~-e»wmiqg.oewwon.
`January 24, 2017
`
`Johnson & Johnson Reports 2016 Fourth-Quarter Results:
`
`2016 Fourth-Quarter Sales of$ 18.1 Billion increased 1. 7%; EPS was $1.38
`2016 Full-Year Sales of $71.9 Billion increased 2.6%, Full-Year EPS was $5.93
`Adjusted 2016 Fourth-Quarter EPS was $1.58, an increase of 9.7%*, and A_dJusted 2016 Full-Year EPS
`was $6.73, an increase of 8.5%*
`Strong 2016 Full-Year Adjusted Operational Sales and EPS Growth of Approximately 7% and 9%,
`Respectively*
`
`NEW BRUNSWICK, N.J., Jan. 24, 2017 /PRNewswire/ -- Johnson & Johnson (NYSE: JNJ) today announced sales of $18.1
`billion for the fourth quarter of 2016, an increase of 1.7% as compared to the fourth quarter of 2015. Operational sales
`results increased 2.3% and the negative impact of currency was 0.6%. Domestic sales increased 2.6%. International sales
`increased 0.6%, reflecting operational growth of 1.9% and a negative currency impact of 1.3%. As a reminder, there were
`additional shipping days in the fourth quarter of 2015 that negatively impacted the current quarter by 480 basis points.
`Excluding the net impact of acquisitions, divestitures, hepatitis C, Venezuela, and the additional shipping days in 2015, on
`an operational basis, worldwide sales increased 7.6%, domestic sales increased 9.5% and international sales increased
`5.6%.*
`
`Worldwide sales for the full-year 2016 were $71.9 billion, an increase of 2.6% versus 2015. Operational results increased
`3.9% and the negative impact of currency was 1.3%. Domestic sales increased 6.0%. International sales decreased 0.9%,
`reflecting operational growth of 1.8% and a negative currency impact of 2.7%. The additional shipping days in 2015
`negatively impacted the current year by 130 basis points. Excluding the net impact of acquisitions, divestitures, hepatitis C,
`Venezuela, and the additional shipping days in 2015, on an operational basis, worldwide sales increased 7.4%, domestic
`sales increased 8.9% and international sales increased 5.7%.
`
`Net earnings and diluted earnings per share for the fourth quarter of 2016 were $3.8 billion and $1.38, respectively. Fourth(cid:173)
`quarter 2016 net earnings included after-tax intangible amortization expense of approximately $0.3 billion and a net charge
`for after-tax special items of approximately $0.3 billion. Fourth-quarter 2015 net earnings included after-tax intangible
`amortization expense of approximately $0.2 billion and a net charge for after-tax special items of approximately $0.6 billion.
`Excluding after-tax intangible amortization expense and special items, adjusted net earnings for the current quarter were
`$4.4 billion and adjusted diluted earnings per share were $1.58, representing increases of 7 .9% and 9. 7%, respectively, as
`compared to the same period in 2015_* On an operational basis, adjusted diluted earnings per share also increased
`10.4%.· A reconciliation of non-GAAP financial measures is included as an accompanying schedule.
`
`Net earnings and diluted earnings per share for the full-year 2016 were $16.5 billion and $5.93, respectively. Full-year net
`earnings included after-tax intangible amortization expense of approximately $0.9 billion and a charge for after-tax special
`items of approximately $1.3 billion. Full-year 2015 net earnings included after-tax intangible amortization expense of
`approximately $1.1 billion and a charge for after-tax special items of approximately $0.9 billion. Excluding after-tax intangible
`amortization expense and special items, adjusted net earnings for the full-year of 2016 were $18.8 billion and adjusted
`diluted earnings per share were $6.73, representing increases of 7.6% and 8.5%, respectively, as compared to the same
`period in 2015.* On an operational basis, adjusted diluted earnings per share also increased 9.4%.* A reconciliation of non(cid:173)
`GAAP financial measures is included as an accompanying schedule.
`
`"We are pleased to report that we accelerated our adjusted growth for 2016 over the prior year, and delivered a strong total
`shareholder return of greater than 15 percent. The strong adjusted sales and EPS growth was driven by the impressive
`performance of our Pharmaceutical business and continued momentum in our Medical Device business and share gains
`while improving profitability in our Consumer business," said Alex Gorsky, Chairman and Chief Executive Officer. "Looking
`forward to 2017, we expect to continue driving sustainable, long-term growth through the new products, science and
`innovation that our talented colleagues and partners of Johnson & Johnson are advancing to positively impact human
`health."
`
`The Company announced its 2017 full-year guidance for sales of $74.1 billion to $74.8 billion reflecting expected
`operational growth in the range of 4.0% to 5.0%. Excluding the impact of acquisitions and divestitures, operational sales
`growth is expected to be in the range of 3.0% to 3.5%.· Additionally, the Company announced adjusted earnings guidance
`for full-year 2017 of $6.93 to $7.08 per share reflecting expected operational growth in the range of 4.8% to 7.0%.*
`Adjusted earnings guidance excludes the impact of after-tax intangible amortization expense and special items.
`
`Additionally, as part of the Company's ongoing portfolio management, the Company is announcing it is engaging in a
`process to evaluate potential strategic options for the Johnson & Johnson Diabetes Care Companies, specifically LifeScan,
`Inc., Animas Corporation, and Calibra Medical, Inc. Strategic options may include the formation of operating partnerships,
`joint ventures or strategic alliances, a sale of the businesses, or other alternatives either separately or together. All options
`will be evaluated to determine the best opportunity to drive future growth and maximize shareholder value. There can be no
`assurance that this process will result in any transaction or other strategic alternative of any kind.
`
`JANSSEN EXHIBIT 2007
`Mylan v. Janssen IPR2016-01332
`
`

