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J&J CEO Prefers Smaller Acquisitions Even as Cash Pile Grows
Jan 13, 2016 | Bloomberg
By Cynthia Koons
Johnson & Johnson’s expanding cash hoard is fueling speculation of a major acquisition, but Chief Executive Officer Alex Gorsky isn’t talking like someone with a big deal in the offing. In an interview, Gorsky said he’s more partial to small deals for treatments in the early stage of development, not the kind of cost-saving megamergers some of his competitors are pursuing. So while Pfizer Inc. takes over Allergan Plc and Medtronic Plc reaps savings from its Covidien Plc deal, Gorsky is skeptical that a large transaction would work for J&J. -
JP Morgan Healthcare Conference: How Johnson & Johnson Became An Industry Leader In Innovation
Jan 11, 2016 | IBI Times
By By Amy Nordrum
On Monday, opening night of the pharmaceutical industry's largest gathering , executives at a “Future of Pharma” forum will mull a simple question that both befuddles and enthralls them: What is innovation, and how can companies spur it? Innovation is the industry's most coveted and elusive concept. The rewards are clearly visible: breakthrough treatments that help patients and generate billions in sales. But few experts agree on metrics or best practices for achieving it. Direct comparisons of companies are often imperfect. Like many buzzwords, its very definition is diffuse. -
Top 10 Most Innovative Biopharma Companies, Announced at the J.P. Morgan Healthcare Conference
Jan 12, 2016 | Drug Discovery & Development
Scores of leading biopharma C-suite and senior executives congregated at IDEA Pharma’s The Future of Pharma panel discussion event to hear the company announce who it believes are the top 10 most innovative and exciting companies selected from the whole of the industry, as it launches its new index - The IDEA Index. ... J&J: for consistently doing what most others are only talking about, redefining what a pharma company can be -
J&J Seeks Oral, Skin And Hair 'Game Changers' Via Research Collaborations
Jan 11, 2016 | Rose Sheet
By Jessica Merrill and Malcolm Spicer
Johnson & Johnson rolls the dice on finding a "game changer" in consumer health technologies for oral health, skin care and hair growth among its latest 22 research collaborations and partnerships, selected as the firm emphasizes tapping external sources for innovation. The deals announced Jan. 7 are highlighted ahead of the firm's presentation at the JP Morgan Healthcare conference starting Jan. 11 in San Francisco, said Paul Stoffels, J&J's chief scientific officer and worldwide chairman for pharmaceuticals. -
Johnson & Johnson's CEO Just Tipped His Cap in a Big Way Regarding M&A
Jan 12, 2016 | Fool.com
By Sean Williams
Whether or not you realize it, this week marks the kickoff of the Super Bowl of all healthcare conference, the J.P. Morgan Healthcare Conference. This four-day event typically features in excess of 400 healthcare companies discussing where they've been and where they're headed next. Healthcare conglomerate Johnson & Johnson (NYSE:JNJ) was one of the presenters in yesterday's session, with CEO Alex Gorsky answering questions and broadly discussing what's made his company so successful. -
Want the skinny from the J.P. Morgan Healthcare Conference? We've got you covered
Jan 12, 2016 | FiercePharma
By Carly Helfand
Sometimes, it can tough to be filter out what a company means from the little it says at the J.P. Morgan Healthcare Conference. So please, allow us to do the summarizing--and check back throughout the week for updates... Recently, Johnson & Johnson ($JNJ) has "tended to focus on smaller opportunities" when it comes to business development, CEO Alex Gorsky told investors. The company would prefer to find the next blockbuster through partnering, later bringing in its clinical development and regulatory skills to turn compounds into billion-dollar platforms, he said. Large acquisitions, on the other hand, are "more challenging," though they're "not something we'd shy away from if we thought it was the right opportunity," he said.
Coverage Highlights
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J&J CEO Prefers Smaller Acquisitions Even as Cash Pile Grows
Jan 13, 2016 | Bloomberg
By Cynthia Koons
Johnson & Johnson’s expanding cash hoard is fueling speculation of a major acquisition, but Chief Executive Officer Alex Gorsky isn’t talking like someone with a big deal in the offing.
