Johnson & Johnson (JNJ) 24 Jan 232022 Q4 Earnings call transcript

Good morning and welcome to Johnson & Johnson’s Fourth Quarter 2022 Earnings Conference Call. All participants will be in a listen-only mode until the question-and-answer session of the conference. This call is being recorded. If anyone has any objections, you may disconnect at this time. [Operator Instructions]

to conference like Johnson over now Johnson. & would turn call the to I

begin. may You

business This for morning. Relations Welcome review and quarter & Investor Moore, of year for Johnson. the XXXX of and company’s full our financial Good to Jessica Johnson is outlook Vice our for fourth XXXX. results President of

before Executive the we A Executive Officer; Chief Joining today’s are call and details. Officer. the me into Financial Joaquin Joe get Board Vice Wolk, on few Chief logistics Duato, Chairman of President, and

As presentation a Johnson the section you including reminder, investor.jnj.com. can find the and Investor materials, additional of & today’s at on Johnson website associated schedules Relations

market separation today’s that Consumer among the financial note position, other of Please Health strategy business. things, development, future and the and the may related business include Company’s anticipated forward-looking statements Company’s to, product meeting performance,

these to rely from information using are not Company’s subject are those of on on cautioned to as that uncertainties projected. actual events, available statements, You’re future results expectations materially the cause differ may current certain and which the risks and of date, to based today’s

these our In website. uncertainties, can XXXX particular, uncertainty about of of the SEC’s is and other the and significant Form SEC in available COVID-XX filings, pandemic. which there including be the further XX-K, description and found contemplated factors A investor.jnj.com on duration is impact risks, our at

collaboration with those or of and acknowledges are partners products developed compounds strategic the several in from today Additionally, This other discussed licensed relationships. slide companies. being

priorities the well P&L the highlights the XXXX. I year to commentary anticipate questions. as be remaining for will three and with overview fourth Moving sharing review to for the for our last an our full and highlighting approximately CEO enterprise. related for segments our will Joaquin his business additional the your before his comments then and XX We corporation priorities Joe available as XXXX results sales quarter year as The open time then will of the for will cash capital and minutes. with position, agenda, will first guidance allocation close results XXXX. webcast

to now turn I’m to call Joaquin. the pleased over

Jess. to I’m of results for be review priorities pleased highlight XXXX for to excited Johnson. our and Thanks, business. Johnson my the everyone. morning, here the & Good I’m today future

For honored XXX This Johnson innovation. remains on have years, be the were people as we to over forefront today legacy. this the counted true to continue healthcare And Johnson I’m day as founded. at of &

is dedication challenges, around the In There as delivered business. full This and operational result of achievements business XXXX, our X%. of last year year. macroeconomic the our focus of of and diversification despite well the we many employees breadth as over growth were world, the

highlights. some share me Let

Our growth, delivering the achieved X% continue as Pharmaceutical vaccine, year advance we to its of growth sales COVID-XX operational team excluding adjusted above XXth innovation market consecutive our nearly pipeline.

I’m made portfolio. filing with particularly CARVYKTI, launches TECVAYLI, GPRCXD excited This bispecific. CDX our and CDX along across our multiple myeloma of our the first about our the therapy; progress the antibody, Talquetamab, recent BCMA cell bispecific of includes

year full second outperforming composite. operational competitive growth, our X% consecutive In above anticipating MedTech, we generated our year

with we innovation, the new potential. significantly of value our net including more pipeline, of present In terms accelerated of of the than enhanced the product quality launches number and MedTech programs of $XXX cadence doubling million over

the to global recovery accretive become This enhances transaction and acquisition leader the MedTech growth. in which in XXXX. heart revenue immediately completed positions we of Notably, Abiomed, as us earnings will

the Finally, separation of we significant made Kenvue. progress towards

step to separation. as a a our business operating in SEC, a pursue IPO us consumer filed the giving company, and the as begun potential We company Form S-X have option our we within with the an

macroeconomic are challenges. Johnson the priorities as and we to ahead, prudent, continue, year XXXX that & have environment, times we our described approach this XXXX is Johnson impacted Looking that for In proven of our and clear while best the headwinds consistent. of can remain resilient expect to some be in

company, First, competitive to simpler, both us we operate are MedTech. performance, change and Pharmaceutical in faster finalizing our and enable This plans focused. two-sector as & will Johnson for dedicated to Johnson to become more a

achieve In and loss line XXXX will in growth challenges. in even be face growth continue macroeconomic Pharmaceutical, of we by $XX revenue annually, towards able in delivering XXXX. consecutive while we year, XXth the for the of STELARA top driving exclusivity billion will believe We market the to our

be portfolio, DARZALEX, SPRAVATO, uptake TREMFYA, new will including continued by UPTRAVI, CARVYKTI ERLEADA, also launches, and SUSTENNA driven TECVAYLI. Growth including existing from and primarily INVEGA our and

with with now Abiomed, MedTech, annual billion in of the over we In platforms acquisition have sales. $X XX

expect XXXX’s on momentum. build We to continue to

Consumer the opportunity for commercial Health will advance investment complete We our Company, to as continuing will track year brings Abiomed priority, prioritizing pipeline recently growth announcement in remain of We creation November my which maximizing & successful me segments our this the XXXX. higher the to Johnson Kenvue. launched to of new This of in be completing next XXXX transformational indicated innovations, for by do a our in Johnson, on markets. and initial the separation in

for look record of gives grow long-term success. our the can us track forward, confidence ahead we our peers we cement the and As that foundation

XXXX. a positioned companies M&A, acquisition balance over that the year confident XXXX and actions for including our R&D have innovation. significant we increased we invested during commitment to $XX $XX sheet billion repurchase capability billion Following few our deployed of We beyond. We and the year. like for Also, XXth are substantially R&D year continue in especially take such XXXX, a the and well instituted organic Very I’m to increased consecutive Abiomed. in dividend we share XXXX. we a concurrently, the where we investment, nearly in

closing, In energized I about is to come. am what

will innovations, and most patients products in drive our continue world. and to largest the shape we of As for to diversified future care care use health around company the scale the the breadth deliver world, and health

Jess. it to back turn me let Now,

Thanks, Joaquin.