`

`Worldwide Consumer sales of $13.3 billion for the full-year 2016 represented a decrease of 1.5% versus the prior year,
`consisting of an operational increase of 1.5% and a negative impact from currency of 3.0%. Domestic sales increased 3.8%;
`international sales decreased 4.8%, which reflected an operational increase of 0.1 % and a negative currency impact of
`4.9%. Excluding the net impact of acquisitions, divestitures, Venezuela, and the additional shipping days in 2015, on an
`operational basis, worldwide sales increased 4.3%, domestic sales increased 5.6% and international sales increased 3.4%·.
`
`Worldwide operational results, excluding the net impact of acquisitions and divestitures, were driven by over-the-counter
`products, including TYLENOL® analgesics, digestive health products and anti-smoking aids; NEUTROGENA ® and
`AVEENO® beauty products and LISTERINE® oral care products.
`
`Worldwide Pharmaceutical sales of $33.5 billion for the full-year 2016 represented an increase of 6.5% versus the prior
`year with an operational increase of 7.4% and a negative impact from currency of 0.9%. Domestic sales increased 9.8%;
`international sales increased 1.8%, which reflected an operational increase of 4.0% and a negative currency impact of
`2.2%. Excluding the net impact of acquisitions, divestitures, hepatitis C, Venezuela, and the additional shipping days in
`2015, on an operational basis, worldwide sales increased 11.5%, domestic sales increased 13.8% and international sales
`increased 8.3%.*
`
`Worldwide operational results, excluding the net impact of acquisitions, divestitures and hepatitis C sales, were driven by
`new products and the strength of core products. Strong growth in new products include IMBRUVICA® (ibrutinib), an oral,
`once-daily therapy approved for use in treating certain 8-cell malignancies, a type of blood or lymph node cancer;
`DARZALEx® (daratumumab), for the treatment of patients with multiple myeloma; XAREL TO® (rivaroxaban), an oral
`anticoagulant and INVOKANA®tlNVOKAMEr® (canagliflozin), for the treatment of adults with type 2 diabetes.
`
`Additional contributors to operational sales growth included STELARA® (ustekinumab), REMICADE® (infliximab)
`and SIMPONl®!SIMPONI ARIA® (golimumab), biologics approved for the treatment of a number of immune-mediated
`inflammatory diseases; INVEGA® SUSTENNA®tXEPLION®tTRINZA® (paliperidone palmitate), long-acting, injectable atypical
`antipsychotics for the treatment of schizophrenia in adults and EDURANr® (rilpivirine) for the treatment of HIV
`
`Sales results were negatively impacted by generic entrants for ORTHO TRI-CYCLEN® LO (norgestimate/ethinyl estradiol)
`oral contraceptive and INVEGA® (paliperidone palmitate), long-acting, injectable atypical antipsychotics for the treatment of
`schizophrenia in adults.
`
`During the quarter, the U.S. Food and Drug Administration (FDA) approved DARZALEX® (daratumumab) in combination
`with lenalidomide and dexamethasone, or bortezomib and dexamethasone, for the treatment of patients with multiple
`myeloma who have received at least one prior therapy. The European Commission approved STELARA® for the treatment
`of adults with moderately to severely active Crohn's disease. Subsequent to the quarter, in January, the FDA approved
`IMBRUVICA® (ibrutinib) for the treatment of patients with marginal zone lymphoma who require systemic therapy and have
`received at least one prior anti-CD20- based therapy.
`
`Additionally, regulatory applications for approval were submitted to the FDA and European Medicines Agency (EMA) for
`guselkumab for the treatment of adults living with moderate to severe plaque psoriasis. Regulatory applications for approval
`were also submitted to the FDA for SIMPON! ARIA® (golimumab) for the treatment of adults living with active psoriatic
`arthritis and the treatment of adults living with active ankylosing spondylitis and for STELARA® (ustekinumab) for the
`treatment of adolescents (12 to 17 years of age) with moderate to severe plaque psoriasis.
`
`Worldwide Medical Devices sales of $25.1 billion for the full-year 2016 represented a decrease of 0.1% versus the prior
`year consisting of an operational increase of 0.9% and a negative currency impact of 1.0%. Domestic sales increased 1.1 %;
`international sales decreased 1.2%, which reflected an operational increase of 0.7% and a negative currency impact of
`1.9%. Excluding the net impact of acquisitions, divestitures, Venezuela and the additional shipping days in 2015, on an
`operational basis, worldwide sales increased 3.8%, domestic sales increased 2.9% and international sales increased 4.7%.*
`
`Worldwide operational results, excluding the net impact of acquisitions and divestitures, were driven by electrophysiology
`products in the Cardiovascular business; endocutters, energy and biosurgicals in the Advanced Surgery business;
`ACUVUE® contact lenses in the Vision Care business; and joint reconstruction and trauma products in the Orthopaedics
`business.
`
`During the quarter, the FDA approved One Touch Vibe™ Plus Insulin Pump and Continuous Glucose Monitoring System for
`the treatment of patients age two and older living with diabetes.
`
`Also during the quarter, the purchase of expandable cage technologies for spinal fusion was completed, and a development
`agreement was entered into, with lnterventional Spine, Inc.
`
`About Johnson & Johnson
`
`Caring for the world, one person at a time, inspires and unites the people of Johnson & Johnson. We embrace research and
`science - bringing innovative ideas, products and services to advance the health and well-being of people. Our
`approximately 126,400 employees at more than 230 Johnson & Johnson operating companies work with partners in health
`care to touch the lives of over a billion people every day, throughout the world.
`
`• Operational sales growth excluding the net impact of acquisitions, divestitures, hepatitis C, Venezuela and the additional
`shipping days in 2015, as well as adjusted net earnings, adjusted diluted earnings per share and operational adjusted
`diluted earnings per share excluding after-tax intangible amortization expense and special items, are non-GAAP financial
`measures and should not be considered replacements for, and should be read together with, the most comparable GAAP
`financial measures. Except for guidance measures, reconciliations of these non-GAAP financial measures to the most
`directly comparable GAAP financial measures can be found in the accompanying financial schedules of the earnings
`
`

