3/7/2017
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`Johnson & Johnson's Management Discusses Q1 2013 Results - Earnings Call Transcript | Seeking Alpha
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`Johnson & Johnson's Management Discusses Q1 2013 Results -
`Earnings Call Transcript
`
`Apr. 16, 2013 1:33 PM ET
`by: SA Transcripts
`
`Johnson & Johnson (NYSE:JNJ)
`
`Q1 2013 Earnings Call
`
`April 16, 2013 8:30 a.m. ET
`
`Executives
`
`Louise Mehrotra – VP, IR
`
`Dominic Caruso – VP, Finance and CFO
`
`Analysts
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`Matthew Dodds – Citigroup
`
`Larry Biegelsen - Wells Fargo
`
`Mike Weinstein - JPMorgan
`
`Kristen Stewart – Deutsche Bank
`
`Rajeev Jashnani - UBS
`
`Derrick Sung - Sanford C. Bernstein
`
`Tony Butler - Barclays Capital
`
`Rick Wise - Stifel Nicolaus
`
`Jami Rubin - Goldman Sachs
`
`Danielle Antalffy - Leerink Swann
`
`http://seekingalpha.com/article/1344911-johnson-and-johnsons-management-discusses-q1-2013-results-earnings-call-transcript?part=single
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`1/31
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`JANSSEN EXHIBIT 2139
`Mylan v. Janssen IPR2016-01332
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`3/7/2017
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`Johnson & Johnson's Management Discusses Q1 2013 Results - Earnings Call Transcript | Seeking Alpha
`
`Matt Miksic - Piper Jaffray
`
`Operator
`
`Good morning and welcome to the Johnson & Johnson First Quarter 2013 Earnings
`
`Conference Call. All participants will be able to listen-only until the question and answer
`
`session of the conference. This call is being recorded. (Operator Instructions) I would now
`
`like to turn the conference over to Johnson & Johnson. You may begin.
`
`Louise Mehrotra
`
`Good morning and welcome. I’m Louise Mehrotra, Vice President of Investor Relations for
`
`Johnson & Johnson, and it is my pleasure this morning to review our business results for
`
`the first quarter of 2013. Joining me on the call today is Dominic Caruso, Vice President,
`
`Finance and Chief Financial Officer. A few logistics before we get into the details.
`
`This review is being made available to a broader audience via webcast accessible through
`
`the Investor Relations’ section of the Johnson & Johnson website. I’ll begin by briefly
`
`reviewing highlights of the first quarter for the corporation and highlights for our three
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`business segments. Following my remarks, Dominic will provide some additional
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`commentary on the financial results and guidance for 2013. We will then open the call to
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`your questions. We expect the call to last approximately 1 hour.
`
`Included with the press release that was issued earlier this morning is the schedule of
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`sales for key products and/or businesses to facilitate updating your model. These
`
`schedules are available on the Johnson & Johnson website as is the press release.
`
`Before I get into the results, let me remind you that some of the statements made during
`
`this review may be considered forward-looking statements. The 10-K for the fiscal year
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`2012 identifies certain factors that could cause the company’s actual results to differ
`
`materially from those projected in any forward-looking statements made today. The
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`company does not undertake to update any forward-looking statements as a result of new
`
`information or future events or developments. The 10-K is available through the company
`
`or online.
`
`During the review, non-GAAP financial measures are used to provide information pertinent
`
`to ongoing business performance. These non-GAAP financial measures should not be
`
`considered replacements for GAAP results. Tables reconciling these measures to the
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`most comparable GAAP measures are available in the press release and on the Investor
`
`Relations’ section of the Johnson & Johnson website at investor.jnj.com.
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`http://seekingalpha.com/article/1344911-johnson-and-johnsons-management-discusses-q1-2013-results-earnings-call-transcript?part=single
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`3/7/2017
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`Johnson & Johnson's Management Discusses Q1 2013 Results - Earnings Call Transcript | Seeking Alpha
`
`Now I would like to review our results for the first quarter of 2013. If you would refer to
`
`your copy of the press release, let's begin with the schedule titled, supplementary sales
`
`data by geographic area. Worldwide sales to customers were $17.5 billion for the first
`
`quarter of 2013, up 8.5% as compared to the first quarter of 2012. On an operational basis
`
`sales were up 9.8% and currency had a negative impact of 1.3%. The acquisition of
`
`Synthes was completed in the second quarter of 2012. In the current quarter the
`
`acquisition, net of the impact of the divestiture of the legacy DePuy trauma business,
`
`contributed 5.7% to the worldwide operational sales growth.