X.X% of of X.X X.X% were decrease with currency for fourth currency, sales versus Starting XXXX Worldwide quarter quarter had fourth a growth, a which as the sales effect of results. XXXX. impact Operational points. negative of increased sales QX the of XXXX, the translational $XX.X excludes billion

In OUS declined impacting regions U.S., XX.X%. sales the the declined In currency negatively results outside reported U.S. our sales increased by XX.X Operational sales outside the U.S., with our X.X%. X.X%, reported points.

Excluding sales the X.X% the sales growth was X.X% the and from in COVID-XX outside vaccine, X.X% operational U.S. worldwide, U.S.

an divestitures the you As acquisitions in sales in had our results will impact our find on schedule, supplemental quarter. and immaterial

to earnings. now Turning

earnings one year of and was share earnings $X.XX For earnings $X.X diluted the quarter, net share $X.XX ago. diluted were billion per per versus

periods, $X.X quarter billion, and and for diluted the XX.X%, were amortization asset $X.XX, intangible for compared adjusted earnings after-tax quarter earnings Excluding of expense special net XXXX. share to increases was fourth of adjusted and per respectively, the X.X% both items representing

an On XX.X%. increased basis, diluted per adjusted earnings operational share

sales For XXXX. the full year year Operationally, the full to currency negative year XXXX, X.X%, full points. having sales X.X% of were consolidated of X.X impact a compared with billion, $XX.X an grew increase of

the X.X our in the results was year-over-year growth growth reported reported Operational regions In our sales negatively sales with grew X.X%. U.S. by U.S., OUS outside points. outside currency impacting declined X%. by U.S. Sales X.X%, the

COVID-XX find in vaccine as for year. divestitures sales our As our as you and from the results sales well will our impact schedules, full on had acquisition an immaterial supplemental

adjusted $X.XX year year increases share and net year $XX of X.X%. diluted earnings On versus billion ago. adjusted earnings X.X% $X.XX by share an of was earnings X.X%, increased and per full basis, the versus earnings $XX.XX, were billion per diluted for earnings a share and full were diluted XXXX adjusted $XX.X diluted Net XXXX. respectively, XXXX operational share representing was per earnings per

today’s income call, our segment, information segment, consolidated While can additional not and which tax full by for part sales year we adjusted and be remarks XXXX statement earnings have downloaded prepared for before from of our backup of website. our provided by

will operational stated, to highlights XXXX segment comment the business I fourth currency otherwise impact quarter therefore, sales comparison of in Unless represent quarter. sales percentages the of the now change the and exclude translation. quoted on for performance

Health decline an the XX.X% Consumer the billion with increase $X.X X.X% and X%, outside U.S. sales increased Worldwide Consumer with Beginning of a of of in U.S. Health.

and price increased sales growth outside X.X%. to X.X% a the worldwide operational operational strategic contributed due strong currency, U.S., flu were cold growth strong and growth OTC second translational new as Skin Results Health/Beauty. for Latin as the growth in X% Excluding by growth Asia increases, cough, product and to Pacific increased America. in NEUTROGENA primarily well driven introductions growth NEUTROGENA season, consecutive operational sales and in quarter of

portfolio across Growth although impacts constraints Russia. portfolio suspension by of the reduced sales continued, and in the simplification U.S. in was supply personal product the China, care in partially COVID-XX offset

Pharmaceutical of of Pharmaceutical Moving Worldwide with the the on U.S. X.X% segment. of in to declines decreased billion $XX.X our and outside XX.X% X.X% U.S. sales

operational outside worldwide currency, the operational U.S., sales X.X%. and declined Excluding X.X%, translational declined sales

and our key growth assets continue U.S., driven brands the by continued increased including in to growth sales and operational worldwide double-digit growth, for sales products, enabling X%. increased sales, increased excluding consecutive X to growth. above-market Pharmaceutical the with the growth U.S. operational adjusted vaccine our XXth COVID-XX sales X.X%, was vaccine, outside sales deliver us growth recently uptake the Excluding year, launched X.X%, operational operational COVID-XX

ZYTIGA, driven was loss along was Growth REMICADE sales. of due and with decrease TREMFYA, exclusivity DARZALEX, by partially a to IMBRUVICA ERLEADA, offset in by STELARA and and

declined in predominantly XX.X% strong and of increases leadership oncology ERLEADA due ZYTIGA competitive its Europe sales drive market IMBRUVICA and XX.X%, Despite business, pressures, XX.X% and market a with DARZALEX respectively. our worldwide due growth, September. loss worldwide, worldwide. to IMBRUVICA pressures of COVID-XX. suppressed XX.X% in to to due Within exclusivity CLL position sales continued sales declined maintains competitive to

in and as X.X ulcerative Results the approximately in grew in well X.X%, mix U.S., unfavorable period gains U.S. gains In Pacific. basis quarter by results in business, timing as the shipment Europe favorable and a well partially by XXX points worldwide and and by our as rebating STELARA X disease impacting market respectively, patient colitis, in Crohn’s austerity offset measures points. in as points prior were adjustment share growth immunology Asia with driven the and of

