New Brunswick, NJ (April 28, 2011) – At Johnson & Johnson’s Annual Meeting of Shareholders today, Chairman and CEO Bill Weldon provided an in-depth look at the steps being taken to address recent quality issues, to restore confidence and trust in the company and its products, and to continue building on its 125-year legacy of meeting the world’s health care needs.
Weldon, along with Alex Gorsky and Sheri McCoy, vice-chairmen of Johnson & Johnson’s Executive Committee, highlighted patient stories and innovations that promise to help people lead healthier lives; products and pipelines to address conditions such as Alzheimer’s disease, stroke, diabetes, prostate cancer and HIV; and efforts to meet the growing demand for health care in emerging markets.
Weldon began by highlighting Johnson & Johnson’s announcement yesterday about the definitive agreement to acquire Synthes, Inc., a premier global developer and manufacturer of orthopaedics devices. He described the agreement as “consistent with our long-term strategy to strengthen our leadership position across important health care markets – in this case, the $37 billion global orthopaedics market.”
125 Years of Caring
Setting context, Weldon said, “One hundred twenty five years ago, three brothers shared knowledge of Joseph Lister’s theories about infection and a dream that they could save lives in the nation’s hospitals.” He said, “Now, the same kind of spirit, commitment and innovation motivates over 114,000 employees of Johnson & Johnson. We are not perfect. Yet every day our employees pursue their dreams of positively impacting human lives in more ways than our founders could have possibly imagined.”
McNeil Consumer Healthcare Progress
Early in the meeting, Weldon expressed his personal disappointment in the series of recalls that have occurred over the past year at the company’s McNeil Consumer Healthcare business. “I accept full accountability for these matters,” he told shareholders, “and am committed to fixing the problems and ensuring that we come back stronger than ever.”
Weldon outlined extensive changes “to restore McNeil Consumer Healthcare to the highest levels of quality and compliance, the levels that people expect of Johnson & Johnson companies and that we expect of ourselves.” He pointed to visible signs of progress, including:
- Products that were made in Fort Washington are beginning to be sourced from other Johnson & Johnson manufacturing locations and the company expects to ramp up supply of many of these products in the second half of this year, with the remainder expected in 2012;
- New steel beams have been placed on the site of the old Fort Washington plant, foreshadowing investment of more than $100 million in one of the world’s most sophisticated liquid medicine manufacturing facilities; and
- McNeil committed to enhancing safety by adding a special dosage-limiting flow restrictor to infant and children’s forms of TYLENOL® as it begins returning these medicines to the market. The company has shared this innovative design publicly.
Weldon told shareholders the company has reviewed all 120 of its internal manufacturing sites around the world to ensure the company did not have a systemic quality problem. “We were pleased to learn that we did not,” he said. Nonetheless, to provide even more assurance, he said the company has put in place a global model for quality and compliance to build a “quality safety net across all of Johnson & Johnson.”
Weldon added: “You would be proud, as I am, of the commitment of our people to rectifying these issues and bringing high-quality products back to our customers. I want to encourage you to keep your faith in this great company and the people in it.”
Better Treatments, Broader Reach
Weldon also emphasized the many opportunities the company has to make a difference in life-altering and life-threatening diseases that have not seen significant advancements in a number of years. In this category, he highlighted Alzheimer’s disease, saying there was “an enormous unmet medical need in addressing this disease.” Weldon described the company’s commitments and investments in helping to advance a promising new compound, bapineuzumab, which, he said, may have “the potential to actually address the underlying pathology of Alzheimer’s disease.”
Gorsky and McCoy discussed how the company is developing new innovations for many of the world’s most pressing health needs, while also expanding its reach to serve a greater number of people around the world.
McCoy highlighted Consumer innovations including NICORETTE® QuickMist, recently launched in the U.K. and clinically proven to relieve nicotine cravings in as little as 60 seconds, and NEUTROGENA® Naturals, combining the benefits of natural ingredients with the effectiveness consumers expect from NEUTROGENA®.
In the company’s Pharmaceuticals segment, McCoy described four innovative medicines that are currently in regulatory review in the United States and/or Europe – abiraterone acetate for advanced prostate cancer, telaprevir for Hepatitis C, rivaroxaban for preventing blood clots, and TMC 278 for HIV.
McCoy noted that the number of current U.S. regulatory submissions – seven – is exceptional, and that “these medicines represent transformational advances over the current standards of care for patients living with serious diseases.”
The existing pharmaceuticals business, McCoy added, which began the year with a strong first quarter, was strengthened by the recent expansion of the Immunology portfolio as a result of the return of rights for REMICADE® and SIMPONI® in 150 global markets from Merck.
Gorsky described the company’s plans to meet the growing demand for healthcare in emerging markets like China and India, where an increasing number of people are suffering from chronic diseases like diabetes and osteoarthritis.
The company’s Medical Devices & Diagnostics segment, for example, recently opened a new R&D Center in Suzhou, China, focused on developing products to meet the unique needs of the “mass” segment of emerging markets, comprised of hundreds of millions of people who have long been underserved, but are now gaining some degree of healthcare coverage.
Gorsky further noted that the definitive merger agreement to acquire the orthopaedics company Synthes would also strengthen the company’s ability to serve patients in emerging markets.
“We’re very excited about what the next few years hold for us,” Gorsky said, “as we seek to bring the promise of good health to as many people as possible.”
The company announced that its Board of Directors declared a 5.6% increase in the quarterly dividend rate, from $0.54 per share to $0.57 per share. This marks the company’s 49th consecutive year of dividend increases.
Shareholders voted on the election of directors; the selection of PriceWaterhouseCoopers as the company’s independent auditor; the company’s executive officer compensation, or “say on pay” proposal; and three shareholder proposals recommending changes to various company policies. The results of several shareholder votes will be posted later today on www.jnjbtw.com.
About Johnson & Johnson
Caring for the world, one person at a time…inspires and unites the people of Johnson & Johnson. We embrace research and science – bringing innovative ideas, products and services to advance the health and well-being of people. Our approximately 115,000 employees at more than 250 Johnson & Johnson companies work with partners in health care to touch the lives of over a billion people every day, throughout the world.
(This press release contains "forward-looking statements" as defined in the Private Securities Litigation Reform Act of 1995. These statements are based on current expectations of future events. If underlying assumptions prove inaccurate or unknown risks or uncertainties materialize, actual results could vary materially from the expectations and projections of Johnson & Johnson. Risks and uncertainties include, but are not limited to, general industry conditions and competition; economic factors, such as interest rate and currency exchange rate fluctuations; technological advances and patents attained by competitors; challenges inherent in new product development, including obtaining regulatory approvals; domestic and foreign health care reforms and governmental laws and regulations; trends toward health care cost containment; and increased scrutiny of the healthcare industry by government agencies. A further list and description of these risks, uncertainties and other factors can be found in Exhibit 99 of Johnson & Johnson’s Annual Report on Form 10-K for the fiscal year ended January 2, 2011. Copies of this Form 10-K, as well as subsequent filings, are available online at www.sec.gov, www.jnj.com or on request from Johnson & Johnson. Johnson & Johnson does not undertake to update any forward-looking statements as a result of new information or future events or developments.)