Johnson & Johnson

Type    Public company
Listing on the stock exchange    NYSE: JNJ
Foundation    1886; 138 years ago
Predecessor    Groupe Vendôme SA
Founders    Robert Wood Johnson, James Wood Johnson, and Edward Mead Johnson
Location     USA: New Brunswick, New Jersey
Key People    Alex Gorski (Chairman of the Board of Directors)Joaquín Duato (CEO)

History
The company was founded in 1886 by three brothers, Robert Wood Johnson, James Wood Johnson and Edward Mead Johnson. Initially, the brothers were engaged in the manufacture of dressings and plasters. Since 1893, the company has also been engaged in the production of baby powder. Johnson & Johnson's efficient methods of sterilizing dressings with steam and hot air contributed to the rapid growth of the product's popularity, and in 1916 the textile company Chicopee Manufacturing Corporation was purchased to provide the company with raw materials. In 1919, a subsidiary was established in Canada, and in 1924 in the United Kingdom. In 1921, patches under the brand name Band-Aid and baby cream appeared, and in 1927 the company began to produce products for feminine hygiene. In addition to the founders, between 1889 and 1934, the company's scientific director, Frederick Barnett Kilmer, played a significant role in the company.

In 1932, Robert Johnson Jr. became president of Johnson & Johnson. During World War II, he also served as vice chairman of the War Production Board and was promoted to brigadier general. Under his leadership, the company was divided into four divisions: surgical kits and gowns (Surgikos, Inc.), sanitary napkins (Modess, Personal Products Company), contraceptives (Ortho Pharmaceutical Corporation), and dressings (Ethicon, Inc.). During his tenure (until his death in 1968), Johnson & Johnson's turnover grew from $11 million to $700 million. In 1959, McNeil Laboratories, Inc. was acquired. the manufacturer of Tylenol (paracetamol), at the time an expensive prescription painkiller, and the Swiss pharmaceutical company Cilag-Chemie. Two years later, the Belgian company Janssen Pharmaceutica, the manufacturer of the antipsychotic Haldol (haloperidol), was born. In 1963, Philip Hofmann took over as Chairman of the Board.

In 1973, Dr. Carl Hahn G.m.b.H., a German manufacturer of tampons under the o.b. brand, was bought, and by 1978 J&J had half of the feminine hygiene market, supplanting leader Kimberly-Clark, aided by an overt television advertising campaign for Carefree and Stayfree pads, which had previously been advertised only in women's magazines and reservedly.

In 1975, the rival Bristol-Myers Company introduced Datril, a drug similar to Tylenol but at a significantly lower price. J&J responded by putting Tylenol into mass production, beating out not only datryl but also anacin (phenacetin), the previously most popular drug produced by the American Home Products Corporation, in the painkiller market. In 1973, Sellars took over as chairman of the board, and three years later he was replaced by James Burke.

While increasing its presence in the consumer goods market, J&J did not lose its leadership in the field of professional medical products. In May 1977, Extracorporeal Medical Specialties, a manufacturer of dialysis systems, was acquired, and three years later, Iolab Corporation, a manufacturer of cataract optics. In 1981, Frontier Contact Lenses, a manufacturer of contact lenses, was purchased. In 1983, a subsidiary, Johnson & Johnson Hospital Services, was formed.

In the early 1980s, the company became the target of blackmail, which was preceded in September 1982 by a series of poisonings of people with Tylenol (potassium cyanide was added to packages with the drug by an unknown attacker). The poisoner, who killed seven people, has not been found to this day. In the aftermath of these poisonings, airtight packaging became mandatory for medications in the United States. The poisoning lawsuit ended in 1991, with 30 survivors receiving $35 million in compensation from J&J. Although the company managed to restore Tylenol's reputation, in the late 1980s it began to be squeezed out of the painkiller market by ibuprofen-based drugs.

In 1986, LifeScan, a manufacturer of blood glucose meters, was acquired, as well as the German company Penaten G.m.b.H. a national leader in baby care products. In 1988, the Acuvue brand was introduced, becoming the world's leading market for contact lenses. In 1989, the company underwent a change of leadership: Ralph Larsen took over as Chief Executive Officer and Chairman of the Board, Robert Wilson became President, and Robert Campbell became Vice Chairman. By this time, Johnson & Johnson was a group of 168 companies that operated in 53 countries. In 1990, the company's turnover was $11.23 billion, and in 1996 it reached $21.62 billion thanks to several major acquisitions: RoC S.A. (a French manufacturer of creams and other cosmetics, 1993), Neutrogena Corporation (a manufacturer of skin and hair care products, $1 billion, 1994), the clinical diagnostics division of Eastman Kodak Company ($1 billion, 1995), Cordis Corporation (a world leader in the treatment of cardiovascular diseases, $1.8 billion, 1996, was sold in 2015). The next major acquisition was DePuy, Inc., which was bought in 1998 for $3.7 billion (it was engaged in the production of orthopedic products, primarily artificial joints). At the end of the 1990s, the company faced difficulties: it lagged behind competitors in the introduction of the second generation of stents (scaffolds for dilation of blood vessels), 9 promising drugs did not pass testing, as a result, 36 factories were closed and 4,100 employees were laid off. Despite this, in 1999, the pharmaceutical company Centocor, Inc. was absorbed, the deal amounted to $ 4.9 billion, the product range was replenished with a number of drugs for the treatment of rheumatoid arthritis, oncological, autoimmune and cardiovascular diseases. In 2000, the company was forced to stop selling propulsid (cisapyride) because it caused about 100 deaths and hundreds of cases of heart failure; In 1999, this drug brought the company about $1 billion (out of $27.47 billion in revenue).