TREMFYA in period gains X,XXX grew the by U.S., adjustment a respectively, and was prior points XX.X%, basis offset year points, driven challenging in approximately QX by impacting worldwide gains results with a patient by points comparison. X.X and X.X psoriasis unfavorable arthritis, with mix growth. partially growth psoriatic and market prior net along of unfavorable share

to that meet XXXX, Beginning in anticipate threshold currently be reported neuroscience, CARVYKTI, currently other separately in SPRAVATO, will the disclosed. oncology, in reported and we QX other

the the of I’ll the of your decreased by decline MedTech U.S. $X.X growth X.X% X.X%, Worldwide of X.X% billion and sales MedTech with segment. U.S. to turn attention of now a outside in

X.X%. translational Excluding operational increased increased the outside operational U.S. sales growth sales growth worldwide currency, and X.X%,

was quarter Excluding strong procedure COVID-XX value-based as new recovery sales impact in growth Partially in growth was world. and predominantly resurgence divestitures, acquisition the of commercial QX of supply by China many as envision. product in the driven offsetting adjusted as well the growth well X.X%. performance the was impact COVID worldwide of execution, procurement, operational constraints as introduction parts

XXXX. continued in primarily delivered commercial double-digit were growth growth reflected of continued sales in each XXnd, Solutions growth our at of as product throughout in December adversely related XX.X%, the dynamics Strong strong date improving also driven by are electrophysiology. dollar U.S., worldwide OUS and sales reported impacted was by performance new to execution in acquisition and the another results performance, sequentially Interventional position COVID-XX, with Interventional closed. market especially Solutions, given Abiomed quarter the strong The introductions financial China. franchise quarter

strong of growth appropriate X-Day, including commercial the Growth tempered ACUVUE market OASYS was of challenges. by supply OASYS lens performance launch actions. of ACUVUE strong continued of X-Day products, price global and execution Contact recent family MAX our X.X% reflects

digital enabling and hips like continued and in to technologies pull-through and and sports spine, in other sales franchise, reported orthopedics knees. drive the areas In accelerate

basis positive For additional days points in XX the on results quarter. context, selling approximately impact a had

impact with mix basis lower the I’d points, coming for enterprise, few unfavorable Now a last quarter a business. from XX manufacturing-related in statement pressures unfavorable deleveraged of with have by year. of driven Pharmaceutical of of turning sales as items highlight Pharmaceutical vaccine same as our COVID-XX of the portion that primarily to the inflationary onetime compared costs, by the products well currency business, consolidated changed to sold noteworthy like Cost XXXX. to earnings quarter the fourth

higher Selling, marketing the well spend by XXX prior inflationary X% and environment. administrative year of basis year, the the points. margins costs phasing in proactive with This earlier management as driven current as a given reduction versus leveraged represents by

reduction levels, continued We competitive sales invest invested at earlier prior quarter. investing phasing year, development with billion and XX.X% strategically this $X.X higher in an of XX.X% to spend the primarily by The research year. the in was versus driven

Interest earned income prior by to of by million, over interest rates on was balances. favorable year higher cash driven just $XXX

an onetime was in compared higher $X vaccine XXXX higher of costs, fourth acquisition million expense the line and driven by of income billion an on quarter was fourth other costs of gains The primarily expense lower separation-related expense Consumer exit Abiomed manufacturing-related quarter the and to $X.X costs, XXXX. This in securities. of the Health COVID-XX to related

related As modification manufacturing in XXXX, program we Company’s of we levels obligations continue clinical COVID-XX and network contractual customer remaining exit with associated to QX all cost and to external and vaccine COVID-XX expenses, the meet research announced that have vaccine, commitments including its the manufacturing required capacity to requirements. trial

Regarding jurisdictions in the primarily higher in The the was income same rate year. year. tax last versus quarter, in the more taxes increase our effective period driven tax was prior X.X% XX.X% versus by

current in items the onetime from Additionally, of the Company the in repeat that quarter fourth tax XXXX not did year. benefited

I versus additional upcoming XX-K was you the filing specific tax same on year. details XX.X% items, last the in XX.X% review to special rate our period for matters. effective encourage Excluding tax XXXX

Lastly, section and special to I’ll also items. earnings amortization exclude earnings our before the the per adjusted slide, expense we your to of attention the impact direct tax, and intangible box of have provided share income where net

a adjusted at income and offset adjusted our from XX.X% from segment. of earlier improved by by year, as XXXX, by fourth R&D cost In currency the percentage XX.X%, driven increased sold. look SG&A of and negative partially let’s XX.X% XX.X%. to impact with for spend the products before margins higher Pharmaceutical the in primarily to phasing, income the tax of quarter sales tax of Now, before enterprise

from the XX.X%, to in MedTech partially by supply primarily and offset inflationary margins higher driven pressures. chain R&D with spend year, phasing, favorable and SG&A portfolio earlier mix XX.X% by improved efficiencies,

marketing to higher XX%, Finally, supply XX.X% spend Consumer pressures. by phasing driven chain by Health brand inflationary offset margins from in partially improved efficiencies, earlier and the with year

Joe year portion results. Joe? earnings fourth now and the I’m sales XXXX to call to the Wolk. & concludes full turn Johnson the quarter pleased Johnson This of and over

for everyone, Thank you, and Jess, today. thanks, joining us

shared, we across competitive Jess XXXX. with in reported growth solid business results As segments our

fourth we performance and challenges while in meet tempered our macroeconomic October prioritized quarter to While sales slightly expectations. better our lingering costs yield managing margin investments, than earnings to impacts COVID-XX-related our guided top growth,

well The entering is business and we resilient, positioned should XXXX. be

supply Abiomed the the and We of proud acquisition of tremendous are the our advancements including Talquetamab filing the portfolio long-term, the and business. TELIGEN of FDA for particularly on of Europe, to pipeline progress and closing our the solidify in separating Health launch in TECVAYLI, the the U.S. clearance solution, digital made our Consumer

cash our XXXX, of Let’s strong unchanged. net marketable securities of our all and uncertainty, the of cash of against debt allocation billion. our Despite generated year-end capital position $XX into for execution flow priorities. allocation approximately And and and priorities $XX a delve had approximately macroeconomic financials, approximately we a cash billion remain at billion of These with deploying $XX debt priorities. end the capital year we billion. year against $XX capital XXXX the of for beginning We position free had

