Johnson & Johnson
Estimated 2026 sales: $54.6 billion
2019 sales: $42.4 billion
2019-26 CAGR: 3.75%
Johnson & Johnson has made some big bets in its pharmaceuticals business, and thanks to new launches and label expansions, its executives aren't the only ones predicting growth in the years ahead. Sales increases will push the company to more than $54 billion in sales by 2026, Evaluate predicts, good enough for a top 3 spot worldwide.
Back in 2018, J&J execs said new launches would fuel “above-market” growth through 2021, and they have echoed that sentiment several times since. Looking forward, Evaluate predicts the company will post 3.75% annual growth to 2026, which is higher than all but four companies in the organization's top 15 rankings by 2026 sales. It beats everyone besides Bristol Myers Squibb, AstraZeneca, Novo Nordisk and Eli Lilly.
J&J’s pharma business turned in $42.2 billion last year, making it by far the largest division at the global healthcare company. Consumer health turned in $13.9 billion, while medical devices generated $26 billion.
And the pharma group wasn't just the largest by sales last year; it also posted the strongest revenue increase at 5.8%. In 2018, pharma posted 11.8% growth versus the prior year.
Within the pharmaceuticals group, oncology has been a strong growth driver. In 2019, the franchise's revenues increased 11.9% operationally to $10.7 billion. In that group, Darzalex, Imbruvica and Zytiga are all blockbusters, although Zytiga is now facing off against U.S. copycats.
Aside from oncology, J&J’s immunology unit generated nearly $14 billion in 2019, a 7.9% increase from the prior year. Stelara, a 2009 launch, is now the company’s bestselling medicine, pulling in $6.3 billion last year. J&J's neuroscience franchise generated $6.3 billion, a 6.6% increase, while sales for cardiovascular, metabolic and other meds came in at $5.2 billion, a 9.7% decrease.
The company is riding strong momentum for some of its blockbusters, but execs see more opportunity in the company's late-stage pipeline. In 2020, the company could see potential label expansions for Zytiga follow-up Erleada, depression nasal spray Spravato, blood cancer fighter Imbruvica, psoriasis therapy Tremfya, cancer therapy Darzalex and diabetes med Invokana, according to an investor presentation.
The company just scored a new approval for its Ebola vaccine in Europe as well, and it could nab an EU nod for HIV drug rilpivrine by year's end, too.
Within J&J's pipeline, the company's "hematology franchise and its therapeutics business, in general, are both underappreciated," Cantor Fitzgerald analyst Louise Chen wrote in a note to clients last month. Her team hosted a conference call with experts after the American Society of Clinical Oncology's virtual meeting, and they spotlighted JNJ-4528, a CAR-T therapy for multiple myeloma, as well as teclistamab, a bispecific antibody in relapsed or refractory multiple myeloma, among promising candidates.
The company has late-stage neuroscience candidates ponesimod and paliperidone palmitate, as well, among several others in its pipeline. The Cantor team rated J&J among its top picks earlier this year, citing a “leading pharma business that is well-positioned to drive above-market growth” in 2020 and beyond.