s plotting a way even as it loses exclusivity on one of its main blockbusters later this year.

Joaquin Duato — who became J&J’s CEO last year after Alex Gorsky stepped aside — repeated the company’s target for $60 billion in pharma sales revenue by 2025 in an investor call Tuesday morning.

That figure was laid out as a revenue goal for 2025 last year, when execs said on the Q3 earnings call that the target number was still possible through what J&J had in sales and in its pipeline at the time.

Says Duato:

In pharmaceuticals, we will continue delivering top line growth annually, while driving towards $60 billion in revenue by 2025. We believe we will be able to achieve our market growth in 2023 for the 12th consecutive year, even in the face of Stelara’s loss of exclusivity, and macro-economic challenges.

That growth over the next few years, Duato added, will be driven by the drugs in J&J’s existing portfolio such as Darzalex and Tremfya, alongside new launches such as Carvykti and Tecvayli.

During a Q&A in response to a question about analysts modeling 2025 sales lower than J&J’s forecast, the chief executive brought up a disconnect between the two predictions, noting that the pharma is primarily putting its weight behind its multiple myeloma portfolio.

In the meantime, J&J’s pharma sales in Q4 last year slipped 7.4% compared to 2021, reporting $13.1 billion in sales versus $14.2 billion in 2021. For the entire year, the pharma division made $52.5 billion in sales, compared to 2021 sales of $51.6 billion.

The company pointed out on the call that while growth was driven by Darzalex and Tremfya, it was offset by decreases in Remicade and Zytiga sales due to loss of exclusivity, and an overall decrease in sales of Imbruvica. Worldwide Remicade and Zytiga sales fell by approximately 37% and 50% respectively, while Imbruvica fell by 18% worldwide — and 27% in the US.

Joseph Wolk

CFO Joseph Wolk elaborated a little bit more on J&J’s priorities moving forward: additional investment in R&D, commitment to dividends and “strategic acquisitions,” noting the pharma’s recent purchase of medtech company Abiomed late last year for $16.6 billion.

Wolk then noted on the call that the Big Pharma expects to lose exclusivity for Stelara later this year. Duato told an analyst asking about what J&J is seeing in terms of competition that while the company is monitoring the situation, “there’s no approved biosimilars at the time.”

Additionally:

We expect the erosion curve of Stelara to be slightly steeper than that of Remicade — given the evolution of the biosimilar market, and the fact that Stelara is a self-administered product. When we think about Stelara in the US, we see the sales of Stelara flat to declining.

Beyond J&J directly, analysts with Cowen noted Tuesday that while J&J did not provide a substantive update about the CARTITUDE-4 study (other than J&J not giving a specific timeline due to it being an event-driven study), Legend told Cowen that the trial did hit the pre-specified events for analysis. Blinded data analysis is now ongoing, and they predict both J&J and Legend to announce topline data by the end of January or early February.

And the plan for Kenvue, J&J’s planned consumer health spinout that recently filed for separation, is to finish the separation and turn it into its own company by the end of the year, Duato added.

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