$XX including MedTech XX% has more advancement total in enabled a This of portfolio, of for which referenced. pipeline of the This our myeloma past nearly our development. sales strengthening and Joaquin multiple research investment billion than we and important of year, programs, progression invested

Investment remains support top and long-term in value creation. R&D to a growth priority

of know We to And annual Our XXth Consumer we we intend, second maintain which the dividend. a a marked priority to our the as dividends. separation, investors consecutive dividend. in year increased dividend. our that commitment at our XXXX minimum, is Health value part

separation that can the you appreciate, best clarity is to type we on how more determine will of As need achieved.

organic MedTech’s strategic in we presence activities. of early-stage deals smaller than complement is as which higher acquisitions, XXX segments, closed more XXXX, In as well to strengthening acquisition our priority is Abiomed, growth third the licensing and Our acquisitions, intended partnerships.

And Finally, shareholders we share XXXX. $XX returned end program. a repurchase quarter. approximately dividend, of of year, of $X in in Board over authorized billion our to we’ve program our third combination In the completed with the billion as the XX% that

full I’ll XXXX our year guidance. now provide

current Health of Consumer still and our separation, are Johnson Kenvue guidance inclusive Pharmaceuticals, the MedTech segments. we businesses, in of process Johnson represents As the & the

net and a performance. are thus, favorable associated growth the sales and a growth with or billion. We X.X% we full with operational acquisition, estimate expect to We sales range billion This models X.X% manage $XX.X is Abiomed in impact operational provided constant business your basis, currency $XX.X acquisitions year range X.X%. divestitures from primarily the of X.X% the on how reflecting to XXXX for in comfortable guidance reflecting to the of adjusted

your sales Our COVID-XX will XXXX. vaccine, anticipate, continues decline already as from correctly contribution guidance to exclude the which, in models

utilizing on currencies, future of the year. to don’t relative as reported on we week well euro for as movements, dollar impact foreign As currency last speculate from U.S. translation rate be currency at as we would estimate there but X.XX the you no sales the know, spot other

Regarding expect to leverage. be inflationary of cost pressures by margin operating operating by expense goods other and items XXXX on we continued sold, flat our P&L, offset continued driven adjusted pretax

losses the the Regarding with where line actuarial gains by basis, write-offs. litigation benefit income and $X.X to income, Development associated as on as and employee as costs on XXXX. an be Johnson related the & billion, balance for $X.X certain items we record sheet programs and well expect to such billion P&L and adjusted Johnson expense, royalty other we this assets return On investments Corp.,

of disclosure on employee future team the rates, majority lowered years. we derisk actions this interest of through implemented this to expect income associated return rising with aligned to program couple benefits on And The benefit based accounting programs projected trends, the is benefit the obligations. have current and plans with requirements, our assets next has our continue

Abiomed modeling and XXXX charges million. acquisition. expense the are increased $XXX $XXX associated versus figures These include comfortable financing million We interest with between with net you

XXXX rate projecting range XX.X% anticipated mix of the effective income an for in across based tax tax we are laws and businesses. on current our XX.X% to geographic Finally,

share range guiding growth or midpoint. Considering of to X.X% X.X% approximately $XX.XX all constant basis, to $XX.XX reflecting of or the operational a we per are at currency earnings currency the these constant X.X% in factors, adjusted on

be not year. in midpoint, $XX.XX our $XX.XX $XX.XX year the the earnings versus predicting referenced, per for or share by per movements, While range approximately share, impact earnings X% recent I currency the per share impacted assuming operational resulting previously would reported at reported prior the adjusted of adjusted of rates $X.XX exchange a growth of in to favorably

segment on provide quarterly considerations like a guidance qualitative I’d not While we modeling. do your or provide basis, for by to some

Some segment remarks, starting with Pharmaceuticals.

expect We SPRAVATO XXXX, driven and growth such continued CARVYKTI, and assets products, which in of recent UPTRAVI market we considers loss uptake than is in and to occurring as deliver key the STELARA lower Pharmaceutical late again SUSTENNA anticipate U.S. above-market the growth as TECVAYLI. DARZALEX, as despite years by ERLEADA, well launched TREMFYA, of recently as growth This such exclusivity, experienced in INVEGA in XXXX

growth expect other continue XXXX across to expect STELARA this offset the to be Europe. post-LOE While growth the increased to we potential by Further, a to volume in pricing impact LOE up products continue from we well expect date, for pressure. measures we as U.S. austerity as

pace products. with expect stable market competitive health constraints staffing we a relatively limitation recovery the on commercial remaining volumes of recently launched of and continued continued by We MedTech, In uptake procedure significant the recovery. most in recovery care fueled anticipate growth

as pressure into volume-based the XXXX easing the policies procurement. as anticipate of impacts we to COVID to China, well from continued related Specific zero

XXXX. we’re growth we’ve As accelerates in Abiomed acquisition, the excited our about which said, sales

In in. with the that continued in Consumer markets we Health, compete we line growth anticipate

the minimize strategic within ongoing impact portfolio to across continue to We the also to expect chain. price utilize of supply the pressures inflationary increases

expect half quarter with to a Regarding be best half theme than general first the stronger second it’s the quarterly that than second we and is quarter. phasing, the first likely up the stronger summed

support We these to are assuming the following statements.