In an interview, Gorsky said he’s more partial to small deals for treatments in the early stage of development, not the kind of cost-saving megamergers some of his competitors are pursuing. So while Pfizer Inc. takes over Allergan Plc and Medtronic Plc reaps savings from its Covidien Plc deal, Gorsky is skeptical that a large transaction would work for J&J.
"History would show that value creation in large deals is much more challenging," Gorsky said in San Francisco, where he was attending the J.P. Morgan Healthcare Conference. "Because we’re more of an innovation-focused company, the ideal deal for us is early, great innovation, great science, then we scale it, versus going in and simply ripping out costs and trying to find other synergies."
Gorsky didn’t rule out a large deal, and his comments reflect the balancing act J&J has maintained in managing investors’ expectations for how the company will use its cash. The balance swelled last quarter to $37.3 billion, including short-term investments.
Buyback Plan
In October, the maker of drugs, medical devices and consumer health products announced a $10 billion share buyback. That led to questions from analysts about whether the plan made a large deal less likely, an idea Chief Financial Officer Dominic Caruso disputed. And J&J did bid to acquire Pharmacyclics Inc. last year, people familiar with the matter said at the time. AbbVie Inc. eventually won that competition with a $21 billion offer.
Gorsky has overseen some large deals since taking over as CEO in 2012, including the completion of the company’s biggest acquisition in history -- the $18 billion takeover of device maker Synthes Inc. Device sales, however, have suffered since the acquisition, with drugs taking over as J&J’s biggest category in 2014.
The company’s shares have climbed 51 percent under Gorsky’s tenure, outpacing the 36 percent increase of the Standard & Poor’s 500 Index. But they’ve trailed other health-care stocks. The S&P 500 Health-Care Sector Index is up 76 percent in that span. J&J fell 1.2 percent to $97.02 at the close in New York Wednesday.
J&J agreed to at least five acquisitions last year,according to Bloomberg data. Those included the acquisition of Coherex Inc., to gain devices to help heart patients avoid strokes, and Novira Therapeutics Inc., to get experimental treatments for hepatitis B. Financial terms of those acquisitions weren’t disclosed.
It’s difficult to pull off larger transactions to gain more scale in an industry and cut costs, Gorsky said.
"We’ve tried that approach -- we’ve had some successes, we’ve had others that haven’t been so successful," he said. "We’d much rather spend our time creating the next platform than downsizing, reorganizing and taking the next track."
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JP Morgan Healthcare Conference: How Johnson & Johnson Became An Industry Leader In Innovation
Jan 11, 2016 | IBI Times
By By Amy Nordrum
On Monday, opening night of the pharmaceutical industry's largest gathering , executives at a “Future of Pharma” forum will mull a simple question that both befuddles and enthralls them: What is innovation, and how can companies spur it? Innovation is the industry's most coveted and elusive concept. The rewards are clearly visible: breakthrough treatments that help patients and generate billions in sales. But few experts agree on metrics or best practices for achieving it. Direct comparisons of companies are often imperfect. Like many buzzwords, its very definition is diffuse.
“I think the biggest issue that we see with innovation in pharma is it’s a poorly described concept,” says Mike Rea, CEO of the design agency IDEA Pharma, who is in San Francisco with thousands of executives and investors gathered for the JP Morgan Healthcare Conference. “I think some people are using it as a veneer on business as usual.”
Rea’s IDEA Pharma has tried to tease out the most innovative companies and discern what sets them apart, even if the differences are only obvious in hindsight. For the past two years Johnson & Johnson has topped the firm’s "Productive Innovation Index," an annual ranking of companies' ability to launch game-changing products. Last spring, the company announced plans to seek approval for 10 drugs that could fetch more than $1 billion in revenue by 2019. Worldwide pharmaceutical sales jumped 14.9 percent in 2014 to $32.3 billion, which trumped industrywide growth of 8.4 percent that year.
Others have also noted Johnson & Johnson’s success. In 2011, Bernard Munos, founder of InnoThink Center for Research in Biomedical Innovation, made a list of the 20 pharmaceutical companies that had developed the most new drugs in the past decade. Johnson & Johnson tied for second place alongside GlaxoSmithKline, with 10 apiece.
