Johnson & Johnson at Morgan Stanley Global Healthcare Conference Transcript

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

Question: Terence Flynn - Morgan Stanley Co. LLC - Analyst : <_ALACRA_META_ABSTRACT>All right. Well, let's do it. Maybe obviously, there's been a lot of focus on kind of longer-term outlook. So as you think about kind of the near-term growth target that you've given for next year in terms of 3%, maybe just help us think about that. And then confidence level in continuing that growth where, again, you guys have targeted for each of your business segments at above industry growth for each of the pharma segment and the MedTech business. I know there are a lot of puts and takes as you think about that with some of the new growth assets and then you obviously have the STELARA LOE. So maybe talk to us about kind of the confidence in the 2025 targets and then those longer-term targets that you put out at the Enterprise Review Day, I think it's about a year ago now.

Question: Terence Flynn - Morgan Stanley Co. LLC - Analyst : Okay. Great. I guess the one corollary is just the margins as we think about 2025, I know you're not going to guide there. But just as you think about those puts and takes you walked through, there's obviously ongoing investments behind some of these new products, you have the STELARA which from a mix perspective is probably a headwind. How should we think high level about kind of the near-term margin picture?

Question: Terence Flynn - Morgan Stanley Co. LLC - Analyst : Okay. Great. Maybe just, again, moving on another high-level question here, is on the M&A side, you've really leaned in on what I'd call growth MedTech assets. You talked about Shockwave, Abiomed obviously, brought in Impella. It seems like that's been a focus. Then you look back at your history on the pharm side where you've leaned in and done one of the best jobs, I think, arguably across the industry at finding assets early and generating a very high return there when you think back to DARZALEX, IMBRUVICA. And so is that the right framework to think about on the forward whereas like MedTech is more -- kind of these growth MedTech assets is really where you'll be focusing on, and then pharma because of that ability to kind of find assets early and generate a very strong return, that's kind of the framework we should think about? Or are there any differences now that STELARA is going LOE and that maybe changes the playbook a little bit?

Question: Terence Flynn - Morgan Stanley Co. LLC - Analyst : Right. What ¡ and again, at this point, given the size of ¡ and focus on obesity, it seems like every company has to have a view internally on if that's something they want to pursue or not. And so given your comments that you outlined in the framework, where does obesity fit in that framework?

Question: Terence Flynn - Morgan Stanley Co. LLC - Analyst : Okay. Great. Maybe the other high-level one is we're on the other side of the first IRA M'dicare Part D negotiations. J&J had two drugs on that list. So just as you think about reflecting on the implications here, just any lessons or takeaways as you think about the other side of IRA? And anything you're doing to adapt the strategy in a post-IRA world to kind of mitigate the impact? REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. SEPTEMBER 04, 2024 / 2:45PM, JNJ.N - Johnson & Johnson at Morgan Stanley Global Healthcare Conference

Question: Terence Flynn - Morgan Stanley Co. LLC - Analyst : Okay. Do you think there be -- is there any movement in D.C. to mitigate that small molecule versus biologic difference? Or do you think that's spelled out?

Question: Terence Flynn - Morgan Stanley Co. LLC - Analyst : Right. Okay. The last one before we go into some of the more exciting pipeline questions, just on -- any update on next steps on the talc litigation here? I know there were some headlines a couple of weeks ago over the summer.

Question: Terence Flynn - Morgan Stanley Co. LLC - Analyst : Yes. And then what would be the next step after that, if they were certified above the 70%.

Question: Terence Flynn - Morgan Stanley Co. LLC - Analyst : Okay. Great. One of the pipeline assets, you alluded to this earlier, Joaquin, is your 113, is the oral IL-23 inhibitor. As you said, it was kind of below the radar for a while here. But then obviously, there were some very exciting Phase 2 data in psoriasis. You're running a Phase 2 trial now in the IBD side. We're waiting on the Phase 3 psoriasis data later this year. Generally high level, should we expect that efficacy to replicate what we saw in Phase 2? Or are there any differences, and this may be more a question for John, any differences in the trial design or the patient population that we need to think about as we think about kind of the level of efficacy we should expect to see out of the Phase 3?

Question: Terence Flynn - Morgan Stanley Co. LLC - Analyst : What's your bet?

Question: Terence Flynn - Morgan Stanley Co. LLC - Analyst : Yes. And those trials -- this is sequential, I'm assuming, so we get like the monotherapy, the kind of Phase 2 trial population, that one will come first. And then the other two trials are after that. Or is this like a all-in, we're going to get data from all three of these around the same time?

Question: Terence Flynn - Morgan Stanley Co. LLC - Analyst : Sorry, I meant psoriasis, the three psoriasis trials. The psoriasis trials. Are we going to get all those at the same time, or are they staggered?

Question: Terence Flynn - Morgan Stanley Co. LLC - Analyst : Yes. So where -- how do you position it relative to TREMFYA then? Because obviously, TREMFYA great medicine as well, same pathway. So it sounds like it's more -- this is for people who don't want an injection as opposed to like you actively look to switch patients for some reason, or it seems like there's two different pockets of population. Is that the right way to think --

Question: Terence Flynn - Morgan Stanley Co. LLC - Analyst : Great. Well, I want to get to a couple more assets just in the last few minutes or so here. TAR-200, again, you highlighted this as one of the $5 billion assets, obviously, greater appreciation now for this opportunity. It sounds like we're going to get an update at the ESMO conference. Is that going to be the data that you're going to submit to the FDA for filing? And maybe just what are we going to see there in terms of patient numbers, follow-up?

Question: Terence Flynn - Morgan Stanley Co. LLC - Analyst : Okay. Great. Maybe just in the last minute. Congratulations. You mentioned the RYBREVANT-lazertinib approval in first line. Maybe just why you're confident in that $5 billion number. Because I think consensus is south of that just given the profile of Tagrisso and they're obviously entrenched competitor oral option. So how do you think about the commercial opportunity and confidence there?

Question: Terence Flynn - Morgan Stanley Co. LLC - Analyst : Great. Well, I think we have to end it there in time. But thank you so much, Joaquin and John. And congrats again, Joaquin, on the anniversary.