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What changed in Johnson & Johnson's 10-K — 2023 vs 2024

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Paragraph-level year-over-year comparison of Johnson & Johnson's 2023 and 2024 10-K annual filings, covering the Business, Risk Factors, Legal Proceedings, Cybersecurity, MD&A and Market Risk sections. Every new, removed and edited paragraph is highlighted side-by-side so you can see exactly what management changed in the 2024 report.

+314 added−348 removedSource: 10-K (2025-02-13) vs 10-K (2023-02-16)

Top changes in Johnson & Johnson's 2024 10-K

314 paragraphs added · 348 removed · 218 edited across 8 sections

Item 1. Business

Business — how the company describes what it does

48 edited+15 added−16 removed24 unchanged
Biggest changeKey products in the Pharmaceutical segment include: REMICADE (infliximab), a treatment for a number of immune-mediated inflammatory diseases; SIMPONI (golimumab), a subcutaneous treatment for adults with moderate to severe rheumatoid arthritis, active psoriatic arthritis, active ankylosing spondylitis and moderately active to severely active ulcerative colitis; SIMPONI ARIA (golimumab), an intravenous treatment for adults with moderate to severe rheumatoid arthritis, active psoriatic arthritis and active ankylosing spondylitis and active polyarticular juvenile idiopathic arthritis (pJIA) in people 2 years of age and older; STELARA (ustekinumab), a treatment for adults and children with moderate to severe plaque psoriasis, for adults with active psoriatic arthritis, for adults with moderately to severely active Crohn's disease and treatment of moderately to severely active ulcerative colitis; TREMFYA (guselkumab), a treatment for adults with moderate to severe plaque psoriasis and active psoriatic arthritis; EDURANT (rilpivirine), PREZISTA (darunavir) and PREZCOBIX/REZOLSTA (darunavir/cobicistat), antiretroviral medicines for the treatment of human immunodeficiency virus (HIV-1) in combination with other antiretroviral products and SYMTUZA (darunavir/cobicistat/emtricitabine/tenofovir alafenamide), a once-daily single tablet regimen for the treatment of HIV; CONCERTA (methylphenidate HCl) extended-release tablets CII, a treatment for attention deficit hyperactivity disorder; INVEGA SUSTENNA/XEPLION (paliperidone palmitate), for the treatment of schizophrenia and schizoaffective disorder in adults; INVEGA TRINZA/TREVICTA (paliperidone palmitate), for the treatment of schizophrenia in patients after they have been adequately treated with INVEGA SUSTENNA for at least four months; RISPERDAL CONSTA (risperidone long-acting injection), for the treatment of schizophrenia and the maintenance treatment of Bipolar 1 Disorder in adults; ZYTIGA 1 (abiraterone acetate), a treatment for patients with prostate cancer; ERLEADA (apalutamide), a next-generation androgen receptor inhibitor for the treatment of patients with prostate cancer; IMBRUVICA (ibrutinib), a treatment for certain B-cell malignancies, or blood cancers and chronic graft versus host disease; DARZALEX (daratumumab), a treatment for multiple myeloma; DARZALEX FASPRO (daratumumab and hyaluronidase-fihj), a treatment for multiple myeloma and light chain (AL) Amyloidosis; XARELTO (rivaroxaban), an oral anticoagulant for the prevention of deep vein thrombosis (DVT), which may lead to pulmonary embolism (PE) in patients undergoing hip or knee replacement surgery, to reduce the risk of stroke and systemic embolism in patients with nonvalvular atrial fibrillation, and for the treatment and reduction of risk of recurrence of DVT and PE to reduce the risk of major cardiovascular events in patients with coronary artery disease (CAD) and peripheral artery disease (PAD), for the treatment and secondary prevention of thromboembolism in pediatric patients, and for thromboprophylaxis in pediatric patients following the Fontan procedure; INVOKANA (canagliflozin), for the treatment of adults with type 2 diabetes; INVOKAMET/VOKANAMET (canagliflozin/metformin HCl), a combination therapy of fixed doses of canagliflozin and metformin hydrochloride for the treatment of adults with type 2 diabetes; and INVOKAMET XR (canagliflozin/metformin hydrochloride extended-release), a once-daily, fixed-dose combination therapy of canagliflozin and metformin hydrochloride extended-release, for the treatment of adults with type 2 diabetes; OPSUMIT (macitentan) as monotherapy or in combination, indicated for the long-term treatment of pulmonary arterial hypertension (PAH); UPTRAVI (selexipag), the only approved oral and intravenous, selective IP receptor agonist targeting a prostacyclin pathway in PAH.
Biggest changeKey products in the Innovative Medicine segment include: REMICADE (infliximab), a treatment for a number of immune-mediated inflammatory diseases; SIMPONI (golimumab), a subcutaneous treatment for adults with moderate to severe rheumatoid arthritis, active psoriatic arthritis, active ankylosing spondylitis and moderately active to severely active ulcerative colitis; SIMPONI ARIA (golimumab), an intravenous treatment for adults with moderate to severe rheumatoid arthritis, active psoriatic arthritis and active ankylosing spondylitis and active polyarticular juvenile idiopathic arthritis (pJIA) in people 2 years of age and older; STELARA (ustekinumab), a treatment for adults and children with moderate to severe plaque psoriasis, for adults with active psoriatic arthritis, for adults with moderately to severely active Crohn's disease and treatment of moderately to severely active ulcerative colitis; TREMFYA (guselkumab), a treatment for adults with moderate to severe plaque psoriasis and active psoriatic arthritis and ulcerative colitis; EDURANT (rilpivirine), PREZISTA (darunavir) and PREZCOBIX/REZOLSTA (darunavir/cobicistat), antiretroviral medicines for the treatment of human immunodeficiency virus (HIV) in combination with other antiretroviral products and SYMTUZA (darunavir/cobicistat/emtricitabine/tenofovir alafenamide), a once-daily single tablet regimen for the treatment of HIV; CONCERTA (methylphenidate HCl) extended-release tablets CII, a treatment for attention deficit hyperactivity disorder; INVEGA SUSTENNA/XEPLION (paliperidone palmitate), for the treatment of schizophrenia and schizoaffective disorder in adults; INVEGA TRINZA/TREVICTA (paliperidone palmitate), for the treatment of schizophrenia in patients after they have been adequately treated with INVEGA SUSTENNA for at least four months; SPRAVATO (Esketamine), a nasal spray, used along with an oral antidepressant, to treat adults with treatment-resistant depression (TRD) and depressive symptoms in adults with major depressive disorder (MDD) with suicidal thoughts or actions; CARVYKTI (ciltacabtagene autoleucel), a chimeric antigen receptor (CAR)-T-cell therapy for the treatment of patients with relapsed/refractory multiple 2024 Annual Report 1 myeloma; ZYTIGA (abiraterone acetate), a treatment for patients with prostate cancer; ERLEADA (apalutamide), a next-generation androgen receptor inhibitor for the treatment of patients with prostate cancer; IMBRUVICA (ibrutinib), a treatment for certain B-cell malignancies, or blood cancers and chronic graft versus host disease; DARZALEX (daratumumab), a treatment for multiple myeloma; DARZALEX FASPRO (daratumumab and hyaluronidase-fihj), a treatment for multiple myeloma and light chain (AL) Amyloidosis; TECVAYLI (teclistamab-cqyv), a ready-to-use bispecific antibody for adults with relapsed or refractory multiple myeloma who have received at least four prior lines of therapy; XARELTO (rivaroxaban), an oral anticoagulant for the prevention of deep vein thrombosis (DVT), which may lead to pulmonary embolism (PE) in patients undergoing hip or knee replacement surgery, to reduce the risk of stroke and systemic embolism in patients with nonvalvular atrial fibrillation, and for the treatment and reduction of risk of recurrence of DVT and PE to reduce the risk of major cardiovascular events in patients with coronary artery disease (CAD) and peripheral artery disease (PAD), for the treatment and secondary prevention of thromboembolism in pediatric patients, and for thromboprophylaxis in pediatric patients following the Fontan procedure; OPSUMIT (macitentan) as monotherapy or in combination, indicated for the long-term treatment of pulmonary arterial hypertension (PAH); UPTRAVI (selexipag), the only approved oral and intravenous, selective IP receptor agonist targeting a prostacyclin pathway in PAH.
The products sold in international business include those developed in the U.S. and by subsidiaries abroad. Investments and activities in some countries outside the U.S. are subject to higher risks than comparable U.S. activities because the investment and commercial climate may be influenced by financial instability in international economies, restrictive economic policies and political and legal system uncertainties.
The products sold in the international business include those developed in the U.S. and by subsidiaries abroad. Investments and activities in some countries outside the U.S. are subject to higher risks than comparable U.S. activities because the investment and commercial climate may be influenced by financial instability in international economies, restrictive economic policies and political and legal system uncertainties.
Any adverse regulatory action, depending on its magnitude, may restrict us from effectively marketing and selling our products and limit our ability to obtain future clearances or approvals, and could result in a substantial modification to our business practices and operations. Equivalent enforcement mechanisms exist in different countries in which we conduct business.
Any adverse regulatory action, depending on its magnitude, may restrict us from effectively marketing and selling our products and limit our ability to obtain future clearances, classifications or approvals, and could result in a substantial modification to our business practices and operations. Equivalent enforcement mechanisms exist in different countries in which we conduct business.
FDA could ban such products, detain or seize adulterated or misbranded products, order a recall, repair, replacement, or refund of such products, refuse to grant pending applications for marketing authorization or require certificates of foreign governments for exports, and/or require us to notify health professionals and others that the products present unreasonable risks of substantial harm to the public health.
FDA could ban such products, detain or seize adulterated or misbranded products, order a recall, repair, replacement, or refund of such products, withdraw approval for such products, refuse to grant pending applications for marketing authorization or require certificates of foreign governments for exports, and/or require us to notify health professionals and others that the products present unreasonable risks of substantial harm to the public health.
Employees worldwide must adhere to the Company’s Code of Business Conduct which sets basic requirements and serves as a foundation for the Company policies, procedures and guidelines, all of which provide additional guidance on expected employee behaviors in every market where it operates.
Employees worldwide must adhere to the Company’s Code of Business Conduct, which sets fundamental requirements and serves as a foundation for the Company policies, procedures and guidelines, all of which provide additional guidance on expected employee behaviors in every market where it operates.
In addition, the Amended and Restated Certificate of Incorporation, By-Laws, the written charters of the Audit Committee, the Compensation & Benefits Committee, the Nominating & Corporate Governance Committee, the Regulatory Compliance & Sustainability Committee, the Science & Technology Committee and any special committee of the Board of Directors and the Company’s Principles of Corporate Governance, Code of Business Conduct (for employees), Code of Business Conduct & Ethics for Members of the Board of Directors and Executive Officers, and other corporate governance materials, are available at www.investor.jnj.com/gov.cfm on the Company's website and will be provided without charge to any shareholder submitting a written request, as provided above.
In addition, the Restated Certificate of Incorporation, as amended, Amended and Restated By-Laws, the written charters of the Audit Committee, the Compensation & Benefits Committee, the Nominating & Corporate Governance Committee, the Regulatory Compliance & Sustainability Committee, and the Science & Technology Committee of the Board of Directors, and the Company’s Principles of Corporate Governance, Code of Business Conduct (for employees), Code of Business Conduct & Ethics for Members of the Board of Directors and Executive Officers, and other corporate governance materials are available on the Company's website at www.investor.jnj.com/governance/corporate-governance-overview and will be provided without charge to any shareholder submitting a written request, as provided above.
Pharmaceutical The Pharmaceutical segment is focused on the following therapeutic areas: Immunology (e.g., rheumatoid arthritis, psoriatic arthritis, inflammatory bowel disease and psoriasis), Infectious Diseases (e.g., HIV/AIDS), Neuroscience (e.g., mood disorders, neurodegenerative disorders and schizophrenia), Oncology (e.g., prostate cancer, hematologic malignancies, lung cancer and bladder cancer), Cardiovascular and Metabolism (e.g., thrombosis, diabetes and macular degeneration) and Pulmonary Hypertension (e.g., Pulmonary Arterial Hypertension).
Innovative Medicine The Innovative Medicine segment is focused on the following therapeutic areas: Immunology (e.g., rheumatoid arthritis, psoriatic arthritis, inflammatory bowel disease and psoriasis), Infectious Diseases (e.g., HIV/AIDS), Neuroscience (e.g., mood disorders, neurodegenerative disorders and schizophrenia), Oncology (e.g., prostate cancer, hematologic malignancies, lung cancer and bladder cancer), Cardiovascular and Metabolism (e.g., thrombosis, diabetes and macular degeneration) and Pulmonary Hypertension (e.g., Pulmonary Arterial Hypertension).
Compensation and Benefits As part of the Company's total rewards philosophy, the Company offers competitive compensation and benefits to attract and retain top talent. The Company is committed to fairness and equitable treatment in its compensation and benefits for employees at all levels. The Company observes legal minimum wage provisions and exceeds them where possible.
Compensation and benefits As part of the Company's total rewards philosophy, the Company offers competitive compensation and benefits to attract and retain top talent. The Company is committed to fair treatment in its compensation and benefits for employees at all levels. The Company observes legal minimum wage provisions and exceeds them where possible.
Culture and Employee Engagement At the Company, employees are guided by Our Credo which sets forth the Company's responsibilities to patients, consumers, customers, healthcare professionals, employees, communities and shareholders.
Culture and employee engagement At Johnson & Johnson, employees are guided by Our Credo, which sets forth the Company's responsibilities to patients, consumers, customers, healthcare professionals, employees, communities and shareholders.
Item 1. BUSINESS General Johnson & Johnson and its subsidiaries (the Company) have approximately 152,700 employees worldwide engaged in the research and development, manufacture and sale of a broad range of products in the healthcare field. Johnson & Johnson is a holding company, with operating companies conducting business in virtually all countries of the world.
Item 1. Business General Johnson & Johnson and its subsidiaries (the Company) have approximately 138,100 employees worldwide engaged in the research and development, manufacture and sale of a broad range of products in the healthcare field. Johnson & Johnson is a holding company, with operating companies conducting business in virtually all countries of the world.
The Company’s human capital management strategy is built on three fundamental focus areas: • Attracting and recruiting the best talent • Developing and retaining talent • Empowering and inspiring talent Underpinning these focus areas are ongoing efforts to cultivate and foster a culture built on diversity, equity and inclusion (DEI), innovation, health, well-being and safety, where the Company's employees are encouraged to succeed both professionally and personally while helping the Company achieve its business goals.
The Company’s human capital management strategy is built on three fundamental focus areas: • Attracting and recruiting top talent • Developing and retaining top talent • Empowering and inspiring talent Underpinning these focus areas are ongoing efforts to cultivate and foster a culture built on innovation, health, well-being and safety, inclusion and belonging where the Company's employees are encouraged to succeed both professionally and personally while helping the Company achieve its business goals.
The Company c onducts global surveys that offer its employees the ability to provide feedback and valuable insight to help address potential human resources risks and identify opportunities to improve.
The Company conducts global surveys that offer its employees the ability to provide feedback and valuable insight to help address potential human resources risks and identify opportunities to improve.
In the U.S., the drug, device and cosmetic industries have long been subject to regulation by various federal and state agencies, primarily as to product safety, efficacy, manufacturing, advertising, labeling and safety reporting. The exercise of broad regulatory powers by the U.S. Food and Drug Administration (the U.S.
In the U.S., the pharmaceutical product and medical technology industries have long been subject to regulation by various federal and state agencies, primarily as to product safety, efficacy, manufacturing, advertising, labeling and safety reporting. The exercise of broad regulatory powers by the U.S. Food and Drug Administration (the U.S.
Various transparency laws and regulations require disclosures of payments and other transfers of value made to physicians and teaching hospitals and, beginning with disclosures in 2022, to certain non-physician practitioners. Federal and foreign laws governing international business practices require strict compliance with anti-bribery standards and certain prohibitions with respect to payments to any foreign government official.
Various state and federal transparency laws and regulations require disclosures of payments and other transfers of value made to certain healthcare practitioners, including physicians, teaching hospitals, and certain non-physician practitioners. Federal and foreign laws governing international business practices require strict compliance with anti-bribery standards and certain prohibitions with respect to payments to any foreign government official.
The information on www.jnj.com , www.factsaboutourprescriptionopioids.com, www.factsabouttalc.com and www.LTLManagementInformation.com is not, and will not be deemed, a part of this Report or incorporated into any other filings the Company makes with the SEC. 7
The information on www.jnj.com , investor.jnj.com and www.factsabouttalc.com is not, and will not be deemed, a part of this Report or incorporated into any other filings the Company makes with the SEC. 8
The products made and sold in the international business include many of those described above under “– Segments of Business – Consumer Health,” “– Pharmaceutical” and “– MedTech.” However, the principal markets, products and methods of distribution in the international business vary with the country and the culture.
The products made and sold in the international business include many of those described above under Segments of Business – Innovative Medicine and MedTech. However, the principal markets, products and methods of distribution in the international business vary with the country and the culture.
With the right awareness, focus, practices and tools, the Company ensures that all its employees around the world, as well as temporary contractors and visitors to the Company's sites, can work safely.
With the right awareness, focus, practices and tools, the Company works to ensure that all its employees around the world, as well as contingent workers, contractors and visitors to the Company's sites, can work safely.
Many of these medicines were developed in collaboration with strategic partners or are licensed from other companies and maintain active lifecycle development programs. MedTech The MedTech (previously referred to as Medical Devices) segment includes a broad portfolio of products used in the Interventional Solutions, Orthopaedics, Surgery and Vision categories.
Many of these medicines were developed in collaboration with strategic partners or are licensed from other companies and maintain active lifecycle development programs. MedTech The MedTech segment includes a broad portfolio of products used in the cardiovascular, orthopaedics, surgery, and vision categories.
All of the Company’s SEC filings are also available on the Company’s website at www.investor.jnj.com/sec.cfm , as soon as reasonably practicable after having been electronically filed or furnished to the SEC. All SEC filings are also available at the SEC’s website at www.sec.gov .
The Company makes its SEC filings available on the Company’s website at www.investor.jnj.com/financials/sec-filings , as soon as reasonably practicable after having been electronically filed or furnished to the SEC. The Company's SEC filings are also available at the SEC’s website at www.sec.gov .
Management’s Discussion and Analysis of Results of Operations and Financial Condition” of this Report; and Note 17 “Segments of Business and Geographic Areas” of the Notes to Consolidated Financial Statements included in Item 8 of this Report.
Management’s discussion and analysis of results of operations and financial condition of this Report; and Note 17 Segments of business and geographic areas of the notes to consolidated financial statements included in Item 8 of this Report.
The Company has continuously expanded health and well-being programs throughout the Company and across the globe, incorporating new thinking and technologies to keep its offerings best-in-class and to help employees achieve their personal health goals. The programs and practices the Company advances for total health—physical, mental, emotional and financial—ensure employee health protection for emerging health risks.
The Company has continuously expanded health and well-being programs throughout the Company and across the globe, incorporating new thinking and technologies to keep its offerings best-in-class and to help employees achieve their personal health goals. The programs and practices the Company provides—physical, mental, emotional and financial—help promote holistic employee health.
Therefore, we encourage investors and others interested in the Company to review the information posted to these websites in conjunction with www.jnj.com, the Company's SEC filings, press releases, public conference calls and webcasts.
It is possible that the information we post to these websites could be deemed to be material information. Therefore, we encourage investors and others interested in the Company to review the information posted to these websites in conjunction with www.jnj.com , the Company's SEC filings, press releases, public conference calls and webcasts.
In the U.S., the Federal Trade Commission has stepped up enforcement of data privacy with several significant settlements and there have been a material increase in class-action lawsuits linked to the collection and use of biometric data.
In the U.S., the Federal Trade Commission has stepped up enforcement of data privacy with several significant settlements (including settlements concerning the downstream sharing of personal information and use and disclosure of personal health data) and there have been a material increase in class-action lawsuits linked to the collection and use of biometric data and use of tracking technologies.
FDA) continues to result in increases in the amounts of testing and documentation required for U.S. FDA approval of new drugs and devices and a corresponding increase in the expense of product introduction. Similar trends are also evident in major markets outside of the U.S.
FDA) continues to result in increases in the amounts of testing and documentation required for U.S. FDA approval of new drugs and devices and a corresponding increase in the expense of product introduction.
Sales of the Company’s second largest product, collectively DARZALEX (daratumumab) and DARZALEX FASPRO (daratumumab and hyaluronidase-fihj), accounted for approximately 8.4% of the Company's total revenues for fiscal 2022. Accordingly, the patents related to this product are believed to be material to the Company.
Sales of the Company’s largest product, collectively DARZALEX (daratumumab) and DARZALEX FASPRO (daratumumab and hyaluronidase-fihj), accounted for approximately 13.1% of the Company's total revenues for fiscal 2024. Accordingly, the patents related to these products are believed to be material to the Company.
In 2022, 92% of global employees across 77 countries participated in Our Credo Survey which was offered in 36 languages . 5 Growth and Development To continue to lead in the changing healthcare landscape, it is crucial that the Company continue to attract and retain top talent.
In 2024, 94% of global employees across 73 countries participated in Our Credo Survey which was offered in 36 languages. 6 Growth and development To lead in the changing healthcare landscape, it is crucial that the Company continue to attract and retain top talent. In 2024, the Company's voluntary turnover rate was 6.3%.
