Alex Gorsky, CEO of Johnson & Johnson
Adam Jeffery | CNBC
Johnson & Johnson’s pharmaceutical business will take the spotlight Wednesday at its annual meeting with analysts as the company tries to allay investors’ concerns over its talc-based baby powder.
The New Brunswick, New Jersey, based health-care conglomerate makes a wide range of products, including everyday household products like Tylenol, Neutrogena face wash and Acuvue contacts as well as prescription drugs Xarelto and Invokana. Prescription drugs are the biggest revenue driver for J&J, accounting for half of its $81.58 billion in 2018 sales. But its consumer products division has come under pressure amid thousands of lawsuits that accuse its namesake talc baby powder of causing cancer.
J&J plans to launch 10 new drugs by 2023, it announced Wednesday. CEO Alex Gorsky said the company needs to stay focused despite the litigation.
“It starts with our 100-plus-year performance of doing things in an appropriate and responsible way, and that’s certainly what we think we’ve done here, and we have a very litigious industry,” he in an interview Wednesday with CNBC’s Meg Tirrell. “But what’s most important is that we stay focused on serving customers, that we stay focused on innovation and really bringing these new products to market.”
The company faces thousands of lawsuits alleging its talc baby powder products contain asbestos and caused ovarian cancer and mesothelioma. A Reuters report in December said J&J knew for decades that its baby powder contained asbestos, a story the company called “an absurd conspiracy theory.”
“Of course we’re spending time educating our consumers about the issues that you raised, but here today again we’re going to be talking about these next several generations of products, and I think that’s where most patients and most consumers really want us to stay focused so that ultimately look we can cure HIV, we can find a cure for Alzheimer’s and some of these other conditions we continue to work on,” Gorsky said.
While J&J’s pharma business keeps growing thanks to drugs like Stelara and Remicade, its other two units, consumer and medical devices, have lagged. Still, Gorsky said the three businesses are better together.
“We think so because it gives us an opportunity to find new health-care solutions wherever these opportunities may occur,” he said.
The company’s shares were little changed late morning Wednesday.
For more on investing in health-care innovation, click here to join CNBC at our Healthy Returns Summit in New York City on May 21.