Latest news with #MedTech
Globe and Mail
10 hours ago
- Business
- Globe and Mail
Should J&J Stock Be in Your Portfolio After Q2 Beat & Guidance Raise?
Johnson & Johnson JNJ delivered strong second-quarter 2025 results, with both the top and bottom lines exceeding expectations. Despite the loss of exclusivity ('LOE') of its multi-billion-dollar product, Stelara, J&J's Innovative Medicines unit once again outperformed expectations, with sales of all key drugs Darzalex, Erleada and Tremfya beating estimates. New drugs like Carvykti, Tecvayli, Talvey, Rybrevant and Spravato contributed significantly to growth. Importantly, its MedTech segment also outperformed expectations. Sales in the MedTech segment improved from the first-quarter levels, driven by strong momentum in Cardiovascular, Surgery and Vision segments despite continued headwinds in China. J&J also raised its sales and EPS guidance for the year to reflect a strong operational performance coupled with currency tailwinds. The sales guidance was raised from a range of $91.0 billion-$91.8 billion to $93.2 billion-$93.4 billion. The sales range indicates growth in the range of 5.1%-5.6% versus the prior expectation of 2.6%-3.6%. The adjusted earnings per share guidance was raised from a range of $10.50-$10.70 to $10.80-$10.90, driven by top-line strength, favorable impact of foreign currency and lowered tariff impact. J&J halved its expectations for tariff-related costs this year from $400 million to $200 million. The tariff costs are exclusively related to its MedTech unit. In response to the earnings beat and guidance raise, J&J's shares rose more than 6% on July 16, reflecting investors' renewed optimism for the stock. However, a single quarter's results are not so important for long-term investors, and the focus should rather be on the company's strong fundamentals. Let's understand the company's strengths and weaknesses to better analyze how to play J&J stock in the post-earnings scenario. J&J's Diversified Business Model Johnson & Johnson's biggest strength lies in its diversified business model as it is the only major health care company operating in both the medical devices and pharmaceutical sectors. In 2023,J&J separated its Consumer Health business into a newly listed company called Kenvue KVUE. The separation of Kenvue allowed J&J to focus on its core pharmaceutical and medical device business. It has more than 275 subsidiaries, indicating that the business is extremely well-diversified. This diversification helps withstand economic cycles more effectively. J&J has 26 platforms with annual sales exceeding $1 billion. Its diversified business is allowing it to post top-line growth in 2025, despite LOE for a blockbuster drug like Stelara. Meanwhile, it has one of the largest R&D budgets among pharma companies. JNJ's Innovative Medicine Unit: A Bright Spot J&J's Innovative Medicine unit is showing a growth trend. The segment's sales rose 2.4% in the second quarter of 2025 on an organic basis despite LOE for Stelara and the negative impact of the Part D redesign. J&J expects continued growth in the second half of 2025 to be driven by its key products such as Darzalex, Tremfya, Spravato and Erleada as well as new drugs like Carvykti, Tecvayli and Talvey and new indications for Tremfya and Rybrevant. J&J expects to generate more than $57 billion in sales in the Innovative Medicines segment in 2025. It expects the Innovative Medicine business to grow 5% to 7% from 2025 to 2030. J&J mentioned on the second-quarter conference call that it expects its oncology sales to be more than $50 billion by 2030 — quite an optimistic target in our view. Moreover, J&J believes 10 of its new Innovative Medicine products have the potential to deliver peak sales of $5 billion, including new cancer drugs like Talvey and Tecvayli, a newly acquired drug, Caplyta and pipeline candidates like nipocalimab, TAR-200 and icotrokinra (JNJ-2113). Nipocalimab was approved under the name Imaavy in April for treating generalized myasthenia gravis. TAR-200 is under priority review with the FDA for treating non-muscle invasive bladder cancer and is expected to be approved this year. Caplyta was added with the Apil acquisition of Intra-Cellular Therapies. J&J's MedTech Segment Shows Improvement in Q2 J&J's MedTech segment sales rose 6.1% on an operational basis in the second quarter, improving from the first-quarter levels, driven by the newly acquired cardiovascular businesses, Abiomed and Shockwave, as well as in Surgical Vision and wound closure in Surgery. Moreover, improvements in J&J's electrophysiology business also drove sequential growth. In the MedTech segment, increased adoption of newly launched products in Cardiovascular, Surgery and Vision is likely to drive growth in the second half. Sales are expected to be higher in the second half than the first half as the business moves past tougher first-half comps and new products gain momentum throughout 2025. However, the company continues to face headwinds in China. Sales in China are being hurt by the impact of the volume-based procurement (VBP) program. VBP is a government-driven cost containment effort in China. J&J expects continued impacts from VBP issues in China in 