The Company continues to address our employees needs through J&J Flex, a hybrid model that empowers the Company’s office-based employees to find the right productivity and balance of in-person and remote work. 6 Available Information The Company’s main corporate website address is www.jnj.com .
The Company continues to address our employees needs through J&J Flex, a hybrid model that empowers the Company’s office-based employees to find a balance of in-person and remote work, while preserving the Company's culture and need for face-to-face engagement and leadership. 2024 Annual Report 7 Available information The Company’s main corporate website address is www.jnj.com .
Genmab A/S owns two patent families related to DARZALEX, and Janssen Biotech, Inc. has an exclusive license to those patent families. The two patent families both expire in the United States in 2029. The latest expiring licensed European patent expires in 2032. Janssen Biotech, Inc. owns a separate patent portfolio related to DARZALEX FASPRO.
Genmab A/S owns two patent families related to DARZALEX, and Janssen Biotech, Inc. has an exclusive license to those patent families. The two patent families both expire in the United States in 2029, and in Europe, compound/use patent protection in select countries extends to 2031/2032. Janssen Biotech, Inc. owns a separate patent portfolio related to DARZALEX FASPRO.
Further, the Company relies on global supply chains, and production and distribution processes, that are complex, are subject to increasing regulatory requirements, and may be faced with unexpected changes such as those resulting from the 4 COVID-19 pandemic and Brexit that may affect sourcing, supply and pricing of materials used in the Company's products.
Further, the Company relies on global supply chains, and production and distribution processes, that are complex, and subject to increasing regulatory requirements that may affect sourcing, supply and pricing of materials used in the Company's products.
Significant legal proceedings and claims involving the Company's patent and other intellectual property are described in Note 19, “Legal Proceedings— Intellectual Property” of the Notes to Consolidated Financial Statements included in Item 8 of this Report. Sales of the Company’s largest product, STELARA (ustekinumab), accounted for approximately 10.2% of the Company's total revenues for fiscal 2022.
Significant legal proceedings 2 and claims involving the Company's patent and other intellectual property are described in Note 19 Legal proceedings—Intellectual property of the Notes to Consolidated Financial Statements included in Item 8 of this Report.
Strategy The Company believes that its employees are critical to its continued success and are an essential element of its long-term strategy. Management is responsible for ensuring that its policies and processes reflect and reinforce the Company's desired corporate culture, including policies and processes related to strategy, risk management, and ethics and compliance.
Management is responsible for ensuring that its policies and processes reflect and reinforce the Company's desired corporate culture, including policies and processes related to strategy, risk management, and ethics and compliance.
The IRA also contains provisions that impose rebates if certain prices increase at a rate that outpaces the rate of inflation, beginning October 1, 2022, for Medicare Part D drugs and January 1, 2023, for Medicare Part B drugs.
In any event, we anticipate that the selected products will be subjected to a government-established price for the Medicare population beginning in 2026. 4 The IRA also contains provisions that impose rebates if certain prices increase at a rate that outpaces the rate of inflation, beginning October 1, 2022, for Medicare Part D drugs and January 1, 2023, for Medicare Part B drugs.
Employee data may not include full population from more recently acquired companies and individuals on long-term disability are excluded. Contingent workers, contractors and subcontractors are also excluded. Abiomed headcount has been included in the above table. 2 FTE represents the total number of full-time equivalent positions and does not reflect the total number of individual employees as some work part-time.
Employee data may not include full population from more recently acquired companies and individuals on long-term disability are excluded. Contingent workers, contractors and subcontractors are also excluded. Shockwave has been included in the fiscal 2024 headcount in the above table.
The Company’s primary focus is products related to human health and well-being. Johnson & Johnson was incorporated in the State of New Jersey in 1887. The Executive Committee of Johnson & Johnson is the principal management group responsible for the strategic operations and allocation of the resources of the Company.
The Company’s primary focus is products related to human health and well-being. Johnson & Johnson was incorporated in the State of New Jersey in 1887. The Chief Operating Decision Maker (CODM) is the Company's Chief Executive Officer (Principal Executive Officer).
Investors and the public should note that the Company also announces information at www.factsaboutourprescriptionopioids.com, www.factsabouttalc.com and www.LTLManagementInformation.com . We use these websites to communicate with investors and the public about our products, litigation and other matters. It is possible that the information we post to these websites could be deemed to be material information.
Investors and the public should note that the Company also announces information through its press releases and media statements at www.jnj.com/mediacenter , investor.jnj.com and www.factsabouttalc.com . We use these websites to communicate with investors and the public about our products, litigation and other matters.
Each subsidiary within the business segments is, with limited exceptions, managed by residents of the country where located. Segments of Business The Company is organized into three business segments: Consumer Health, Pharmaceutical and MedTech. Additional information required by this item is incorporated herein by reference to the narrative and tabular descriptions of segments and operating results under: “Item 7.
Segments of business The Company is organized into two business segments: Innovative Medicine and MedTech. Additional information required by this item is incorporated herein by reference to the narrative and tabular descriptions of segments and operating results under: Item 7.
FDA were to conclude that we are not in compliance with applicable laws or regulations, or that any of our drugs or medical 3 devices are ineffective or pose an unreasonable health risk, the U.S.
FDA and regulatory agencies around the globe are also increasing their enforcement activities. If the U.S. FDA were to conclude that we are not in compliance with applicable laws or regulations, or that any of our pharmaceutical products or medical technologies are ineffective or pose an unreasonable safety risk, the U.S.
Payers and Pharmacy Benefit Managers (PBMs) have become a more potent force in the market place and increased attention is being paid to drug pricing and appropriate drug and medical device utilization. Our business has been and continues to be affected by federal and state legislation that alters the pricing, coverage, and reimbursement landscape.
Payors and Pharmacy Benefit Managers (PBMs) are a potent force in the marketplace, and increased attention is being paid to the impact of PBM practices on healthcare cost and access in the U.S. Our business has been and continues to be affected by federal and state legislation that alters the pricing, coverage, and reimbursement landscape.
Interventional Solutions include Electrophysiology products (Biosense Webster) to treat cardiovascular diseases, Neurovascular care (Cerenovus) that treats hemorrhagic and ischemic stroke and the Heart Recovery portfolio (Abiomed) which includes technologies to treat severe coronary artery disease requiring high-risk PCI or AMI cardiogenic shock. The Orthopaedics portfolio (DePuy Synthes) comprises products in support of Hips, Knees, Trauma, and Spine, Sports & Other.
The Cardiovascular (previously referred to as Interventional solutions) portfolio includes electrophysiology products to treat heart rhythm disorders, the heart recovery portfolio (Abiomed) which includes technologies to treat severe coronary artery disease requiring high-risk PCI or AMI cardiogenic shock, circulatory restoration products (Shockwave) for the treatment of calcified coronary artery disease (CAD) and peripheral artery disease (PAD), and neurovascular care that treats hemorrhagic and ischemic stroke.
The Company conducts business in virtually all countries of the world with the primary focus on products related to human health and well-being.
These products are distributed to wholesalers, hospitals, and retailers and are used predominantly in the professional fields by physicians, nurses, hospitals, eye care professionals, and clinics. Geographic areas The Company conducts business in virtually all countries of the world with the primary focus on products related to human health and well-being.
In addition, the development and maintenance of customer demand for the Company’s consumer products involve significant expenditures for advertising and promotion. Environment The Company is subject to a variety of U.S. and international environmental protection measures. The Company believes that its operations comply in all material respects with applicable environmental laws and regulations.
Environment The Company is subject to a variety of environmental laws and regulations in the United States and other jurisdictions. The Company believes that its operations comply in all material respects with applicable environmental laws and regulations.
Employees and Human Capital Management As of January 1, 2023, and January 2, 2022, the number of employees were approximately: 2022 2021 Employees 1 155,800 144,300 Full-time equivalent (FTE) positions 2 152,700 141,700 1 “Employee” is defined as an individual working full-time or part-time, excluding fixed term employees, interns and co-op employees.
These processes also are subject to complex and lengthy regulatory approvals. 2024 Annual Report 5 Employees and human capital management As of December 29, 2024 and December 31, 2023 the number of employees was approximately: 2024 2023 Employees (1) 139,800 134,400 Full-time equivalent (FTE) positions (2) 138,100 131,900 (1) “Employee” is defined as an individual working full-time or part-time, excluding fixed term employees, interns and co-op employees.
This Committee oversees and coordinates the activities of the Company's three business segments: Consumer Health, Pharmaceutical and MedTech (previously referred to as Medical Devices). Within the strategic parameters provided by the Committee, senior management groups at U.S. and international operating companies are each responsible for their own strategic plans and the day-to-day operations of those companies.
The Executive Committee is Johnson & Johnson’s senior leadership team responsible for setting the strategy and priorities of the Company and driving accountability at all levels. Within the strategic parameters provided by the Executive Committee, senior management groups at U.S. and international operating companies are each responsible for their own strategic plans and the day-to-day operations of those companies.
In some cases, the Company’s subsidiaries may deem it advisable to initiate product recalls regardless of whether it has been required or directed to. The U.S. FDA and regulatory agencies around the globe are also increasing their enforcement activities. If the U.S.
The regulatory agencies under whose purview the Company operates have administrative powers that may subject it to actions such as product withdrawals, recalls, seizure of products and other civil and criminal sanctions. In some cases, the Company’s subsidiaries may deem it advisable to initiate product recalls regardless of whether it has been required or directed to. The U.S.
The new medical device regulatory framework and the evolving privacy, data localization, and emerging cyber security laws and regulations around the world are examples of such increased regulation. Five U.S. States (California, Connecticut, Colorado, Utah and Virginia) now have comprehensive privacy laws in place and China introduced broad personal information protection and data security regulations in 2022.
Similar trends are also evident in major markets outside of the U.S. 2024 Annual Report 3 The medical device regulatory framework and the evolving privacy, data localization, and emerging cyber security laws and regulations around the world are examples of such increased regulation. Within the U.S., an increasing number of U.S.
The Surgery portfolios include advanced and general surgery offerings (Ethicon), solutions that focus on Breast Aesthetics (Mentor), and Ear, Nose and Throat (Acclarent) procedures. Johnson & Johnson Vision products include ACUVUE Brand contact lenses and ophthalmic technologies related to cataract and laser refractive surgery.
The Orthopaedics portfolio includes products and enabling technologies that support hips, knees, trauma, spine, sports, and others. The Surgery portfolios include advanced and general surgery technologies, as well as solutions that focus on breast aesthetics and reconstruction (Mentor). Vision products include ACUVUE brand contact lenses and TECNIS intraocular lenses for cataract surgery.
With other jurisdictions enacting similar privacy laws, local data protection authorities will force greater accountability on the collection, access and use of personal data in the healthcare industry. The regulatory agencies under whose purview the Company operates have administrative powers that may subject it to actions such as product withdrawals, recalls, seizure of products and other civil and criminal sanctions.
In addition, China has introduced broad personal information protection and data security regulations, with more anticipated, thereby increasing China’s scrutiny of company compliance and data transfer practices. With other jurisdictions enacting similar privacy laws, local data protection authorities will force greater accountability on the collection, access and use of personal data in the healthcare industry.
The impact of the IRA on our business and the broader pharmaceutical industry remains uncertain, as the federal government has yet to make various IRA implementation decisions. Additionally, we expect continued scrutiny on drug pricing and government price reporting from Congress, agencies, and other bodies at the federal and state levels.
In April 2024, Janssen appealed the district court’s denial of its summary judgment motion to the Third Circuit. Additionally, we expect continued scrutiny on drug pricing and government price reporting from Congress, agencies, and other bodies at the federal and state levels, which may result in additional regulations or other mechanisms to increase pricing transparency and controls.
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Consumer Health The Consumer Health segment includes a broad range of products focused on personal healthcare used in the Skin Health/Beauty, Over-the-Counter medicines, Baby Care, Oral Care, Women’s Health and Wound Care markets. Major brands in Skin Health/Beauty include the AVEENO; CLEAN & CLEAR; DR. CI:LABO; NEUTROGENA and OGX product lines.
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Sales of the Company’s second largest product, STELARA (ustekinumab) accounted for approximately 11.7% of the Company's total revenues for fiscal 2024. According to patent settlement and license agreements, the Company expects continued launches of biosimilar versions of STELARA in Europe and the United States in 2025 which will impact the Company’s sales of STELARA.
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Over-the-Counter (OTC) medicines include the broad family of TYLENOL acetaminophen products; SUDAFED cold, flu and allergy products; BENADRYL and ZYRTEC allergy products; MOTRIN IB ibuprofen products; NICORETTE smoking cessation products outside the U.S.; ZARBEE’S products, inspired by nature, and the PEPCID line of acid reflux products. Baby Care includes the JOHNSON’S and AVEENO Baby line of products.
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States have enacted comprehensive privacy laws, and federal regulators (e.g., the U.S. FDA, FTC and HHS) continue to stress the intersection of health and privacy as a compliance and enforcement priority.
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Oral Care includes the LISTERINE product line. Major brands in Women’s Health outside of North America are STAYFREE and CAREFREE sanitary pads and o.b. tampon brands. Wound Care brands include the BAND-AID Brand Adhesive Bandages and NEOSPORIN First Aid product lines.
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In the EU, multiple directives and laws (including NIS2, EHDS, the Data Act, the Cyber Resilience Act, and the AI Act) are rapidly changing privacy and cybersecurity compliance requirements while introducing new enforcement risks.
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These products are marketed to the general public and sold online (eCommerce) and to retail outlets and distributors throughout the world.
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These laws can also restrict transfers of data across borders, potentially impacting how data-driven health care solutions are developed and deployed globally in a compliant manner.
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In November 2021, the Company announced its intention to separate the Company’s Consumer Health business (Kenvue as the name for the planned New Consumer Health Company), with the intention to create a new, publicly traded company by the end of the fiscal year 2023.
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Moreover, as a result of the broad scale release and availability of Artificial Intelligence (AI) technologies such as generative AI, a global trend towards more comprehensive and nuanced regulation to ensure the ethical use, privacy, and security of AI is underway that includes standards for transparency, accountability, and fairness, which will require compliance developments or enhancements.
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These products are distributed to wholesalers, hospitals and retailers, and used predominantly in the professional fields by physicians, nurses, hospitals, eye care professionals and clinics. Geographic Areas Johnson & Johnson and its subsidiaries (the Company) have approximately 152,700 employees worldwide engaged in the research and development, manufacture and sale of a broad range of products in the healthcare field.
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On August 29, 2023, the Centers for Medicare & Medicaid Services (“CMS”) published the first “Selected Drug” list, which includes XARELTO and STELARA as well as IMBRUVICA, which is developed in collaboration and co-commercialized in the U.S. with Pharmacyclics LLC, an AbbVie company.
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Accordingly, the patents related to this product are believed to be material to the 2 Company. Janssen Biotech, Inc., a wholly-owned subsidiary of Johnson & Johnson, owns patents specifically related to STELARA . The latest expiring United States composition of matter patent expires in 2023. The latest expiring European composition of matter patent expires in 2024.
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The Selected Drug list also included other medicines targeting disease states that are prevalent in the Medicare population. Although CMS published an explanation for how it determined prices for selected drugs in December 2024, uncertainty remains as to the methodology used to determine these prices.
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It is not yet certain which products the federal government will select and subject to government-established prices, or how the federal government will establish prices for selected products, as the IRA specifies a ceiling price but not a minimum price. One or more of our products could be selected and subject to the government-established price.
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The IRA specifies a ceiling price but not a minimum price for selected drugs and does not require CMS to use a specific framework for determining selected drug prices.
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These processes also are subject to complex and lengthy regulatory approvals.
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In July 2023, Janssen Pharmaceuticals, Inc. (Janssen) filed litigation against the U.S. Department of Health and Human Services as well as the Centers for Medicare and Medicaid Services challenging the constitutionality of the IRA's Medicare Drug Price Negotiation Program.
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In 2022, 46.2% of employees in Manager and above job categories who had movements (including upward promotions or lateral transfers) took advantage of career opportunities by moving across functions, country or business segment lines (excluding employees in the research and development organizations). The Company's voluntary turnover rate was 9%.
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The litigation requests a declaration that the IRA violates Janssen’s rights under the First Amendment and the Fifth Amendment to the Constitution and therefore that Janssen is not subject to the IRA’s mandatory pricing scheme.
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Diversity, Equity, and Inclusion (DEI) The Company is committed to workplace diversity and to cultivating, fostering, and advancing a culture of equity and inclusion.
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The impact of the IRA on our business and the broader pharmaceutical industry remains uncertain, as litigation filed by Janssen and other pharmaceutical companies remains ongoing and while CMS has publicly announced the maximum fair price for each of the selected drugs, implementation of the program is still in progress.
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In 2022, Johnson & Johnson introduced the Company’s evolved enterprise Diversity, Equity and Inclusion strategy, which recognizes how DEI accelerates the Company’s ability to meet the changing needs of the communities the Company serves to deliver Our Purpose to profoundly change the trajectory of health for humanity. The Company’s DEI vision is: Be yourself, change the world.
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(2) FTE represents the total number of full-time equivalent positions and does not reflect the total number of individual employees as some work part-time. Employees by region (in percentages) Strategy The Company believes that its employees are critical to its continued success and are an essential element of its long-term strategy.
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The Company’s DEI Mission is: Make diversity, equity and inclusion how we work everyday .
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To prioritize learning, the Company recently held Johnson & Johnson's second Global Learning Day. Employees were encouraged to set aside a full day to explore skill-building courses on J&J Learn, the new state-of-the-art learning platform. Our workforce As stated in Our Credo, we are responsible to our employees who work with us throughout the world.
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Our evolved enterprise DEI Strategy is aligned to our DEI Vision and Mission and rests on four core pillars: • Accelerate our global culture of inclusion where every individual belongs • Build a workforce that reflects the diversity of our communities • Transform talent and business processes to achieve equitable access and outcomes for all • Drive innovation and growth with our business to serve diverse markets around the world The Company’s DEI strategy is guided by internal and external insights, global best practices and continual employee feedback which remind the Company that while diversity changes by location, inclusion is the same everywhere.
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The Company is committed to cultivating, fostering and advancing an inclusive, credo-based work environment for employees that recognizes and rewards based on merit.
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In recognition of the Company’s commitment to help employees balance their personal and professional responsibilities, the Company extended its paid parental leave benefit globally from 8 to 12 weeks for all eligible employees. In the U.S., the benefit was effective on January 1, 2022, with retroactive coverage for new family additions as of July 1, 2021.
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The Company is dedicated to the values in Our Credo and strives to meet the needs of its employees and stakeholders through compliance with law and the following evidence based strategies: • Sustain a global workforce of individuals with many different backgrounds, abilities, cultures and perspectives • Maintain a work environment where each person’s dignity is respected and they have an opportunity to advance based on their merit • Drive innovation and growth with our business to serve markets around the world Our approach with respect to our workforce is guided by applicable laws, internal and external insights, global best practices and employee feedback.
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Protecting and supporting our employees as the COVID-19 pandemic has evolved continues to be a top priority and the Company’s approach includes: ensuring the health and safety of our employees in the workplace through robust layers of protection; enhanced cleaning and access to cleaning supplies and personal protective equipment; supporting employees with benefits and well-being tools.

Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

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Biggest changeThe Company has established privacy compliance programs and controls that our businesses worldwide are required to comply with, but with many technology and data-driven initiatives being prioritized across the Company and involving multiple vendors and third parties, there are potential risks of controls imposed on cross border data flows, unauthorized access, and loss of personal data through internal and external threats that could impact our business operations and research activities. 15
Biggest changeHowever, with many technology and data-driven initiatives evolving across the Company, involving multiple vendors and third parties, there are threats that could impact our business operations and research activities, including potential risks of unauthorized access and loss of personal data as well as legislative actions imposing limitations and controls on the use and sharing of personal data as well as on cross border data flows. 16
Further, the impacts of climate change have an influence on customer preferences, and failure to provide climate-friendly products could potentially result in loss of market share. An information security incident, including a cybersecurity breach, could have a negative impact to the Company’s business or reputation.
Further, the impacts of climate change have an influence on customer preferences, and failure to provide climate-friendly products could potentially result in loss of market share. An information security incident, including a cybersecurity breach, could have a negative impact on the Company’s business or reputation.
In the event of any such disruption, the 8 Company would need to seek and source other qualified third-party manufacturers, likely resulting in further delays and increased costs which could affect our business adversely. Counterfeit versions of our products could harm our patients and have a negative impact on our revenues, earnings, reputation and business.
In the event of any such disruption, the Company would need to seek and source other qualified third-party manufacturers, likely resulting in further delays and increased costs which could affect our business adversely. Counterfeit versions of our products could harm our patients and have a negative impact on our revenues, earnings, reputation and business.
Such delays and difficulties in manufacturing can result in product shortages, declines in sales and reputational impact as well as significant remediation and related costs associated with addressing the shortage. The Company relies on third parties to manufacture certain of our products.
Such delays and difficulties in manufacturing can result in product shortages, declines in sales and reputational impact as well as significant remediation and related costs associated with addressing the shortage. The Company relies on third parties to manufacture and supply certain of our products.
In addition to the U.S. application and enforcement of the FCPA, various jurisdictions in which the Company operates have laws 12 and regulations, including the U.K. Bribery Act 2010, aimed at preventing and penalizing corrupt and anticompetitive behavior.
In addition to the U.S. application and enforcement of the FCPA, various jurisdictions in which the Company operates have laws and regulations, including the U.K. Bribery Act 2010, aimed at preventing and penalizing corrupt and anticompetitive behavior.
As part of various efforts to contain healthcare costs, these payers are putting downward pressure on prices at which products will be reimbursed. In the U.S., increased purchasing power of entities that negotiate on behalf of Medicare, Medicaid, and private sector beneficiaries, in part due to continued consolidation among healthcare providers, could result in further pricing pressures.
As part of various efforts to contain healthcare costs, these payors are putting downward pressure on prices at which products will be reimbursed. In the U.S., increased purchasing power of entities that negotiate on behalf of Medicare, Medicaid, and private sector beneficiaries, in part due to continued consolidation among healthcare providers, could result in further pricing pressures.
Other risks inherent in conducting business globally include: • local and regional economic environments and policies in the markets that we serve, including interest rates, monetary policy, inflation, economic growth, recession, commodity prices, and currency controls or other limitations on the ability to expatriate cash; • protective economic policies taken by governments, such as trade protection measures and import/export licensing requirements; • compliance with local regulations and laws including, in some countries, regulatory requirements restricting the Company’s ability to manufacture or sell its products in the relevant market; • diminished protection of intellectual property and contractual rights in certain jurisdictions; • potential nationalization or expropriation of the Company’s foreign assets; • political or social upheavals, economic instability, repression, or human rights issues; and • geopolitical events, including natural disasters, disruptions to markets due to war, armed conflict, terrorism, epidemics or pandemics.
Other risks inherent in conducting business globally include: • local and regional economic environments and policies in the markets that we serve, including interest rates, monetary policy, inflation, economic growth, recession, commodity prices, and currency controls or other limitations on the ability to expatriate cash; • protective economic policies taken by governments, such as trade protection measures, increased antitrust reporting requirements and enforcement activity, and import/export licensing requirements; • compliance with local regulations and laws including, in some countries, regulatory requirements restricting the Company’s ability to manufacture or sell its products in the relevant market; • diminished protection of intellectual property and contractual rights in certain jurisdictions; • potential nationalization or expropriation of the Company’s foreign assets; • political or social upheavals, economic instability, repression, or human rights issues; and • geopolitical events, including natural disasters, disruptions to markets due to war, armed conflict, terrorism, epidemics or pandemics.
The Company’s more significant legal proceedings are described in Note 19, “Legal Proceedings” under Notes to the Consolidated Financial Statements included in Item 8 of this Report. Litigation, in general, and securities, derivative action, class action and multi-district litigation, in particular, can be expensive and disruptive.
The Company’s more significant legal proceedings are described in Note 19 Legal proceedings under Notes to the Consolidated Financial Statements included in Item 8 of this Report. Litigation, in general, and securities, derivative action, class action and multi-district litigation, in particular, can be expensive and disruptive.
Regulatory issues regarding compliance with current Good Manufacturing Practices (cGMP) (and comparable quality regulations in foreign countries) by manufacturers of drugs, devices and consumer products can lead to fines and penalties, product recalls, product shortages, interruptions in production, delays in new product approvals and litigation.
Regulatory issues regarding compliance with current Good Manufacturing Practices (cGMP) (and comparable quality regulations in foreign countries) by manufacturers of drugs and devices can lead to fines and penalties, product recalls, product shortages, interruptions in production, delays in new product approvals and litigation.
New products or enhancements to existing products may not be accepted quickly or significantly in the marketplace due to product and price competition, changes in customer preferences or healthcare purchasing patterns, resistance by healthcare providers or uncertainty over third-party reimbursement.
After approval, new products or enhancements to existing products may not be accepted quickly or significantly in the marketplace due to product and price competition, changes in customer preferences or healthcare purchasing patterns, resistance by healthcare providers or uncertainty over third-party reimbursement.
The Company could in the future be required to pay significant amounts as a result of settlements or judgments in these matters, potentially in excess of accruals, including matters where the Company could be held jointly and severally liable among other defendants.
The Company has been and could in the future be required to pay significant amounts as a result of settlements or judgments in these matters, potentially in excess of accruals, including matters where the Company could be held jointly and severally liable among other defendants.
Development of successful products and technologies is also necessary to offset revenue losses when the Company’s existing products lose market share due to various factors such as competition and loss of patent exclusivity. New products introduced within the past five years 11 accounted for approximately 25% of 2022 sales.
Development of successful products and technologies is also necessary to offset revenue losses when the Company’s existing products lose market share due to various factors such as competition and loss of patent exclusivity. New products introduced within the past five years accounted for approximately 25% of 2024 sales.
The Company faces substantial competition in all three operating segments and in all geographic markets. The Company’s businesses compete with companies of all sizes on the basis of cost-effectiveness, technological innovations, intellectual property rights, product performance, real or perceived product advantages, pricing and availability and rate of reimbursement.
The Company faces substantial competition in its two operating segments and in all geographic markets. The Company’s businesses compete with companies of all sizes on the basis of cost-effectiveness, technological innovations, intellectual property rights, product performance, real or perceived product advantages, pricing and availability and rate of reimbursement.
Manufacturing disruptions can occur for many reasons including regulatory action, production quality deviations or safety issues, labor disputes, labor shortages, site-specific incidents (such as fires), natural disasters such as hurricanes and other severe weather events, raw material shortages, political unrest, terrorist attacks and epidemics or pandemics.
Manufacturing disruptions can occur for many reasons including regulatory action, production quality deviations or safety issues, labor disputes, labor shortages, site-specific incidents (such as fires), natural disasters such as hurricanes and other severe weather events, raw material shortages, lack of available inspectors, political unrest, terrorist attacks and epidemics or pandemics.
The Company’s manufacture of products requires the timely delivery of sufficient amounts of complex, high-quality components and materials. The Company’s subsidiaries operate 89 manufacturing facilities as well as sourcing from thousands of suppliers around the world.
The Company’s manufacturing of products requires the timely delivery of sufficient amounts of complex, high-quality components and materials. The Company’s subsidiaries operate 64 manufacturing facilities as well as sourcing from thousands of suppliers around the world.
The global spread of COVID-19 or other health crises could adversely impact the Company’s operations, including, among other things, our manufacturing operations, supply chain, third-party suppliers, sales and marketing, and clinical trial operations. Any of these factors could adversely affect the Company’s business, financial results, and global economic conditions generally.
Health crises could adversely impact the Company’s operations, including, among other things, our manufacturing operations, supply chain, third-party suppliers, sales and marketing, and clinical trial operations. Any of these factors could adversely affect the Company’s business, financial results, and global economic conditions generally.
See Note 8, “Income Taxes” under Notes to the Consolidated Financial Statements included in Item 8 of this Report for additional information. The Company conducts business and files tax returns in numerous countries and is addressing tax audits and disputes with many tax authorities.
See Note 8 Income taxes under Notes to the Consolidated Financial Statements included in Item 8 of this Report for additional information. The Company conducts business and files tax returns in numerous countries and is addressing tax audits and disputes with many tax authorities.
Risks Related to Government Regulation and Legal Proceedings Global sales in the Company’s Pharmaceutical and MedTech segments may be negatively impacted by healthcare reforms and increasing pricing pressures. 9 Sales of the Company’s Pharmaceutical and MedTech products are significantly affected by reimbursements by third-party payers such as government healthcare programs, private insurance plans and managed care organizations.
Risks related to government regulation and legal proceedings Global sales in the Company’s Innovative Medicine and MedTech segments may be negatively impacted by healthcare reforms and increasing pricing pressures. Sales of the Company’s Innovative Medicine and MedTech products are significantly affected by reimbursements by third-party payors such as government healthcare programs, private insurance plans and managed care organizations.
The most significant current investigations and litigation brought by government agencies are described in Note 19, “Legal Proceedings—Government Proceedings” under Notes to the Consolidated Financial Statements included in Item 8 of this Report. Changes in tax laws or exposures to additional tax liabilities could negatively impact the Company’s operating results.
The most significant current investigations and litigation brought by government agencies are described in Note 19 Legal proceedings—Government proceedings under Notes to the Consolidated Financial Statements included in Item 8 of this Report. 2024 Annual Report 11 Changes in tax laws or exposures to additional tax liabilities could negatively impact the Company’s operating results.
To meet business objectives, the Company relies on both internal information technology (IT) systems and networks, and those of third parties and their vendors, to process and store sensitive data, including confidential research, business plans, financial information, intellectual property, and personal data that may be subject to legal protection, and ensure the continuity of the Company’s supply chain.
To meet business objectives, the Company relies on both internal information technology (IT) systems and networks, and those of third parties and their vendors, to process and store sensitive data (including confidential research, business plans, financial information, intellectual property, and personal data that may be subject to legal protection) to ensure the continuity of the Company’s supply chain and operations, and as part of many of the products we deliver to customers.
Changes in tax laws or regulations around the world, including in the U.S. and as led by the Organization for Economic Cooperation and Development, such as the recent adoption by the EU, enactment by South Korea and the anticipated enactment 10 by additional countries of a global minimum tax, could negatively impact the Company’s effective tax rate and results of operations.
Changes in tax laws or regulations around the world, including in the U.S. and as led by the Organization for Economic Cooperation and Development, such as the enactment by certain EU and non-EU countries, and the anticipated enactment by additional countries, of a global minimum tax, could negatively impact the Company’s effective tax rate and results of operations.
Any failure by or loss of a third-party manufacturer could result in delays and increased costs, which may adversely affect our business. The Company relies on third parties to manufacture certain of our products.
Any failure by or loss of a third-party manufacturer or supplier could result in delays and increased costs, which may adversely affect our business. The Company relies on third parties to manufacture and supply certain of our raw materials, component parts and products.
The continued spread of COVID-19 or other health crises may cause the Company to modify its business practices, and take further actions as may be required by government authorities or as the Company determines are in the best interests of our patients, customers, employees and business partners.
The spread of health crises have caused and may cause the Company to modify its business practices, and take further actions as may be required by government authorities or as the Company determines are in the best interests of our patients, customers, employees and business partners under such circumstances.
Breach of such requirements could result in substantial fines, penalties, private right of actions, claims and damage to our reputation and business. New privacy laws are expected in other territories, together with greater privacy enforcement by governmental authorities globally, particularly on data localization requirements and international data flows.
Breach of the requirements of these laws and regulations could result in substantial fines, penalties, governmental actions, private right of actions, including class actions, and damage to our reputation and business. New privacy laws are expected globally, together with greater privacy enforcement by governmental authorities globally, particularly on data localization requirements and data transfers including international data flows.
While the Company has robust business continuity plans in place across our global supply chain network to help mitigate the impact of health crises, these efforts may not completely prevent our business from being adversely affected and future impacts remain uncertain.
While the Company has robust business continuity plans in place across our global supply chain network designed to help mitigate the impact of health crises, these efforts may not completely prevent our business from being adversely affected in the event of a health crisis.
Foreign Currency Exchange : In fiscal 2022, approximately 49% of the Company’s sales occurred outside of the U.S., with approximately 25% in Europe, 6% in the Western Hemisphere, excluding the U.S., and 18% in the Asia-Pacific and Africa region. Changes in non-U.S. currencies relative to the U.S. dollar impact the Company’s revenues and expenses.
Foreign currency exchange : In fiscal 2024, approximately 43% of the Company’s sales occurred outside of the U.S., with approximately 23% in Europe, 5% in the Western Hemisphere, excluding the U.S., and 15% in the Asia-Pacific and Africa region. Changes in non-U.S. currencies relative to the U.S. dollar impact the Company’s revenues and expenses.
Furthermore, the Russian government has already taken action allowing Russian companies and individuals to exploit inventions owned by patent holders from the United States and many other countries without consent or compensation and we may not be able to prevent third parties from practicing our inventions in Russia or from selling or importing products in and into Russia.
Furthermore, in some countries, such as in Russia, action may be taken that allows companies and individuals to exploit inventions owned by patent holders from the United States and many other countries without consent or compensation and we may not be able to prevent third parties from practicing the Company's inventions in Russia or from selling or importing products in and into Russia.
Although we have taken steps to enhance our protections against these attacks, we may not be able to address the threat of information security or cybersecurity incidents proactively or implement adequate preventative measures and we may not be able to detect and address any such disruption or security breach promptly, or at all, which could adversely affect our business, results of operations or financial condition.
Given the potential sophistication of these attacks, the Company may not be able to address the threat of information security or cybersecurity incidents proactively or implement adequate preventative measures and we may not be able to detect and address any such disruption or security breach promptly, or at all, which could adversely affect customers that use our products, our business, results of operations or financial condition.
Product recalls have in the past, and could in the future, prompt government investigations and inspections, the shutdown of manufacturing facilities, continued product shortages and related sales declines, significant remediation costs, reputational damage, possible civil penalties and criminal prosecution.
These circumstances can also result in damage to brand image, brand equity and consumer trust in the Company’s products. Product recalls have in the past, and could in the future, prompt government investigations and inspections, the shutdown of manufacturing facilities, continued product shortages and related sales declines, significant remediation costs, reputational damage, possible civil penalties and criminal prosecution.
We are subject to risks associated with global health crises, epidemics, pandemics and other outbreaks (such incident(s), a health crisis or health crises), including the global outbreak of coronavirus and its variants (COVID-19).
We are subject to risks associated with global health crises, epidemics, pandemics and other outbreaks (such incident(s), a health crisis or health crises).
The Company continually assesses these threats and makes investments to increase internal protection, detection, and response capabilities, as well as ensure the Company’s third-party providers have required capabilities and controls, to address this risk .
The Company assesses these threats, responds to attacks and breaches that it has experienced, and makes investments to increase internal protection, detection, and response capabilities, as well as ensure the Company’s third-party providers have required capabilities and 2024 Annual Report 15 controls, to address this risk.
The extensive information security and cybersecurity threats, which affect companies globally, pose a risk to the security and availability of these systems and networks, and the confidentiality, integrity, and availability of the Company’s sensitive data.
The extensive range of information security and cybersecurity threats, which affect companies globally, pose a persistent risk to the security and availability of these systems and networks, including to customer products that are connected to or rely on such systems and networks, and the confidentiality, integrity, and availability of the Company’s sensitive data.
Concerns about product safety, whether raised internally or by litigants, regulators or consumer advocates, and whether or not based on scientific evidence, can result in safety alerts, product recalls, governmental investigations, regulatory action on the part of the U.S.
Product concerns, whether raised internally or by litigants, regulators or consumer advocates, and whether or not based on scientific evidence, can result in safety alerts, product recalls, governmental investigations, regulatory action on the part of the U.S. FDA (or its counterpart in other countries), private claims and lawsuits, payment of fines and settlements, declining sales and reputational damage.
This impact could result in reputational, competitive, operational or other business harm as well as financial costs and regulatory action. The Company maintains cybersecurity insurance in the event of an information security or cyber incident; however, the coverage may not be sufficient to cover all financial, legal, business or reputational losses.
The Company maintains cybersecurity insurance in the event of an information security or cyber incident; however, the coverage may not be sufficient to cover all financial, legal, business or reputational losses.
Outside the U.S., numerous major markets, including the EU, United Kingdom, Japan and China, have pervasive government involvement in funding healthcare and, in that regard, directly or indirectly impose price controls, limit access to, or reimbursement for, the Company’s products, or reduce the value of its intellectual property protection.
Outside the U.S., numerous major markets, including the EU, United Kingdom, Japan and China, have pervasive government involvement in funding healthcare and, in that regard, directly or indirectly impose price controls, limit access to, or reimbursement for, the Company’s products, or reduce the value of its intellectual property protection. 10 We are subject to an increasing number of costly and complex governmental regulations in the countries in which operations are conducted which may materially adversely affect the Company’s financial condition and business operations.
Even following initial regulatory approval, the success of a product can be adversely impacted by safety and efficacy findings in larger real-world patient populations, as well as market entry of competitive products. Risks Related to Financial and Economic Market Conditions The Company faces a variety of financial, economic, legal, social and political risks associated with conducting business internationally .