in namely In and declines more XXXX expect that first the by well launches half we of in new as half prominently ZYTIGA pressure. second year the the of QX as SUSTENNA Europe continued product the products INVEGA of be ramp Pharmaceuticals, will impacted occur Also, LOE continued pricing year. results, will impacted the from

second half procedure year expect sales year recovery we to the growth higher the be than we the MedTech, as half operational of progresses. In anticipate ongoing as to first improve

more the in in launches felt carry of Pharmaceuticals, assumed is uptake some impact QX And that second into believe to China of COVID pronounced over XXXX. half. product in to also early the new similar We will be

regulations the the we are around Given in currently limit we can registration Company. planned what discuss Consumer process, Health

second attributable half On the by to costs is anticipate half. inflation be driven in that than higher XXXX we comments the P&L, the first inventory in through operating margin also built better higher the by mitigation half a to will This half second the XXXX at driven the first P&L cost and accounts efforts in and for just flow reflected made. sales of that leverage I in

currency And as a we year, spot don’t of our on in negative well half. as euro second results would X.XX the other to on exchange last in the dollar finally, while but speculate of have potentially rate as week favorable a U.S. relative utilizing movements, impact impact the the the future first half at currencies, foreign

events to key in Turning XXXX.

first in as we on mentioned, the and we step have Commission, within a the filed an initial we provide started Consumer around the Securities limited Form a January planned the Exchange offering with are a As us as separation. and We to public separation, planned company. the company information Xth potential Health operate can S-X option Kenvue publicly giving a pursue to in

the conditions. be Consistent we with separation with that complete subject XXXX. any an in to consistent such our initial interim expect as to announcement market continue we of to that in steps, would XXXX, expect November timing, And IPO,

of Johnson’s end $X.X Johnson given for are average in billion These market $X.X already this industry standup to estimating line cap. & incurred having billion in $X.X with through such transactions billion been are after-tax XXXX. as estimates costs, We Kenvue the with one,

annual estimating after-tax dissynergies completion the separation, we to following between the be incurred are $XXX $XXX million In impact. million terms of of of and

fully expect the end to executing to mitigated already are have by them of We these address plans dissynergies XXXX. and on

new the discussions of Johnson level continue on provided reevaluate based Johnson, separate & ongoing information also financial with we’ll to we investors. As

three-segment a XX-K. two-segment expiry While we disclosures, look table in our will for quarterly to financials move to ways by a enhance company, we our and segment simpler from R&D to continue become such as patent company a as will providing our Form

and expect across Pharmaceutical In also CAR-T bispecific of in in some XXXX be potential year myeloma. clinical segments. We relapsed/refractory lines our important readouts our include therapy. business, trial Talquetamab, innovations a of to CDX from multiple to studying our scientific BCMA examples X CARVYKTI, an antibody GPRCXD of the Potential approval data CARTITUDE-X, our patients with X prior

potential data analysis chemotherapy. MARIPOSA in in an potential interim in clinical [ph] lung of the cell cancer non-small from as lung The study mutations cancer study versus the with of cell EGFR non-small combination frontline PAPILLON plus well frontline as lazertinib for RYBREVANT with Tagrisso

hemolytic X the clinical data finally, in in Potential X from TREMFYA, fetus will Bristol-Myers in our partnership non-muscle study China, invasive year. Squibb. later rheumatoid Reimbursement IL-XX the disease Phase with TREMFYA to Crohn’s and data in Factor in National inhibitor, And nipocalimab, clinical recently Phase colitis. X take ulcerative arthritis and Drug SunRISe-X for anticoagulant was eluting our TAR-XXX, Starting disease antagonist Phase List XI device and the effect Phase a of which Early X from FcRn clinical bladder added newborn, this of potential from data cancer. program drug clinical our milvexian,

expansion our for for including look solutions in pulsed Ottava, ablation studies clinical MedTech, cardiac our digital ablation Abiomed. solution, the innovation heart and to pipeline orthopedics, we across of forward digital on field solutions associated providing our with In and robotic information our advancements business, significant recovery in programs

cautious to our guidance many Overall, approach the uncertainties. XXXX external should financial responsibly viewed given be as

completing new Health delivering a & growth focused Johnson, Johnson separation. are competitive Consumer We while for successful also on

confident for We position current and our that plans value creation for growth long-term are us shareholders.

like That will open they’d pleased the prepared your concludes line with for to am please Kevin, you the ask to questions. listeners question? remarks. instructions provide I a our now if

Our Instructions] Flynn Morgan question [Operator from coming Stanley. today is from Certainly. Terence first

guidance, first you it as should guess, me. question viewed Maybe the mentioned a cautious. Joe, be two-part I for responsibly on

year? think Just you’d any conservatism wondering out about we in terms areas call the of as

And you me, important obviously, on then, excuse for pipeline myeloma -- area side, sorry, an myeloma the guys.

timing and Just you of CARTITUDE-X wondering the confirm study can you’re that you. Thank hoping to see if the readout? from what

geopolitical out the with assuming Good a question, uncertainty, Joaquin. say, just I’ll I quite this I’ll did. classify in in the in time was and we’re that conservative come inflationary all P&L, approach XXXX. as to right respect guidance at this What for Terence. that guidance, is the I of in we the the point se. ranges first uncertainty, kick of of outlook With we thought question given per say that over morning, then handle to CARTITUDE to would we our would had it of I terms the wouldn’t carryover, frankly, lot the impact macroeconomic

the will inventory the If of relief fact assuming would element XXXX. of balance mostly at imagine, As you XXXX. conservatism, and year-end year. sheet flow half the resides say, in work, set on first as built in any any at higher cost can deflationary that That’s the we throughout way the we’re the we accounting I would there’s through not probably it go

as do and results the level saw So, we’re really top some you as outlook investments for will well fourth in to prioritize doing for everything manage the a quarter at But higher time. our long these think the be we as for our costs we XXXX, interim. term can costs responsibly with

