FILE - In this July 16, 2012 file photo, Johnson & Johnson products are displayed in Orlando, Fla. Johnson & Johnson reports earnings, Tuesday, Oct. 17, 2017. (AP Photo/John Raoux, File)

Johnson & Johnson tops Street 3Q forecasts, hikes forecast

October 17, 2017 - 8:39 am

Higher spending across the board drove Johnson & Johnson's third-quarter profit down 12 percent, despite a big sales jump fueled by recent acquisitions, hot new cancer drugs and strong sales of other key medicines.

However, the health care giant easily topped Wall Street expectations. With momentum in product sales across all three business segments, Johnson & Johnson boosted its financial forecast for the third time this year.

Shares hit all-time high of $137.85, up $1.83 or 1.4 percent, in premarket trading Tuesday.

Sales of prescription medicines soared 15.4 percent to $9.7 billion, boosted by blood cancer drug Imbruvica, Darzalex for multiple myeloma, blood thinner Xarelto and immune disorder drug Stelara. Sales of some older drugs declined amid pressure for lower prices and increased competition from other brand-name drugs or generics, particularly top seller Remicade for rheumatoid arthritis and other immune disorders.

Those declines were offset by $670 million in revenue from Swiss biopharmaceutical company Actelion's drugs for dangerously high blood pressure in the lungs. J&J bought it in June for $30 billion, opening a sixth disease area as a major focus, along with drugs for cancer, infectious diseases and immune, neurological and cardiovascular conditions.

Meanwhile, the Band-Aid maker finally threw in the towel on experimental rheumatoid arthritis drug sirukumab after disappointing testing results and said it's stopped its patient study of leukemia drug talacotuzumab, without giving a reason.

Sales of consumer health products such as Tylenol and Neutrogena skin care rose 2.9 percent, to $3.4 billion, and sales of Acuvue contact lenses and other medical devices jumped 7.1 percent, to $6.6 billion. Device sales were boosted $291 million by this year's acquisition of Abbott Medical Optics, which sells products for Lasik and eye cataract surgery.

The New Brunswick, New Jersey, company reported overall sales of $19.7 billion, up from $17.8 billion in 2016's third quarter. That exceeded analyst forecasts for $19.28 billion.

J&J reported net income of $3.76 billion, or $1.37 per share, down from $4.27 billion, or $1.53 per share, a year earlier. Adjusted for one-time costs, the company posted earnings of $1.90 per share, topping analysts' forecasts for $1.80 per share.

Johnson & Johnson now expects full-year earnings ranging from $7.25 to $7.30 per share, on revenue of $76.1 billion to $76.5 billion. In August, it forecast full-year earnings of $7.12 to $7.22 per share and revenue of $75.8 billion to $76.1 billion.

Wall Street has been projecting full-year earnings of $7.18 per share, according to a poll by FactSet.

___

Follow Linda A. Johnson at https://twitter.com/LindaJ_onPharma

_____

Elements of this story were generated by Automated Insights (http://automatedinsights.com/ap) using data from Zacks Investment Research.

AP Editorial Categories: 
Comments ()