Even following initial regulatory approval, the success of a product can be adversely impacted by safety and efficacy findings in larger real-world patient populations, as well as market entry of competitive products.
The Company’s extensive operations and business activity throughout the world are accompanied by certain financial, economic, legal, social and political risks, including those listed below.
Risks related to financial and economic market conditions The Company faces a variety of financial, economic, legal, social and political risks associated with conducting business internationally. The Company’s extensive operations and business activity throughout the world are accompanied by certain financial, economic, legal, social and political risks, including those listed below.
Other risks associated with our reliance on third parties to manufacture these products include reliance on the third party for regulatory compliance and quality assurance, misappropriation of the Company’s intellectual property, limited ability to manage our inventory, possible breach of the manufacturing agreement by the third party and the possible termination or nonrenewal of the manufacturing agreement by the third party at a time that is costly or inconvenient for us.
However, we cannot guarantee that these third-party manufacturers will be able to meet our near-term or long-term manufacturing requirements, which could result in lost sales and have an adverse effect on our business. 2024 Annual Report 9 Other risks associated with our reliance on third parties to manufacture these products include reliance on the third party for regulatory compliance and quality assurance, misappropriation of the Company’s intellectual property, limited ability to manage our inventory, possible breach of the manufacturing agreement by the third party and the possible termination or nonrenewal of the manufacturing agreement by the third party at a time that is costly or inconvenient for us.
For the Company’s MedTech businesses, technological innovation, product quality, reputation and customer service are especially important to competitiveness. Development by other companies of new or improved products, processes and technologies could threaten to make the Company’s products or technologies less desirable, less economical or obsolete.
Development by other companies of new or improved products, processes and technologies could threaten to make the Company’s products or technologies less desirable, less economical or obsolete.
In addition, effective succession planning is important to our long-term success. Any unsuccessful implementation of our succession plans or failure to ensure effective transfer of 14 knowledge and smooth transitions involving key employees could adversely affect our business, financial condition, or results of operations.
Any unsuccessful implementation of our succession plans or failure to ensure effective transfer of knowledge and smooth transitions involving key employees could adversely affect our business, financial condition, or results of operations. Climate change or legal, regulatory or market measures to address climate change may negatively affect our business and results of operations.
A breach of privacy laws or unauthorized access, loss or misuse of personal data could have a negative impact to the Company’s business or reputation. The Company is subject to privacy and data protection laws across the globe that impose broad compliance obligations on the collection, use, storage, access, transfer and protection of personal data.
The Company is subject to privacy and data protection laws and regulations across the globe that impose broad compliance obligations on the collection, possession, use, storage, access, disclosure, transfer, deletion and protection of personal data.
Failure to maintain a satisfactory credit rating could adversely affect our liquidity, capital position, borrowing costs and access to capital markets. We currently maintain investment grade credit ratings with Moody’s Investors Service and Standard & Poor’s Ratings Services. Rating agencies routinely evaluate us, and their ratings of our long-term and short-term debt are based on a number of factors.
Weak financial performance, failure to maintain a satisfactory credit rating or disruptions in the financial markets could adversely affect our liquidity, capital position, borrowing costs and access to capital markets. We currently maintain investment grade credit ratings with Moody’s Investors Service and Standard & Poor’s Ratings Services.
For the Company’s Pharmaceutical businesses, loss of patent exclusivity for a product often is followed by a substantial reduction in sales as competitors gain regulatory approval for generic and other competing products and enter the market. Similar competition can be triggered by the loss of exclusivity for a biological product.
For the Company’s Innovative Medicine businesses, loss of patent exclusivity for a product often is followed by a substantial reduction in sales as competitors gain regulatory approval for generic, biosimilar and other competing products and enter the market. For the Company’s MedTech businesses, technological innovation, product quality, reputation and customer service are especially important to competitiveness.
Some of these matters may include thousands of plaintiffs, may involve parties seeking large and/or indeterminate amounts, including punitive or exemplary damages, and may remain unresolved for several years.
Some of these matters may include thousands of plaintiffs, may involve parties seeking large and/or indeterminate amounts, including punitive or exemplary damages, and may remain unresolved for several years. For example, the Company is a defendant in numerous lawsuits arising out of the use of body powders containing talc, primarily JOHNSON’S Baby Powder.
Risks Related to Product Development, Regulatory Approval and Commercialization Significant challenges or delays in the Company’s innovation and development of new products, technologies and indications could have an adverse impact on the Company’s long-term success.
Current legal proceedings involving the Company’s patents and other intellectual property rights are described in Note 19 Legal proceedings—Intellectual property under Notes to the Consolidated Financial Statements included in Item 8 of this Report. 12 Risks related to product development, regulatory approval and commercialization Significant challenges or delays in the Company’s innovation, development and implementation of new products, technologies and indications could have an adverse impact on the Company’s long-term success.
In addition, recent legislation and ongoing political scrutiny or pricing, coverage and reimbursement could result in additional pricing pressures. Specifically, the Inflation Reduction Act of 2022 (IRA) may subject certain products to government-established pricing, potentially impose rebates, and subject manufacturers who fail to adhere to the government's interpretations of the law to penalties.
In addition, recent legislation and ongoing political scrutiny on pricing, coverage and reimbursement could result in additional pricing pressures. Specifically, the Inflation Reduction Act of 2022 (IRA) has changed Medicare Part D benefit design and has subjected certain of the Company's products to government-established pricing beginning in 2026 and may subject additional products in the future.
We have experienced, and expect to continue to experience, other risks related to the broad economic consequences of the Russia-Ukraine War, including foreign currency volatility, decreased demand for our products in countries affected by the Russia-Ukraine War and challenges to our global supply chain related to increased costs of materials and other inputs for our products and suppliers operating in Russia and Ukraine.
Global tensions, conflict and/or war among any of the countries in which we conduct business or distribute our products may result in foreign currency volatility, decreased demand for our products in affected countries, and challenges to our global supply chain related to increased costs of materials and other inputs for our products and suppliers.
Maintaining our brand and reputation, as well as a diverse, equitable and inclusive work environment enables us to attract top talent. If we are less successful in our recruiting efforts, or if we cannot retain highly skilled workers and key leaders, our ability to develop and deliver successful products and services may be adversely affected.
If we are less successful in our recruiting efforts, or if we cannot retain highly skilled workers and key leaders, our ability to develop and deliver successful products and services may be adversely affected. In addition, effective succession planning is important to our long-term success.
The COVID-19 pandemic has adversely impacted, and may continue to adversely impact, certain aspects of the Company’s business, results of operations and financial condition, including lower sales and reduced customer demand and usage of certain of our products.
Impacts to the Company have included and may include adverse impacts to results of operations and financial condition, including lower sales and reduced customer demand and usage of certain of our products.
As a result of the Russia-Ukraine War, there has been, and we expect there will continue to be, an increased risk of information security or cybersecurity incidents, including cyberattacks perpetrated by Russia or others at its direction.
As a result of increased global tensions, the Company expects there will continue to be, an increased risk of information security or cybersecurity incidents, including cyberattacks perpetrated by adversaries of countries where the Company maintains operations.
Our continued growth requires us to recruit and retain talented employees representing diverse backgrounds, experiences, and skill sets. The market for highly skilled workers and leaders in our industry is extremely competitive and our ability to compete depends on our ability to hire, develop and motivate highly skilled personnel in all areas of our organization.
The market for highly skilled workers and leaders in our industry is extremely competitive and our ability to compete depends on our ability to hire, develop and motivate highly skilled personnel in all areas of our organization. Maintaining our brand and reputation, as well as a credo-based work environment enables us to attract top talent.
The Company owns or licenses a significant number of patents and other proprietary rights relating to its products and manufacturing processes. These rights are essential to the Company’s businesses and materially important to the Company’s results of operations. Public policy, both within and outside the U.S., has become increasingly unfavorable toward intellectual property rights.
The Company owns or licenses a significant number of patents and other proprietary rights relating to its products and manufacturing processes. These rights are essential to the Company’s businesses and the inability of the Company to secure and maintain these rights may have a detrimental impact on the Company’s financial results.
In addition, challenges that the Company’s products infringe the patents of third parties could result in an injunction and/or the need to pay past damages and future royalties and adversely affect the competitive position and sales of the products in question.
In addition, others may claim the Company has infringed their intellectual property rights, including copyrights, patents, or trademarks, and/or has misappropriated their trade secrets, any of which could result in an injunction and/or the need to pay past damages and future royalties and adversely affect the competitive position and sales of our products.
For example, the Company is a defendant in numerous lawsuits arising out of the use of body powders containing talc, primarily JOHNSON’S Baby Powder, and the Company’s sale, manufacturing and marketing of opioids. While the Company believes it has substantial defenses in these matters, it is not feasible to predict the ultimate outcome of litigation.
While the Company believes it has substantial defenses in these matters, it is not feasible to predict the ultimate outcome of litigation.
Specifically, the Company has accounted for operations in Argentina, Turkey and Venezuela as highly inflationary, as the prior three-year cumulative inflation rate surpassed 100%. While the Company strives to maintain profit margins in these areas through cost reduction programs, productivity improvements and periodic price increases, it might experience operating losses as a result of continued inflation.
While the Company strives to maintain profit margins in these areas through cost reduction programs, productivity improvements and periodic price increases, it might experience operating losses as a result of continued inflation. 2024 Annual Report 13 In addition, the impact of currency devaluations in countries experiencing high inflation rates or significant currency exchange fluctuations could negatively impact the Company’s operating results.
The Company faces significant regulatory scrutiny, which imposes significant compliance costs and exposes the Company to government investigations, legal actions and penalties. Like other companies in the healthcare industry, the Company is subject to extensive regulation, investigations and legal action by national, state and local government agencies in the U.S. and other countries in which it operates.
The Company faces significant regulatory scrutiny, which imposes significant compliance costs and exposes the Company to government investigations, legal actions and penalties.
The Company is subject to significant legal proceedings that can result in significant expenses, fines and reputational damage.
If the Company is unable to identify ways to mitigate these delays or constraints, there may be an adverse effect on sales and access to our products. The Company is subject to significant legal proceedings that can result in significant expenses, fines and reputational damage.
The Company cannot be certain that it will obtain adequate patent protection for new products and technologies in the United States and other important markets or that such protections, once granted, will last as long as originally anticipated.
Public policy, both within and outside the U.S., has become increasingly unfavorable toward intellectual property rights. The Company cannot be certain that it will secure and maintain adequate patent protection for new products and technologies in the United States and other important markets.
To date, the Company has not experienced any material impact to the business or operations resulting from information or cybersecurity attacks; however, because of the frequently changing attack techniques, along with the increased volume and sophistication of the attacks, there is the potential for the Company to be adversely impacted.
Because of the frequently changing attack techniques, along with the increased volume and sophistication of the attacks, there is the potential for the Company to be adversely impacted. This impact could result in reputational, competitive, operational or other business harm as well as financial costs and regulatory action. Also, increasing use of AI could increase these risks.
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The Company’s Consumer Health businesses face intense competition from other branded products and retailers’ private-label brands. If the Company fails to sufficiently differentiate and market its brand name consumer products, this could adversely affect revenues and profitability of those products. Interruptions and delays in manufacturing operations could adversely affect the Company’s business, sales and reputation.
Added
The Company may also experience operational and financial risk in connection with acquisitions if we are unable to fully identify potential risks and liabilities associated with acquired businesses or products, successfully integrate operations and employees, and successfully identify and realize synergies with existing businesses while containing acquisition-related strain on our management, operations and financial resources.
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However, we cannot guarantee that these third-party manufacturers will be able to meet our near-term or long-term manufacturing requirements, which could result in lost sales and have an adverse effect on our business.
Added
The Company’s business and operations will be negatively impacted if we are unable to introduce new products or technological advances that are safe, more effective, more effectively marketed or otherwise outperform those of our competitors. Interruptions and delays in manufacturing operations could adversely affect the Company’s business, sales and reputation.
Removed
While the U.S. and other countries have substantially reopened their economies, the extent to which COVID-19, or other health crises, could impact the Company’s future operations will depend on many factors which cannot be predicted with confidence, including the duration of an outbreak and impact of variants.
Added
Failure to adhere to the government's interpretations of the law pending ongoing litigation may expose the Company to penalties. In addition, change to Medicare Part D could have a negative impact on U.S. Innovative Medicine sales.
Removed
A surge in COVID-19 or other health crises could result in the imposition of new mandates and prolonged restrictive measures implemented in order to control the spread of disease.
Added
Further, increased third-party utilization of the 340B Federal Drug Discount Program from expanded interpretations of the statute and program abuse may have a negative impact on the Company's financial performance.
Removed
We also face uncertainties related to our vaccine development programs, including uncertainties related to the risk that our continued development programs may not be successful, commercially viable or receive approval from regulatory authorities; risks associated with clinical trial and real-world data, including further analyses of its efficacy, safety and durability; the risk that continued evolution and mutation of disease and the duration of a particular outbreak may impede our ability to conduct trials within a specified time frame; the risk that data are subject to differing interpretations and assessments, including during the peer review/publication process, in the scientific community generally, and by national immunization technical advisory groups (NITAGs) and regulatory authorities; disruptions in the relationships between us, our third-party suppliers, external manufacturers, and other third parties with whom we engage; the risk that other companies may produce superior or competitive products; the risk that demand for any products we may develop may no longer exist; risks related to the availability of raw materials to manufacture any such products; the risk that we may not be able to recoup costs associated with our R&D and manufacturing efforts and risks associated with any changes in the way we approach or provide additional research funding for potential drug development; the risk that we may not be able to create or scale up manufacturing capacity on a timely basis, that we may continue to experience manufacturing delays once a manufacturing site is activated, or have access to logistics or supply channels commensurate with global demand for any potential approved vaccine or product candidate, which would negatively impact our ability to supply the estimated numbers of doses of our vaccine within the projected time periods indicated, and other challenges and risks associated with the pace of our vaccine development program; and pricing and access challenges for such products, including in the U.S.
Added
As described in Item 1. Business, the Company is subject to an increasing number of extensive government laws and regulations, investigations and legal action by national, state and local government agencies in the U.S. and other countries in which it operates. For example, changes to the U.S.
Removed
Food and Drug Administration (or its counterpart in other countries), private claims and lawsuits, payment of fines and settlements, declining sales and reputational damage. These circumstances can also result in damage to brand image, brand equity and consumer trust in the Company’s products.
Added
FDA’s timing or requirements for approval or clearance of our products may have a negative impact on our ability to bring new products to market.
Removed
In the U.S., manufacturers of generic versions of innovative human pharmaceutical products may challenge the validity, or claim non-infringement, of innovator products through the Abbreviated New Drug Application, or ANDA, process with the U.S. FDA and related ANDA litigation.
Added
New and changing laws, regulations, executive orders and other directives may also impose deadlines on the Company, or its third-party suppliers, manufacturers or other partners and providers, for which there may be insufficient time to implement changes to comply with such new regulations and may result in manufacturing delays or other supply chain constraints.
Removed
The Biologics Price Competition and Innovation Act (BPCIA), enacted in 2010, which created a new regulatory pathway for the approval by the U.S. FDA of biosimilar alternatives to innovator-developed biological products, also created mechanisms for biosimilar applicants to challenge the patents on the innovator biologics.
Added
The rapid increase in new government laws and regulations imposes significant compliance costs to the Company and a failure of the Company to timely implement changes to comply with these new laws may expose the Company to investigations, legal actions or penalties.
Removed
The IPR process with the USPTO is also being used by competitors to challenge patents asserted in litigation.
Added
Moreover, the development and regulatory approval of new products may be delayed due to limits on federal agency budgets or personnel, including reductions to the U.S. FDA’s budget, employees, and operations, which may lead to slower response times and longer review periods.
Removed
Current legal proceedings involving the Company’s patents and other intellectual property rights are described in Note 19, “Legal Proceedings—Intellectual Property” under Notes to the Consolidated Financial Statements included in Item 8 of this Report.
Added
The Company leverages the use of data science, machine learning and other forms of AI and emerging technologies across varying parts of its business and operations, and the introduction and incorporation of AI may result in unintended consequences or other new or expanded risks and liabilities.
Removed
In addition, the impact of currency devaluations in countries experiencing high inflation rates or significant currency exchange fluctuations could negatively impact the Company’s operating results.

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Item 2. Properties

Properties — owned and leased real estate

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Biggest changeThe manufacturing facilities are used by the industry segments of the Company’s business approximately as follows: Segment Square Feet (in thousands) Consumer Health 4,562 Pharmaceutical 5,456 MedTech 4,930 Worldwide Total 14,948 Within the U.S., four facilities are used by the Consumer Health segment, five by the Pharmaceutical segment and 19 by the MedTech segment.
Biggest changeThe manufacturing facilities are used by the industry segments of the Company’s business approximately as follows: Segment Square Feet (in thousands) Innovative Medicine 4,696 MedTech 4,911 Worldwide Total 9,607 Within the U.S., four facilities are used by the Innovative Medicine segment and 19 by the MedTech segment.
Segment information on additions to property, plant and equipment is contained in Note 17 “Segments of Business and Geographic Areas” of the Notes to Consolidated Financial Statements included in Item 8 of this Report.
Segment information on additions to property, plant and equipment is contained in Note 17 Segments of business and geographic areas of the Notes to Consolidated Financial Statements included in Item 8 of this Report.
Item 2. PROPERTIES The Company's subsidiaries operate 89 manufacturing facilities occupying approximately 14.9 million square feet of floor space.
Item 2. Properties The Company's subsidiaries operate 64 manufacturing facilities occupying approximately 9.6 million square feet of floor space.
The locations of the manufacturing facilities by major geographic areas of the world are as follows: Geographic Area Number of Facilities Square Feet (in thousands) United States 28 4,169 Europe 27 6,016 Western Hemisphere, excluding U.S. 9 1,733 Africa, Asia and Pacific 25 3,030 Worldwide Total 89 14,948 In addition to the manufacturing facilities discussed above, the Company maintains numerous office and warehouse facilities throughout the world.
The locations of the manufacturing facilities by major geographic areas of the world are as follows: Geographic Area Number of Facilities Square Feet (in thousands) United States 23 2,892 Europe 21 4,521 Western Hemisphere, excluding U.S. 7 898 Africa, Asia and Pacific 13 1,296 Worldwide Total 64 9,607 In addition to the manufacturing facilities discussed above, the Company maintains numerous office and warehouse facilities throughout the world.
Outside of the U.S., 23 facilities are used by the Consumer Health segment, 13 by the Pharmaceutical segment and 25 by the MedTech segment.
Outside of the U.S., 14 facilities are used by the Innovative Medicine segment and 27 by the MedTech segment.