filing about continued Pharmaceutical BCMA bispecific; progression CARTITUDE-X Thank the in important GPRCXD our It’s of for BCMA CARVYKTI, forward. TECVYLI, and moving also, CDX our approved you. is DARZALEX first of with about and Terence, respect we CARVYKTI, the most our cell driver growth bispecific. recently excited our multiple And line; portfolio, group best-in-class CDX our are myeloma Talquetamab, to the therapy;

this being used we’ll the treating And sequences in us cure. progression enables portfolio cure. in treating all, is combination significant, changing see which something to order treatment medicines from in all different do paradigm very these to this and treating to to So achieve to in to

in it’s CARTITUDE-X, who some in three results the CARTITUDE-X in goal. therapy. you very important very We to important of CARVYKTI forward one be what we received you cannot because that into an event-driven or that it’s therapy, have ambition evaluates XXXX. will which have give lines is prior and and an it study, event-driven look the study, Specifically, timing our of is patients CARTITUDE-X specific achieving of study mentioned, in move CARVYKTI earlier to lines

is today Risinger from question Securities. David from SVB coming Next

on $XX past, And the congratulations that’s so, Pharmaceutical under target. prospects I for still billion targeted revenue In consensus could you the is So, J&J consensus billion sales was wondering you that the discuss hoping the first please for of in in is modeling has XXXX. what the longer all, XXXX? the you. performance. term Thank believe Pharmaceutical if $XX below if I’m figure business. projecting because

for turning mentioned, to And you Thank you targets. XXXX what question. our the

work at continue year by despite achieving XXXX group goals revenue in accomplishing to to of one same on loss of $XX of single and our billion our hand, through the every XXXX. our previously the delivering growth stated We towards continue pipeline differentiated STELARA, in of exclusivity Pharmaceutical advance time,

towards work to goals. these continue we So,

portfolio. well the our is have driven marketed discussed times, going be as to currently growth of XXXX strength portfolio we of multiple indications as the this marketed As new by mainly through

psoriasis, TREMFYA; of line, ERLEADA, Some additional gaining in first TREMFYA, will and is our ulcerative provide in expect of which Crohn’s a for examples, a and in leg now and IBD growth OPSUMIT been in and the in is colitis metastatic have as which in psoriatic significant our growth. both in readouts affected studies indications continuous different arthritis XXXX share, DARZALEX UPTRAVI we we in studies growth with of providing hypertension in well our will prostate but INVEGA arterial continue to U.S. prostate cancer of and an franchise deliver non-metastatic high-risk that will of cancer additional that franchise XXXX, leg readout by SUSTENNA has COVID-XX, in expect pulmonary some growth; as localized

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the products the in we At our in time, some to continue of key significant same pipeline. make progress

more we the bladder cancer. opportunities commented combination in in them lazertinib platform our of milvexian, plus than of diseases. RYBREVANT our that Example non-small $X And nipocalimab lung TARIS finally, anticoagulant, them, of cell billion. autoantibody-mediated oral were in Some of cancer,

the So, of growth drivers XXXX. are those moving into our key

about the our forecast I If our think and main Street disconnect myeloma multiple between portfolio. forecast, the it’s

that commented our of combining see multiple we a we helping And rather our other. cannibalizing place show ambition some each cure of now of that as have than matter earlier, studies treat the As into therapies. fact, myeloma portfolio in I

also Talquetamab, study CARTITUDE-X, mentioned are bispecific earlier combination one therapy; our DARZALEX. Talquetamab studied a I and TECVAYLI combination CARVYKTI another, being lines of and being two with into or are moving with TECVAYLI antibodies in in

of major with as see disconnect that I So, source the the Street.

arterial XXXX. of that We I strong then, that, finally, continue forward. for will read because to we as of in I the in the further Then half in with loss pandemic, moving also hypertension in a see depression; growth by Xarelto indications high-risk ERLEADA localized exclusivity, UPTRAVI and the in to SPRAVATO, been have in our disconnects back And of treatment the with see expectations commented which see cancer disconnects our OPSUMIT, this impacted patients that but prostate decade. in which disconnect, see pulmonary significant we for treatment-resistant franchise

have are I So, as disconnect. reflected elements that those

we So, growth year. as drive towards I continue and every billion of our XXXX goal posting said, to $XX

how the I we of in well our reflection executing pipeline. and think are it’s portfolio of strength current a our

Next Biegelsen from question coming from Wells today Larry is Fargo.

one what on operational the the lower do much sales first to in you half in the you a second be color How growth each the and versus half? cadence segments me. for for a can Pharma of in little growth more expect are Joe, provide Just of And assuming ‘XX? devices? X-part market you

billion? just do And David’s the more billion, follow taking it to implies for on you up expect X% it question XXXX $XX Joaquin, questions. Thanks XXXX. $XX about a back-end between loaded? X% there think should to we the to the and CAGR ramp be to How

Larry. morning, Good

growth. So, pretty we see guidance don’t by typically to bit about know, MedTech, start market anticipate as you in talk let much let we any a -- me X%. year, to what me quarter, we With by little respect given provide X% but

in comments the Pacific little carryover steady call my will Asia reflect, earlier saw be of bit cadence from than prepared recovery. anticipate I’ll the in some of that we As region it, in of, the other we some a remarks that the COVID of procedure there surges But, quarter. fourth a that, normal

job staffing really that administrators in the done to The getting of some a normalcy wonderful hospital sense that. now but are concern, biggest right they’ve is challenge facing

year base. XXth our be Pharmaceuticals, XXXX lower With enjoyed is growth. we of again, off to We a it consecutive respect a of will but above-market year, anticipate XXth

global X.X% range, If you what X% at. IQVIA actually growth and calling that some of on last from region happen U.S. somewhere to to looking data you’re depending week, the they’re see in