Meanwhile, other major pharmaceutical companies have earned a reputation for being stiff and overextended despite having scores of researchers on payroll. Critics complain that these behemoths are now just as likely to seek Food and Drug Administration approval for a mediocre drug or expand use of an existing one as they are to develop an original treatment or cure.
Lately many of these traditional companies eager to show growth have relied heavily on licensing treatments from smaller biotechs or scooping them up altogether. But a recent analysis that looked at the return on investment of big pharma’s mergers and acquisitions as well as licensing deals concluded that “few companies excel at sourcing innovation externally.” Johnson & Johnson was one of the only ones to score high marks in both categories.
Rea says Johnson & Johnson is earnest in its search for the best ideas and business opportunities. “When we published that first index, even though they came in first they were the only company that rang up to see what they could improve,” he says. “That says a lot about their lack of hubris.”
Another part of Johnson & Johnson’s strategy has been to build a network of JLabs, or “biotech incubators,” in cities with high concentrations of life sciences companies. Entrepreneurs set up at JLabs for a fee, gaining access to business development resources plus lab and office space that can be reconfigured as a company grows.
“Somebody could come in and literally be a researcher at a university and rent a 5-foot bench that they could put on their credit card like a gym membership and get started in under 24 hours,” Melinda Richter, head of JLabs, says. Residents do not give up equity and are not obligated to partner with Johnson & Johnson, though they work closely with staff.
Over the past three years, Johnson & Johnson has started JLabs in San Diego and San Francisco and created “satellite” sites at LabCentral in Cambridge, Massachusetts, and the California Institute for Quantitative Biosciences in San Francisco. In the next few months, up to 50 companies will move into a brand-new lab in Houston and another will open in Toronto. Together, the sites can house up to 225 companies.
Already, this model has generated some promising leads. In June, Arcturus Therapeutics, a JLabs alumnus specializing in rare diseases, struck a deal of an undisclosed amount with Johnson & Johnson to use its platform technology to develop drugs. In October, Arcturus agreed to do the same for Ultragenyx Pharmaceutical Inc. in a deal that could bring $1.6 billion to the startup.
“It's pretty remarkable and that's what we're trying to do,” Richter says. “We're trying to be there for entrepreneurs doing work in areas we care about.”
Only time will tell how many residents will form successful deals with Johnson & Johnson, but experts say the130-year-old company’s willingness to think like an entrepreneur and embrace uncertainty is key to its success.
"I think the future of J&J lies in great part in what's going to come out of JLabs,” Munos says. "When that innovation starts percolating into the J&J pipeline, it's not going to be two drugs per year that they're going to be approving. It could be four or five or more."
Separately, Johnson & Johnson runs “Innovation Centers” in Boston; Menlo Park, California; London and Shanghai staffed with scientific and business development experts who can strike deals. They also run anEntrepreneur Innovator Program to welcome pitches from lone scientists who have an idea but no business plan. Together, all of these programs and projects put Johnson & Johnson ahead of competitors in securing deals with promising biotech companies.
Of course, finding and commercializing innovation is only part of the formula for any major pharmaceutical company’s success. In the most recent quarter, ending in October 2015, Johnson & Johnson’s worldwide sales slipped 7.4 percent from the prior year. Sales of a new hepatitis C treatment lagged because of competition, and a strong dollar lowered the value of overseas sales.
Johnson & Johnson will report fourth-quarter and full-year results Jan. 26. Then in mid-February, IDEA Pharma releases a new annual list of pharma’s top innovators. For now, Johnson & Johnson remains the company to beat.
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Top 10 Most Innovative Biopharma Companies, Announced at the J.P. Morgan Healthcare Conference
Jan 12, 2016 | Drug Discovery & Development
Scores of leading biopharma C-suite and senior executives congregated at IDEA Pharma’s The Future of Pharma panel discussion event to hear the company announce who it believes are the top 10 most innovative and exciting companies selected from the whole of the industry, as it launches its new index - The IDEA Index.
