Johnson & Johnson on Nov. 12 announced its plan to split into two separate companies — one focusing on medical devices and drugs, and the other focusing on consumer health products.
Eleven details on the transaction and Johnson & Johnson's long-term strategy:
1. Johnson & Johnson said the separation is designed to create two global leaders to pursue more targeted business strategies and accelerate growth.
2. The new Johnson & Johnson will focus on pharmaceuticals and medical devices. It will continue to develop treatments such as Darzalax, Erleada and Stelara, as well as orthopedic devices and surgical solutions, including its Ottava robot and Velys digital joint reconstruction system.
3. The consumer health company, yet to be named, will focus on consumer health products, including bandages, lotions and Tylenol. It will focus on brands such as Neutrogena, Aveeno, Tylenol, Listerine and Band-Aid.
4. The organizational design for the consumer health company is expected to be complete by the end of 2022.
5. On Jan. 3, 2022, Joaquin Duato will become CEO of Johnson & Johnson, succeeding Alex Gorsky, who has held the role since 2012.
6. The separation is expected to be completed in 18 to 24 months.
7. Objectives of the separation are:
- Improve management focus, resources, agility and speed to address differing industry trend
- Focus capital allocation based on the goals of each independent company
- Provide each company with a financial profile that more accurately reflects the strengths and opportunities of each business
- Align corporate and operational structures so each company is better able to drive growth and create value
8. The company said the new Johnson & Johnson will be better positioned to bring integrated care to patients, particularly in areas such as oncology and eye health that require a combination of surgical, interventional and pharmaceutical treatments.
9. The medical devices unit plans to accelerate growth in orthopedics, interventional solutions, surgery and vision.
10. The pharmaceutical business aims to accelerate key therapeutic areas, including oncology and immunology, while advancing new product areas such as cell and gene therapies.
11. Full-year 2021 revenue is projected to be about $77 billion for the pharmaceutical and medical devices segment and $15 billion for the consumer health business.