So, that’s beat the of be kind of the the thinking overall. how will think we’re by will it just we we of it. while lower market, number market And a dynamic

that be to I of In elaborate will the cadence, see long-acting in in as some over fourth consistent quarter measures well prepared second pricing bleeding terms fourth that ZYTIGA on earlier, Europe likely of as the quarter, impact will a we injectables maybe more had some year. having quarter. that of generic the with first the experienced in throughout And the erosion much we and the comments the from pronounced

half our line helps the based hold performance, than than expectations. to given of second So at stronger give second as hopefully, quarter again, top first we’re of quarter that it. half how stronger well better intact general probably as you sense and looking first seems theme a on bottom line But

commented, discussed which your as year XXXX that XXXX despite have pick market regarding the will our see. growth. to see see see we question, growth That’s up we above XXXX. Pharmaceutical in in growth positive group, continue the again growth in Larry, market would we loss we exclusivity And then the And STELARA. for of sequence and be would above we of And market in XXth consecutive our our to

positive market FX XXXX. see how we growth rate we But We don’t FX. by about moment. in we change actual don’t see $XX the above growth for and significant were purposes that, Certainly, don’t billion will then, FX billion be be when the of understanding we And the $XX a what establishing don’t in thinking growth impacted one, by we we market. at see XXXX; we the and growth, and our the would we know XXXX; FX a in goal, see above because you XXXX were project pickup of the we anticipate

Morgan. Chris Your Schott is JP from next today question from coming

Just and headwinds on is just I one the this quick of, and guess, trying one of I LOE one as operating through hand, inventory, question I through maybe inflation potentially beyond the work guess, of some against think on clarification. the margins, balance a spin. question I’m and to ‘XX. of from the dissynergies guess you this STELARA some balanced decreasing some the

kind guess, sense get margins about just some trying out. I too is So, erosion modest I’m is that of to something expansion, as or just XXXX proxy bigger operating going we could decent it or a call? plays early of picture margins, either forward, see to how in or

regarding a my made is XQ. then some And question, second of the just immunology clarification comments you on maybe which

like guess, dynamics as expect so this that and rebates ‘XX? mentioned think a a for more just Thanks franchise you kind seen I continue Should are you’ve those years getting whole? we what just headwinds. as that the are or of gradually much. unfavorable they to is And few mix in in rebate dynamics continuation up of going I worse, last

Chris. morning, it the immunology to tackle Joaquin and Good references. then I’ll operating question, the over Great. for margin turn some I’ll of

we organization guidance, this operating to with managing addition relief. inflationary year we’ll I that’s And that does of an pressures. don’t see portend to respect considerable with So I to think think, combated terms in assumption deflationary multiyear achievement in again, the not a give margin, while have cost by

We also consumer come have the along separation that with itself. the dissynergies

As already those, address those. to started fully in the of we XXXX. comments all mid-XXXX They’ll indicated, to by be mitigated mitigate of plan and we’ve some

have think similar out you’ve and the would and ‘XX qualitatively, now So, to how I ‘XX of course over certainly year. out, see different got just dynamics some inflation playing because plays we’ll looking this may out look

you that we cadence, normal a on improving to back more a Johnson like margin from sales getting profile. then, I would income would than say, you growth. Johnson, And expect you your bit faster that do grow And by know little &

a billion year. given We resources of have $XX in

being as prioritization, as efficient also as sure at as to only can effective we’ve a looking our processes not can responsibility, and So, we got be but and think, our technology are be. continue to we we make we that

mix having is the market, from overall, XXXX, We continuing patient channels, dynamics Thank we net that now pressure participation the we immunology lower you. we Chris, And some a are more are where we not into is regarding those by worse. XXXX, priced. into of in situations see higher overall see getting stabilize will Simply but the but the situation will putting continue are. what our changing, price that in

next Miksic Matt is from Barclays. Our coming from question

talk China the a So, you conservatism and bright the little the assumptions had guidance. procedure ‘XX, you one just you could expect of -- what and of a spots, go? for And us Joe, up sense could if then I maybe on bit give for follow-up STELARA some on the about LOE? a on if maybe you into made how you’ve disruption that that to VBP, long assume following

be And spot, continue but then, I in I’m ranges. the contemplated example, spine, does your of went and kind bright into of challenges sort we helpful? aim kind in ortho kind you on that I trends. of strength covered, of of would assuming that this kind there, are range this you in think side had I we guess, what And a that just U.S. strong elements sort -- you very Does of back comp understand are at into is ‘XX, of for that or conservative well wondering on historical very, which ortho or performance, sort in half the above just the guidance, for how some mid-single-digit the

behalf. to some me our let Terence’s could maybe how of all, First did he with follow that miss guess to on up go about better conservatism. probably positioned, I speak of things respect the an to I question opportunity

effect be ground to bit whether teams could the indicate MedTech saw the that on from little persistent, is a some or in in it’s be if assuming Right of there that rebound a The we quicker some both And in the that seem quicker. still quarter. China, rebounded now, surges that we’re fourth COVID carryover Pharmaceuticals. but

at I the and the be think or looking pockets myeloma could multiple TECVAYLI CARVYKTI upside. of also performance portfolio, and or opportunities for significant

the reach, And current bringing by and obviously We’re in that possibly of some projections. maybe mean. Johnson, capabilities presents and could & the Abiomed the scale opportunity terms of excited both isn’t acquisition Johnson in what that

are that. number with respect Right now, there at the like for outperformance. where to opportunities is some So, we

be China we a that at and throughout help specifically, XXXX, And had won a really is were with persistent that win not that think time persistent we patients us. tenders a VBP XXXX new I volume phenomenon would for many the We continue and will end of that’s to to say tenders. dynamic and the the over number opportunity more of that.

