What is the comparison baseline for faster growth in 2027?

  • Johnson & Johnson management expects operational sales growth in 2027 to exceed the rate in 2026, excluding the effects of exchange rates and the extra week in 2026 while accounting for the impact of several drugs losing market exclusivity.
  • The midpoint of the company’s latest 2026 operational sales guidance is 100.7 billion dollars, representing growth of 6.9%; the extra week contributes approximately 1 percentage point. Adjusted to a reported basis, the comparison baseline would be approximately 5.9% if growth does not accelerate in 2027.
  • The market consensus compiled by Visible Alpha forecasts reported sales growth of approximately 6% in 2027, already incorporating some year-on-year acceleration; this measure differs from the operational growth emphasized by the company.

What will sustain growth after the recent business low point?

  • Management says weak medical devices results in the third quarter of 2026 marked the low point, with a rebound observed from the end of the quarter through October. A separation remains the base plan for the orthopedics business, which is expected to operate as an independent entity in the second half of 2027.
  • The company expects revenue growth to continue rising as the impact of products losing exclusivity gradually fades, reaching double digits by the end of the decade; management sees Icotyde, Rybrevant and Inlexzo as potential contributors to growth.
  • Management says the target does not depend on additional acquisitions and that the focus is on executing new product launches and investing in the research and development pipeline. Goldman Sachs notes that if new products ramp up more slowly than expected, revenue may not be sufficient to fill the gap left by declining products.

How does the prostate cancer pipeline broaden the oncology business?

  • Johnson & Johnson hopes to expand its solid-tumor business beyond its existing strengths in hematologic oncology and multiple myeloma. Management says prostate cancer is the first proof of concept for the RIPTAC platform, which could also be used for other tumors in the future; breast cancer research has begun.
  • Data obtained with JNJ-6143 in prostate cancer prompted the company to plan broader studies in early and late stages and prepare to initiate a phase three trial. Management believes the data could support an application for approval based on a single-arm phase two study and plans to discuss this with regulators.
  • The company is also advancing a combination of the prostate cancer drug pasritamig and JNJ-9401, seeking to enhance treatment through T-cell activation and co-stimulation; initial clinical proof-of-concept data for the combination are expected to be presented soon at a medical conference, and a phase three trial is recruiting.

What are the long-term targets and upcoming data milestones?

  • Johnson & Johnson aims to achieve high-single-digit organic growth after 2030, above the industry average. The company is more confident in its target for oncology revenue to exceed 50 billion dollars, and that target does not yet include emerging prostate cancer programs.
  • At its enterprise business review day on 8 December, the company will further explain its growth target for the end of the decade, its outlook after 2030 and priority pipeline programs. Data from the SSP trial of the anticoagulant milvexian are expected before year-end, although timing depends on the rate at which events occur; data from the larger atrial fibrillation trial are expected in the first quarter of 2027.
  • Goldman Sachs maintains its buy rating on Johnson & Johnson and a 12-month price target of 280 dollars. In addition to the risk of slower uptake of new products, the bank warns that talc litigation payouts and the macroeconomic and tariff environment could weigh on valuation or earnings expectations.