Item 3. Legal Proceedings

Legal Proceedings — active lawsuits and investigations

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Biggest changeItem 3. LEGAL PROCEEDINGS The information called for by this item is incorporated herein by reference to the information set forth in Note 19 “Legal Proceedings” of the Notes to Consolidated Financial Statements included in Item 8 of this Report.
Biggest changeItem 3. Legal proceedings The information called for by this item is incorporated herein by reference to the information set forth in Note 19 Legal proceedings of the Notes to Consolidated Financial Statements included in Item 8 of this Report.

Item 4. Mine Safety Disclosures

Mine Safety Disclosures — required of mining issuers

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Biggest changeFrom 2013 to 2017, she held General Manager roles at Amgen in Inflammation & Cardiovascular, and Cardiovascular & Bone. In 2017, Ms. Broadhurst rejoined Johnson & Johnson as U.S. President, Cardiovascular & Metabolism and a member of the Janssen Americas Leadership Team.
Biggest changeBroadhurst was named Executive Vice President, Global Corporate Affairs and appointed to the Executive Committee in 2022. Ms. Broadhurst rejoined the Company in 2017 and was appointed Company Group Chairman, Global Commercial Strategy Organization in 2018. From 2013 to 2017, she held General Manager roles at Amgen in Inflammation & Cardiovascular, and Cardiovascular & Bone.
Swanson rejoined the Company in 2019 as Chief Information Officer of Johnson & Johnson from Bayer Crop Science, where he served as a member of the Executive Leadership Team and as CIO and Head of Digital Transformation. From 1996 to 2005, Mr. Swanson held positions of increasing responsibility at the Company, including Project Manager, Director IT, Sr.
He rejoined the Company in 2019 as Chief Information Officer of Johnson & Johnson from Bayer Crop Science, where he served as a member of the Executive Leadership Team and as Chief Information Officer and Head of Digital Transformation. From 1996 to 2005, Mr. Swanson held positions of increasing responsibility at the Company, including Project Manager, Director IT, Sr.
Item 4. MINE SAFETY DISCLOSURES Not applicable. 16 EXECUTIVE OFFICERS OF THE REGISTRANT Listed below are the executive officers of the Company. There are no family relationships between any of the executive officers, and there is no arrangement or understanding between any executive officer and any other person pursuant to which the executive officer was selected.
Item 4. Mine safety disclosures Not applicable. 18 Executive officers of the registrant Listed below are the executive officers of the Company. There are no family relationships between any of the executive officers, and there is no arrangement or understanding between any executive officer and any other person pursuant to which the executive officer was selected.
Wengel joined the Company in 1988 as Project Engineer and Engineering Supervisor at Janssen, a subsidiary of the Company. During her tenure with the Company, she has held a variety of strategic leadership and executive positions, including in roles within operations, quality, engineering, new products, information technology, and other technical and business functions.
During her tenure with the Company, she has held a variety of strategic leadership and executive positions, including in roles within operations, quality, engineering, new products, information technology, and other technical and business functions. Joseph J. Wolk, 58 Member, Executive Committee; Executive Vice President, Chief Financial Officer Mr. J. J.
Taubert joined the Company in 2005 as Worldwide Vice President, and she held several executive positions of increasing responsibility in the Pharmaceutical sector. In 2012, she was appointed Company Group Chairman, North America Pharmaceuticals, and in 2015 became Company Group Chairman, The Americas, Pharmaceuticals. In July 2018, Ms.
She joined the Company in 2005 as Worldwide Vice President and held several executive positions of increasing responsibility in the Pharmaceuticals sector, including Company Group Chairman, North America, and Company Group Chairman, The Americas from 2012-2018. Kathryn E. Wengel, 59 Member, Executive Committee; Executive Vice President, Chief Technical Operations & Risk Officer Ms. K. E.
At the annual meeting of the Board of Directors, the executive officers are elected by the Board to hold office for one year and until their respective successors are elected and qualified, or until earlier resignation or removal. Information with regard to the directors of the Company is incorporated herein by reference to the material captioned “Item 1.
At the annual meeting of the Board of Directors, the executive officers are elected by the Board to hold office for one year and until their respective successors are elected and qualified, or until earlier resignation or removal. Vanessa Broadhurst, 56 Member, Executive Committee; Executive Vice President, Global Corporate Affairs Ms. V.
In 2018, she was named Executive Vice President, Chief Global Supply 18 Chain Officer, and became a member of the Executive Committee. In January 2023, she was appointed Executive Vice President, Chief Technical Operations & Risk Officer. Ms.
Wengel was appointed Executive Vice President, Chief Technical Operations & Risk Officer in 2023, subsequent to her appointment to the Executive Committee in 2018 when she was named as Executive Vice President, Chief Global Supply Chain Officer. Ms. Wengel first joined the Company in 1988 as Project Engineer and Engineering Supervisor at Janssen, a subsidiary of the Company.
Taubert was promoted to Executive Vice President, Worldwide Chairman, Pharmaceuticals, and became a member of the Executive Committee. Ms.
Director IT and Vice President, Chief Information Officer. Jennifer L. Taubert, 61 Member, Executive Committee; Executive Vice President, Worldwide Chairman, Innovative Medicine Ms. J. L. Taubert was appointed Executive Vice President, Worldwide Chairman, Innovative Medicine (formerly Pharmaceuticals) and a member of the Executive Committee in 2018.
From 2014 to 2016, he served as Vice President, Finance and Chief Financial Officer of the Janssen Pharmaceutical Companies of Johnson & Johnson. In 2016, Mr. Wolk became the Vice President, Investor Relations. In July 2018, he was appointed Executive Vice President, Chief Financial Officer and became a member of the Executive Committee. Mr.
Wolk was appointed Executive Vice President, Chief Financial Officer and a member of the Executive Committee in 2018. He first joined the Company in 1998 as Finance Manager, Business Development for Ortho-McNeil, a subsidiary of the Company.
He joined the Company in 1989 with Janssen-Farmaceutica S.A. (Spain), a subsidiary of the Company, and held executive positions of increasing responsibility in all business sectors and across multiple geographies and functions. In 2009, he was named Company Group Chairman, Pharmaceuticals, and in 2011, he was named Worldwide Chairman, Pharmaceuticals. In 2016, Mr.
Duato was appointed to the Executive Committee in 2016 when he was named Executive Vice President, Worldwide Chairman, Pharmaceuticals and subsequently served as Vice Chairman of the Executive Committee. Mr. Duato first joined the Company in 1989 with Janssen-Farmaceutica S.A.
Elizabeth Forminard joined the Company in 2006 as Vice President, Law, Consumer Healthcare Global Business Unit and continued to serve in roles of increasing responsibility. In 2012, she was promoted to General Counsel, Medical Devices & Diagnostics and became General Counsel, Consumer Group & Supply Chain in 2013. She was appointed Worldwide Vice President, Corporate Governance in 2016.
Forminard joined the Company in 2006, serving in roles of increasing responsibility including General Counsel Medical Devices & Diagnostics, General Counsel Consumer Group & Supply Chain, Worldwide Vice President Corporate Governance, and in her immediate past role as General Counsel Pharmaceuticals. Kristen Mulholland, 58 Member, Executive Committee; Executive Vice President, Chief Human Resources Officer Ms. K.
Broadhurst was named Executive Vice President, Global Corporate Affairs and a member of the Executive Committee, leading the Company's global marketing, communication, Global Public Health and philanthropy functions. (b) Mr. J. Duato became Chairman of the Board of Directors in January 2023 subsequent to his appointment as Chief Executive Officer and a Director in January 2022.
Prior to her roles at Amgen, she served in various leadership roles at the Company from 2005-2013. Joaquin Duato, 62 Chairman of the Board; Chief Executive Officer Mr. J. Duato became Chairman of the Board of Directors in 2023 subsequent to his appointments as Chief Executive Officer and Director in 2022. Mr.
Removed
Election of Directors” in the Proxy Statement. Name Age Position Vanessa Broadhurst 54 Member, Executive Committee; Executive Vice President, Global Corporate Affairs (a) Joaquin Duato 60 Chairman of the Board; Chief Executive Officer (b) Peter M.
Added
(Spain), a subsidiary of the Company, and held executive positions of increasing responsibility in all business sectors and across multiple geographies and functions. Elizabeth Forminard, 54 Member, Executive Committee; Executive Vice President, Chief Legal Officer Ms. E. Forminard was appointed Executive Vice President, Chief Legal Officer and a member of the Executive Committee in 2022. Ms.
Removed
Fasolo, Ph.D. 60 Member, Executive Committee; Executive Vice President, Chief Human Resources Officer (c) Elizabeth Forminard 52 Member, Executive Committee; Executive Vice President, General Counsel (d) William N. Hait, M.D., Ph.
Added
Mulholland was appointed Executive Vice President, Chief Human Resources Officer and appointed to the Executive Committee in 2024. She joined the company in 2005 and has held HR leadership positions across the full breadth of the company including MedTech, Innovative Medicines, our Corporate Functions and Corporate HR Services including Performance and Development and most recently, Global Total Rewards. John C.
Removed
D. 73 Member, Executive Committee; Executive Vice President, Chief External Innovation and Medical Safety Officer; Interim Head Janssen R&D (e) Ashley McEvoy 52 Member, Executive Committee; Executive Vice President, Worldwide Chairman, MedTech (f) Thibaut Mongon 53 Member, Executive Committee, Executive Vice President, Worldwide Chairman, Consumer Health (g) James Swanson 57 Member, Executive Committee; Executive Vice President, Chief Information Officer (h) Jennifer L.
Added
Reed, M.D., Ph.D., 66 Member, Executive Committee; Executive Vice President, Innovative Medicine, R&D Dr. J. C. Reed joined the Company in 2023 as Executive Vice President, Innovative Medicine, R&D and a member of the Executive Committee. Prior to joining the Company, Dr. Reed held executive leadership positions at Sanofi (2018-2022) and Roche (2013-2018), serving on their respective executive committees.
Removed
Taubert 59 Member, Executive Committee; Executive Vice President, Worldwide Chairman, Pharmaceuticals (i) Kathryn E. Wengel 57 Member, Executive Committee; Executive Vice President, Chief Technical Operations & Risk Officer (j) Joseph J. Wolk 56 Member, Executive Committee; Executive Vice President, Chief Financial Officer (k) (a) Ms. V.
Added
He also served as CEO of Sanford-Burnham Medical Research Institute (now Sanford Burnham Prebys) where he established multiple therapeutic area-aligned research centers and platform technology centers. 2024 Annual Report 19 Tim Schmid, 55 Member, Executive Committee; Executive Vice President, Worldwide Chairman, MedTech Mr. T.
Removed
Broadhurst joined the Company in 2005 as Worldwide Vice President, Anemia & Oncology Supportive Care. She then went on to become Vice President of the Cardiovascular & Institutional Franchise in 2008, and President of Janssen Therapeutics in 2011 before becoming U.S. President, Internal Medicine in 2012.
Added
Schmid was appointed Executive Vice President, Worldwide Chairman, MedTech and a member of the Executive Committee in 2023. He joined the Company in 1993 and has served in leadership positions throughout Johnson & Johnson MedTech, including Chief Strategic Customer Officer and President of Ethicon, and most recently served as Company Group Chairman MedTech Asia Pacific from 2018-2023.
Removed
In this role she also provided operational oversight of the full portfolio of Janssen medicines in Puerto Rico and Canada. In 2018, she was appointed Company Group Chairman, Global Commercial Strategy Organization. In 2022, Ms.
Added
James Swanson, 59 Member, Executive Committee; Executive Vice President, Chief Information Officer Mr. J. Swanson was appointed Executive Vice President, Chief Information Officer and a member of the Executive Committee in 2022.
Removed
Duato became a member of the Executive Committee and was named Executive Vice President, Worldwide Chairman, Pharmaceuticals. In July 2018, Mr. Duato was promoted to Vice Chairman of the Executive Committee, where he provided strategic direction for the Pharmaceutical and Consumer Health sectors and oversaw both the Global Supply Chain, Information Technology and Health & Wellness teams.
Added
During his tenure at the Company, he has held a variety of senior leadership roles in several segments and functions across the Company's subsidiaries, including Vice President, Finance and Chief Financial Officer of the Janssen Pharmaceutical Companies, and Vice President, Investor Relations. 20 Part II
Removed
As a dual citizen of Spain and the United States, Mr. Duato's international perspective and global lens gives him a deep appreciation of diverse thoughts and opinions. 17 (c) Dr. P. M. Fasolo joined the Company in 2004 as Worldwide Vice President, Human Resources in the MedTech segment, and subsequently served as the Company’s Chief Talent Officer.
Removed
He left Johnson & Johnson in 2007 to join Kohlberg Kravis Roberts & Co. as Chief Talent Officer. Dr. Fasolo returned to the Company in 2010 as the Vice President, Global Human Resources, and in 2011, he became a member of the Executive Committee. In April 2016, he was named Executive Vice President, Chief Human Resources Officer. Dr.
Removed
Fasolo has responsibility for global talent, recruiting, diversity, compensation, benefits, employee relations and all aspects of the human resources agenda for the Company. He also serves on the Boards of the Human Resources Policy Association, Tufts University and Save the Children and was named a Fellow of the National Academy of Human Resources in 2017. (d) Ms.
Removed
From 2019 to 2022, she served as General Counsel, Pharmaceuticals. In October 2022, she was named Executive Vice President, General Counsel and became a member of the Executive Committee. Ms. Forminard has worldwide responsibility for the legal and privacy functions, and leads the development and execution of the Company's environment, social and governance strategy. (e) Dr. W.
Removed
Hait joined the Company in 2007 as Senior Vice President, Worldwide Head of Oncology Research. He then served as the first Global Therapeutic Area Head for Oncology from 2009 to 2011, and then as Global Head, Janssen Research & Development from 2011 through 2018. From 2018 to 2022, he was Global Head, Johnson & Johnson Global External Innovation.
Removed
In 2022, he became Executive Vice President, Chief External Innovation, Medical Safety and Global Public Health Officer, and a member of the Executive Committee. He is responsible for leading external sourcing and creation of transformational innovation to help Johnson & Johnson achieve its mission to improve human health utilizing the Company’s excellence in pharmaceuticals, medical devices and consumer products.
Removed
He also has oversight over Global Public Health and the Office of the Chief Medical Officer. As Interim Head of Janssen R&D, Dr. Hait's mission is to focus the best research and development teams in the world at the intersection of unmet medical need and breakthroughs in science and technology to make medicines with benefit for patients worldwide. (f) Ms.
Removed
A. McEvoy joined the Company in 1996 as Assistant Brand Manager of McNeil Consumer Health, a subsidiary of the Company, advancing through positions of increasing responsibilities until she was appointed Company Group Chairman, Vision Care in 2012, followed by Company Group Chairman, Consumer Medical Devices in 2014. In July 2018, Ms.
Removed
McEvoy was promoted to Executive Vice President, Worldwide Chairman, MedTech, and became a member of the Executive Committee. Ms. McEvoy has responsibility for the surgery, orthopaedics, interventional solutions and eye health businesses across Ethicon, DePuy Synthes, Biosense Webster, Abiomed, and Johnson & Johnson Vision. (g) Mr. T.
Removed
Mongon joined the Company in 2000 as Director of Marketing for the Vision Care group in France and subsequently held positions of increasing responsibility until he transitioned to the Pharmaceutical sector in 2012, as the Global Commercial Strategy Leader for the Neuroscience therapeutic area. In 2014, he joined the Consumer Health sector as Company Group Chairman Asia-Pacific.
Removed
In 2019, he was promoted to Executive Vice President and Worldwide Chairman, Consumer Health, and became a member of the Executive Committee. Mr. Mongon has responsibility for the global development of Johnson & Johnson’s health and wellness products and solutions in beauty, OTC, oral care, baby care, women’s health, and wound care. (h) Mr. J.
Removed
Director IT and Vice President, Chief Information Officer. Mr. Swanson is responsible for enhancing Johnson & Johnson’s business impact and shaping its direction through the strategic use of technology. Mr. Swanson, Executive Vice President, Enterprise Chief Information Officer, joined the Executive Committee effective January 3, 2022. (i) Ms. J. L.
Removed
Taubert is responsible for the Pharmaceutical sector globally, including shaping the company’s strategy of transformational medical innovation and for successfully bringing to market critical new medicines that significantly improve the lives of patients living with cancer, immune-related diseases, cardiovascular disease, infectious diseases, pulmonary hypertension and serious mental illness. (j) Ms. K. E.
Removed
Wengel has enterprise-wide responsibilities for key technical operations functions, including Procurement, Engineering & Property Services, Sustainability and cross-sector Supply Chain teams focused on standards, services, strategic programs and data science, and serves as Chair of the Company’s Supply Chain Management Committee.
Removed
She also oversees critical risk functions, including Quality & Compliance, Health Care Compliance, Environmental Health & Safety, Global Security and Global Brand Protection. (k) Mr. J. J.
Removed
Wolk joined the Company in 1998 as Finance Manager, Business Development for Ortho-McNeil, a subsidiary of the Company, and through the years held a variety of senior leadership roles in several segments and functions across the Company's subsidiaries, in Pharmaceuticals, Medical Devices and Supply Chain.
Removed
Wolk plays a strategic role in the overall management of the Company, and leads the development and execution of the Company's global long-term financial strategy. 19 PART II

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

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Biggest changePrice Paid Per Share Total Number of Shares (or Units) Purchased as Part of Publicly Announced Plans or Programs (2) Maximum Number (or Approximate Dollar Value) of Shares (or Units) that May Yet Be Purchased Under the Plans or Programs (3) October 3, 2022 through October 30, 2022 3,921,949 $ 165.29 3,179,491 - October 31, 2022 through November 27, 2022 1,444,006 173.26 - - November 28, 2022 through January 1, 2023 2,379,100 178.18 - - Total 7,745,055 3,179,491 13,876,567 (1) During the fiscal fourth quarter of 2022, the Company repurchased an aggregate of 7,745,055 shares of Johnson & Johnson Common Stock in open-market transactions, of which 3,179,491 shares were purchased pursuant to the repurchase program that was publicly announced on September 14, 2022, and of which 4,565,564 shares were purchased as part of a systematic plan to meet the needs of the Company’s compensation programs.
Biggest changePrice Paid Per Share Total Number of Shares (or Units) Purchased as Part of Publicly Announced Plans or Programs Maximum Number (or Approximate Dollar Value) of Shares (or Units) that May Yet Be Purchased Under the Plans or Programs September 30, 2024 through October 27, 2024 621,412 $163.13 — — October 28, 2024 through November 24, 2024 831,866 $158.98 — — November 25, 2024 through December 29, 2024 150,000 $152.96 — — Total 1,603,278 — (1) During the fiscal fourth quarter of 2024, the Company repurchased an aggregate of 1,603,278 shares of Johnson & Johnson Common Stock in open-market transactions, all of which were purchased as part of a systematic plan to meet the needs of the Company’s compensation programs.
Item 5. MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES As of February 10, 2023, there were 124,211 record holders of common stock of the Company.
Item 5. Market for registrant’s common equity, related stockholder matters and issuer purchases of equity securities As of February 6, 2025, there were 114,147 record holders of common stock of the Company.
Additional information called for by this item is incorporated herein by reference to the following sections of this Report: Note 16 “Common Stock, Stock Option Plans and Stock Compensation Agreements” of the Notes to Consolidated Financial Statements included in Item 8; and Item 12 “Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters – Equity Compensation Plan Information.” Issuer Purchases of Equity Securities On September 14, 2022, the Company announced that its Board of Directors approved a share repurchase program, authorizing the Company to purchase up to $5.0 billion of the Company's Common Stock.
Additional information called for by this item is incorporated herein by reference to the following sections of this Report: Note 16 “Common Stock, Stock Option Plans and Stock Compensation Agreements” of the Notes to Consolidated Financial Statements included in Item 8; and Item 12 “Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters – Equity Compensation Plan Information.” Issuer purchases of equity securities The following table provides information with respect to common stock purchases by the Company during the fiscal fourth quarter of 2024.
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Share repurchases may be made at management’s discretion from time to time on the open market or through privately negotiated transactions. The repurchase program has no time limit and may be suspended for periods or discontinued at any time. The following table provides information with respect to common stock purchases by the Company during the fiscal fourth quarter of 2022.
Removed
(2) As of January 1, 2023, an aggregate of 15,411,776 shares were purchased for a total of $2.5 billion since the inception of the repurchase program announced on September 14, 2022.
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(3) As of January 1, 2023, the maximum number of shares that may yet be purchased under the plan is 13,876,567 based on the closing price of Johnson & Johnson Common Stock on the New York Stock Exchange on December 30, 2022 of $176.65 per share.

Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

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Biggest changeMajor Pharmaceutical Therapeutic Area Sales*: Total Operations Currency (Dollars in Millions) 2022 2021 Change Change Change Total Immunology $ 16,935 16,750 1.1 % 4.8 % (3.7) % REMICADE 2,343 3,190 (26.6) (25.3) (1.3) SIMPONI/SIMPONI ARIA 2,184 2,276 (4.0) 1.0 (5.0) STELARA 9,723 9,134 6.5 10.4 (3.9) TREMFYA 2,668 2,127 25.4 30.1 (4.7) Other Immunology 17 24 (28.2) (28.2) 0.0 Total Infectious Diseases 5,449 5,825 (6.5) 0.8 (7.3) COVID-19 VACCINE 2,179 2,385 (8.6) 2.0 (10.6) EDURANT/rilpivirine 1,008 994 1.5 11.8 (10.3) PREZISTA/ PREZCOBIX/REZOLSTA/ SYMTUZA 1,943 2,083 (6.7) (4.4) (2.3) Other Infectious Diseases (2) 318 363 (12.3) (7.2) (5.1) Total Neuroscience 6,893 6,988 (1.4) 3.4 (4.8) CONCERTA/methylphenidate 644 667 (3.5) 4.1 (7.6) INVEGA SUSTENNA/XEPLION/ INVEGA TRINZA/TREVICTA 4,140 4,022 3.0 6.9 (3.9) RISPERDAL CONSTA 485 592 (18.1) (13.0) (5.1) Other Neuroscience (2) 1,623 1,706 (4.9) 0.4 (5.3) Total Oncology 15,983 14,548 9.9 16.9 (7.0) DARZALEX 7,977 6,023 32.4 39.5 (7.1) ERLEADA 1,881 1,291 45.7 53.0 (7.3) IMBRUVICA 3,784 4,369 (13.4) (7.6) (5.8) ZYTIGA /abiraterone acetate 1,770 2,297 (22.9) (13.6) (9.3) Other Oncology 571 568 0.6 6.0 (5.4) Total Pulmonary Hypertension 3,417 3,450 (1.0) 3.0 (4.0) OPSUMIT 1,783 1,819 (2.0) 2.6 (4.6) UPTRAVI 1,322 1,237 6.9 8.6 (1.7) Other Pulmonary Hypertension 313 395 (20.8) (13.1) (7.7) Total Cardiovascular / Metabolism / Other 3,887 4,119 (5.6) (4.0) (1.6) XARELTO 2,473 2,438 1.4 1.4 — INVOKANA/ INVOKAMET 448 563 (20.4) (17.2) (3.2) Other (1,2) 966 1,119 (13.6) (9.3) (4.3) Total Pharmaceutical Sales $ 52,563 51,680 1.7 % 6.7 % (5.0) % *Certain prior year amounts have been reclassified to conform to current year presentation (1) Inclusive of PROCRIT / EPREX which was previously disclosed separately (2) Fiscal 2021 reflects approximately $0.4 billion of certain international OTC products, primarily in China, which were reclassified from the Pharmaceutical segment to the Consumer Health segment based on operational changes 24 Immunology products achieved sales of $16.9 billion in 2022, representing an increase of 1.1% as compared to the prior year.
Biggest changeIn fiscal 2024, the net impact of the Covid-19 Vaccine on the total Innovative Medicine and International change in operational sales was a negative 1.8% and 4.2%, respectively. 24 Major Innovative Medicine therapeutic area sales: (Dollars in Millions) 2024 2023 Total Change Operations Change Currency Change Total Immunology $17,828 $18,052 (1.2 %) 0.4 % (1.6) % REMICADE 1,605 1,839 (12.8) (11.4) (1.4) SIMPONI/SIMPONI ARIA 2,190 2,197 (0.3) 4.5 (4.8) STELARA 10,361 10,858 (4.6) (3.4) (1.2) TREMFYA 3,670 3,147 16.6 18.1 (1.5) Other Immunology 3 11 (74.1) (74.1) — Total Infectious Diseases 3,396 4,418 (23.1) (22.7) (0.4) COVID-19 VACCINE 198 1,117 (82.4) (82.4) 0.0 EDURANT/rilpivirine 1,272 1,150 10.6 10.6 0.0 PREZISTA/PREZCOBIX/REZOLSTA/SYMTUZA 1,712 1,854 (7.7) (7.1) (0.6) Other Infectious Diseases 214 297 (27.6) (25.0) (2.6) Total Neuroscience 7,115 7,140 (0.4) 1.3 (1.7) CONCERTA/methylphenidate 641 783 (18.1) (15.1) (3.0) INVEGA SUSTENNA/XEPLION/INVEGA TRINZA/TREVICTA 4,222 4,115 2.6 3.4 (0.8) SPRAVATO 1,077 689 56.4 56.8 (0.4) Other Neuroscience 1,175 1,553 (24.3) (20.7) (3.6) Total Oncology 20,781 17,661 17.7 19.8 (2.1) CARVYKTI 963 500 92.7 92.7 0.0 DARZALEX 11,670 9,744 19.8 22.2 (2.4) ERLEADA 2,999 2,387 25.6 27.3 (1.7) IMBRUVICA 3,038 3,264 (6.9) (5.2) (1.7) TECVAYLI 549 395 38.8 39.8 (1.0) ZYTIGA /abiraterone acetate 631 887 (28.8) (25.0) (3.8) Other Oncology 931 484 92.5 94.3 (1.8) Total Pulmonary Hypertension 4,282 3,815 12.3 14.1 (1.8) OPSUMIT 2,184 1,973 10.7 11.9 (1.2) UPTRAVI 1,817 1,582 14.9 16.1 (1.2) Other Pulmonary Hypertension 281 260 7.9 18.3 (10.4) Total Cardiovascular / Metabolism / Other 3,562 3,671 (3.0) (2.6) (0.4) XARELTO 2,373 2,365 0.3 0.3 — Other 1,189 1,306 (8.9) (7.8) (1.1) Total Innovative Medicine Sales $56,964 54,759 4.0 % 5.7 % (1.7) % 2024 Annual Report 25 Immunology products sales were $17.8 billion in 2024, representing a decrease of 1.2% as compared to the prior year.
Rebates are estimated based on contractual terms, historical experience, patient outcomes, trend analysis and projected market conditions in the various markets served. The Company evaluates market conditions for products or groups of products primarily through the analysis of wholesaler and other third-party sell-through and market research data, as well as internally generated information.
Rebates and discounts are estimated based on contractual terms, historical experience, patient outcomes, trend analysis and projected market conditions in the various markets served. The Company evaluates market conditions for products or groups of products primarily through the analysis of wholesaler and other third-party sell-through and market research data, as well as internally generated information.
The preparation of these financial statements requires that management make estimates and assumptions that affect the amounts reported for revenues, expenses, assets, liabilities and other related disclosures. Actual results may or may not differ from these estimates.
(GAAP). The preparation of these financial statements requires that management make estimates and assumptions that affect the amounts reported for revenues, expenses, assets, liabilities and other related disclosures. Actual results may or may not differ from these estimates.
The policy impacts contract pharmacy transactions involving non-grantee 340B covered entities for most of the Company’s drugs, subject to multiple exceptions. Both grantee and non-grantee covered entities can maintain certain contract pharmacy arrangements under policy exceptions.
This policy impacts contract pharmacy transactions involving non-grantee 340B covered entities for most of the Company’s drugs, subject to multiple exceptions. Both grantee and non-grantee covered entities can maintain certain contract pharmacy arrangements under policy exceptions.
The Company has accrued for these matters and will continue to monitor each related legal issue and adjust accruals as might be warranted based 38 on new information and further developments in accordance with ASC 450-20-25.
The Company has accrued for these matters and will continue to monitor each related legal issue and adjust accruals as might be warranted based on new information and further developments in accordance with ASC 450-20-25, Contingencies.
A 1% change in the spread between U.S. and foreign interest rates on the Company’s interest rate sensitive financial instruments would either increase or decrease the unrealized value of the Company’s swap contracts by approximately $1.7 billion.
A 1% change in the spread between U.S. and foreign interest rates on the Company’s interest rate sensitive financial instruments would either increase or decrease the unrealized value of the Company’s swap contracts by approximately $1.5 billion.
A 1% (100 basis points) change in spread on the Company’s interest rate sensitive investments would either increase or decrease the unrealized value of cash equivalents and current marketable securities by less than $0.1 billion. The Company has access to substantial sources of funds at numerous banks worldwide.
A 1% (100 basis points) change in spread on the Company’s interest rate sensitive investments would either increase or decrease the unrealized value of cash equivalents and current marketable securities by less than $8.0 million. The Company has access to substantial sources of funds at numerous banks worldwide.
In response to these concerns, the Company has a long-standing policy of pricing products responsibly. For the period 2012 - 2022, in the U.S., the weighted average compound annual growth rate of the Company’s net price increases for healthcare products (prescription and over-the-counter drugs, hospital and professional products) was below the U.S. Consumer Price Index (CPI).
In response to these concerns, the Company has a long-standing policy of pricing products responsibly. For the period 2014 - 2024, in the U.S., the weighted average compound annual growth rate of the Company’s net price increases for healthcare products (prescription and over-the-counter drugs, hospital and professional products) was below the U.S. Consumer Price Index (CPI).
Item 7. MANAGEMENT’S DISCUSSION AND ANALYSIS OF RESULTS OF OPERATIONS AND FINANCIAL CONDITION Organization and Business Segments Description of the Company and Business Segments Johnson & Johnson and its subsidiaries (the Company) have approximately 152,700 employees worldwide engaged in the research and development, manufacture and sale of a broad range of products in the healthcare field.
Item 7. Management’s discussion and analysis of results of operations and financial condition Organization and business segments Description of the company and business segments Johnson & Johnson and its subsidiaries (the Company) have approximately 138,100 employees worldwide engaged in the research and development, manufacture and sale of a broad range of products in the healthcare field.
Dollar as compared to all foreign currencies in which the Company had sales, income or expense in 2022 would have increased or decreased the translation of foreign sales by approximately $0.5 billion and net income by approximately $0.1 billion.
Dollar as compared to all foreign currencies in which the Company had sales, income or expense in 2024 would have increased or decreased the translation of foreign sales by approximately $0.4 billion and net income by approximately $0.1 billion.
New Accounting Pronouncements Refer to Note 1 to the Consolidated Financial Statements for recently adopted accounting pronouncements and recently issued accounting pronouncements not yet adopted as of January 1, 2023. 37 Economic and Market Factors The Company is aware that its products are used in an environment where, for more than a decade, policymakers, consumers and businesses have expressed concerns about the rising cost of healthcare.
New accounting pronouncements Refer to Note 1 to the Consolidated Financial Statements for recently adopted accounting pronouncements and recently issued accounting pronouncements not yet adopted as of December 29, 2024. 40 Economic and market factors The Company is aware that its products are used in an environment where, for more than a decade, policymakers, consumers and businesses have expressed concerns about the rising cost of healthcare.
Sales returns are estimated and recorded based on historical sales and returns information. Products that exhibit unusual sales or return patterns due to dating, competition or other marketing matters are specifically investigated and analyzed as part of the accounting for sales return accruals.
Sales returns are estimated and recorded based on historical sales and returns information. Products that have lost patent exclusivity, or that otherwise exhibit unusual sales or return patterns due to dating, competition or other marketing matters are specifically investigated and analyzed as part of the accounting for sales return accruals.
In addition to accruals in the self insurance program, claims that exceed the insurance coverage are accrued when losses are probable and amounts can be reasonably estimated. The Company follows the provisions of U.S. GAAP when recording litigation related contingencies. A liability is recorded when a loss is probable and can be reasonably estimated.
In addition to accruals in the self insurance program, claims that exceed the insurance coverage are accrued when losses are probable and amounts can be reasonably estimated. The Company follows the provisions of U.S. GAAP when recording litigation related contingencies.
The Company records accruals for loss contingencies associated with these legal matters when it is probable that a liability will be incurred and the amount of the loss can be reasonably estimated. As of January 1, 2023, the Company has determined that the liabilities associated with certain litigation matters are probable and can be reasonably estimated.
The Company records accruals for loss contingencies associated with these legal matters when it is probable that a liability will be incurred and the amount of the loss can be reasonably estimated. As of December 29, 2024, the Company has determined that the liabilities associated with certain litigation matters are probable and can be reasonably estimated.
U.S. sales were $13.4 billion, an increase of 5.4% as compared to the prior year. International sales were $14.1 billion, a decrease of 2.3% as compared to the prior year, which included operational growth of 6.9% and a negative currency impact of 9.2%.
U.S. sales were $16.3 billion, an increase of 6.9% as compared to the prior year. International sales were $15.5 billion, an increase of 2.6% as compared to the prior year, which included operational growth of 5.4% and a negative currency impact of 2.8%.
The sales returns reserve for the total Company has been approximately 1.0% of annual net trade sales during the fiscal years 2022, 2021 and 2020. Promotional programs, such as product listing allowances and cooperative advertising arrangements, are recorded in the same period as related sales. Continuing promotional programs include coupons and volume-based sales incentive programs.
The sales returns reserve for the total Company has been approximately 1.0% of annual net trade sales during the fiscal years 2024, 2023 and 2022. Promotional programs, such as product listing allowances are recorded in the same period as related sales and include volume-based sales incentive programs.
The Company currently discloses the impact of changes to assumptions in the quarterly or annual filing in which there is a material financial statement impact. 34 Below are tables that show the progression of accrued rebates, returns, promotions, reserve for doubtful accounts and reserve for cash discounts by segment of business for the fiscal years ended January 1, 2023 and January 2, 2022.
The Company currently discloses the impact of changes to assumptions in the quarterly or annual filing in which there is a material financial statement impact. 2024 Annual Report 37 Below are tables that show the progression of accrued rebates, returns, promotions, reserve for doubtful accounts and reserve for cash discounts by segment of business for the fiscal years ended December 29, 2024 and December 31, 2023.
In addition, the Company monitors the global capital markets on an ongoing basis and from time to time may raise capital when market conditions are favorable. Effective beginning in fiscal 2022, the U.S.
In addition, the Company monitors the global capital markets on an ongoing basis and from time to time may raise capital when market conditions are favorable.
Employees are empowered and inspired to lead with Our Credo and purpose as guides. This allows every employee to use the Company’s reach and size to advance the Company’s purpose, and to also lead with agility and urgency. Leveraging the extensive resources across the enterprise enables the Company to innovate and execute with excellence.
This allows every employee to use the Company’s reach and size to advance the Company’s purpose, and to also lead with agility and urgency. Leveraging the extensive resources across the enterprise enables the Company to innovate and execute with excellence.
The Company anticipates that operating cash flows, the ability to raise funds from external sources, borrowing capacity from existing committed credit facilities and access to the commercial paper markets will continue to provide sufficient resources to fund operating needs, including the Company's remaining balance to be paid on the agreement to settle opioid litigation for approximately $2.7 billion and the establishment of the $2.0 billion trust for talc related liabilities (See Note 19 to the Consolidated Financial Statements for additional details).
The Company anticipates that operating cash flows, the ability to raise funds from external sources, borrowing capacity from existing committed credit facilities and access to the commercial paper markets will continue to provide sufficient resources to fund operating needs, including the Company's remaining balance to be paid on the agreement to settle opioid litigation for approximately $1.5 billion and the approximately $11.6 billion ($13.5 billion nominal) reserve for talc matters (See Note 19 to the Consolidated Financial Statements for additional details).
See Note 1 to the Consolidated Financial Statements for additional disclosures on collaborations. Reasonably likely changes to assumptions used to calculate the accruals for rebates, returns and promotions are not anticipated to have a material effect on the financial statements.
Reasonably likely changes to assumptions used to calculate the accruals for rebates, returns and promotions are not anticipated to have a material effect on the financial statements.
The primary sources and uses of cash that contributed to the $0.4 billion decrease were: (Dollars In Billions) $ 14.5 Q4 2021 Cash and cash equivalents balance 21.2 cash generated from operating activities (12.4) net cash used by investing activities (8.9) net cash used by financing activities $ (0.3) effect of exchange rate and rounding $ 14.1 Q4 2022 Cash and cash equivalents balance In addition, the Company had $9.4 billion in marketable securities at the end of fiscal year 2022 and $17.1 billion at the end of fiscal year 2021.
The primary sources and uses of cash that contributed to the $2.2 billion increase were: (Dollars in billions) $21.9 Q4 2023 Cash and cash equivalents balance 24.3 cash generated from operating activities (18.6) net cash used by investing activities (3.1) net cash used by financing activities (0.4) effect of exchange rate and rounding $24.1 Q4 2024 Cash and cash equivalents balance In addition, the Company had $0.4 billion in marketable securities at the end of fiscal year 2024 and $1.1 billion at the end of fiscal year 2023.
These sales changes consisted of the following: Sales increase/(decrease) due to: 2022 2021 Volume 6.9 % 12.9 % Price (0.8) (0.7) Currency (4.8) 1.4 Total 1.3 % 13.6 % The net impact of acquisitions and divestitures on the worldwide sales growth was a negative impact of 0.1% in 2022 and a negative impact of 0.6% in 2021.
These sales changes consisted of the following: Sales increase/(decrease) due to: 2024 2023 Volume 5.9 % 6.8 % Price 0.0 0.6 Currency (1.6) (0.9) Total 4.3 % 6.5 % The net impact of acquisitions and divestitures on the worldwide sales growth was a positive impact of 0.5% in 2024 and a positive impact of 1.5% in 2023.
The development of new and innovative products, as well as protecting the underlying intellectual property of the Company's product portfolio, is important to the Company’s success in all areas of its business. The competitive environment requires substantial investments in continuing research.
The development of new and innovative products, as well as protecting the underlying intellectual property of the Company's product portfolio, is important to the Company’s success in all areas of its business. The competitive environment requires substantial investments in continuing research. Management’s objectives With Our Credo as the foundation, the Company believes health is everything.
The five-year compound annual growth rates for worldwide, U.S. and international sales were 4.4%, 4.0% and 4.9%, respectively. The ten-year compound annual growth rates for worldwide, U.S. and international sales were 3.5%, 5.0% and 2.2%, respectively.
The five-year compound annual growth rates for worldwide, U.S. and international sales were 5.4%, 6.8% and 3.8%, respectively.
Russia-Ukraine War Although the long-term implications of Russia’s invasion of Ukraine are difficult to predict at this time, the financial impact of the conflict in the fiscal 2022, including accounts receivable or inventory reserves, was not material.
Conflict in the Middle East Although the long-term implications of the conflict in the Middle East are difficult to predict at this time, the financial impact of the conflict in the fiscal year 2024, including accounts receivable or inventory reserves, was not material.
Sales by companies in the Asia-Pacific, Africa region experienced a decline of 2.8% as compared to the prior year, including operational growth of 6.2% and a negative currency impact of 9.0%. In 2022, the Company utilized three wholesalers distributing products for all three segments that represented approximately 16.5%, 13.0% and 12.0% of the total consolidated revenues.
Sales by companies in the Asia-Pacific, Africa region experienced a decline of 1.2% as compared to the prior year, including operational growth of 2.3% offset by a negative currency impact of 3.5%. In 2024, the Company utilized three wholesalers distributing products for both segments that represented approximately 20.5%, 15.6% and 12.3% of the total gross revenues.
