Johnson & Johnson

R&D chief Paul Stoffels

New moves by a big player - J&J

2012: $7.66 billion
2011: $7.54 billion
Change: Up 1.5%
Percentage of sales: 11.6%
R&D chief: Paul Stoffels

By the end of last year, J&J's ($JNJ) recently approved Zytiga (abiraterone) had come within a hair of registering blockbuster results--a swift start to a new and growing franchise, which has helped to dramatically improve treatment for prostate cancer patients. Canagliflozin (now Invokana), one of a new class of SGLT2 diabetes drugs recently waved through an FDA advisory committee, was picked by Reuters' top biopharma reporters recently as one of the top therapies in the industry's late-stage pipeline. As a direct competitor to Merck's ($MRK) Januvia, it could roil the entire diabetes segment of the market. Sirturo, the newly approved TB therapy, will do less well in terms of annual sales, but it's also the first new TB drug to come along in decades.

Those three drugs--the up-and-coming Zytiga, the experimental canagliflozin and newly approved Sirturo--help represent what sets J&J aside from your average Big Pharma player. While other companies may have bigger late-stage pipelines or more active business groups, J&J knows how to bet big--and wisely. So when it bought out Cougar Biotech, the R&D group was on a short path to a big approval. And there are quite a few analysts who believe its big bet on Pharmacyclics' ($PCYC) ibrutinib will follow the same path.

J&J has enjoyed the industry limelight for its big wins--which helps take the sting out of a pratfall on the order of bapineuzumab. But the spotlight also neglects a growing focus on early-stage work that so many big companies struggle with. Last fall the company announced plans to set up four key innovation centers around the world, with plans to dive into the big hubs where academics and developers rub shoulders in the new ecosystem. Culturally, that could be considered something of an awkward debut for a giant player like J&J. But expect lots of open arms. Everything J&J does in drug R&D, it does with considerable panache. 

"What is different now is that we brought the people much closer to where much of the action is--top scientists and venture capital and licensing and acquisitions and deal-making teams--to make sure we can interact in a much more interactive way," Stoffels told FierceBiotech recently. J&J also brings its internal technological skills in chemistry, preclinical work and more to play for its collaborators, which will "reduce the amount of capital needed and increase the probability of success."

Stoffels' work has been lauded inside and outside of the company. In the most recent SEC filing, J&J's board singled out Stoffels and the R&D team for a stream of new biotech deals as well as the development of the innovation network. And the remarks stand in stark contrast to the muted criticism of CEO Alex Gorsky after a fresh round of setbacks on devices.

Even in the pre-Phase II sphere, you can expect J&J to keep a sharp eye on commercialization potential. Like most other giants, J&J is fighting a losing battle against generic competition to some old standards. Remicade, a $5 billion therapy, loses patent protection in 2014. Velcade slips over the patent cliff the same year. Those are some very big shoes to fill. And J&J will stay on watch for some big deals to help with the transition. 

For more:
J&J's diabetes drug passes FDA panel test despite safety concerns
J&J wins accelerated OK for first new TB drug in 40 years
J&J's Zytiga gets expanded approval that could double sales

Johnson & Johnson
Read more on

Suggested Articles

Plexium is launching with $28 million to build its platform and a pipeline of drugs that target the enzymes drive recognition of protein targets.

In this week's EuroBiotech Report, Healx raises $56 million, Boehringer's VC wing backs anti-cancer virus startup and Ipsen bags Blueprint drug.

In our EuroBiotech roundup this week, GammaDelta forms antibody spinout, gene therapy startup raises cash and Amsterdam plans medical business park.