Johnson & Johnson at Credit Suisse Healthcare Conference (Virtual) Transcript

The following is excerpted from the question-and-answer section of the transcript.

Question: Matt Miksic - Credit Suisse - Analyst : We're going to sort of jump right into some broad topics, since most of the folks, I think, joining us have some familiarity with J&J. But maybe to get it out of the way early, there's been a lot of news this week on vaccines. So maybe, Joaquin, if you could take a minute to sort of give us your overview, updated thoughts or next steps, and sort of a rough time line of where your program stands. Thoughts, if you have any, on the results and progress that others are making, I'm sure everyone would be interested in that type of update.

Question: Matt Miksic - Credit Suisse - Analyst : That's a great point. And I think, as you've commented on before, and the team has commented on, if it were only J&J reaching the finish line here, you'd be I think concerned that you need a team of successful programs to really address the demand globally over the next couple of years. If you could -- I don't know if you're able to, but give any sense as to -- I know everyone is very much focused on when we're going to get results, when we're going to have a vaccine. Anything in terms of next steps on the time line? Is it just the next few months or the next couple of months or by the end of the year? Any color would be helpful, of course.

Question: Matt Miksic - Credit Suisse - Analyst : Yes. No, it's impressive that you and others are having results so fast. I think people on the ground and in the street and my neighbors and everyone would like to have something last month. But there's -- it's obviously an immensely complex process with all kinds of considerations. If you could just maybe -- and we've talked about this at length before, but just remind folks, the protocol that you have for the U.S. trial, without going into great detail, and then sort of the second sort of booster trial that you're evaluating, and sort of the, I guess, understanding of -- because there's obviously going to be 2-dose vaccines out there. There's going to be potential for dose and then a booster, depending on the duration of immunity. And so just some context as to where you stand and how you're progressing.

Question: Matt Miksic - Credit Suisse - Analyst : Excellent. Okay, so I just have one more here for you, Joaquin, and I want to make sure we spend some time on consumer as well, Thibaut. But just at a high level, you've had some great performance, as you mentioned in your -- in the rest of your pipeline in pharma. You've got some abstracts and sessions coming up at ASH, which we recently commented on, so that progress and pipeline continues. Maybe at a high level, just -- and we can come back to this, but you have been delivering above-market growth in pharma for some time. It's a combination of things, I guess. If you could talk at a high level, what is the strategy? How -- what do you focus on? What do you think is critical to sort of maintain these above-market growth rates over time as you have in the past?

Question: Matt Miksic - Credit Suisse - Analyst : That's excellent. Thank you, Joaquin. So maybe changing gears for a minute to Thibaut in terms of consumer. So I know it's a bit of a disparate business, at least from an investor's perspective, markets that we might not dive deep into very often. But there's clearly business lines that are sort of in a growth mode. There's business lines that are recovering. You have a SKU rationalization program that's been driving some benefits. So maybe take a minute, if you could, just sort of tick off whatever the 2 or 3 of these items that I mentioned that you see as the biggest opportunity over the next sort of 3 to 6 to 12 months.

Question: Matt Miksic - Credit Suisse - Analyst : That's helpful. And I guess, my own perspective on this is that being a medtech analyst and covering J&J for a long time, I think we don't appreciate the -- I mean, there's obviously global brands, and we know many of those -- but the sort of value of sort of diverse and geographic brands and assets that you've acquired. I think someone asked me years ago, what would you buy in consumer? And my answer for a long time used to be, well, probably something we've never heard of, meaning that it was a brand in an overseas market that we might not be familiar with, but that was strategic and important to your global business in growing in various geographies around the world. And I guess how much of your growth strategy is that still? And what opportunities do you see for not only driving your existing brands, but extending into these local branded opportunities around the world? REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. NOVEMBER 11, 2020 / 4:45PM, JNJ.N - Johnson & Johnson at Credit Suisse Healthcare Conference (Virtual)

Question: Matt Miksic - Credit Suisse - Analyst : Sure, yes, brands tied to a large-growing developing in emerging markets are great. So maybe switching gears back to you, Joaquin, it's an interesting juxtaposition to maybe defines the wonder of J&J, that we're talking about the 100-year anniversary of BAND-AIDs, and on the other hand, your pipeline and the lineup for abstracts and sessions at ASH. So I won't drag you through a series of mispronunciations of all the sessions and data that you're expecting, but you, I'm sure, have a few filings and presentations that you're most excited about, so we'll start with those.

Question: Matt Miksic - Credit Suisse - Analyst : Excellent. And I guess I'd also call attention to the amivantamab data at ESMO, which got an awful lot of attention. Maybe if you could -- in non-small cell lung cancer -- if you talk a little bit about that and the time line there?

Question: Matt Miksic - Credit Suisse - Analyst : That's super. And if I could, just on the long-term opportunity for that, I mean, that came out of the call that we hosted after ESMO, excitement around that potential. So you have near-term breakthrough designation, but that sort of combo therapy is what, 2 years away, maybe? Very, very promising, but any sense of...

Question: Matt Miksic - Credit Suisse - Analyst : That's very helpful. So I wanted to come back to you, Thibaut. We did not -- you talked about some of the drivers. I don't know that you fully sort of explain the opportunity and whether it's in terms of margin or sort of underlying, ongoing growth around the SKU rationalization. Talk about the execution there, what inning we're in, and what kind of benefits do you see that driving in the next 6, 12 months again.

Question: Matt Miksic - Credit Suisse - Analyst : Excellent. So maybe as we emerge from this, hopefully, it sounds like some of those initiatives, I don't want to say tailwind to margins, but certainly provide the foundation for some leverage and improvement, it sounds like, as growth rates sort of normalize?

Question: Matt Miksic - Credit Suisse - Analyst : Okay, that's helpful. Joaquin, back to you, if I could. So you laid out this sort of framework of these very large $11 billion-plus franchises that are driving much of the growth now. You got a great sort of pipeline coming up. I guess when -- I'd love to hear a little bit more about XARELTO and some of the recent TCT and upcoming presentations and how they kind of play into your growth strategy for XARELTO. But first, just looking out at the pipeline in, say, 2, 3, 4 years' time, I think there's a debate that emerges among investors as to whether and how you'll be able to sustain this. And I seem to remember having the same debate with folks 5 years ago about the current time frame, so I don't know how much it's just doubting the sustainability of the model. But I wonder, is there a stage where another deal of scale or something like that becomes more probable on the pharma side to continue this growth? Or is it more just the things that you mentioned?

Question: Matt Miksic - Credit Suisse - Analyst : We'll come back to XARELTO. But my question is just around -- you talked about the sustainability model and the high-level drivers and strategy. There is a debate, I think, among investors as to 2, 3 years out, is there something that needs to be filled in terms of a larger acquisition or more external activity or something that we don't currently see in the pipeline? Or is that just investors not, again, not believing the sustainability from time to time. REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. NOVEMBER 11, 2020 / 4:45PM, JNJ.N - Johnson & Johnson at Credit Suisse Healthcare Conference (Virtual)

Question: Matt Miksic - Credit Suisse - Analyst : Well, that is a very confident and comprehensive answer, and I think probably a good point to end on here, since we're a little bit over time. But thank you so much for that Joaquin. Thank you, Thibaut, for your comments and for joining us as well. Again, thanks, everyone else, for joining us, and appreciate you being able to be here with us today. REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. NOVEMBER 11, 2020 / 4:45PM, JNJ.N - Johnson & Johnson at Credit Suisse Healthcare Conference (Virtual)