`

`release and the Investor Relations section of the com pany's website at www .investor.jnj.com . Johnson & Johnson does not
`provide GAA P financial measures on a fo rw ard-looking basis because the company is unable to predict with reasonable
`certainty the ultim ate outcome of legal proceedings, unusual gains and losses, acquisition-related expenses and purchase
`accounting fair value adjustments without unreasonable effort. These item s are uncertain, depend on various factors, and
`could be material to Johnson & Johnson's results com puted in accordance with GAA P.
`
`Johnson & Johnson will conduct a conference call with investors to discuss this news release today at 8:30 a.m ., Eastern
`Tim e. A sim ultaneous webcast of the call fo r investors and other interested parties may be accessed by visiting the Johnson
`& Johnson website at ww w.investor.jnj.com . A replay and podcast will be available approxim ately tw o hours after the live
`webcast by visiting W\VW .investor.jnj.com .
`
`Copies of the financial schedules accompanying this press release are available at www .investor .jnj.com/historical(cid:173)
`_$_files.g1_rn . These schedules include supplementary sales data, a condensed consolidated statement of earn ings,
`reconciliations of non-GAA P financial measures, and sales of key pro ducts/franchises. Additional info rmation on Johnson &
`Johnson, including adjusted income befo re tax by segment, a pharmaceutical pipeline of selected com pounds in late stage
`developm ent and a copy of today's earn ings call presentation can be fo und on the com pany's website at
`www .investor.jnj.com .
`
`NOTE TO INVESTO RS CONCER NING FORW ARD-LOOKING STATEMENTS
`
`This press release contains "fo rw ard-looking statements" as defined in the Private Securities Litigation Reform Act of 1995
`regarding, am ong other things, future operating and financial performance, pro duct development, market position and
`business strategy. The reader is cautioned not to rely on these forw ard-looking statem ents. These statem ents are based on
`current expectations of future events. If underlying assum ptions pro ve inaccurate or known or unknown risks or
`uncertainties materialize, actual results could vary materially from the expectations and projections of Johnson & Johnson.
`Risks and uncertainties include, but are not lim ited to, econom ic factors, such as interest rate and currency exchange rate
`fluctuations; competition, including technological advances, new products and patents attained by competitors; challenges
`inherent in new product research and developm ent, including uncertainty of clinical success and obtaining regulatory
`approvals; uncertainty of com mercial success fo r new and existing pro ducts; challenges to patents; the im pact of patent
`expira tions; the ability of the com pany to successfully execute strategic plans, including business plans, transactions and
`restructuring plans; market conditions and the possibility that the on-going share re purchase program may be delayed,
`suspended or discontinued; the im pact of business combinations and divestitures; significant adverse litigation or
`govern m ent action, including related to product liability claims; changes to applicable laws and regulations, including tax
`laws and global health care refo rms; trends toward health care cost containm ent; changes in behavior and spending
`pattern s or financial distress of purchasers of health care products and services; financial instability of intern ational
`econom ies and legal system s and sovereign risk; manufacturing difficulties or delays, intern ally or within the supply chain;
`product efficacy or safety concern s resulting in pro duct recalls or regulatory action; increased scrutiny of the health care
`industry by govern m ent agencies; and the potential fa ilure to meet obligations in com pliance agreements with govern ment
`bodies. A further list and description of these risks, uncertainties and other factors can be found in Johnson & Johnson's
`Annual Report on Form 10-K fo r the fiscal year ended January 3, 2016, including in Exhibit 99 there to, and the com pany's
`subsequent filings with the Securities and Exchange Com mission. Copies of these filings are available online at
`www .sec.gov, ww w.investor.inj.com, or on request fro m Johnson & Johnson. Any fo rw ard-looking statement made in this
`release speaks only as of the date of this release. Johnson & Johnson does not undertake to update any fo rw ard-looking
`statement as a result of new information or future events or developments.
`
`Johnson & Johnson and Subsidiaries
`Supplementary Sales Data
`
`(Unaudited; Dollars in Millions)
`
`Sales to customers by
`segment of business
`
`Consumer
`U.S.
`International
`
`Pharmaceutical
`U.S.
`International
`
`Medical Devices
`U.S.
`International
`
`U.S.
`International
`Worldwide
`
`FOURTH QUARTER
`Percent Chan9e
`Operations Currenc~
`
`Total
`
`TWELVE MONTHS
`Percent Change
`Operations Currency
`
`Total
`
`2016
`
`2015
`
`2016
`
`2015
`
`1,387
`2,045
`3,432
`
`5,002
`3,230
`8,232
`
`3,148
`3,294
`6,442
`
`9,537
`8,569
`$18,106
`
`1,231
`2,089
`3,320
`
`4,910
`3,154
`8,064
`
`3,152
`3,275
`6,427
`
`9,293
`8,518
`17,811
`
`12.7 %
`(2.1)
`3.4
`
`12.7
`0.2
`4.9
`
`1.9
`2.4
`2.1
`
`(0.1)
`0.6
`0.2
`
`2.6
`0.6
`1.7 %
`
`1.9
`3.7
`2.6
`
`(0.1)
`1.3
`0.6
`
`2.6
`1.9
`2.3
`
`(2.3)
`(1.5)
`
`(1.3)
`(0.5)
`
`(0.7)
`(0.4)
`
`(1.3)
`(0.6)
`
`$ 5,420
`7,887
`13,307
`
`5,222
`8,285
`13,507
`
`3.8 %
`(4.8)
`(1.5)
`
`20,125
`13,339
`33,464
`
`18,333
`13,097
`31,430
`
`12,266
`12,853
`25,119
`
`37,811
`34,079
`$71,890
`
`12,132
`13,005
`25,137
`
`35,687
`34,387
`70,074
`
`9.8
`1.8
`6.5
`
`1.1
`(1.2)
`(0.1)
`
`6.0
`(0.9)
`2.6 %
`
`3.8
`0.1
`1.5
`
`9.8
`4.0
`7.4
`
`1.1
`0.7
`0.9
`
`6.0
`1.8
`3.9
`
`(4.9)
`(3.0)
`
`(2.2)
`(0.9)
`
`(1.9)
`(1.0)
`
`(2.7)
`(1.3)
`
`Johnson & Johnson and Subsidiaries
`
`