2025 as the program continues to expand across provinces and products. Patent Expiration of J&J's Blockbuster Drug Stelara & Other Headwinds J&J lost U.S. patent exclusivity of Stelara in 2025. The drug generated sales of $10.36 billion in 2024. The launch of generics is significantly eroding the drug's sales and hurting J&J's sales and profits in 2025. Stelara sales declined 42.7% in the second quarter of 2025. Several biosimilar versions of Stelara have been launched in the United States in 2025. According to patent settlements and license agreements, Amgen AMGN, Teva Pharmaceutical Industries TEVA, Samsung Bioepis/Sandoz and some other companies have already launched Stelara biosimilars this year. Stelara biosimilar competition is expected to accelerate throughout 2025 as the number of biosimilar entrants increases. In addition, sales in 2025 are being hurt by the impact of the Medicare Part D redesign. J&J's Talc Suits & Pharma Tariffs Remain an Overhang J&J faces more than 62,000 lawsuits for its talc-based products, primarily baby powders. The lawsuits allege that its talc products contain asbestos, which caused many women to develop ovarian cancer. J&J insists that its talc-based products are safe and do not cause cancer. The company permanently discontinued the sales of its talc-based Johnson's Baby Powder. In April, a bankruptcy court in Texas rejected J&J's proposed bankruptcy plan to settle its talc lawsuits after a two-week trial in Houston. J&J will go back to the traditional tort system to fight the lawsuits individually with its bankruptcy strategy to settle the lawsuits failing for the third time. The uncertainty around tariffs and trade production measures has muted economic growth. President Trump has once again threatened to impose heavy tariffs, as high as 200%, on pharmaceutical imports. Trump's repeated threats to impose tariffs on pharmaceutical imports are aimed at pushing American pharma companies to shift pharmaceutical production back to the United States, primarily from European and Asian countries. Trump has said that drugmakers have about one to one and a half years to bring production back to the United States before the new tariffs are imposed. J&J has already committed to boosting manufacturing in the United States and has a plan to invest $55 billion over the next four years to ensure that all medicines consumed in the United States are manufactured domestically. J&J Stock Price, Valuation and Estimates J&J's shares have outperformed the industry year to date. The stock has risen 15.1% in the year-to-date period against a 0.5% decline for the industry. The stock has also outperformed the sector and the S&P 500 Index, as seen in the chart below. JNJ Stock Outperforms Industry, Sector & S&P 500 From a valuation standpoint, J&J is slightly expensive. In terms of the price/earnings ratio, the company's shares currently trade at 14.74 forward earnings, slightly higher than 14.71 for the industry. The stock is, however, trading below its five-year mean of 15.70. JNJ Stock Valuation The Zacks Consensus Estimate for 2025 earnings has risen from $10.64 per share to $10.83 over the past seven days, while that for 2026 has risen from $11.09 to $11.33 over the same timeframe. JNJ Estimate Movement Consider Investing in J&J's Stock J&J considers 2025 to be a 'catalyst year,' positioning the company for growth in the second half of the decade. J&J expects operational sales growth in both the Innovative Medicine and MedTech segments to be higher in the second half than in the first. While newly launched products should drive growth in the Innovative Medicines segment in the second half, the MedTech segment may benefit from new products and easier comps. J&J expects growth to accelerate from 2026 onward. J&J is also rapidly advancing its pipeline, attaining significant clinical and regulatory milestones that will help drive accelerating growth through the back half of the decade. J&J has also been on an acquisition spree, with the latest acquisition of Intra-Cellular Therapies strengthening its presence in the neurological and psychiatric drug market. In April, J&J's board authorized a 4.8% increase in its quarterly dividend, marking the company's 63rd consecutive year of dividend increase. The Stelara patent cliff and the potential impact of Part D redesign will be significant headwinds in 2025. The uncertainty around the talc lawsuits and pharma tariffs lingers. However, the company looks quite confident that it will be able to navigate these challenges. The stock's price appreciation this year, attractive valuation and rising estimates should encourage investors to bet on this Zacks Rank #2 (Buy) stock. You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here. One Big Gain, Every Trading Day To help you take full advantage of this market, you're invited to access every stock recommendation in all our private portfolios - for just $1. Zacks private portfolio services that closed 256 double and triple-digit winners in 2024 alone. That's about one big gain every day the market was open. Of course, not all our picks are winners, but members have seen recent gains as high as +627% +1,340%, and +1,708%. Imagine how much you could profit with a steady stream of real-time picks from all our services that cover a number of strategies to suit a variety of investing and trading styles. See Stocks Now >> Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Johnson & Johnson (JNJ): Free Stock Analysis Report Amgen Inc. (AMGN): Free Stock Analysis Report Teva Pharmaceutical Industries Ltd. (TEVA): Free Stock Analysis Report Kenvue Inc. (KVUE): Free Stock Analysis Report