Already renowned for compiling the annual Productive Innovation Index (PII) that ranks those companies best at successfully bringing innovations to the market (scheduled for release in late February), the IDEA Index celebrates those companies who either can’t be included in the PII by revenue, who innovate in ways that aren’t about NCEs making it to market, or who just haven’t had the time to make that top 30 yet. The IDEA Index purely focusses on those biopharma companies that excite IDEA Pharma the most and who it believes are the companies it expects to be driving the industry in the next 5-10 years.
"The IDEA Index is gloriously analogue. If we have learned anything when we have looked into innovation in past performance, it is that talk is easy, but many companies haven’t even figured out which walk to do. Past performance may well not predict future performance, but when you spend enough time looking into what contributed to those past performances, the substance of innovation becomes more noticeable.” comments Mike Rea, IDEA Pharma’s CEO. “True innovation should be celebrated, but in the main it is poorly defined and there is a lack of understanding about what it is. Which is why we not only devised The Future of Pharma panel series, bringing the best minds in the industry together to combine insight and key learnings centred around this complex topic, but also designed the index, to highlight those companies that are demonstrating true innovation, creating a stir and making a real difference to our industry.”
The Future of Pharma discussion panel comprised: Otsuka America Pharmaceutical Inc.’s President and COO, Bob Oliver; Janssen’s Global Head of R&D, Dr William N. Hait and Teva’s President of Global R&D and Chief Scientific Officer, Dr Michael Hayden, who joined forces to discuss what innovation is and how collective thinking can positively shape the future of our industry, as well as promoting healthier values and ethical practices.
The IDEA Index 2016 – celebrating innovation. The most exciting innovators in the biopharma industry:
Alexion: for pioneering rare disease treatments, and for bringing meaningful differences to their patients
BioMarin: for laser-like focus on commercialisation, from nothing to 5 globally marketed products, with no partnering/ licensing and with 7 products in late-stage developmentCelgene: for delivering actual, authentic patient-centricity
Gilead: for developing cures where others saw incremental improvements, for holding onto the idea of value for its treatments, and for wide-ranging clinical programmes to ‘own’ diseases
Incyte: for approaching the unmet need in cancer in its own, meaningful way
J&J: for consistently doing what most others are only talking about, redefining what a pharma company can be
Novo Nordisk: for single-minded pursuit of excellence in a disease area, for properly engaging with IBM’s Watson for more than PR, and for an ability to take an innovative wraparound approach to diabetes and obesity
Otsuka: for being the first to have a chip in a pill approved, and ushering in the era of possibility that enables
Regeneron: for a continued opportunistic harnessing of science in discovery and development, but also for showing established players the way to commercialise
Teva: for a truly patient-centred approach in novel therapeutic entities (NTEs), challenging the gap between unmet need and solution, putting known molecules into novel approaches
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J&J Seeks Oral, Skin And Hair 'Game Changers' Via Research Collaborations
Jan 11, 2016 | Rose Sheet
By Jessica Merrill and Malcolm Spicer
Johnson & Johnson rolls the dice on finding a "game changer" in consumer health technologies for oral health, skin care and hair growth among its latest 22 research collaborations and partnerships, selected as the firm emphasizes tapping external sources for innovation.
The deals announced Jan. 7 are highlighted ahead of the firm's presentation at the JP Morgan Healthcare conference starting Jan. 11 in San Francisco, said Paul Stoffels, J&J's chief scientific officer and worldwide chairman for pharmaceuticals.
“It is our strategy to collaborate externally, and we have many objectives, first of all getting the best minds in the world to advance health care, to advance therapies and products,” Stoffels said in an interview. Collaborating also allows J&J to improve its own internal research, he added.
John Bell, head of the external innovation consumer group for Johnson & Johnson Innovation, said the investments "are at the bold edge of innovation" and acknowledged that sometimes the research "just doesn't lead to a result which we can translate into a product."
"But that doesn’t take us away from trying to do this because if it works, we might have a game changer in our hands," said Bell in an interview.
The start-ups and other firms and organizations J&J collaborates with have a better chance of developing beneficial and needed drugs, devices or other medical products with the innovation investments, but they are not required to deliver anything to the firm.