`

`Supplementary Sales Data
`
`(Unaudited; Dollars in Millions)
`
`Sales to customers by
`geographic area
`
`2016
`
`2015
`
`FOURTH QUARTER
`Percent Chan\le
`Operations Currency
`
`Total
`
`2016
`
`2015
`
`TWELVE MONTHS
`Percent Chan\le
`Operations Currency
`
`Total
`
`U.S.
`
`$ 9,537
`
`9,293
`
`2.6 %
`
`2.6
`
`$37,811
`
`35,687
`
`6.0 %
`
`6.0
`
`Europe
`Western Hemisphere excluding U.S.
`Asia-Pacific, Africa
`International
`
`4,001
`1,465
`3,103
`8,569
`
`4,002
`1,442
`3,074
`8,518
`
`0.0
`1.6
`0.9
`0.6
`
`3.9
`2.4
`(0.9)
`1.9
`
`(3.9)
`(0.8)
`1.8
`(1.3)
`
`15,770
`5,734
`12,575
`34,079
`
`15,995
`6,045
`12,347
`34,387
`
`(1.4)
`(5.1)
`1.8
`(0.9)
`
`1.4
`4.0
`1.4
`1.8
`
`Worldwide
`
`$18,106
`
`17,811
`
`1.7 %
`
`2.3
`
`(0.6)
`
`$71,890
`
`70,074
`
`2.6 %
`
`3.9
`
`(2.8)
`(9.1)
`0.4
`(2.7)
`
`(1.3)
`
`Johnson & Johnson and Subsidiaries
`Condensed Consolidated Statement of Earnings
`
`(Unaudited; in Millions Except Per Share Fi11ures)
`
`FOURTH QUARTER
`
`Sales to customers
`Cost of products sold
`Selling, marketing and administrative expenses
`Research and development expense
`In-process research and development
`Interest (income) expense, net
`Other (income) expense, net
`Restructurinll
`Earnings before provision for taxes on income
`Provision for taxes on income
`Net earnings
`
`Net earnings per share (Diluted)
`
`Average shares outstanding (Diluted)
`
`2016
`
`2015
`
`Amount
`$18,106
`5,534
`5,309
`2,640
`
`84
`20
`195
`4,324
`510
`3,814
`
`1.38
`
`2,764.5
`
`Percent
`to Sales
`100.0
`30.5
`29.3
`14.6
`
`0.5
`0.1
`1.1
`23.9
`2.8
`21.1
`
`Amount
`$17,811
`5,673
`5,891
`2,864
`214
`107
`(1,205)
`509
`3,758
`543
`3,215
`
`1.15
`
`2,803.3
`
`Percent
`to Sales
`100.0
`31.8
`33.1
`16.1
`1.2
`0.6
`(6.8)
`2.9
`21.1
`3.0
`18.1
`
`Effective tax rate
`
`11.8 ¾
`
`14.4 ¾
`
`Adjusted earnings before provision for taxes and net earnings (1)
`Earnings before provision for taxes on income
`Net earnings
`Net earnings per share (Diluted)
`Effective tax rate
`
`$ 5,103
`$ 4,361
`1.58
`$
`14.5 ¾
`
`28.2
`24.1
`
`$ 4,913
`$ 4,043
`1.44
`$
`17.7 ¾
`
`27.6
`22.7
`
`(1lsee Reconciliation of Non-GAAP Financial Measures.
`
`Percent
`Increase
`(Decrease)
`1.7
`(2.5)
`(9.9)
`(7.8)
`
`15.1
`(6.1)
`18.6
`
`20.0
`
`3.9
`7.9
`9.7
`
`Johnson & Johnson and Subsidiaries
`Condensed Consolidated Statement of Earnings
`
`(Unaudited; in Millions Except Per Share Figures)
`
`TWELVE MONTHS
`
`Sales to customers
`Cost of products sold
`Selling, marketing and administrative expenses
`Research and development expense
`In-process research and development
`Interest (income) expense, net
`Other (income) expense, net
`Restructuring
`Earnings before provision for taxes on income
`Provision for taxes on income
`Net earnings
`
`Net earnings per share (Diluted)
`
`2016
`
`2015
`
`Amount
`$71,890
`21,685
`19,945
`9,095
`29
`358
`484
`491
`19,803
`3,263
`$16,540
`
`5.93
`
`Percent
`to Sales
`100.0
`30.2
`27.7
`12.7
`0.0
`0.5
`0.7
`0.7
`27.5
`4.5
`23.0
`
`Amount
`$ 70,074
`21,536
`21,203
`9,046
`224
`424
`(2,064)
`509
`19,196
`3,787
`$15,409
`
`5.48
`
`Percent
`to Sales
`100.0
`30.7
`30.3
`12.9
`0.3
`0.6
`(2.9)
`0.7
`27.4
`5.4
`22.0
`
`Percent
`Increase
`(Decrease)
`2.6
`0.7
`(5.9)
`0.5
`
`3.2
`(13.8)
`7.3
`
`8.2
`
`

