J&J predicts sales decline for blockbuster drug, Stelara

Johnson & Johnson (J&J) has issued a conservative full-year profit forecast due to inflation-driven costs. The healthcare conglomerate raised the midpoint of its full-year profit forecast by 10 cents despite beating first-quarter estimates by 18 cents. However, J&J cautioned investors over the lingering impact of inflation on costs this year and said it expected a steep decline in sales of Stelara, its blockbuster Crohn's disease drug once it loses US patent protection in late 2023.

The company’s medical device unit posted sales of $7.48 billion for Q1 which topped analysts' estimates while consumer health sales rose 7.4% to $3.85 billion powered by price hikes offsetting the impact from inflation.

Despite these positive results, shares fell more than 2%. On their post-earnings call management stated that they see pharmaceuticals’ sale closer to around $57bn rather than the previously predicted figure two years ago at approximately $60bn; however, experts believe weakness represents an opportunity as prices increase and demand remains strong indicating pricing power within J&Js brand name soon-to-be Kenvue.

Aside from prescription drugs such as cancer treatments including products for knee and hip replacements helped counter another revenue hit caused by currency rates with overall U.S.sales growing nearly ten percent ($12.bn). International Sales also climbed almost two percent not counting currency rate impacts where international growth was just above eight per cent.