Common Stock The Company’s Common Stock is listed on the New York Stock Exchange under the symbol JNJ. As of February 10, 2023, there were 124,211 record holders of Common Stock of the Company.
Common stock The Company’s Common Stock is listed on the New York Stock Exchange under the symbol JNJ. As of February 6, 2025, there were 114,147 record holders of Common Stock of the Company.
This ensures the Company can remain focused on addressing the unmet needs of society every day and invest for an enduring impact, ultimately delivering value to its patients, consumers and healthcare professionals, employees, communities and shareholders. 21 Results of Operations Analysis of Consolidated Sales For discussion on results of operations and financial condition pertaining to the fiscal years 2021 and 2020 see the Company’s Annual Report on Form 10-K for the fiscal year ended January 2, 2022, Item 7.
This ensures the Company can remain focused on addressing the unmet needs of society every day and invest for an enduring impact, ultimately delivering value to its patients, consumers and healthcare professionals, employees, communities and shareholders. 22 Research & development Acquisitions* (net of cash acquired) Dividends paid per share * Includes business combinations and asset acquisitions Results of operations Analysis of consolidated sales For discussion on results of operations and financial condition pertaining to the fiscal years 2023 and 2022 see the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2023, Item 7.
In 2022, the net impact of acquisitions and divestitures on the MedTech segment worldwide operational sales growth was a positive 0.1%.
In 2024, the net impact of acquisitions and divestitures on the MedTech segment worldwide operational sales growth was a positive 1.5% primarily related to the Shockwave acquisition.
International sales were $8.4 billion, a decrease of 1.9%, which included 5.3% operational growth and a negative currency impact of 7.2%. In 2022, acquisitions and divestitures had a net negative impact of 0.3% on the operational sales growth of the worldwide Consumer Health segment.
U.S. sales were $34.0 billion, an increase of 9.0%. International sales were $23.0 billion, a decrease of 2.5%, which included operational growth of 1.3% offset by a negative currency impact of 3.8%. In 2024, acquisitions and divestitures had a net negative impact of 0.1% on the operational sales growth of the worldwide Innovative Medicine segment.
Liquidity and Capital Resources Liquidity & Cash Flows Cash and cash equivalents were $14.1 billion at the end of 2022 as compared to $14.5 billion at the end of 2021.
Liquidity and capital resources Liquidity & cash flows Cash and cash equivalents were $24.1 billion at the end of 2024 as compared to $21.9 billion at the end of 2023.
See Notes 1 and 19 to the Consolidated Financial Statements for further information regarding product liability and legal proceedings. 36 Long-Lived and Intangible Assets: The Company assesses changes, both qualitatively and quantitatively, in economic conditions and makes assumptions regarding estimated future cash flows in evaluating the value of the Company’s property, plant and equipment, goodwill and intangible assets.
Long-Lived and Intangible Assets: The Company assesses changes, both qualitatively and quantitatively, in economic conditions and makes assumptions regarding estimated future cash flows in evaluating the value of the Company’s property, plant and equipment, goodwill and intangible assets.
Cash, cash equivalents and marketable securities totaled $23.5 billion at the end of 2022, and averaged $27.6 billion as compared to the cash, cash equivalents and marketable securities total of $31.6 billion and $28.4 billion average cash balance in 2021.
Cash, cash equivalents and marketable securities totaled $24.5 billion at the end of 2024, and averaged $23.7 billion as compared to the cash, cash equivalents and marketable securities total of $22.9 billion and $22.6 billion average balance in 2023.
See Note 1 to the Consolidated Financial Statements for additional details on cash, cash equivalents and marketable securities. 31 Cash flow from operations of $21.2 billion was the result of: (Dollars In Billions) $ 17.9 Net Earnings 7.3 non-cash expenses and other adjustments primarily for depreciation and amortization, stock-based compensation and asset write-downs partially offset by the deferred tax provision, net gain on sale of assets/businesses and credit losses and accounts receivable allowances (2.0) a decrease in current and non-current liabilities 0.7 a decrease in other current and non-current assets 1.1 an increase in accounts payable and accrued liabilities (3.8) an increase in accounts receivable and inventories $ 21.2 Cash Flow from operations Investing activities use of $12.4 billion of cash was primarily used for: (Dollars In Billions) $ (4.0) additions to property, plant and equipment (17.7) acquisitions 0.5 proceeds from the disposal of assets/businesses, net 9.2 net sales of investments (0.2) Credit support agreements activity, net (0.2) other (primarily licenses and milestones) and rounding $ (12.4) Net cash used for investing activities Financing activities use of $8.9 billion of cash was primarily used for: (Dollars In Billions) $ (11.7) dividends to shareholders (6.0) repurchase of common stock 7.5 net proceeds from short and long term debt 1.3 proceeds from stock options exercised/employee withholding tax on stock awards, net $ (8.9) Net cash used for financing activities As of January 1, 2023, the Company's notes payable and long-term debt was in excess of cash, cash equivalents and marketable securities.
Cash flow from operations of $24.3 billion was the result of: (Dollars In billions) $14.1 Net Earnings 8.4 non-cash expenses and other adjustments primarily for depreciation and amortization, stock-based compensation, asset write-downs and charges for acquired in-process research and development assets partially offset by net gain on sale of assets/businesses and the deferred tax provision 1.7 a decrease in other current and non-current assets 1.6 an increase in accounts payable and accrued liabilities (1.5) an increase in accounts receivable and inventories $24.3 Cash flow from operations 2024 Annual Report 33 Cash flow used for investing activities of $18.6 billion was primarily due to: (Dollars in billions) $(4.4) additions to property, plant and equipment (15.1) acquisitions, net of cash acquired 0.7 proceeds from the disposal of assets/businesses, net (1.8) acquired in-process research and development assets 0.7 net sales of investments 1.5 credit support agreements activity, net (0.2) other (including capitalized licenses and milestones) $(18.6) Net cash used for investing activities Cash flow used for financing activities of $3.1 billion was primarily due to: (Dollars in billions) $(11.8) dividends to shareholders (2.4) repurchase of common stock 11.0 net proceeds from short and long-term debt 0.8 proceeds from stock options exercised/employee withholding tax on stock awards, net 0.3 credit support agreements activity, net (1.0) settlement of convertible debt acquired from Shockwave $(3.1) Net cash used for financing activities The following table summarizes cash taxes paid net of refunds: (Dollars in Millions) 2024 2023 2022 U.S.
Dollar from the January 1, 2023 market rates would decrease the unrealized value of the Company’s forward contracts by $0.1 billion. In either scenario, the gain or loss on the forward contract would be offset by the gain or loss on the underlying transaction, and therefore, would have no impact on future anticipated earnings and cash flows.
In either scenario, the gain or loss on the forward contract would be offset by the gain or loss on the underlying transaction, and therefore, would have no impact on future anticipated earnings and cash flows.
The Company has accounted for operations in Argentina and Venezuela as highly inflationary, as the prior three-year cumulative inflation rate surpassed 100%. Beginning in the fiscal second quarter of 2022, the Company accounted for operations in Turkey as highly inflationary, as the prior three-year cumulative inflation rate surpassed 100%.
The Company has accounted for operations in Argentina, Venezuela, Turkey and Egypt (beginning in the fiscal fourth quarter of 2024) as highly inflationary, as the prior three-year cumulative inflation rate surpassed 100%. This did not have a material impact to the Company's results in the period.
Sales by companies in the Western Hemisphere, excluding the U.S., achieved growth of 6.5% as compared to the prior year, which included operational growth of 10.2%, and a negative currency impact of 3.7%.
In fiscal 2024, the net impact of the Covid-19 Vaccine on the European regions change in operational sales was a negative 4.7%. Sales by companies in the Western Hemisphere, excluding the U.S., achieved growth of 3.6% as compared to the prior year, which included operational growth of 20.4%, and a negative currency impact of 16.8%.
The MedTech segment includes a broad portfolio of products used in the Orthopaedic, Surgery, Interventional Solutions (cardiovascular and neurovascular) and Vision fields. These products are distributed to wholesalers, hospitals and retailers, and used principally in the professional fields by physicians, nurses, hospitals, eye care professionals and clinics.
These products are distributed to wholesalers, hospitals and retailers, and used principally in the professional fields by physicians, nurses, hospitals, eye care professionals and clinics.
In addition, the Company enters into collaboration arrangements that contain multiple revenue generating activities. Amounts due from collaborative partners for these arrangements are recognized as each activity is performed or delivered, based on the relative selling price. Upfront fees received as part of these arrangements are deferred and recognized over the performance period.
Amounts due from collaborative partners for these arrangements are recognized as each activity is performed or delivered, based on the relative selling price. Upfront fees received as part of these arrangements are deferred and recognized over the performance period. See Note 1 to the Consolidated Financial Statements for additional disclosures on collaborations.
Other Information Critical Accounting Policies and Estimates Management’s discussion and analysis of results of operations and financial condition are based on the Company’s consolidated financial statements that have been prepared in accordance with accounting principles generally accepted in the U.S. (GAAP).
On January 2, 2025, the Board of Directors declared a regular cash dividend of $1.24 per share, payable on March 4, 2025 to shareholders of record as of February 18, 2025. 36 Other information Critical accounting policies and estimates Management’s discussion and analysis of results of operations and financial condition are based on the Company’s consolidated financial statements that have been prepared in accordance with accounting principles generally accepted in the U.S.
The Company conducts business in virtually all countries of the world with the primary focus on products related to human health and well-being. The Company is organized into three business segments: Consumer Health, Pharmaceutical and MedTech.
The Company conducts business in virtually all countries of the world with the primary focus on products related to human health and well-being. The Company is organized into two business segments: Innovative Medicine and MedTech. The Innovative Medicine segment is focused on the following therapeutic areas: Immunology, Infectious Diseases, Neuroscience, Oncology, Pulmonary Hypertension, and Cardiovascular and Metabolism.
The redemption cost of consumer coupons is based on historical redemption experience by product and value. Volume-based incentive programs are based on the estimated sales volumes for the incentive period and are recorded as products are sold. These arrangements are evaluated to determine the appropriate amounts to be deferred or recorded as a reduction of revenue.
Volume-based incentive programs are based on the estimated sales volumes for the incentive period and are recorded as products are sold. These arrangements are evaluated to determine the appropriate amounts to be deferred or recorded as a reduction of revenue. The Company also earns profit-share payments through collaborative arrangements of certain products, which are included in sales to customers.
As a percent to sales, consolidated earnings before provision for taxes on income was 22.9% and 24.3%, in 2022 and 2021, respectively. (Dollars in billions. Percentages in chart are as a percent to total sales) Cost of Products Sold and Selling, Marketing and Administrative Expenses: (Dollars in billions.
Percentages in chart are as a percent to total sales) Cost of products sold and selling, marketing and administrative expenses: Cost of products sold Selling, marketing & administrative (Dollars in billions.
Interest charged on borrowings under the credit line agreement is based on either Secured Overnight Financing Rate (SOFR) Reference Rate or other applicable market rate as allowed plus applicable margins. Commitment fees under the agreement are not material. Total borrowings at the end of 2022 and 2021 were $39.7 billion and $33.8 billion, respectively.
In June 2024, the Company secured a new 364-day Credit Facility of $10 billion, which expires on June 25, 2025. Interest charged on borrowings under the credit line agreement is based on either Secured Overnight Financing Rate (SOFR) Reference Rate or other applicable market rate as allowed plus applicable margins. Commitment fees under the agreement are not material.
Changes in the behavior and spending patterns of purchasers of healthcare products and services, including delaying medical procedures, rationing prescription medications, reducing the frequency of physician visits and foregoing healthcare insurance coverage, as a result of the current global economic downturn, may continue to impact the Company’s businesses.
The Company faces various worldwide healthcare changes that may continue to result in pricing pressures that include healthcare cost containment and government legislation relating to sales, promotions, pricing and reimbursement of healthcare products. 2024 Annual Report 41 Changes in the behavior and spending patterns of purchasers of healthcare products and services, including delaying medical procedures, rationing prescription medications, reducing the frequency of physician visits and foregoing healthcare insurance coverage may continue to impact the Company’s businesses.
Gains or losses on these contracts are offset by the gains or losses on the underlying transactions. A 10% appreciation of the U.S. Dollar from the January 1, 2023 market rates would increase the unrealized value of the Company’s forward contracts by $0.1 billion. Conversely, a 10% depreciation of the U.S.
Dollar from the December 29, 2024 market rates would increase the unrealized value of the Company’s forward contracts by $0.2 billion. Conversely, a 10% depreciation of the U.S. Dollar from the December 29, 2024 market rates would decrease the unrealized value of the Company’s forward contracts by $0.2 billion.
In 2022, sales by companies in Europe experienced a decline of 0.6% as compared to the prior year, which included operational growth of 11.0% and a negative currency impact of 11.6%.
The ten-year compound annual growth rates for worldwide, U.S. and international sales were 4.0%, 5.4% and 2.5%, respectively. 2024 Annual Report 23 In 2024, sales by companies in Europe experienced a decline of 1.0% as compared to the prior year, which included an operational decline of 0.6% and a negative currency impact of 0.4%.
This did not have a material impact to the Company's results in the period. In the face of increasing costs, the Company strives to maintain its profit margins through cost reduction programs, productivity improvements and periodic price increases.
In the face of increasing costs, the Company strives to maintain its profit margins through cost reduction programs, productivity improvements and periodic price increases. In July 2023, Janssen Pharmaceuticals, Inc. (Janssen) filed litigation against the U.S.
Sales returns in the Consumer Health and Pharmaceutical segments are almost exclusively not resalable. Sales returns for certain franchises in the MedTech segment are typically resalable but are not material. The Company infrequently exchanges products from inventory for returned products.
GAAP guidance for revenue recognition when right of return exists. Sales returns reserves are recorded at full sales value. Sales returns in the Innovative Medicine segment are almost exclusively not resalable. Sales returns for certain franchises in the MedTech segment are typically resalable but are not material. The Company infrequently exchanges products from inventory for returned products.
The Company also earns profit-share payments through collaborative arrangements of certain products, which are included in sales to customers. Profit-share payments were less than 2.0% of the total revenues in fiscal year 2022 and less than 3.0% of the total revenues in fiscal years 2021 and 2020 and are included in sales to customers.
Profit-share payments were less than 2.0% of the total revenues in fiscal year 2024 and 2023, respectively, and less than 3.0% of the total revenues in the fiscal year 2022 and are included in sales to customers. In addition, the Company enters into collaboration arrangements that contain multiple revenue generating activities.
The operational sales growth of OPSUMIT (macitentan) and UPTRAVI (selexipag) due to continued share gains and market growth was offset by COVID-19 related impacts and continued declines in Other Pulmonary Hypertension. Cardiovascular/Metabolism/Other products sales were $3.9 billion, a decline of 5.6% as compared to the prior year.
Pulmonary Hypertension products sales were $4.3 billion, representing an increase of 12.3% as compared to the prior year. Sales growth of both OPSUMIT (macitentan) and UPTRAVI (selexipag) was driven by market growth and share gains. Growth in Other Pulmonary Hypertension was driven by OPSYNVI (macitentan/tadalafil).
Biosimilar versions of REMICADE have been introduced in the United States and certain markets outside the United States and additional competitors continue to enter the market. Continued infliximab biosimilar competition will result in a further reduction in sales of REMICADE. The latest expiring United States patent for STELARA (ustekinumab) will expire in September 2023.
According to patent settlement and license agreements, the Company expects continued launches of biosimilar versions of STELARA in Europe and the United States in 2025 which will impact the Company’s sales of STELARA. Biosimilar versions of REMICADE have been introduced in the United States and certain markets outside the United States and additional competitors continue to enter the market.
Financing and Market Risk The Company uses financial instruments to manage the impact of foreign exchange rate changes on cash flows. Accordingly, the Company enters into forward foreign exchange contracts to protect the value of certain foreign currency assets and liabilities and to hedge future foreign currency transactions primarily related to product costs.
Accordingly, the Company enters into forward foreign exchange contracts to protect the value of certain foreign currency assets and liabilities and to hedge future foreign currency transactions primarily related to product costs. Gains or losses on these contracts are offset by the gains or losses on the underlying transactions. A 10% appreciation of the U.S.
Shareholders’ equity per share at the end of 2022 was $29.39 compared to $28.16 at year-end 2021. A summary of borrowings can be found in Note 7 to the Consolidated Financial Statements. 33 Dividends The Company increased its dividend in 2022 for the 60th consecutive year.
Total debt represented 34.0% of total capital (shareholders’ equity and total debt) in 2024 and 30.0% of total capital in 2023. Shareholders’ equity per share at the end of 2024 was $29.70 compared to $28.57 at year-end 2023. A summary of borrowings can be found in Note 7 to the Consolidated Financial Statements.
As of both the fiscal years ending January 1, 2023 and January 2, 2022, the business of the Company’s Ukraine subsidiaries represented less than 1% of the Company’s consolidated assets and revenues.
As of and for each of the fiscal years ending December 29, 2024 and December 31, 2023, the business of the Company’s Russian subsidiaries represented less than 1% of the Company’s consolidated assets and revenues. The Company does not maintain Ukraine subsidiaries subsequent to the Kenvue separation.
In 2022, $14.6 billion was invested in research and development reflecting management’s commitment to create life-enhancing innovations and to create value through partnerships that will profoundly change the trajectory of health for humanity. A critical driver of the Company’s success is the diversity of its 152,700 employees worldwide.