"Maybe over time some of them will have a relationship with J&J, but there is no need for them to do that. By offering this opportunity we expect really interesting start-ups coming because given the opportunity, they can make use of the equipment and they may get access to some expertise within J&J," Bell said.
Adding to consumer product projects funded through the firm's Johnson & Johnson Consumer Inc. business, the deals include early-stage discovery or pre-clinical partnerships with academia or biotechs facilitated by J&J’s Innovation Centers in London, Menlo Park, Calif., Boston and Shanghai, the first of which opened in March 2013 ("In Brief Helen Of Troy In Supplements JampJ Innovation UK Ad Enforcement CHPA Chairmanelect" "The Tan Sheet" Jun. 23, 2014).
J&J Innovation focuses on accelerating early-stage innovation worldwide and forming collaborations.
Bell noted that while J&J Consumer and its other businesses already work with outside partners, the firm currently is "putting even much more emphasis on external."
Stoffels said investors should expect many more deals to follow those spotlighted with the announcement, as J&J has about 200 people around the world evaluating external research opportunities. “We will continue to do collaborations as they make sense. They come as they come,” he said.
Bell, who moved to J&J in mid-2015 from a business development post at Dutch telecom and information technology firm Royal Phillips, also predicted additional innovation collaboration investments as J&J leverages its improvements in internal research and development into landing stronger external partners.
"We are now investing really in building a team and building the network in the external world," he said.
"We realized that we have very strong internal R&D, which is marvelous because we need very strong internal R&D to be able to connect with the best players outside, the innovators in the outside world."
Matching internal and external R&D levels enables not only connecting with "the best brains in the world," but also finding research that aligns with J&J's pipeline outlook.
"If you want to work in the external world and get something into product categories, it hardly ever works that you can pick up something in the external world and bring it to our customers. There is always a need for adaptation to make sure it's really in line in the application to the needs of the consumer, and therefore also we need to have this strong internal R&D," Bell said.Consumer Franchise Assessments
J&J Consumer entered collaborations with BioMed X Innovation Center in Germany, ProdermIQ Inc. in San Francisco and University of Pennsylvania researchers after assessing the pipelines of J&J's consumer product franchises: OTC drugs, oral care, beauty and baby.
"We have a strategic direction where we want to focus; we want to get new game changers into our businesses. We team up with and we look for external innovators to bring some of those game changers into our strategic portfolio," Bell said.
J&J Consumer's collaboration with BioMed X, an incubation company at the University of Heidelberg, focuses on "biofilm disruption." Biofilms, such as plaque, can lead to conditions including gingivitis, caries and halitosis.
J&J Consumer also will work with ProdermIQ Inc. to determine the potential of the start-up's proprietary SKINdex Skin Health Measurement platform.
Additionally, the business invested in a collaboration with Penn researchers to develop improved pre-clinical models for the study of human hair growth and androgenetic alopecia, known as male-pattern hair loss in men.
"If you just look at those three, you say, 'Wow, this is peculiar because those are three very different projects,'" Bell said.
"In each of them we are looking for partnerships to get new game changers, new innovations to the people. So you can expect in the coming 12 to 24 months, more and more of these kinds of deals which fit in those four big franchises."BioMed X Crowd-Sources For Solutions
BioMed X says the collaboration will establish a research group to focus on the development of novel methods for the disruption of oral biofilms. BioMed X will be responsible for housing the new research group, operating the innovation center facility and providing access to the Heidelberg scientific community and research facilities.
According to the research center, the collaboration extends its project portfolio to consumer health care for the first time.
Bell said BioMed X helps companies that encounter a problem in medical product development by making the question known to researchers worldwide and asking for proposals on solving the problem.
Through crowdsourcing, BioMed X will consider proposals from researchers on novel approaches to remove saliva-derived, mixed-species and potentially pathogenic bacterial biofilms from oral surfaces to reduce the incidence of gum disease or caries. "The best ideas and life science talents will be jointly selected to form a new research group within BioMed X's open innovation lab," according to the German research group.
"For a company like ours," Bell said, "it's a really interesting approach because they have access to many more of these innovators than we do, and we don't know exactly how to reach them," he said.