`
`In the U.S., sales were up 11.2%. In regions outside the U.S. our operational growth was
`
`8.7% while the effect of currency exchange rates negatively impacted our reported results
`
`by 2.4 points. The Asia Pacific/Africa region grew 11.8% operationally while the western
`
`hemisphere excluding the U.S. grew by 9.1% operationally. Europe grew 6.2% on an
`
`operational basis. The success of new product launches and Synthes sales made strong
`
`contributions to the results in all regions.
`
`If you’ll now turn to the consolidated statements of earnings. Net earnings were $3.5
`
`billion compared to $3.9 billion in the same period in 2012. Earnings per share were $1.22
`
`versus $1.41 a year ago. Please direct your attention to the box section with the schedule
`
`where we have provided earnings adjusted to exclude special items.
`
`As referenced in the accompanying table of non-GAAP measures 2013 first quarter net
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`earnings were adjusted to exclude special items primarily related to an increase in the
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`litigation accrual as well as integration and transaction costs related to the acquisition of
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`Synthes, Inc. First quarter 2012 net earnings included a gain related to an after-tax special
`
`item of $106 million as outlined in the reconciliation of non-GAAP financial measures.
`
`Excluding these special items for both periods, net earnings for the current quarter were
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`$4.1 billion and diluted earnings per share were $1.44, representing increases of 8.0%
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`and 5.1%, respectively, as compared to the same period in 2012.
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`I would now like to make some additional comments relative to the component leading to
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`earnings before we move on to the segment highlights. For the first quarter of 2013, cost
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`of goods sold at 31.7% was up 130 basis points from the same period last year, primarily
`
`due to an inventory step up charge related to the Synthes acquisition. Excluding the
`
`inventory step up charge which has been treated as a special item, cost of goods sold
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`increased 50 basis points versus the same period last year.
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`3/7/2017
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`Johnson & Johnson's Management Discusses Q1 2013 Results - Earnings Call Transcript | Seeking Alpha
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`Incremental amortization expense related to Synthes of approximately $140 million
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`negatively impacted cost of goods sold by 80 basis points. Also impacting cost of goods
`
`sold were the ongoing remediation work in our OTC business and the medical devices
`
`excise tax. Positive mix and cost reduction efforts partially offset these items.
`
`First quarter selling, marketing and administrative expenses at 29.8% of sales were down
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`130 basis points due to tightening up expenditures as well as cost containment initiatives
`
`across many of our businesses.
`
`Our investment in research and development as a percent of sales was 10.2%, consistent
`
`with our 2012 results.
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`Interest expense net of interest income of $104 million was down $26 million versus the
`
`first quarter of 2012 due to a lower average debt level. Other expense net of other income
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`was $515 million in the first quarter of 2013 compared to $611 million of other income net
`
`of other expense in the same period last year. excluding special items, other income net of
`
`other expense of $83 million was $411 million less than 2012 due primarily to lower gains
`
`from divestitures. Excluding special items, the effective tax rate of 19% in the first quarter
`
`of 2013 compared to 22.8% in the same period last year. Dominic will provide commentary
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`on taxes in his remarks.
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`Turning now to business segment highlights, please refer to the supplementary sales
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`schedule highlighting key products or businesses for the first quarter of 2013. I’ll begin
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`with the consumer segment.
`
`Worldwide Consumer segments sales for the first quarter of 2013 of $3.7 billion increased
`
`2.2% as compared to the same period last year. On an operational basis, sales increased
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`3.3% while the impact of currency was negative 1.1%. U.S sales were up 2.4%, while
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`international sales grew 3.8% on an operational basis.
`
`Excluding the impact of divestitures net of acquisitions, operational growth was
`
`approximately 4.3%. Baby care products increased on an operational basis by 7% when
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`compared to the first quarter of 2012 primarily due to wipes, hair care, cleansers and
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`powders.