In 2024, $17.2 billion was invested in research and development reflecting management’s commitment to create life-enhancing innovations and to create value through partnerships that will profoundly impact of health for humanity. Our approximately 138,100 employees are critical drivers of the Company’s success. Employees are empowered and inspired to lead with Our Credo and purpose as guides.
Management's Discussion and Analysis of Results of Operations and Financial Condition. In 2022, worldwide sales increased 1.3% to $94.9 billion as compared to an increase of 13.6% in 2021.
Management's discussion and analysis of results of operations and financial condition. Prior periods disclosed herein were recast to reflect the continuing operations of the Company. In 2024, worldwide sales increased 4.3% to $88.8 billion as compared to an increase of 6.5% in 2023.
Note: values may have been rounded 22 Analysis of Sales by Business Segments Consumer Health Segment Consumer Health segment sales in 2022 were $15.0 billion, a decrease of 0.5% from 2021, which included 3.6% operational growth and a negative currency impact of 4.1%. U.S. Consumer Health segment sales were $6.6 billion, an increase of 1.3%.
In 2023, the Company had three wholesalers distributing products for both segments that represented approximately 18.2%, 15.1% and 14.2% of the total gross revenues. 2024 Sales by geographic region (in billions) 2024 Sales by segment (in billions) Note: values may have been rounded Analysis of sales by business segments Innovative Medicine segment Innovative Medicine segment sales in 2024 were $57.0 billion, an increase of 4.0% from 2023, which included operational growth of 5.7% and a negative currency impact of 1.7%.
The total debt balance at the end of 2022 was $39.7 billion with an average debt balance of $36.7 billion as compared to $33.8 billion at the end of 2021 and an average debt balance of $34.5 billion.
The total debt balance at the end of 2024 was $36.6 billion with an average debt balance of $33.0 billion as compared to $29.3 billion at the end of 2023 and an average debt balance of $34.5 billion. The higher debt balance was due to the senior unsecured notes issued by the Company in the fiscal second quarter of 2024.
Sales returns allowances represent a reserve for products that may be returned due to expiration, destruction in the field, or in specific areas, product recall. The sales returns reserve is based on historical return trends by product and by market as a percent to gross sales.
Sales returns allowances represent a reserve for products that may be returned due to expiration, destruction in the field, or in specific areas, product recall. In accordance with the Company’s accounting policies, the Company generally issues credit to customers for returned goods. The Company’s sales returns reserves are accounted for in accordance with the U.S.
The operational growth in knees was primarily driven by procedure recovery, strength of the ATTUNE portfolio and pull through related to the VELYS Robotic assisted solution. This growth was partially offset by impacts of volume-based procurement in China and timing of tenders outside the U.S.
The growth in Hips reflects continued strength of the portfolio primarily in the Anterior approach, and global procedure growth. The growth in Knees was primarily driven by the ATTUNE portfolio, pull through related to the VELYS Robotic assisted solution and global procedure growth. Growth in Trauma was driven by the adoption of recently launched products.
The program was completed in the fiscal fourth quarter of 2022. See Note 20 to the Consolidated Financial Statements for additional details related to the restructuring programs. Provision for Taxes on Income: The worldwide effective income tax rate was 17.4% in 2022 and 8.3% in 2021.
Total project costs of approximately $0.5 billion have been recorded since the restructuring was announced. See Note 20 to the Consolidated Financial Statements for additional details related to the restructuring programs. Provision for Taxes on Income: The worldwide effective income tax rate from continuing operations was 15.7% in 2024 and 11.5% in 2023.
The Company intends to finance the share repurchase program through available cash. Through January 1, 2023, approximately $2.5 billion has been repurchased under the program. The following table summarizes the Company’s material contractual obligations and their aggregate maturities as of January 1, 2023: To satisfy these obligations, the Company intends to use cash from operations.
This exchange resulted in a loss of approximately $0.4 billion recorded in Other (income) expense. The following table summarizes the Company’s material contractual obligations and their aggregate maturities as of December 29, 2024: To satisfy these obligations, the Company intends to use cash from operations.
Other (income) expense, net for the fiscal year 2022 was unfavorable by $1.4 billion as compared to the prior year primarily due to the following: (Dollars in Billions)(Income)/Expense 2022 2021 Change Consumer Health separation costs $ 1.0 0.1 0.9 Litigation related (1) 0.9 2.3 (1.4) Changes in the fair value of securities 0.7 (0.5) 1.2 One-time COVID-19 vaccine manufacturing exit related costs 0.7 0.0 0.7 Acquisition, Integration and Divestiture related (2) 0.1 (0.5) 0.6 Restructuring related 0.1 0.1 0.0 Employee benefit plan related (1.2) (0.6) (0.6) Other (0.4) (0.4) — Total Other (Income) Expense, Net $ 1.9 0.5 1.4 ( 1) 2022 was primarily related to pelvic mesh and 2021 was primarily related to talc and Risperdal Gynecomastia (2) 2022 was primarily costs related to the acquisition of Abiomed. 2021 was p rimarily related to divestiture gains of two pharmaceutical brands outside the U.S. 29 Interest (Income) Expense: Interest (income) expense in the fiscal of 2022 was net interest income of $214 million as compared to interest expense of $130 million in the fiscal year 2021 primarily due to higher rates of interest earned on cash balances.
(JJDC), changes in the fair value of securities, investment (income)/loss related to employee benefit programs, gains and losses on divestitures, certain transactional currency gains and losses, acquisition and divestiture related costs, litigation accruals and settlements, as well as royalty income. 30 Other (income) expense, net for the fiscal year 2024 reflected less expense of $1.9 billion as compared to the prior year primarily due to the following: (Dollars in Billions)(Income)/Expense 2024 2023 Change Litigation related (1) $5.5 6.9 (1.4) Acquisition, Integration and Divestiture related (2) 0.8 0.3 0.5 Changes in the fair value of securities (3) 0.3 0.6 (0.3) COVID-19 vaccine manufacturing exit related costs 0.1 0.4 (0.3) Monetization of royalty rights (0.3) 0.0 (0.3) Employee benefit plan related (0.9) (1.4) 0.5 Other (0.8) (0.2) (0.6) Total Other (Income) Expense, Net $4.7 6.6 (1.9) (1) The fiscal years 2024 and 2023 include charges primarily for talc matters (See Note 19 to the Consolidated Financial Statements for more details).
In 2022, the Company recorded a pre-tax charge of $0.5 billion, which is included on the following lines of the Consolidated Statement of Earnings, $0.3 billion in restructuring, $0.1 billion in other (income) expense and $0.1 billion in cost of products sold. Total project costs of approximately $2.2 billion have been recorded since the restructuring was announced.
The pre-tax restructuring charge of approximately $0.5 billion in the fiscal year 2023, of which $449 million was recorded in Restructuring and $30 million was recorded in Cost of products sold on the Consolidated Statement of Earnings, and included the termination of partnered and non-partnered program costs and asset impairments.
U.S. sales were $28.6 billion, an increase of 2.3%. International sales were $24.0 billion, an increase of 1.0%, which included 11.9% operational growth and a negative currency impact of 10.9%. In 2022, acquisitions and divestitures had a net negative impact of 0.1% on the operational sales growth of the worldwide Pharmaceutical segment.
This represents a decrease of 0.5% in 2024 and an increase of 1.9% in 2023. In fiscal 2024, acquisitions and divestitures had a net positive impact of 0.2% on the international operational sales growth. In fiscal 2024, the impact of the Covid-19 Vaccine sales decline on the international operational sales was a negative 2.6%.
The increase in borrowings was due to the acquisition of Abiomed, Inc. In 2022, net debt (cash and current marketable securities, net of debt) was $16.1 billion compared to net debt of $2.1 billion in 2021. Total debt represented 34.1% of total capital (shareholders’ equity and total debt) in 2022 and 31.3% of total capital in 2021.
Total borrowings at the end of 2024 and 2023 were $36.6 billion and $29.3 billion, respectively. The increase in the borrowings was due to the issuance of new debt in 2024. In 2024, net debt (cash and current marketable securities, net of debt) was $12.1 billion compared to net debt of $6.4 billion in 2023.
Considering recent market conditions, the Company has re-evaluated its operating cash flows and liquidity profile and does not foresee any significant incremental risk.
For additional details on borrowings, see Note 7 to the Consolidated Financial Statements. The net proceeds from this offering were used to fund the Shockwave acquisition which closed on May 31, 2024, and for general corporate purposes. Considering recent market conditions, the Company has re-evaluated its operating cash flows and liquidity profile and does not foresee any significant incremental risk.
Operational growth was driven by the COVID-19 vaccine outside the U.S partially offset by lower sales of PREZISTA and PREZCOBIX/REZOLSTA (darunavir/cobicistat) due to increased competition and loss of exclusivity of PREZISTA in certain countries outside the U.S. Neuroscience products sales were $6.9 billion, in 2022, representing a decline of 1.4% as compared to the prior year.
Neuroscience products sales were $7.1 billion in 2024, representing a decrease of 0.4% as compared to the prior year primarily driven by a decline in Other Neuroscience. The decline was partially offset by the growth of SPRAVATO (esketamine) driven by the ongoing launch and increased physician and patient demand.
Percentages in chart are as a percent to total sales) Cost of products sold increased as a percent to sales driven by: • One-time COVID-19 vaccine manufacturing exit related costs • Currency impacts in the Pharmaceutical segment • Commodity inflation in the MedTech and Consumer Health segments partially offset by • Supply chain benefits in the Consumer Health segment The intangible asset amortization expense included in cost of products sold was $4.3 billion and $4.7 billion for the fiscal years 2022 and 2021, respectively. 28 Selling, Marketing and Administrative Expenses decreased as a percent to sales driven by: • Reduction of brand marketing expenses in the Pharmaceutical and Consumer Health businesses Research and Development Expense: Research and development expense by segment of business was as follows: 2022 2021 (Dollars in Millions) Amount % of Sales* Amount % of Sales* Consumer Health $ 493 3.3 % $ 459 3.1 % Pharmaceutical 11,622 22.1 11,878 23.0 MedTech 2,488 9.1 2,377 8.8 Total research and development expense $ 14,603 15.4 % $ 14,714 15.7 % Percent increase/(decrease) over the prior year (0.8) % 21.0 % *As a percent to segment sales Research and development activities represent a significant part of the Company's business.
Selling, Marketing and Administrative expense: Selling, Marketing and Administrative Expenses increased as a percent to sales driven by: • Increased commercial investment in the Innovative Medicine business partially offset by • Optimization efforts related to the residual costs associated with the Kenvue separation Research and Development expense: Research and development expense by segment of business was as follows: 2024 2023 (Dollars in Millions) Amount % of Sales* Amount % of Sales* Innovative Medicine $13,529 23.8 % $11,963 21.8 % MedTech 3,703 11.6 3,122 10.3 Total research and development expense $17,232 19.4 % $15,085 17.7 % Percent increase/(decrease) over the prior year 14.2 % 6.7 % *As a percent to segment sales Research and development activities represent a significant part of the Company's business.
The Executive Committee of Johnson & Johnson is the principal management group responsible for the strategic operations and allocation of the resources of the Company. This Committee oversees and coordinates the activities of the Consumer Health, Pharmaceutical and MedTech business segments. In all of its product lines, the Company competes with other companies both locally and globally, throughout the world.
Within the strategic parameters provided by the Executive Committee, senior management groups at U.S. and international operating companies are each responsible for their own strategic plans and the day-to-day operations of those companies. In all of its product lines, the Company competes with other companies both locally and globally, throughout the world.
Contributions to operational growth were strong sales of DARZALEX (daratumumab) driven by share gains in all regions, continued strong market growth, and uptake of the subcutaneous formulation as well as the continued global launch uptake of ERLEADA (apalutamide).
Oncology products achieved sales of $20.8 billion in 2024, representing an increase of 17.7% as compared to the prior year. Strong sales of DARZALEX (daratumumab) were driven by continued share gains and market growth. Growth of ERLEADA (apalutamide) was primarily due to continued share gains and market growth.
Income Before Tax by Segment Income (loss) before tax by segment of business were as follows: Income Before Tax Segment Sales Percent of Segment Sales (Dollars in Millions) 2022 2021 2022 2021 2022 2021 Consumer Health (3) $ 2,930 1,573 14,953 15,035 19.6 % 10.5 Pharmaceutical (3) 15,901 17,969 52,563 51,680 30.3 34.8 MedTech 4,607 4,373 27,427 27,060 16.8 16.2 Segment earnings before tax (1) 23,438 23,915 94,943 93,775 24.7 25.5 Less: Expenses not allocated to segments (2) 624 1,072 Less: Consumer Health separation costs 1,089 67 Worldwide income before tax $ 21,725 22,776 94,943 93,775 22.9 % 24.3 (1) See Note 17 to the Consolidated Financial Statements for more details.
Income before tax by segment Income (loss) before tax by segment of business were as follows: Income Before Tax Segment Sales Percent of Segment Sales (Dollars in Millions) 2024 2023 2024 2023 2024 2023 Innovative Medicine $18,919 18,246 56,964 54,759 33.2 % 33.3 MedTech 3,740 4,669 31,857 30,400 11.7 15.4 Segment earnings before tax (1) 22,659 22,915 88,821 85,159 25.5 26.9 Less: Expenses not allocated to segments (2) 5,972 7,853 Worldwide income before tax $16,687 15,062 88,821 85,159 18.8 % 17.7 (1) See Note 17 to the Consolidated Financial Statements for more details.
Sales by U.S. companies were $48.6 billion in 2022 and $47.2 billion in 2021. This represents increases of 3.0% in 2022 and 9.3% in 2021. Sales by international companies were $46.4 billion in 2022 and $46.6 billion in 2021. This represents a decrease of 0.6% in 2022 and an increase of 18.2% in 2021.
Sales by U.S. companies were $50.3 billion in 2024 and $46.4 billion in 2023. This represents increases of 8.3% in 2024 and 10.6% in 2023. In the fiscal 2024, acquisitions and divestitures had a net positive impact of 0.7% on the U.S. operational sales growth. Sales by international companies were $38.5 billion in 2024 and $38.7 billion in 2023.
As of both the fiscal years ending January 1, 2023 and January 2, 2022, the business of the Company’s Russian subsidiaries represented less than 1% of the Company’s consolidated assets and represented 1% of revenues. In early March, the Company took steps to suspend all advertising, enrollment in clinical trials, and any additional investment in Russia.
In March of 2022, the Company took steps to suspend all advertising, enrollment in clinical trials, and any additional investment in Russia. The Company continues to supply products relied upon by patients for healthcare purposes.
(2) Includes prior period adjustments 35 MedTech Segment (Dollars in Millions) Balance at Beginning of Period Accruals Payments/Credits Balance at End of Period 2022 Accrued rebates ( 1) $ 1,446 6,131 (6,107) 1,470 Accrued returns 134 531 (531) 134 Accrued promotions 54 102 (113) 43 Subtotal $ 1,634 6,764 (6,751) 1,647 Reserve for doubtful accounts 148 6 (29) 125 Reserve for cash discounts 10 99 (100) 9 Total $ 1,792 6,869 (6,880) 1,781 2021 Accrued rebates (1) $ 1,174 5,942 (5,670) 1,446 Accrued returns 138 559 (563) 134 Accrued promotions 52 140 (138) 54 Subtotal $ 1,364 6,641 (6,371) 1,634 Reserve for doubtful accounts 202 12 (66) 148 Reserve for cash discounts 9 96 (95) 10 Total $ 1,575 6,749 (6,532) 1,792 (1) Includes reserve for customer rebates of $802 million at January 1, 2023 and $845 million at January 2, 2022, recorded as a contra asset.
(2) Includes prior period adjustments 38 MedTech segment (Dollars in Millions) Balance at Beginning of Period Accruals Payments/ Credits Balance at End of Period 2024 Accrued rebates (1) $1,455 5,955 (5,986) 1,424 Accrued returns 125 543 (550) 118 Accrued promotions 25 62 (65) 22 Subtotal $1,605 6,560 (6,601) 1,564 Reserve for doubtful accounts 133 31 (38) 126 Reserve for cash discounts 5 92 (91) 6 Total $1,743 6,683 (6,730) 1,696 2023 Accrued rebates (1) $1,470 6,241 (6,256) 1,455 Accrued returns 134 555 (564) 125 Accrued promotions 43 74 (92) 25 Subtotal $1,647 6,870 (6,912) 1,605 Reserve for doubtful accounts 125 33 (25) 133 Reserve for cash discounts 9 96 (100) 5 Total $1,781 6,999 (7,037) 1,743 (1) Includes reserve for customer rebates of $704 million at December 29, 2024 and $740 million at December 31, 2023, recorded as a contra asset.
The operational growth in Trauma was driven by global market recovery and uptake of new products. The operational growth in Spine, Sports & Other was primarily driven by procedure recovery and new product introductions. This growth was partially offset by competitive pressures in Spine and impacts of volume-based procurement in China.
Electrophysiology growth was driven by global procedure growth, new product performance and commercial execution. This was partially offset by the impacts of volume-based procurement in China and competitive pressures in Pulsed Field Ablation catheters in the U.S. Abiomed sales reflect the strength of all major commercialized regions driven by the continued adoption of Impella 5.5 and Impella RP.
The Pharmaceutical segment is focused on the following therapeutic areas, including Immunology, Infectious diseases, Neuroscience, Oncology, Pulmonary Hypertension, and Cardiovascular and Metabolic diseases. Products in this segment are distributed directly to retailers, wholesalers, distributors, hospitals and healthcare professionals for prescription use.
Products in this segment are distributed directly to retailers, wholesalers, distributors, hospitals and healthcare professionals for prescription use. The MedTech segment includes a broad portfolio of products used in the Orthopaedic, Surgery, Cardiovascular (previously referred to as Interventional Solutions) and Vision fields.
As of January 1, 2023, the net debt position was $16.1 billion as compared to the prior year of $2.1 billion. The increase was primarily due to the acquisition of Abiomed, Inc. in December 2022. The debt balance at the end of 2022 was $39.7 billion as compared to $33.8 billion in 2021.
As of December 29, 2024, the net debt position was $12.1 billion as compared to the prior year of $6.4 billion. The debt balance at the end of 2024 was $36.6 billion as compared to $29.3 billion in 2023. In the fiscal second quarter of 2024, the Company issued senior unsecured notes for a total of $6.7 billion.

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Item 7A. Quantitative and Qualitative Disclosures About Market Risk

Market Risk — interest-rate, FX, commodity exposure

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Biggest changeManagement’s Discussion and Analysis of Results of Operations and Financial Condition - Liquidity and Capital Resources - Financing and Market Risk” of this Report; and Note 1 “Summary of Significant Accounting Policies - Financial Instruments” of the Notes to Consolidated Financial Statements included in Item 8 of this Report.
Biggest changeManagement’s discussion and analysis of results of operations and financial condition - Liquidity and capital resources - Financing and market risk of this Report; and Note 1 Summary of significant accounting policies - Financial instruments of the Notes to Consolidated Financial Statements included in Item 8 of this Report. 42
Item 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK The information called for by this item is incorporated herein by reference to “Item 7.
Item 7A. Quantitative and qualitative disclosures about market risk The information called for by this item is incorporated herein by reference to Item 7.

Other JNJ 10-K year-over-year comparisons