`

`Average shares outstanding (Diluted)
`
`Effective tax rate
`
`2,788.9
`
`16.5 %
`
`2,812.9
`
`19.7 %
`
`Adjusted earnings before provision for taxes and net earnings (1)
`Earnings before provision for taxes on income
`Net earnings
`Net earnings per share (Diluted)
`Effective tax rate
`
`$22,759
`$18,764
`$
`6.73
`17.6 %
`
`31.7
`26.1
`
`$ 22,003
`$17,445
`$
`6.20
`20.7 %
`
`31.4
`24.9
`
`3.4
`7.6
`8.5
`
`<1lsee Reconciliation of Non-GAAP Financial Measures.
`
`Johnson & Johnson and Subsidiaries
`Reconciliation of Non-GAAP Financial Measures
`
`(Dollars in Millions Except Per Share Data)
`
`Fourth Quarter
`2016
`2015
`
`% Iner./
`(Deer.)
`
`Twelve Months
`2016
`2015
`
`% Iner./
`(Deer.)
`
`Earnings before provision for taxes on income - as reported
`
`$4,324
`
`3,758
`
`15.1 %
`
`$19,803
`
`19,196
`
`3.2 %
`
`Intangible asset amortization expense
`
`Restructuring/Other!1 l
`
`Litigation expense, net
`
`DePuy ASR™Hip program
`
`ln-process research and development
`
`Other
`
`344
`
`298
`
`96
`
`32
`
`301
`
`590
`
`214
`
`50
`
`1,271
`
`1,570
`
`685
`
`817
`
`29
`
`145
`
`590
`
`141
`
`148
`
`224
`
`134
`
`Earnings before provision for taxes on income - as adjusted
`
`$5,103
`
`4,913
`
`3.9 %
`
`$ 22,759
`
`22,003
`
`3.4 %
`
`Net Earnings - as reported
`
`$3,814
`
`3,215
`
`18.6 %
`
`$16,540
`
`15,409
`
`7.3 %
`
`Intangible asset amortization expense
`
`Restructuring/Other
`
`252
`
`251
`
`220
`
`415
`
`931
`
`544
`
`1,113
`
`415
`
`118
`
`Litigation expense, net
`
`DePuy ASR™ Hip program
`
`In-process research and development
`
`Other
`
`Net Earnings - as adjusted
`
`80
`
`(43)
`
`156
`
`37
`
`675
`
`23
`
`44
`
`130
`
`162
`
`98
`
`$4,361
`
`4,043
`
`7.9 %
`
`$18,764
`
`17,445
`
`Diluted Net Earnings per share - as reported
`
`$ 1.38
`
`1.15
`
`20.0 %
`
`Intangible asset amortization expense
`
`Restructuring/Other
`
`Litigation expense, net
`
`DePuy ASR ™Hip program
`
`In-process research and development
`
`0.09
`
`0.09
`
`0.03
`
`0.07
`
`0.15
`
`0.06
`
`Other
`
`(0.01)
`
`0.01
`
`Diluted Net Earnings per share - as adjusted
`
`$ 1.58
`
`1.44
`
`9.7 %
`
`Operational Diluted Net Earnings per share - as adjusted at 2014
`foreign currency exchange rates
`
`1.54
`
`5.93
`
`0.33
`
`0.20
`
`0.24
`
`0.01
`
`0.02
`
`6.73
`
`5.48
`
`0.39
`
`0.15
`
`0.04
`
`0.05
`
`0.06
`
`0.03
`
`6.20
`
`6.76
`
`7.6 %
`
`8.2 %
`
`8.5 %
`
`Impact of currency at 2015 foreign currency exchange rates
`
`0.01
`
`(0.10)
`
`0.05
`
`(0.56)
`
`Operational Diluted Net Earnings per share - as adjusted at 2015
`foreign currency exchange rates
`
`$ 1.59
`
`1.44
`
`10.4 %
`
`6.78
`
`6.20
`
`9.4 %
`
`(1) Includes $18M recorded in cost of products sold and $85M recorded in other (income) expense for the fourth quarter 2016,
`and $81 M recorded in cost of products sold for the fourth quarter 2015.
`Includes $45M recorded in cost of products sold and $149M recorded in other (income) expense for twelve months YTD 2016,
`
`