Economic Times
11 hours ago
- Business
- Economic Times
ADIA signs a definitive agreement to invest $200 million in medical devices firm Meril
Abu Dhabi Investment Authority (ADIA) has signed a definitive agreement to invest $200 million (about Rs1,725 crore) for a 3% stake in medical devices maker Micro Life Sciences Pvt Ltd (Meril). The investment by a wholly-owned subsidiary of ADIA pegged Meril's enterprise valuation at $6.6 billion, the Vapi, Gujarat-based company said in a statement. Post the investment, Meril will be backed by two major global investors ADIA, and US private equity firm Warburg Pincus. The deal is subject to Competition Commission of India (CCI) approval. 'This investment by ADIA reinforces confidence in Meril's long-term vision and global ambitions,' said Sanjeev Bhatt, senior vice president-strategy at Meril. 'This investment will enable us to accelerate growth, attract world-class talent, and further strengthen clinical research efforts as we work towards improving the quality of human life through advanced healthcare solutions.' Meril was founded in 2006 by the Bilakhia Group after divesting their agrochemical business to Bayer, and the Micro lnks business to Hubergroup—both from Germany. In 2022, the promoters tapped Warburg Pincus to raise Rs 1,575 crore by selling a 14% stake in Meril, and Rohit Kothari's Anchorage Capital for Rs 200 crore by divesting a 2% stake at a valuation of about Rs 11,000 crore. In the three years since, Meril closed fundraisings for another 3% shareholdings while its valuation surged more than fivefold to nearly Rs 60,000 crore. The Bilakhia family currently has more than 81% stake in the company, with Warburg, ADIA, and Kothari being other principal shareholders together holding nearly 19%.Meril is regarded as an innovator in medical technology (MedTech), with a focus on clinically-advanced solutions across multiple specialties such as cardiovascular, structural heart, orthopaedics, endo-surgery, in-vitro diagnostics and surgical robotics. Some of the innovations include transcatheter heart valve series, transcatheter edge-to-edge repair system, and surgical robotic system. The company is growing between 30-35% compounded annually, with FY25 revenue at Rs 4,800 crore and margins of 27-28%. Exports contributed about 55% of expect the company to double revenue within less than three years. Meril employs more than 13,000 employees and has over 35 global subsidiaries. Its Vapi facility spans over 100 acres with over 1 million sq ft manufacturing space.
Hans India
16 hours ago
- Business
- Hans India
ADIA to Invest USD 200 Million in Meril
Vapi -- A wholly owned subsidiary of the Abu Dhabi Investment Authority ('ADIA') has entered into definitive agreements to invest USD 200 million for ~3% stake in Micro Life Sciences Private Limited ('Meril'), one of India's leading medical devices companies. This investment values Meril at an enterprise value of USD 6.6 billion. The transaction is subject to regulatory approval by the Competition Commission of India (CCI). Post this investment, Meril will be backed by two globally recognized investors, ADIA and Warburg Pincus. Founded by the Bilakhia Group, Meril is a global innovator in medical technology (MedTech), with a strong focus on clinically advanced solutions across multiple specialties — including Cardiovascular, Structural Heart, Orthopaedics, Endo-surgery, In-vitro Diagnostics and Surgical Robotics. Headquartered in Vapi, India, Meril operates state-of-the-art, vertically integrated, and globally certified manufacturing and R&D facilities, across a 100-acre sustainable MedTech campus. The company employs more than 13,000 people, has 35+ global subsidiaries, and serves healthcare systems in 150+ countries. Meril is committed to becoming the world's leading MedTech company, powered 100% by green energy, reinforcing its commitment to sustainable innovation. With a robust in-house global R&D ecosystem and a portfolio of 200+ technology platforms, Meril continues to lead in global clinical research and education. Breakthrough innovations such as the Myval Transcatheter Heart Valve (THV) series, MyClip Transcatheter Edge-to-Edge Repair (TEER) system, and the MISSO Surgical Robotic System highlight Meril's dedication to next-generation innovation. Through its 12+ global training academies, Meril empowers over 10,000 healthcare professionals annually. Sanjeev Bhatt, Senior Vice President – Strategy, Meril said: 'This investment by ADIA reinforces confidence in Meril's long term vision and global ambitions. This investment will enable us to accelerate growth, attract world-class talent, and further strengthen our RCD and clinical research efforts as we work towards improving the quality of human life through advanced healthcare solutions.'
