Johnson & Johnson's ($JNJ) earnings surpassed analyst expectations. Its prescription drug sales were up 6.8%, helped by leaps forward in cancer drugs and anti-inflammatories. Its new prostate cancer drug Zytiga fell just a tad short of blockbuster status, and that's without its newly approved label expansion. That's the good news.
The bad? Revenues fell short of forecasts for the fourth quarter. J&J's forecast for 2013 disappointed market-watchers. The consumer health unit's ongoing supply-and-manufacturing issues let sales slide again, after a drop last year. Doxil supply problems took the cancer drug's numbers down again. And legal charges continue to weigh on the company's results.
Here are the numbers: Full-year earnings hit $5.10 per share, excluding items, on a 3.4% increase in sales to $67.2 billion. Pharma sales grew by 4% to $25.4 billion; excluding currency losses, the increase would have been 6.8%. Much of that growth came in international markets, where sales jumped by 7.9% to $12.4 billion.
Besides the Doxil hit, J&J's drug division suffered from ongoing generic competition for its antibiotic Levaquin. But those blows were outclassed by Zytiga growth--to $961 million for the year--along with sales increases for the arthritis drug Simponi (48%, to $607 million) and psoriasis drug Stelara (38.9%, to $1.025 billion). The company also cited strength in the blood thinner Xarelto, which J&J markets in the U.S., and the HIV fighter Prezista.
"By any measure, we have transformed our pharmaceuticals business," CEO Alex Gorsky told analysts on a conference call (as quoted by Reuters).
The consumer business's numbers weren't so pretty. The unit posted a 2% drop in U.S. sales for the year, on top of last year's year-over-year decline of 6.7%. The McNeil unit's ongoing struggle to fix manufacturing shortfalls, particularly at its Fort Washington, PA, plant, continues to take its toll. Many of the company's leading OTC brands haven't made their way back to store shelves.
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