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J&J COVID-19 vaccine sales to total $2.5 billion in 2021

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·3 min read
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Johnson and Johnson (JNJ) reported second quarter earnings and said sales of its COVID-19 vaccine could total $2.5 billion by year's end. "It's not only an expectation, it's almost a certainty, quite frankly, given the advanced purchase agreements that we have around the world," CFO Joe Wolk told Yahoo Finance Live.

A study made public Tuesday indicates the one shot J&J vaccine may be less effective against the Delta and Lambda variants of the virus that causes COVID-19. The study, which has not been peer reviewed, suggests people who have received J&J's vaccine may need a booster shot but Wolk cautioned against a rush to judgment.

"I think we all have to be just a little bit cautious on a test tube study that looks at one element of protection. You know, the data that I just referenced, really looks at neutralizing antibodies, as well as T cell activity for complete immunity protection," he said.

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The Centers for Disease Control and Prevention (CDC) says, "The J&J/Janssen COVID-19 vaccine was 66.3% effective in clinical trials (efficacy) at preventing laboratory-confirmed COVID-19 infection in people who received the vaccine and had no evidence of being previously infected."

Wolk added, "I think it's really the responsible act to rely on health officials who have all the data at their fingertips to determine when and if boosters are needed for any of the vaccines at this point. They haven't done that yet."

'Clicking on all cylinders'

J&J's revenue, in the second quarter, grew to $23.3 billion up from $18.3 billion in the same quarter of 2020. Adjusted earnings per share was $2.48, up 48.5% year-over-year. "I don't know that we've ever been in a healthier position. All segments are really clicking on all cylinders," Wolk said.

U.S. sales which includes J&J's Pharmaceutical, Consumer Health and Medical Device units totaled $11.9 billion. Global pharmaceutical sales alone were up 17%, reaching $12.6 billion. The Medical Devices unit recovered from its COVID-19 induced slowdown caused by pandemic-related delays in surgeries. Global sales were $6.97 billion, up 57%.  

"We knew coming into the quarter, it was going to be strong, right, the comps were going to be favorable to Q2 of last year, when elective procedures were essentially shut down. But you look at the underlying business, and you compare it to let's say, a more normal quarter of Q2 2019. That business (Medical Devices) is up 7%," Wolk said.

J&J raised its full-year guidance, estimating sales will fall between $92.5 billion and $93.3 billion. But, maintaining its position as the world's third largest pharmaceutical company will require increased funding for research and development.  

"I think it is notable that this year, we're up about $1.3 billion dollars over last year's levels," said Wolk, pointing out last year's R&D budget was at an all-time record. 

"We just think it's critically important to find solutions, whether they be in immunology, oncology, and digital robotic surgery, to keep addressing unmet medical needs for patients well being as well as for our business," Wolk added.

Adam Shapiro is co-anchor of Yahoo Finance Live 3pm to 5pm. Follow him on Twitter @Ajshaps

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