Fashion Value Chain
2 days ago
- Business
- Fashion Value Chain
ADIA to Invest USD 200 Million in Meril
A wholly owned subsidiary of the Abu Dhabi Investment Authority ('ADIA') has entered into definitive agreements to invest USD 200 million for a ~3% stake in Micro Life Sciences Private Limited ('Meril'), one of India's leading medical devices companies. This investment values Meril at an enterprise value of USD 6.6 billion. The transaction is subject to regulatory approval by the Competition Commission of India (CCI). Post this investment, Meril will be backed by two globally recognized investors, ADIA and Warburg Pincus. ADIA to invest USD 200 million in Meril, valuing the Indian medical devices company at an enterprise value of USD 6.6 billion Founded by the Bilakhia Group, Meril is a global innovator in medical technology (MedTech), with a strong focus on clinically advanced solutions across multiple specialties – including Cardiovascular, Structural Heart, Orthopaedics, Endo-surgery, In-vitro Diagnostics and Surgical Robotics. Headquartered in Vapi, India, Meril operates state-of-the-art, vertically integrated, and globally certified manufacturing and RCD facilities, across a 100 acre sustainable MedTech campus. The company employs more than 13,000 people, has 35+ global subsidiaries, and serves healthcare systems in 150+ countries. Meril is committed to becoming the world's leading MedTech company, powered 100% by green energy, reinforcing its commitment to sustainable innovation. With a robust in-house global RCD ecosystem and a portfolio of 200+ technology platforms, Meril continues to lead in global clinical research and education. Breakthrough innovations such as the Myval Transcatheter Heart Valve (THV) series, MyClip Transcatheter Edge-to-Edge Repair (TEER) system, and the MISSO Surgical Robotic System highlight Meril's dedication to next-generation innovation. Through its 12+ global training academies, Meril empowers over 10,000 healthcare professionals annually. Sanjeev Bhatt, Senior Vice President – Strategy, Meril said: 'This investment by ADIA reinforces confidence in Meril's long term vision and global ambitions. This investment will enable us to accelerate growth, attract world-class talent, and further strengthen our RCD and clinical research efforts as we work towards improving the quality of human life through advanced healthcare solutions.'
Scoop
4 days ago
- Business
- Scoop
Auckland Chamber Welcomes Advanced Technology Institute In Auckland
The Auckland Business Chamber and Auckland Tech Council are welcoming today's announcement that the Government will base the New Zealand Institute for Advanced Technology in Auckland — a move that follows clear calls from the business community to supercharge the city's tech future. 'In April, we put a vision on the table for Auckland to become a serious global tech hub,' says Simon Bridges, CEO of the Auckland Business Chamber. 'We made the case — and now the Government is listening.' While the Institute will initially be incubated within the Ministry of Business, Innovation and Employment, today's announcement confirms that Auckland will be its central base. The Chamber and Tech Council had earlier identified Auckland's Newmarket innovation precinct as the natural home for cutting-edge research and commercialisation — with the scale and connectivity to anchor a nationally significant tech hub. 'Newmarket offers the full package — advanced R&D, space to scale, and commercial potential,' says Bridges. 'I certainly hope the Institute will be based at Newmarket, it is the right place for it. But regardless of the precise final location, Auckland is the right launchpad for a national push into advanced tech.' The city is uniquely positioned to connect research, business, and investment. With world-leading AI and quantum researchers already based at the University of Auckland, Auckland can serve as a critical link between academia, startups, and global partners. The Chamber's recent tech report, developed in partnership with leading businesses and institutions, laid out a clear roadmap — calling for major investment, a regulatory sandbox for MedTech, and urgent action to close the capital and skills gaps. 'Today's announcement is proof that when business leads with a clear, ambitious plan, Government can move too,' says Bridges. 'This is just the start. We now need to double down on digital skills, commercial investment, and putting our startups on the global map.' 'With the private sector already stepping up, this gives Auckland a real shot at becoming a magnet for talent, capital, and world-class innovation.' Note: A copy of the Time for Growth: The Plan Auckland Needs to Be a Global Tech Hub report is available here: Key recommendations from the report include: Levelling up the technology district opportunity – Newmarket Innovation Precinct The front door to a new Advanced Technology Public Research Organisation An Auckland Technology and Innovation Alliance Technology trade mission Develop a regional innovation strategy Tech and Innovation job development accord Build a series of regulatory sandboxes (with a focus on MedTech) Increase the diversity of funds investing in Auckland ventures Leveraging partnerships with peer tech and innovation cities for mutual gain Increasing PhD enrolment and empowering PhD students to start businesses in NZ Investing in grassroots initiatives to foster entrepreneurship in areas outside of science, starting at the high school level.