Activities

Johnson & Johnson produces a wide range of medicines, body care products under the trademarks JOHNSON's Baby, Neutrogena, o.b., Carefree, Reach, Clean & Clear, RoC, Acuvue contact lenses, etc. The corporation includes about 230 subsidiaries in more than 50 countries; Johnson & Johnson products are sold in more than 175 countries.

3 main divisions of the company:

Consumer Health Care

The division's turnover in 2021 amounted to $14.6 billion.

• over-the-counter medications – Tylenol and other paracetamol-based medicines, Sudafed (pseudoephedrine, colds and allergies), Benadryl and Zyrtec (Benadryl diphenhydramine and Zyrtec, allergy medications), Motrin (Motrin, ibuprofen), Pepsid (Pepsid, famotidine, heartburn remedy); turnover — $5.23 billion;
• skin care products – brands Aveeno, Clean & Clear, Dabao, Johnson's Adult, Le Petite Marseillais, Lubriderm, Neutrogena and RoC; turnover — $4.54 billion;
• baby care products – Johnson's Baby brand; turnover — $1.57 billion;
• oral care products – Listerine trademark; turnover — $1.65 billion;
• feminine hygiene – Stayfree, Carefree, o.b. trademarks; turnover — $0.92 billion;
• bandages – Band-Aid (adhesive plaster) and Neosporin (first aid kits); The turnover is $0.74 billion.

Pharmaceuticals

The division's turnover in 2021 amounted to $52.1 billion.

• Stelara (Stelara, ustekinumab, used in the treatment of psoriasis, $9.13 billion);
• Darzalex (darzalex, daratumumab, an anticancer drug, $6.02 billion);
• Imbruvica (ibrutinib, an anticancer drug, $4.37 billion);
• Invega and analogues (Invega, paliperidone, atypical antipsychotic, $4.02 billion);
• Remicade (infliximab, an immunosuppressive drug used for rheumatoid arthritis, $3.19 billion);
• Xarelto (Xarelto, rivaroxaban, anticoagulant, $2.44 billion);
• Johnson & Johnson COVID-19 vaccine (Ad26.COV2.S, JNJ-78436735, $2.39 ppm);
• Zitiga (abiraterone acetate, used in the treatment of prostate cancer, $2.30 billion);
• Simponi and analogues (Simponi, golimumab, immunosuppressant, used for rheumatoid arthritis, $2.28 billion);
• Tremfya (guselcumab, for psoriasis, $2.13 billion);
• Presista and analogues (Presista, darunavir, used in the treatment of HIV infection, $2.08 billion);
• Opsumit (macitentan, used for pulmonary arterial hypertension, $1.82 billion);
• Erleada (apalutamide, used in the treatment of prostate cancer, $1.29 billion);
• Uptravi (Selexipag, used for pulmonary arterial hypertension, $1.24 billion);
• Edurant (rilpivirine, used in the treatment of HIV infection, $0.99 billion);
• Concerta (methylphenidate, used for attention deficit hyperactivity disorder, $0.67 billion);

.

Medical Devices & Diagnostics

The division's turnover in 2021 was $27.1 billion, which includes the following areas: orthopedics ($8.59 billion), surgery ($9.81 billion), ophthalmology ($4.69 billion)

As of 2017, the equipment, medical products and consumables produced by the division are used for the treatment and diagnosis of diseases in the following areas:

• Cardiovascular surgery (Ethicon surgical sutures and hemostats, catheters and Biosense Webster radiofrequency ablation systems);
• oncosurgery (stitching-cutting, bipolar instruments, Ethicon ultrasound scalpels);
• neurosurgery (Ethicon surgical sutures, Codman clot removal catheters);
• traumatology and orthopedics (endoprostheses, implants, fixation systems and strength equipment DePuy Synthes);
• Sports Medicine (DePuy Synthes Implants);
• ophthalmology (Acuvue contact lenses);
• endocrinology (OneTouch glucose meters);
• obstetrics and gynecology (meshes, Ethicon anti-adhesion solutions).