`

`and $81M recorded in cost of products sold for twelve months YTD 2015.
`
`Johnson & Johnson and Subsidiaries
`Reconciliation of Non-GAAP Financial Measure
`
`Operational Sales Growth Excluding Acquisitions Divestitures Hepatitis C Salesill Venezuela and Additional 2015 Shipping Days
`FOURTH QUARTER 2016 ACTUAL vs. 2015 ACTUAL
`
`Se ments
`
`Consumer
`
`4.9%
`12.7%
`0.2%
`
`0.5
`0.0
`0.8
`
`(2.7)
`(5.7)
`(1.0)
`
`(0.1)
`(0.3)
`0.1
`
`2.6%
`6.7%
`0.1%
`
`0.4
`0.0
`0.7
`
`4.6
`7.0
`3.3
`
`7.6%
`13.7%
`4.1%
`
`WW As Reported:
`U.S.
`International
`
`Wound Care/Other
`SPLENDA®
`U.S.
`International
`
`Cardiovascular
`Cordis
`U.S.
`International
`
`Beauty
`Vogue
`U.S.
`International
`
`Other Neuroscience
`Controlled Substance Raw Material and AP/ Business
`U.S.
`International
`
`All Other Acquisitions and Divestitures
`U.S.
`International
`
`WW Ops excluding Acquisitions and Divestitures
`U.S.
`International
`
`Hepatitis C
`U.S.
`International
`
`Venezuela
`U.S.
`International
`
`Additional 2015 Shipping Days
`U.S.
`International
`
`WW Ops excluding Acquisitions, Divestitures, Hepatitis C,
`Venezuela & Shipping Days
`U.S.
`International
`
`(1)Hepatitis C products include OL YSIO®/SOVRIAD®and INCIVO®
`(2loperational growth excludes the effect of translational currency
`
`Medical Devices
`Pharmaceutical
`Operational %(2)
`2.6%
`1.9%
`3.7%
`
`0.6%
`(0.1)%
`1.3%
`
`Total
`
`2.3%
`2.6%
`1.9%
`
`0.1
`0.0
`0.2
`
`0.0
`0.0
`0.0
`
`(0.5)
`(0.8)
`(0.3)
`
`0.5
`0.8
`0.3
`
`0.1
`(0.2)
`0.4
`
`2.5%
`2.4%
`2.5%
`
`0.2
`0.0
`0.5
`
`0.1
`0.0
`0.3
`
`4.8
`7 1
`2.3
`
`0.0
`0.1
`(0.1)
`
`0.3
`(0.4)
`1.0
`
`0.9%
`(0.4)%
`2.2%
`
`0.1
`0.0
`0.2
`
`3.7
`4.9
`2.6
`
`4.7%
`4.5%
`5.0%
`
`7.6%
`9.5%
`5.6%
`
`1.2
`1.4
`0.8
`
`0.0
`(0.1)
`0.0
`
`3.8%
`3.2%
`4.5%
`
`0.4
`(0.1)
`1.2
`
`0.0
`0.0
`0.2
`
`5.7
`8.7
`1.2
`
`9.9%
`11.8%
`71%
`
`Johnson & Johnson and Subsidiaries
`Reconciliation of Non-GAAP Financial Measure
`
`Operational Sales Growth Excluding Acquisitions Divestitures Hepatitis C Salesill Venezuela and Additional 2015 Shipping Days
`
`

`

`TWELVE MONTHS 2016 ACTUAL vs. 2015 ACTUAL
`
`Medical Devices
`Pharmaceutical
`Operational %(2l
`7.4%
`9.8%
`4.0%
`
`0.9%
`1.1%
`0.7%
`
`Total
`
`3.9%
`6.0%
`1.8%
`
`0.3
`0.5
`0.2
`
`0.7
`0.3
`1.0
`
`(0.2)
`(0.4)
`0.0
`
`0.2
`0.3
`0.1
`
`0.1
`0.0
`0.1
`
`5.0%
`6.7%
`3.2%
`
`0.8
`0.4
`1.2
`
`0.3
`0.0
`0.7
`
`1.3
`1.8
`0.6
`
`1.7
`0.8
`2.6
`
`0.1
`(0.2)
`0.3
`
`2.7%
`1.7%
`3.6%
`
`0.2
`0.0
`0.4
`
`0.9
`1.2
`0.7
`
`3.8%
`2.9%
`4.7%
`
`7.4%
`8.9%
`5.7%
`
`WW As Reported:
`U.S.
`International
`
`Wound Care/Other
`SPLENDA®
`U.S.
`International
`
`Cardiovascular
`Cordis
`U.S.
`International
`
`Beauty
`Vogue
`U.S.
`International
`
`Other Neuroscience
`Controlled Substance Raw Material and AP/ Business
`U.S.
`International
`
`All Other Acquisitions and Divestitures
`U.S.
`International
`
`WW Ops excluding Acquisitions and Divestitures
`U.S.
`International
`
`Hepatitis C
`U.S.
`International
`
`Venezuela
`U.S.
`International
`
`Additional 2015 Shipping Days
`U.S.
`International
`
`WW Ops excluding Acquisitions, Divestitures, Hepatitis C,
`Venezuela & Shipping Days
`U.S.
`International
`
`(1lHepatitis C products include OLYSIO®/SOVRIAD®and INCIVO®
`12loperational growth excludes the effect of translational currency
`
`Se ments
`
`Consumer
`
`1.5%
`3.8%
`0.1%
`
`1.8
`3.4
`0.8
`
`(1.2)
`(2.8)
`(0.3)
`
`(0.1)
`(0.3)
`0.1
`
`2.0%
`4.1%
`0.7%
`
`1.2
`0.0
`1.9
`
`1.1
`1.5
`0.8
`
`4.3%
`5.6%
`3.4%
`
`0.5
`0.7
`0.2
`
`0.1
`0.2
`0.1
`
`8.0%
`10.7%
`4.3%
`
`1.9
`0.7
`3.4
`
`0.1
`0.0
`0.3
`
`1.5
`2.4
`0.3
`
`11.5%
`13.8%
`8.3%
`
`FOURTH QUARTER
`% Chanae
`Reported Operational ill Currency
`
`2015
`
`2016
`
`TWELVE MONTHS
`
`2016
`
`2015
`
`% Change
`Reported Operational ill Currency
`
`REPORTED SALES vs PRIOR PERIOD /$MM)
`
`CONSUMER SEGMENT ill.ill
`BABY CARE
`us
`Intl
`VW,J
`BEAUTY
`us
`Intl
`VW,J
`ORAL CARE
`us
`Intl
`VW,J
`OTC
`us
`Intl
`
`$
`
`$
`
`123
`370
`493
`
`580
`483
`1,063
`
`163
`234
`397
`
`418
`621
`
`126
`387
`513
`
`442
`461
`903
`
`170
`238
`408
`
`386
`632
`
`-2.4%
`-4.4%
`-3.9%
`
`31.2%
`4.8%
`17.7%
`
`-4.1%
`-1.7%
`-2.7%
`
`8.3%
`-1.7%
`
`-2.4%
`-2.2%
`-2.3%
`
`31.2%
`6.7%
`18.7%
`
`-4.1%
`0.2%
`-1.6%
`
`8.3%
`1.5%
`
`-2.2%
`-1.6%
`
`-1.9%
`-1.0%
`
`-1.9%
`-1.1%
`
`-3.2%
`
`488
`514
`1,513 ~ -7.9%
`2,001
`2,157
`
`-7.2%
`
`-5.1%
`
`2,135
`1,861
`1,762 ~ -0.6%
`3,897
`3,633
`
`14.7%
`
`7.3%
`
`648
`920
`1,568
`
`629
`951
`1,580
`
`3.0%
`-3.3%
`-0.8%
`
`1,675
`1,565
`7.0%
`2,302 ~ -1.2%
`
`-5.1%
`-2.0%
`-2.7%
`
`14.7%
`3.7%
`9.4%
`
`3.0%
`1.4%
`2.0%
`
`7.0%
`3.4%
`
`-5.9%
`-4.5%
`
`-4.3%
`-2.1%
`
`-4.7%
`-2.8%
`
`-4.6%
`
`

