UPDATE 3: J&J Optimistic on Pharmaceuticals, Highlights New Medications

Johnson & Johnson Aims for Approvals of HIV and Hepatitis C Drugs by Next Year

Johnson & Johnson announced plans to seek approval for HIV and hepatitis C medications by next year, as the company aims to revitalize its pharmaceutical division amid stagnant earnings for the year.

The company intends to pursue U.S. approvals for eight drugs from 2011 to 2013, targeting various conditions such as diabetes, tuberculosis, attention deficit disorder, pain, and obesity.

During an analyst meeting focused on the pharmaceutical sector, executives highlighted J&J’s robust pipeline of experimental drugs and outlined strategies for five therapeutic areas. Sheri McCoy, worldwide chairman of pharmaceuticals, expressed optimism about the company’s future prospects.

With prescription drug sales declining due to impending patent expirations, J&J has forecast flat earnings for the year, which marks a significant slowdown compared to the double-digit growth seen in previous years. The company is banking on its diverse range of consumer products and medical devices to stabilize its financial performance.

Market analysts remain hopeful that J&J’s prescription drugs will resume driving revenue and earnings growth starting in the upcoming year. Analysts from Morgan Stanley predict earnings increases of 12 percent in 2010, 10 percent in 2011, and 12 percent in 2012, with new products contributing approximately $6 billion to sales by 2012.

Next year, J&J plans to request European approval for telaprevir, a notable hepatitis C drug licensed from Vertex Pharmaceuticals, as well as U.S. approval for the HIV medication TMC 278. Additionally, the company intends to advance its Type 2 diabetes drug, canagliflozin, into late-stage clinical trials later this year.

There is also optimism surrounding the recently approved arthritis drug, Simponi, with expectations for U.S. approvals soon for the psoriasis treatment Stelara and blood clot preventative Xarelto, developed in collaboration with Bayer AG.

The company anticipates launching Nucynta, a new treatment for moderate to severe pain that has received U.S. regulatory approval.

Despite facing challenges in the first quarter, including slight earnings declines due to generic competition for its schizophrenia treatment Risperdal and decreased demand for anemia medicines, J&J is under additional scrutiny following the patent expiration of its $2.5 billion annual revenue epilepsy drug, Topamax, in March.

Market analysts suggest that investor reactions to J&J’s pharmaceutical review could impact its stock price significantly, potentially moving it close to $60 or below $55.

In morning trading, J&J shares experienced a decline, falling 31 cents to $55.85. So far this year, shares are down approximately 6.5 percent, slightly more than the decline of the overall Pharmaceutical index.