"It seems to work for the pharma, so let's also do this for the consumer approach – and I think in oral care there still are some big questions to be solved. We hope to get all the best brains in the world proposing solutions to our questions."
He added that while crowdsourcing projects typically have a specific solution or goal identified, BioMed X is asking questions that have not been answered, and for some a solution may not be found.
"The question we have here on the table is much more scientifically unanswered. Therefore we need a team from around the world to work on this for maybe three years, maybe more to solve these questions."Understanding The Skin Microbiome
ProdermIQ says while much research has focused on the skin's immune system and its interaction with the environment, it focuses on how probiotics and pathogens, which make up a person's microbiome, affect the skin.
The firm says it became interested in the microbiome and its impact on skin health through research on the gut microbiome and its relationship to obesity and disease, and launched "with the mission to characterize the skin microbiome and find ways to create and maintain a healthy skin microbiome."
ProDermIQ's SKINdex platform combines precise evaluation of skin microbial communities with demographic, lifestyle and clinical data to gain insights into intervention strategies for maintaining healthy skin or treating skin conditions, according to J&J.
The consumer-health research collaborations are the first J&J Consumer announced since June 2014 when it began working with the University of Manchester to explore using probiotics to prevent and treat skin, oral and respiratory conditions. The partnership was one of 12 the company formed at that time with life sciences companies and research institutions
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Johnson & Johnson's CEO Just Tipped His Cap in a Big Way Regarding M&A
Jan 12, 2016 | Fool.com
By Sean Williams
Whether or not you realize it, this week marks the kickoff of the Super Bowl of all healthcare conference, the J.P. Morgan Healthcare Conference. This four-day event typically features in excess of 400 healthcare companies discussing where they've been and where they're headed next.
Healthcare conglomerate Johnson & Johnson (NYSE:JNJ) was one of the presenters in yesterday's session, with CEO Alex Gorsky answering questions and broadly discussing what's made his company so successful.
Unlike typical presentation sessions for most biotech and medical device companies, Gorsky isn't the type to deliver groundbreaking new presentation material. One reason for that is J&J is currently in the midst of its quiet period, with its earnings report for the fourth-quarter due out in two weeks. Because it reports before many of its peers, J&J is often in the quiet period when the J.P. Morgan Healthcare Conference begins. Not being able to discuss the performance of its pharmaceutical products, medical devices, or consumer health products, made for a presentation that was pretty vague at times.
Alex Gorsky just tipped his cap on M&A
However, Gorsky did hit on one topic where he went into some specifics -- and if you paid close attention, he tipped his cap as to what J&J's merger and acquisition strategy is likely to consist of moving forward.Forgive the fact that I'm splicing together a few comments from Gorksy's 24-minute presentation, but here were some of his critical comments concerning internal versus external research and development, as well as M&A.
"If you look, and we've done this analysis over the last 20 years, over the last 10 years, our investment in terms of research and development internally and exogenously has been pretty balanced: about 55-45, 55% internal, 45% external... and we think that's a good balance.
We've been very outspoken about the need to make sure we're agnostic about where we're sourcing our innovation from... We've invested, I think, about 30% of free cash flow into those activities [internal and exogenous R&D] over the past 10 or 20 years, and we'll keep that going.
We've tended to focus more on smaller opportunities. We would prefer to find... the next Imbruvica, we'd like to find the next Darzalex, we'd like to find the next minimally invasive surgery platform with a contact lens. Then how do we bring our clinical development, our regulatory skills, our global skills to bear on those kind of opportunities, globalize them, turn those into billion dollar platforms."
Why is the above mish-mosh of quotes important? Three reasons as I see it.
1. Acquisition-based growth is vital
First, we now know, based on Gorsky's commentary, just how important both internal and acquisition-based growth is for J&J. No one will question J&J's internal growth engine, especially as it relates to its pharmaceutical pipeline. J&J believes it can bring 10 novel therapies to market by the end of the decade that could eventually become blockbusters. Multiple myeloma drug Darzalex, which was approved in November, is the first of those 10.But, now that we have a number (roughly 45% based on Gorsky's comments), we also understand just how critical collaborative growth and acquisitions are for J&J's future. It's almost safe to assume that J&J's hunt for acquisitions never stops. J&J ended the previous quarter with $17 billion in net cash, and it's had no trouble generating $11.4 billion or more in free cash flow since 2006, so it's just a matter of time before J&J's pulls the trigger.