what the on experienced offered has today we’ve of but of we’ve part impact not are we pronounced So, we it’s the the business more -- already. today, see it terms that that guidance in really much it’s versus

from [ph] Suisse. is today question Trong Win coming from Next Credit

question a on expectations. STELARA erosion Just

are expect I in So, hoping we’ve year. approved enter exclusivity to us None give on rest for going then answer we you and the can with patent expect to be Thanks. six the HUMIRA, this products coming thoughts But, cadence was the first can be about with biosimilar color X’X? Or some this of the that come we coming So, company months, are seen to any yet. should once? all something helpful. players at would along

and difficult And approved monitor biosimilars this are topics to there. There’s to the the we of your on continue it’s comment time, no situation. some for at to question. you going us Thank for

biosimilar evolution and the the well the we the is potentially potentially curve than self-administered As of the to point, that likely fact expect we market interchangeability as given be erosion as label. have your a that REMICADE, product, steeper in of commented, STELARA to of STELARA

of we the exclusivity. how loss that’s see So, STELARA

STELARA. given of volume the we also STELARA to see pressures. the the U.S., offset think obviously, that That sales when in we price declining, continuous XXXX, by growth see In STELARA the be about we flat in will

we perspective that’s So, for STELARA in that the XXXX. have

we studies, franchise. a disease psoriatic have commented of Overall, in is in the of too. readout Crohn’s ulcerative have TREMFYA exciting. before, very our opportunity oral continuous we IL-XX, arthritis, the exciting also, think which study XXXX, data And in our strong psoriasis, immunology from our X may which pipeline, we it’s and progression on some underappreciated colitis Phase I very our a

from Goldman Sachs. today question coming Next Chris is Shibutani from

have multiple launch you. The XXXX. interplay very myeloma your franchise, obviously, and about Between sort that of upon based Thank XXXX? what you launch, and through gradual what can central you talk CAR-T approval supply been you’re that in for to objective since and the the has the the expecting bispecifics, year

this see for new demand in therapies significant also for demand There’s CARVYKTI, strong population. and as CARVYKTI for patient for the a need we far As relapsed/refractory TECVAYLI. very

has So, demand patient the been strong. really the adoption the for physicians products, and

is medical the unmet need of types really these that and encouraging patients. pertains for So,

With a doing CARVYKTI, expand our we and production and of approach. in that network we scale are our capacity to continue phased providers,

self-option of the very high are TECVAYLI, this there. too, successful start positive, the are unmet and connected need to the With early off we indications for see with very, a medical we that

earlier the Also lines of reading a studies filing us opportunity line use into of therapy, either move Moving are patients into in continuous data to bispecifics, CARTITUDE-X, myeloma. from cell multiple which portfolio the Talquetamab, therapy to key how incredible and the would perspective, the Talquetamab done XXXX, will of which continue would elements provide guide that that give therapy. be, data another us of the in we’ll to CARVYKTI because have give this to failed who of or BCMA, some of

Sorry.

Kevin. Sorry,

We have time last one for question.

Perfect.

Fitzgerald. from question Chen final coming Louise Our is today from Cantor

for about or you ask first few expectations the to readouts wanted I half data and second half of products. your a timing

interim steps you you. RYBREVANT just IL-XX still readout lastly, arthritis. here here? you and are are and First was next expecting a lung and nipocalimab then one oral have cancer And finished your lazertinib, potential trial I and a might then, your data? rheumatoid Thank And some that what saw is when on your for

I that the give XXXX, key an you I data us already it’s which CARTITUDE-X, So, Again, you so for is main commented difficult mean, timing, a study, could is regarding one on exact event-driven in readouts Louise. expect to for us. this

have versus And plus mutations the Tagrisso. for of study, cancer Importantly, this us. which important cell for with frontline on study study Mariposa in we analysis lung the this lazertinib an EGFR interim is an potential is the in RYBREVANT study non-small

lung chemotherapy. PAPILLON the combination which have from is the cell study, non-small also, in data cancer in frontline And we potential clinical with

important in cell non-small So, those lung are ones cancer.

we in have device staying Phase continue prostate for the bladder the our with of also to oncology, study cancer And in localized cancer. our SunRISe-X high-risk work then, on TAR-XXX -- ERLEADA. And invasive drug-eluting data the our X non-muscle platform, we from

that’s So, side. oncology key in our elements

nipocalimab, RA, you As far newborn. expecting colitis in also our targets to we data has in towards arthritis, attention studies, later the part important of data the are Crohn’s and as data the reads year. ulcerative then, IBD we’ll from and which will disease disease be of in you the X and hemolytic come year, expect have the keeping studies with X next It That’s can significant date with TREMFYA. rheumatoid in Phase I fetus from our those know up. also And when created

our be X XI in at our Phase progress our with clinical will milvexian, important Bristol-Myers Factor starting Squibb. we anticoagulant our that Finally, program with partners is pipeline

a year our say, time X you to important also IL-XX. expect oral happen study very to It’s That but difficult our us will XXXX. for we an in of exact give terms fully So, include I Phase us read. data in of would for line, that

important showcase we’re So, data us the pipeline. for having reads that our that many in good execution will

brief to it Louise, would hesitate in for closing like to continued that couldn’t to have. apologize any everyone some may you, our don’t that We but your interest questions Thank of the thanks we time, those Relations to and questions get team because Investor out now to company. Joaquin for over turn and to remarks. your to you with reach I

your Johnson and you, & for So interest everyone, questions thank in Johnson.

for environment, the you patients. in highlighted have rely challenges And macro the the XXXX we to on us both, you exciting going strong have much. Thank term. the that long be of very that for we performance financial delivering innovation, and near some we is can for While on think another year

concludes Johnson’s This Johnson conference quarter fourth & call. today’s XXXX earnings

disconnect. now may You