`

`RISPERDAL CONSTA
`
`us
`
`Intl
`WW
`OTHER NEUROSCIENCE
`us
`
`Intl
`WW
`ONCOLOGY
`us
`
`Intl
`WW
`DARZALEX
`us
`Intl
`WW
`IMBRUVICA
`us
`
`Intl
`WW
`VELCADE
`us
`
`Intl
`WW
`ZYTJGA
`us
`
`Intl
`WW
`OTHER ONCOLOGY
`us
`
`Intl
`WW
`CARDIOVASCULAR l METABOLISM/
`OTHER
`us
`
`Intl
`WW
`XARELTO
`us
`
`92
`118
`210
`
`76
`339
`415
`
`103
`131
`234
`
`-10.7%
`-9.9%
`-10.3%
`
`-48.3%
`147
`_EL -8.4%
`-19.7%
`517
`
`595
`867
`1,462
`
`457
`816
`1,273
`
`30.2%
`6.3%
`14.8%
`
`151
`49
`200
`
`158
`188
`346
`
`274
`274
`
`20
`
`20
`
`122
`113
`235
`
`321
`321
`
`29.5%
`66.4%
`47.2%
`
`-14.6%
`-14.6%
`
`-12.9%
`249
`286
`270 ~ -8.5%
`-10.7%
`519
`581
`
`37
`86
`123
`
`1,265
`338
`1,603
`
`598
`
`598
`
`29
`87
`116
`
`1,237
`381
`1,618
`
`494
`
`494
`
`27.6%
`-1.1%
`6.0%
`
`2.3%
`-11.3%
`-0.9%
`
`211%
`
`-10.7%
`-8.6%
`-9.5%
`
`-48.3%
`-9.8%
`-20.7%
`
`30.2%
`8.1%
`15.9%
`
`29.5%
`72.2%
`50.0%
`
`-12.6%
`-12.6%
`
`-12.9%
`-9.0%
`-11.0%
`
`27.6%
`1.3%
`7.8%
`
`2.3%
`-7.8%
`-0.1%
`
`211%
`
`-1.3%
`-0.8%
`
`1.4%
`1.0%
`
`-1.8%
`-1.1%
`
`0.0%
`0.0%
`
`-5.8%
`-2.8%
`
`-2.0%
`-2.0%
`
`0.5%
`0.3%
`
`-2.4%
`-1.8%
`
`-3.5%
`-0.8%
`
`381
`512
`893
`
`409
`561
`970
`
`-6.8%
`-8.7%
`-7.9%
`
`-37.2%
`366
`583
`1,438 ~ -3.0%
`-12.6%
`1,804
`2,065
`
`50.9%
`2,335
`1,547
`3,472 ~ 10.3%
`23.7%
`5,807
`4,695
`
`471
`101
`572
`
`613
`638
`1,251
`
`20
`
`20
`
`375
`314
`689
`
`63.5%
`
`81.6%
`
`1,224 ~ -8.2%
`-8.2%
`1,224
`1,333
`
`1.8%
`1,089
`1,070
`1,171 ~ 0.9%
`1.3%
`2,231
`2,260
`
`162
`338
`500
`
`82
`340
`422
`
`97.6%
`-0.6%
`18.5%
`
`2.0%
`4,855
`4,759
`1,541 ~ -71%
`-0.3%
`6,396
`6,418
`
`2,288
`
`2,288
`
`1,868
`
`1,868
`
`22.5%
`
`-1.3%
`-0.8%
`
`-0.1%
`-0.1%
`
`-2.3%
`-1.5%
`
`0.0%
`0.0%
`
`-6.3%
`-2.9%
`
`-2.3%
`-2.3%
`
`-0.9%
`-0.5%
`
`-2.7%
`-2.1%
`
`-4.2%
`-1.1%
`
`-6.8%
`-7.4%
`-71%
`
`-37.2%
`-2.9%
`-12.5%
`
`50.9%
`12.6%
`25.2%
`
`63.5%
`
`84.5%
`
`-5.9%
`-5.9%
`
`1.8%
`1.8%
`1.8%
`
`97.6%
`2.1%
`20.6%
`
`2.0%
`-2.9%
`0.8%
`
`22.5%
`
`22.5%
`
`Intl
`WW
`JNVOKANA/ INVOKAMET
`us
`
`Intl
`WW
`PROCRIT / EPREX
`us
`
`Intl
`WW
`OTHER
`us
`
`Intl
`WW
`