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`Sales in the oral care business increased 5.1% operationally. Results were driven by
`
`strong sales of LISTERINE due to the continued success of new product launches
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`partially offset by the impact of the divestiture of the manual toothbrushes in the U.S.
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`3/7/2017
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`Johnson & Johnson's Management Discusses Q1 2013 Results - Earnings Call Transcript | Seeking Alpha
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`For the first quarter of 2013, sales for OTC pharmaceuticals and nutritionals increased
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`7.6% on an operational basis compared to the same period in 2012, with U.S sales up
`
`14.4% and sales outside the U.S up 3.9% on an operational basis. The strong sales
`
`results in the U.S were driven by analgesics and upper respiratory products due to
`
`progress in returning to a reliable supply of products to the marketplace and a strong flu
`
`season.
`
`Strong growth of analgesics drove results outside the U.S. Our skin care business was flat
`
`on an operational basis in the first quarter of 2013. Strong results for NEUTROGENA were
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`offset by the impact of divestiture, the initial stocking related to new product launches last
`
`year and competitive pressure. Women's health grew 0.8% on an operational basis due to
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`strong growth in liners offset by lower sales of KY products.
`
`Wound Care/Other sales decreased 10% on an operational basis with the sales decline in
`
`the U.S. of 13.3% and outside the U.S. operational sales were down 6.1% due to
`
`competitive pressures and the impact of divestiture. That completes our review of the
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`consumer segment and I will now review highlights for our pharmaceutical segment.
`
`Worldwide net sales for the first quarter of $6.8 billion increased 10.4% versus the same
`
`period last year. On an operational basis, sales increased 11.4% with the negative
`
`currency impact of 1 point. Sales in the U.S. increased 14.7% while sales outside the U.S.
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`increased on an operational basis by 8.1%. U.S. results included a positive adjustment to
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`previous estimates for managed Medicaid rebates under the Affordable Care Act related
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`to new data received from the states. Excluding this item, both U.S. sales and worldwide
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`sales were up approximately 8% operationally. The most significant impacts from the
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`adjustment were in immunology, neuroscience and PROCRIT.
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`Now reviewing sales for major therapeutic areas. Immunology products grew 16.8%
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`operationally with sales in the U.S. up 12.8%. Excluding the adjustment, U.S. immunology
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`growth was approximately 6.5% with REMICADE excluding export sales, up
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`approximately 4%. SIMPONI up approximately 22%, and STELARA up approximately
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`57%. Results were driven by strong market growth across the major products,
`
`complemented by increased market share for STELARA. With the strength of our portfolio,
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`we continue to be the U.S. market leader in immunology.
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`REMICADE exports sales declined 7.7% due primarily to a change in inventory levels.
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`Immunology sales outside the U.S. increased by 30.1% operationally due to strong results
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`for both SIMPONI and STELARA. SIMPONI's strong growth was due to the increased
`
`shipments to our distribution partner and very strong growth in Japan. STELARA made
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`3/7/2017
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`Johnson & Johnson's Management Discusses Q1 2013 Results - Earnings Call Transcript | Seeking Alpha
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`significant contributions due primarily to market share gains complemented by strong
`
`market growth in the major regions. Sales of infectious disease products increased 8.6%
`
`on an operational basis. INCIVO, a treatment for hepatitis C, grew 24.9% on an
`
`operational basis due to the success of the continued rollout primarily in Latin America.
`
`Please note for your models, 2012 sales by quarter for both INCIVO and XARELTO have
`
`been included in the sales by major product schedule. Continued momentum in market
`
`share growth of PREZISTA made notable contributions to the results as to the combined
`
`sales of COMPLERA and EDURANT. Neuroscience product sales increased 7.7% on an
`
`operational basis with U.S. growth at 10.7%. Excluding the managed Medicaid adjustment
`
`which is primarily related to TOPAMAX and CONCERTA, U.S. sales declined
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`approximately 2% impacted by generic competition primarily for CONCERTA and
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`DURAGESIC.