2. J&J prefers diamonds in the rough
Secondly, it's interesting to note Gorsky's comments about going after smaller opportunities. Gorsky was clear that larger acquisitions aren't overlooked, but they do come with their own set of integration challenges. If J&J has its way, it would much prefer to find smaller diamonds in the rough, which will then allow the company to use its size to turn these diamonds into long-term gems.One diamond in the rough that it added to its arsenal in late 2014 was imetelstat, an experimental cancer drug being developed by Geron (NASDAQ:GERN). J&J wound up giving Geron $35 million upfront and pledged an additional $900 million in development, regulatory, and sales-based milestones depending on the success of the drug in treating myelofibrosis and myelodysplastic syndrome. What's most notable about imetelstat is that it generated the first-ever partial and complete responses for myelofibrosis patients in early clinical trials. Current standard of care MF treatments merely focus on reducing symptom severity. A success for imetelstat would put another feather in J&J's cap and, it'd be a big win for the clinical-stage Geron.
3. It's not on a timetable
Lastly, Gorsky's comments, and previous comments from meetings with analysts, have suggested that J&J is in no hurry to rush into an M&A deal if the price isn't right.If you think about it, J&J is sitting pretty as the stock market declines from its recent highs. As the valuations of some biotech companies deflate, it could bring down what had been high expectations for many drug and device makers. This creates a potential buyer's market for the cash-rich J&J.
All told, after listening to Gorsky's presentation my faith in J&J over the long-term remains as strong as ever. The company's three franchises -- pharmaceuticals, medical devices, and consumer health products -- each offer a piece of the puzzle to make J&J whole. Consumer health delivers slow growth but predictable cash flow and strong pricing power; medical devices offer to potential for long-tail growth with an aging global population; and pharmaceuticals is the high-margin machine for J&J. Between its solid long-term growth prospects and 53-year streak of increasing its annual dividend, income and value investors should seriously consider taking a closer look at Johnson & Johnson.
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Want the skinny from the J.P. Morgan Healthcare Conference? We've got you covered
Jan 12, 2016 | FiercePharma
By Carly Helfand
Sometimes, it can tough to be filter out what a company means from the little it says at the J.P. Morgan Healthcare Conference. So please, allow us to do the summarizing--and check back throughout the week for updates.
According to Novartis ($NVS) CEO Joe Jimenez, competition in the pharma space is intensifying--and it's not just thanks to the traditional players. Tech companies, with the digitization of healthcare, "are coming in from a different angle, and it's going to be an area where we have to watch leverage and pay real attention," he said on Monday. Lately, Novartis has been teaming up with tech, inking a pact last week to develop a smart inhaler; it already had a contact-lens partnership with Verily.
Recently, Johnson & Johnson ($JNJ) has "tended to focus on smaller opportunities" when it comes to business development, CEO Alex Gorskytold investors. The company would prefer to find the next blockbuster through partnering, later bringing in its clinical development and regulatory skills to turn compounds into billion-dollar platforms, he said. Large acquisitions, on the other hand, are "more challenging," though they're "not something we'd shy away from if we thought it was the right opportunity," he said.
When it comes to pricing, Merck ($MRK) CEO Kenneth Frazier thinks "the industry needs to communicate better with the outside world." For one, the difference isn't clear between list prices and effective prices, and he also thinks people need to focus on the amount patients pay through copays. "The amount of insurance effectively creates a huge issue for patients at the pharmacy counter," he said.
The way Teva's ($TEVA) generics CEO, Siggi Olafsson, sees it, "there's a lot of talk about inflations" in generics pricing. But the FDA is still backed up with more generic approval applications than it's been able to process, and if it could catch up, that would make a material difference for the Israeli generics giant, he said. "If the FDA starts to approve products faster, we will have a net benefit from that versus the pricing pressure that we experience," he said.
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