Geographical distribution of revenue in 2021:

• USA — $47.16 billion;
• Europe — $23.59 billion;
• America (except the United States) — $5.75 billion;
• Asia and Africa — $17.28 billion.

In the Forbes Global 2000 list of the world's largest public companies in 2021, Johnson & Johnson ranked 34th (78th in terms of revenue, 29th in terms of net profit, 222nd in terms of assets, and 15th in terms of market capitalization). According to Fortune magazine, the company was ranked 36th on the Fortune 500 list of the largest companies in the United States and 94th among the world's largest companies in the Fortune Global 500^.

Criticism and lawsuits

Since 2008, the company has received complaints about the poor quality of medicines: the smell of mold, bacteria and metal particles. In 2010, FDA inspections resulted in the recall of 288 million packages of McNeil Consumer Healthcare (a subsidiary of Johnson & Johnson), including popular drugs such as Tylenol, Motrin, Zyrtec and Benadryl, and the closure of one of the company's factories (in Fort Washington, Pennsylvania)). In 2012, another 500,000 packs of Tylenol for infants were recalled due to inconsistencies in the content of the active ingredient. Quality issues weren't limited to McNeil. In 2012-13, a series of lawsuits were filed against another subsidiary, DePuy, a manufacturer of artificial joints, for the rapid deterioration of metal hip implants. In November 2013, the company paid $2.5 billion in 7,500 lawsuits. In December 2016, a court in Dallas ordered the company to pay another $1.041 billion to six plaintiffs in connection with such implants, and about 8,000 lawsuits are pending^. In 2013-15, lawsuits were filed against the Ethicon subsidiary in connection with transvaginal meshes. In 2014, 4,600 lawsuits related to the anticoagulant pradax were settled for $650 ^million.

Beginning in 2010, a series of lawsuits were filed against Johnson & Johnson for illegally marketing the atypical antipsychotic risperdal, which was advertised for use in cases for which it was not certified (it was certified to treat schizophrenia, but not dementia). The company paid the largest fine in Arkansas ($1.2 billion), another $158 million in Texas, $327 million in South Carolina, $258 million in Louisiana, and $181 million in a group of 36 states and the District ^{of Columbia.} In 2013, the company was fined another $2.2 billion for similar mismarketing of Risperdal, Invega, and Natrecor, as well as withholding side effects and providing financial incentives to doctors and hospitals for prescribing drugs made by Johnson & Johnson instead of cheaper counterparts from ^{other manufacturers.}

In 2011, Johnson & Johnson was fined $70 million by the Securities and Exchange Commission and the U.S. Department of Justice for bribing doctors in Greece, Romania and Poland, as well as in Iraq, to win oil-for-food contracts. According to investigators, the company has been using such methods of promoting goods since at least 1998.

In August 2019, an Oklahoma court found Johnson & Johnson guilty of causing the opioid epidemic in the United States and fined the company $572 million. Shares of Johnson & Johnson rose 5% after the verdict as the state attorney general filed a lawsuit amounted to $17 billion. Between 1999 and 2017, about 400,000 people died from an overdose of opiate-based painkillers in the United States, and Johnson & Johnson and other pharmaceutical companies actively promoted opiates, downplaying their dangers and exaggerating their benefits^.

In October 2019, a jury in Philadelphia, Pennsylvania, ordered the company to pay 26-year-old Nicholas Murray $8 billion: Murray reported that as a child he used the neuroleptic drug Risperdal, which has a very unpleasant side effect for men - gynecomastia (enlargement of the mammary glands), but the manufacturer forgot to warn consumers about this. In 2020, the appellate court reduced the amount to $6.8 million. Both sides promised to appeal the decision.

In December 2018, Reuters released data according to which traces of asbestos, which is a carcinogen, have been periodically found in Johnson's Baby powder, which contains talc, since the late 1950s. At the same time, the company's managers, scientists, experts, and lawyers were concerned about the problem, but did not report it to the U.S. Food and Drug Administration or inform the public. What's more, in 1976, when the U.S. Food and Drug Administration imposed limits on asbestos content in talc cosmetic products, the company assured that regulator that asbestos had not been found in "a single sample" of talc.

There are 30,000 lawsuits filed against Johnson & Johnson alleging that Johnson's Baby powder causes cancer. In 2016, a jury in Missouri ordered the company to pay $72 million to the family of a woman who died of ovarian cancer. The jury found it to have been caused by the woman's decades-long use of talcum powder and a hygiene product produced by the company. In early 2021, the U.S. Supreme Court ordered the company to pay $2.5 billion in a lawsuit filed by 22 women who claimed that the powder produced by the company caused them ovarian cancer. In 2023, it was announced that the company would set aside $8.9 billion to settle "all current and future" consumer claims related to this powder.

In May 2020, the company stopped selling Johnson's Baby in the U.S. and Canada, citing pressure from multiple lawsuits it says are unfair. The company also said it will discontinue talc-based baby powder globally in 2023 and replace it with cornstarch-based powder^.