`TOTAL PHARMACEUTICAL
`us
`Intl
`WW
`
`See footnotes at end of schedule
`
`MEDICAL DEVICES SEGMENT ill
`CARDIOVASCULAR
`us
`
`Intl
`WW
`DIABETES CARE
`us
`
`Intl
`WW
`DIAGNOSTICS
`us
`
`Intl
`WW
`ORTHOPAEDICS
`us
`
`Intl
`WW
`HIPS
`us
`
`21.1%
`
`-4.0%
`54.2%
`-0.3%
`
`7.5%
`-16.1%
`-0.4%
`
`-33.8%
`-15.6%
`-23.8%
`
`348
`24
`372
`
`173
`87
`260
`
`222
`270
`492
`
`334
`37
`371
`
`186
`73
`259
`
`147
`228
`375
`
`4,910
`5,002
`1.9%
`3,230 ~ 2.4%
`8,064
`8,232
`2.1%
`
`21.1%
`
`-4.0%
`60.3%
`0.1%
`
`7.5%
`-14.5%
`0.1%
`
`-33.8%
`-11.7%
`-21.6%
`
`1.9%
`3.7%
`2.6%
`
`-6.1%
`-0.4%
`
`-1.6%
`-0.5%
`
`-3.9%
`-2.2%
`
`-1.3%
`-0.5%
`
`1,273
`134
`1,407
`
`767
`338
`1,105
`
`1,238
`70
`1,308
`
`692
`376
`1,068
`
`22.5%
`
`2.8%
`91.4%
`7.6%
`
`10.8%
`-10.1%
`3.5%
`
`-45.2%
`527
`961
`1,069 ~ -11.9%
`-26.6%
`2,174
`1,596
`
`20,125
`18,333
`9.8%
`13,339 ~ 1.8%
`33,464
`31,430
`6.5%
`
`2.8%
`
`8.1%
`
`10.8%
`-7.6%
`4.4%
`
`-45.2%
`-7.5%
`-24.1%
`
`9.8%
`4.0%
`7.4%
`
`-9.7%
`-0.5%
`
`-2.5%
`-0.9%
`
`-4.4%
`-2.5%
`
`-2.2%
`-0.9%
`
`FOURTH QUARTER
`'lo Change
`Reported Operational ill Currency
`
`2015
`
`2016
`
`TWELVE MONTHS
`
`2016
`
`2015
`
`'lo Chance
`Reported Operational ill Currency
`
`REPORTED SALES vs. PRIOR PERIOD fSMMl
`
`$
`
`247
`238
`485
`
`191
`271
`462
`
`229
`210
`439
`
`202
`278
`480
`
`24
`24
`
`1,422
`965
`2,387
`
`1,438
`985
`2,423
`
`208
`
`213
`
`7.9%
`13.3%
`10.5%
`
`-5.4%
`-2.5%
`-3.8%
`
`..
`..
`
`-1.1%
`-2.0%
`-1.5%
`
`-2.3%
`
`7.9%
`12.4%
`10.1%
`
`-5.4%
`-11%
`-3.0%
`
`..
`..
`
`-1.1%
`-0.6%
`-0.9%
`
`-2.3%
`
`0.9%
`0.4%
`
`-1.4%
`-0.8%
`
`..
`..
`
`-1.4%
`-0.6%
`
`$
`
`1.8%
`931
`948
`901 ~ -18.5%
`-9.2%
`2,036
`1,849
`
`-11.3%
`739
`833
`1,050 ~ -4.1%
`-7.2%
`1,789
`1,928
`
`1.8%
`-18.4%
`-9.2%
`
`-11.3%
`-1.9%
`-5.9%
`
`-0.1%
`0.0%
`
`-2.2%
`-1.3%
`
`66
`66
`
`86
`86
`
`-23.3%
`-23.3%
`
`-13.9%
`-13.9%
`
`-9.4%
`-9.4%
`
`2.6%
`5,380
`5,521
`3,813 ~ -1.8%
`0.8%
`9,262
`9,334
`
`798
`
`781
`
`2.2%
`
`2.6%
`0.5%
`1.8%
`
`2.2%
`
`-2.3%
`-1.0%
`
`

`

`,
`
`Intl
`WN
`
`~ us
`
`Intl
`WN
`TRAUMA
`us
`Intl
`WN
`SPINE & OTI--fER
`us
`Intl