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`The long-acting injectable antipsychotics, RISPERDAL CONSTA and INVEGA
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`SUSTENNA or Xeplion achieved operational growth of nearly 20% due to an increase in
`
`combined market share. INVEGA achieved double-digit operational growth of 11.1% due
`
`to strong operational growth outside the U.S. primarily driven by increased market share in
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`Japan.
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`Sales of oncology products increased 35% on an operational basis due to the very strong
`
`results for ZYTIGA. ZYTIGA is now approved to treat both chemo-refractory and chemo
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`naïve metastatic castration resistant prostate cancer. In the quarter, ZYTIGA achieved
`
`operational sales growth of over 70%, with U.S. sales growing 61% due to a very strong
`
`market growth of over 20% and increased market share in the combined metastatic
`
`castrate resistant prostate cancer market. ZYTIGA has captured 28% of that market and is
`
`up 1.5 points sequentially. Operational sales outside the U.S. grew 83.4% versus first
`
`quarter 2012 and on a sequential basis were up over 20%. ZYTIGA is approved in more
`
`than 75 countries. VELCADE is a treatment for multiple myeloma. Sales increased 2.5%
`
`on an operational basis.
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`As I mentioned last quarter, the timing of tender business negatively impacted the growth
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`rate in the first quarter of 2013. Excluding the timing of the tender business, operational
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`growth was over 20%. Strong performance in patient share in the frontline setting and the
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`launch of the subcutaneous version continues to drive sales growth.
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`Other oncology increased primarily due to Doxil/Caelyx. Regarding Doxil in the U.S,
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`Johnson is releasing additional Doxil produced by an alternate manufacturing approach
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`under the regulatory discretion of the U.S FDA. The longer term solution for Doxil/Caelyx
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`3/7/2017
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`Johnson & Johnson's Management Discusses Q1 2013 Results - Earnings Call Transcript | Seeking Alpha
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`production involving transitioning manufacturing to additional suppliers continues to meet
`
`expected milestones.
`
`Other pharmaceutical products declined 1.7% on an operational basis with lower sales for
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`Eprex and Pariet related primarily to generic competition. PROCRIT results were impacted
`
`by the managed Medicaid adjustment. Excluding this item, PROCRIT sales declined
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`approximately 14% due primarily to a market decline. Positively impacting results, Xarelto
`
`sales grew over 60% on a sequential basis, capturing 38% of the new to brand scripts in
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`cardiology.
`
`Total prescription share in the broader anticoagulant market grew 1.6 points on a
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`sequential basis to 5.6%. as an update on the status of the acute coronary syndrome
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`indication for XARELTO, the FDA issued a second complete response letter. Johnson is
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`continuing to work with the FDA to address their questions.
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`That completes a review of the pharmaceutical segment. I’ll now review the medical
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`devices and diagnostic segment results. Worldwide Medical Devices and Diagnostics
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`segment sales of $7.1 billion grew 11.9% operationally as compared to the same period in
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`2012. Currency had a negative impact of 1.7%, resulting in a total sales increase of
`
`10.2%. Sales excluding the net impact of Synthes were down 2.4% on an operational
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`sales, with U.S sales down 5.2% and sales outside the U.S down 0.2% on an operational
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`basis.
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`Divestitures and exit from certain businesses drove approximately half the worldwide
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`operational decline in the quarter. Market dynamics, including lower distributor inventories,
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`pricing pressures, as well as the impact of less selling days, particularly in our orthopedics
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`business, negatively impacted operational growth by approximately 2 points. I will provide
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`more commentary on these factors in the franchise reviews.
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`Now turning to the MD&D business, starting with cardiovascular care. Cardiovascular care
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`sales were up 8.5% operationally, with U.S. up 12.5% and sales outside the U.S. up 6.2%
`
`operationally. Excluding the impact of drug eluting stents, worldwide sales were up nearly
`
`11% on an operational basis due to strong results for Biosense Webster's and
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`endovascular products.
`
`Biosense Webster, our electrophysiology business achieved worldwide operational sales
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`growth of nearly 12% in the quarter, driven by market share growth. The expansion of the
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`install base of the CARTO 3 system and the success of catheter launches made strong
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`Johnson & Johnson's Management Discusses Q1 2013 Results - Earnings Call Transcript | Seeking Alpha
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`contributions to the results. Strong double digit growth for endovascular products were
`
`driven by the re-launch of the S.M.A.R.T. vascular stent system and the EXOSEAL
`
`Vascular Closure Device.
