Johnson & Johnson increased its 2017 sales and adjusted profit guidance for the third quarter in a row, though net income in the quarter fell due to one-time items and amortization related to the company's Actelion acquisition.
J&J, one of the largest health-products companies by revenue based in the U.S., urged lawmakers in Washington to "unite behind" a plan to overhaul the corporate tax system but said its 2017 guidance doesn't assume there will be tax reform this year.
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Overall in the third quarter, J&J's revenue rose 10% to $19.7 billion. The company posted earnings per share of $1.37 on net income of $3.7 billion, which decreased 12% from $4.3 billion in the previous year's quarter.
A J&J spokesman said profit fell "due to amortization and inventory step-up charges primarily related to" the company's recent $30 billion acquisition of rare-disease drugmaker Actelion.
Adjusted earnings per share, which exclude one-time items and amortization expenses, were $1.90 on adjusted net income of $5.2 billion, which rose 11% from a year ago. Analysts polled by Thomson Reuters had expected adjusted net income of $4.9 billion.
J&J is now forecasting adjusted earnings per share for the year of $7.25 to $7.30, up from $7.12 to $7.22. It also raised its sales outlook to $76.1 billion to $76.5 billion, from $75.8 billion to $76.1 billion.
The New Brunswick, N.J., company's shares, which are up 18% for the year, were up 2.3% Tuesday.
The company gave an indication of the impact of Hurricane Maria, which has devastated Puerto Rico, on the manufacturing of medical products there. J&J CFO Dominic Caruso said J&J's six plants on the island are making and shipping products using generator power.
"Considering the magnitude of the storm, our sites fared very well," Mr. Caruso said during a conference call with investors and analysts. He said he doesn't expect the hurricane will have "any material impact to our future results."
Mr. Caruso said the storm season had a "limited" negative impact on the company's medical-device business because some hospitals canceled surgeries due to the bad weather.
Despite the storms' impact, J&J's medical-device sales rose 7.1% to $6.6 billion world-wide. Meanwhile, global consumer-health sales grew 2.9% to $3.4 billion.
Joaquin Duato, who runs J&J's pharmaceuticals business, said its performance is accelerating during the second half of the year. Revenue from the prescription-drugs business, J&J's largest, jumped 15% to $9.4 billion world-wide during the third quarter.
The pharmaceutical results were bolstered by J&J's purchase of Swiss biotech Actelion earlier this year and gains by key brands, such as autoimmune disease treatment Stelara and blood-thinner Xarelto.
Revenue from Remicade, a rheumatoid-arthritis treatment that is J&J's top-selling product, fell 7.6% to $1.6 billion amid competition from lower-priced copies called biosimilars.
Last month Pfizer Inc., which makes one of the Remicade biosimilars, sued J&J, alleging it had protected Remicade from Pfizer's biosimilars through "exclusionary contracts" that violate federal antitrust law.
Mr. Duato said during the conference call that Remicade's price after discounts has fallen amid the competition.
"The key factor to Remicade being successful is physicians and patients have a high confidence in Remicade based on experience" using the drug, and they don't want to switch to another therapy, Mr. Duato said, noting the biosimilars aren't "interchangeable" with Remicade.
The company also said it is dropping development of two drugs that it had expressed high hopes for: rheumatoid-arthritis therapy sirukumab and talacotuzumab for acute myeloid leukemia.
Earlier this month, J&J abandoned its insulin pump business in the U.S. and Canada, and pledged to help transition its roughly 90,000 diabetes patients to Medtronic PLC's pumps instead. Medtronic commands about 65% of the insulin pump market, while analysts estimate J&J held 10%. Groups representing diabetes patients have said they are concerned that J&J's decision will limit options and stunt innovation.
Write to Jonathan D. Rockoff at Jonathan.Rockoff@wsj.com and Cara Lombardo at firstname.lastname@example.org
(END) Dow Jones Newswires
October 17, 2017 12:38 ET (16:38 GMT)