`
`The diabetes care business operational sales declined 9.8% in the first quarter of 2013,
`
`with U.S business down 19.6% due to the impact of the initial stocking related to new
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`product launches last year, lower price and competitive pressures, including private label.
`
`The business outside the U.S. grew 0.9% operationally, with strong sales in emerging
`
`markets largely offset by lower sales in many of the developed markets.
`
`The diagnostics business declined 4.9% on an operational basis. Excluding the impact of
`
`the divestiture of RhoGAM and the varicose business, operational sales grew
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`approximately 2%, with U.S. growth of approximately 8% and growth outside the U.S.
`
`down approximately 3% operationally. Results in the U.S were driven by strong growth in
`
`clinical labs and donor screening.
`
`Infection prevention declined 10.5% on an operational basis, with sales in the U.S. down
`
`26.7%. Last year in the U.S., a customer program to upgrade systems to STERRAD
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`solutions ended in the first quarter, impacting the timing of capital purchases for the
`
`balance of the year in 2012. Excluding capital sales, U.S. results declined approximately
`
`3.5% in the quarter due primarily to timing of purchases for consumables.
`
`Outside the U.S., operational growth of 4.1% was driven by both consumables and capital
`
`items sales. Orthopedic sales were up 60.7% on an operational basis when compared to
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`the same period in 2012. Excluding the net impact of Synthes and the divestiture of
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`certain neurosurgical instruments, operational sales were flat with the U.S. flat and outside
`
`the U.S. down approximately 1% operationally. Worldwide sales were impacted by
`
`approximately 1.5 less selling days in the quarter.
`
`Operationally, hips were 2% worldwide driven by 5% growth in the U.S. due to strong
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`results in primary stem platform sales, partially offset by continued pricing pressure. Hips
`
`outside the U.S. were flat on an operational basis with strong results in emerging markets
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`offset by slower sales in the developed markets. Knees worldwide declined 1% on an
`
`operational basis, with U.S. up 1% driven by fixed bearing and revision platforms offset by
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`lower sales of rotating platforms. Sales outside the U.S. were down 2% with lower sales of
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`low contact stress or LCS and mobile bearing technology.
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`Including the Synthes business in both periods, and excluding the divested DePuy trauma
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`business in both periods, trauma grew approximately 2% on an operational basis with
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`similar results both in and outside the U.S. The fourth quarter supply disruption in the U.S.
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`Johnson & Johnson's Management Discusses Q1 2013 Results - Earnings Call Transcript | Seeking Alpha
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`was substantially remedied late in the first quarter. Including the Synthes business in both
`
`periods, worldwide spine was down 7% on an operational basis with the U.S. down
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`approximately 10% impacted by the continued softness as well as the restructuring of the
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`commercial sales organization. Outside the U.S. sales were down approximately 3%
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`operationally.
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`Specialty surgery operational growth was 1% in the first quarter of 2013. U.S. sales were
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`down 2.4% and sales outside the U.S. were up 4.7% on an operational basis. Strong
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`sales of energy products outside the U.S. and solid results for bio-surgical products were
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`substantially offset by lower sales of mental products due to market and pricing pressure.
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`Surgical care worldwide sales were down 5.4% on an operational basis with the U.S.
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`10.5% and sales outside the U.S. down 2.4% operationally. Negatively impacting growth
`
`were divestitures and business exits as well as other factors such as reduction in
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`inventory levels.
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`Excluding these items, the underlying business was down approximately 1.5 points.
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`Competitive and pricing dynamics impacted sales in the quarter. Rounding up the review
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`of the medical devices and diagnostics segment, our vision care business achieved
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`operational sales growth of 1.6% in the first quarter compared to the same period last year
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`with the similar results both in and outside the U.S. Growth was driven by daily lenses and
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`astigmatism lenses, partially offset by lower sales of reusable lenses. That completes
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`highlights for the medical devices and diagnostics segment and concludes the segment
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`highlights for Johnson & Johnson's first quarter of 2013.
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`It is now my pleasure to turn the call over to Dominic Caruso. Dominic?
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`Dominic Caruso
`
`Thank you, Louise, and good morning everyone. I would like to start by saying that our
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`thoughts and prayers are with the families and victims of the tragic event in Boston
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`yesterday. Now turning to the business of this call. I would like to provide some additional
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`comments about our first quarter results, highlight some of our recent business and
`
`pipeline developments, and then provide guidance for you to consider in refining your
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`models for 2013.
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`I am pleased that we are off to a good start in 2013 with solid results in the first quarter.
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`We continued delivering on our three near term priorities, building on the momentum in
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`our pharmaceuticals business, integrating Synthes and returning a reliable supply of OTC
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`products for the marketplace. I would like to make a few comments on the state of the
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`healthcare market.
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`Johnson & Johnson's Management Discusses Q1 2013 Results - Earnings Call Transcript | Seeking Alpha
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`While we believe that overall healthcare utilization trends continues to show signs of
`
`stabilization, the modest positive increases we saw in the fourth quarter do not appear to
`
`have persisted. And at this point we are not anticipating a meaningful market acceleration
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`this year. Adapting to these changes in the healthcare environment is important and our
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`leaders continue to apply financial discipline for operations while investing in key growth
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`opportunities.
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`Our growth strategies of creating value for innovation, global reach with a local focus,
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`excellence in execution and leading with a purpose, are begin executed well across our
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`businesses as you will see in the review of our highlights for the first quarter. The breadth
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`of our business which provides balance and consistency to our overall performance, as
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`well as the extraordinary achievements and dedication of our people in all of our locations
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`around the world, positions us well to sustain and drive growth in this increasingly dynamic
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`global healthcare market.
`
`Let’s review some highlights for the Q1 results. We had a solid start to the year and are
`
`pleased to report earnings per share of %1.44 excluding special items. This result was
`
`driven by operational sales growth from the first quarter of 9.8% versus the prior year,
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`which was led by the success of many of our recently launched pharmaceutical products
`
`as well as the addition of Synthes to our orthopedics business.
`
`As we announced in February, our first quarter earnings were impacted by the Venezuelan
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`government’s decision to devalue its currency, for which we incurred a charge of
`
`approximately $100 million net income and which resulted in a $0.04 negative impact to
`
`earnings per share. This charge is related to the re-measurement of our local balance
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`sheet at the date of the devaluation. We did not treat this charge as a special item and I’m
`
`pleased that this negative impact to earnings was more than offset by strong operating
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`performance in the first quarter.
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`As you know, the federal R&D tax credit was renewed by congress in January under the
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`American Taxpayer Relief Act for both 2012 and 2013 and during the first quarter, we
`
`recorded the full year impact of the 2012 effect. We recorded special items in the first
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`quarter of approximately $600 million on an after tax basis that consisted of charges
`
`primarily for litigation expense accruals related to various legal matters and as expected,
`
`continued costs associated with the global integration of Synthes.
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`Along with the charge for in process research and development, these special items
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`negatively impacted our first quarter results by $0.23 per share. Excluding these special
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`items, our adjusted earnings per share of $1.44 for the quarter exceeded the mean of the
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`Johnson & Johnson's Management Discusses Q1 2013 Results - Earnings Call Transcript | Seeking Alpha
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`analyst estimates of $1.40 as published by First Call.
`
`Let’s look at sales performance by segment. In pharmaceuticals we reported operational
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`sales growth in the quarter of approximately 11.4% fueled by the continued strong
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`performance of long established brands, including REMICADE, PREZISTA, STELARA
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`and INVEGA SUSTENNA and more recently launched products such as ZYTIGA and
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`XARELTO which are continuing to grow share even with new competitors entering their
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`markets, largely due to the strength of the clinical profiles of these medicines themselves
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`and the strong commercialization capabilities in our pharmaceuticals business.
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`In MD&D, sales increased 11.9% operationally versus the prior year. this included the
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`impact of Synthes net of the divestiture of the legacy DePuy trauma business, which
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`contributed 14% growth. In addition to Synthes, Biosense Webster's electrophysiology
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`devices and Cordis' endovascular products in our Cardiovascular Care business, coupled
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`with Vision Care's ACUVUE TRUEYE and 1-Day ACUVUE MOIST disposable contact
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`lenses also contributed to our growth.
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`Strategic divestitures and exits from certain businesses have impacted the growth in our
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`MD&D segment this quarter, as did key market dynamics such as the initial
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`implementation of the Medicare competitive bidding legislation in diabetes, significant
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`decreases in the women’s health market and reductions in U.S distributor inventory levels,
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`as well as less selling days, particularly in orthopedics as Louise mentioned.
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`In our consumer business, of particular note this quarter is the growth in our over the
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`counter medicines businesses, as we continued to make progress in returning a reliable
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`supply of high quality products to consumers. In the quarter we saw operational sales
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`increase of 3.3% driven by the positive contribution of TYLENOL and MOTRIN analgesics,
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`upper respiratory over-the-counter medications, baby care products, LISTERINE
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`mouthwash and our NEUTROGENA skin care products. Divestitures impacted the growth
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`in this segment by 1%.
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`I’d like to provide an update on exciting developments in our pipeline of new products and
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`I’ll start with developments in our pharmaceuticals business. We were extremely pleased
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`to have received FDA approval for INVOKANA, the first in a new class of SGLT2 inhibitors
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`for type 2 diabetes to be available in the United States. It’s also the first pharmaceutical
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`product for Johnson & Johnson in this category and will be a core component of our
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`comprehensive platform for the management of diabetes. As such, our diabetes care
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`business will partner with our pharmaceuticals business to directly sell INVOKANA to
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`healthcare professionals treating patients with diabetes.
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`http://seekingalpha.com/article/1344911-johnson-and-johnsons-management-discusses-q1-2013-results-earnings-call-transcript?part=single
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`11/31
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`3/7/2017
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`Johnson & Johnson's Management Discusses Q1 2013 Results - Earnings Call Transcript | Seeking Alpha
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`We’re also expecting a decision from the European Medicines Agency on our application
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`for INVOKANA later this year, and in order to expand its use, in March we submitted a
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`marketing authorization application to European Medicines Agency seeking approval for a
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`fixed dose therapy that combines INVOKANA and immediate release metformin. You will
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`recall that we filed an application for this combination with the FDA in December.
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`In the quarter, simeprevir or TMC435, was filed for the treatment of chronic hepatitis C in
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`both Japan and the U.S., and an EU filing is expected in the second quarter. In addition,
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`the FDA granted Breakthrough Therapy Designations for the investigational oral agent
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`ibrutinib as a monotherapy for three B-cell malignancies. We continue to anticipate filing
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`for the mantle cell lymphoma indication by the end of the year. This designation is
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`intended to expedite the development and review time for potential new medicines that
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`treat serious or life threatening diseases or conditions based on preliminary clinical
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`evidence.
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`Turning to our MD&D businesses, Ethicon Endo-Surgery earned 510(k) clearances from
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`the U.S. FDA for two products in the ENSEAL G2 line, the cordless tissue sealer, a first of
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`its kind product that includes a power generator and the ENSEAL G2 articulating tissue
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`sealer device which makes it easier for surgeons to seal some vessels and control
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`bleeding. Supporting our strategy to further our position in the endovascular market,
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`Cordis completed its acquisition of Flexible Stenting Solutions, a leading developer of
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`innovative flexible peripheral, arterial, venous, and biliary stents.
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`And recently, our diabetes care business submitted a premarket approval application for
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`the FDA for the Animas Vibe insulin pump and continuous glucose monitoring system.
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`This next generation insulin pump incorporates Animas' color screen and waterproof
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`technology and a Dexcom G4 Platinum sensor, which enables people with diabetes to
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`make more informed decisions to help control their disease.
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`In our consumer business, during the quarter Johnson & Johnson China Investment
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`completed the acquisition of Shanghai Elsker Mother & Baby Co., Ltd, a well-regarded
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`baby care company in China, known for its position in the naturals segment. This is in line
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`with our growth strategy of driving global growth with products intended for use in specific
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`local markets. Our ability to continue to advance our pipeline for new products in all three
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`of our segments, supports our confidence in the continued growth of our business.
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`Now let me provide some guidance for you to consider as you refine your models for
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`2013. Let me begin with a discussion of