Q3 2024 Johnson & Johnson Earnings Call

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Speaker Change: I'd now like turn the conference call over to Johnson <unk> Johnson you may begin.

Speaker Change: Hello, everyone. This is Jeff Kumar Vice President of Investor Relations for Johnson <unk> Johnson welcome to our company's review of the third quarter results and our full year financial outlook for 2024 a.

Speaker Change: A few logistics before we get into the details.

Speaker Change: As a reminder, you can find additional materials, including today's presentation and associated schedules on the Investor Relations section of the Johnson and Johnson website at Investor Dot J&J Dot com.

Speaker Change: Please note that this presentation contains forward looking statements regarding among other things the company's future operating and financial performance market position and business strategy. You are cautioned not to rely on these forward looking statements, which are based on the current expectations of future events using.

Speaker Change: Good morning, and welcome to Johnson & Johnson's third quarter 2020-24 earnings conference call. All participants will be in a listen only mode until the question and answer session of the conference.

Operator: 24 - Earnings conference call. All participants will be in a listening mode until the question-and-answer session of the conference. This call is being recorded.

Jessica Moore: Medtech margin decline from 24.7 percent to 24.1 percent, driven by increased R&D investment and lapping of a prior year divestiture gain, partially offset by supply chain efficiencies. As a result, adjusted income before tax for the enterprise as a percentage of sales decreased from 37.6 percent to 32.4 percent, with acquired IPR&D expense impacting results.

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Speaker Change: The information available as of the date of this recording and are subject to certain risks and uncertainties that may cause the company's actual results to differ materially from those projected.

Speaker Change: This call is being recorded. If anyone has any objections, you may disconnect at this time. If you experience technical difficulties during the conference, you may press Star-0 to reach the operator. I will now turn the conference all over to Johnson and Johnson. You may begin.

Operator: I will now turn the conference call over to Johnson & Johnson. You may begin. Hello, everyone.

A description of these risks uncertainties and other factors can be found in our SEC filings, including our 2023 Form 10-K, which is available at investor Dot J&J Dot com and on the Sec's website.

Jessica Moore: This is Jessica Moore, Vice President of Investor Relations for Johnson & Johnson. Welcome to our company's review of the third quarter results and our full year financial outlook for 2024. A few logistics before we get into the details. As a reminder, you can find additional materials, including today's presentation and associated schedules, on the Investor Relations section of the Johnson & Johnson website at investor.jnj.com. Please note that this presentation contains forward-looking statements regarding, among other things, the company's future operating and financial performance, market position, and business strategy. You are cautioned not to rely on these forward-looking statements, which are based on the current expectations of future events using the information available as of the date of this recording and are subject to certain risks and uncertainties that may cause the company's actual results to differ materially from those projected.

Speaker Change: Hello everyone, this is Jessica Moore, Vice President of Investor Relations for Johnson and Johnson. Welcome to our company through view of the third quarter results in our full year financial outlook for 2024. A few logistics before we get into the details.

Speaker Change: Additionally, several of the products and compounds discussed today are being developed in collaboration with strategic partners or licensed from other companies. This slide acknowledges those relationships.

Jessica Moore: Starting in 2025, aligned with recent FASB reporting disclosure requirements, we will begin providing additional P&L details by segment.

Speaker Change: As a reminder, you can find additional materials, including today's presentation and associated schedules on the investor-relation section of the Johnson & Johnson website at investor.J&J.com.

Jessica Moore: This concludes the sales and earnings portion of the call.

Speaker Change: Moving to today's agenda well.

Joe Wolk: I'm now pleased to turn it over to Joe. Thank you, Jessica. In the third quarter, Johnson and Johnson delivered results that illustrate not only the breadth of the business but our ability to consistently beat financial expectations. Innovative medicine continued to build on strong first half revenue momentum. We are advancing our pharmaceutical pipeline, achieving significant clinical and regulatory milestones across key therapeutic areas. Our MedTech business, with the addition of Shockwave, delivered operational growth of 6.4% in the quarter, but did experience headwinds in the Asia-Pacific region. We continue to fortify our future, advancing the OTAVO Robotic Surgery System to IDE, expanding Bellas use, and launching new intraocular lenses.

Speaker Change: Well I can't do auto our chairman and CEO will kick us off with opening remarks, and highlight key catalyst within the segments.

Speaker Change: Please note that this presentation contains forward-looking statements regarding, among other things, the company's future operating and financial performance, market position and business strategy.

Speaker Change: I will review the third quarter sales and P&L results for the enterprise as well as highlights related to our two businesses.

Speaker Change: Joe Walk our CFO will then provide an overview of our pipeline advancements cash position capital allocation priorities and guidance for 2024 as well as qualitative considerations for 2025.

Speaker Change: You are caution not to rely on these forward-looking statements.

Speaker Change: which are based on the current expectations of future events using the information available as of the date of this recording, and our subject to certain risk and uncertainties that may cause the company's actual results to differ materially from those projected.

Speaker Change: Jennifer Taubert, John Reed, and Tim Schmid, our innovative medicine, and Med Tech leaders will be joining us for Q&A.

Jessica Moore: A description of these risk uncertainties and other factors can be found in our SEC filings, including our 2023 Form 10-K, which is available at investor.jng.com and on the SEC's website. Additionally, several of the products and compounds discussed today are being developed in collaboration with strategic partners or licensed from other companies. This slide acknowledges those relationships.

Speaker Change: A description of these risk uncertainties and other factors can be found in our SEC filings, including our 2023 Form-10K, which is available at investor.jnj.com and on the SEC's website.

Speaker Change: To ensure we provide enough time to address your questions. We anticipate the webcast will last approximately 60 minutes.

Joe Wolk: Due to dynamics in the Asia-Pacific region, specifically in China, we are taking a responsibly conservative approach by assuming no material improvement in that part of the business for the remainder of this year. And as such, we expect MedTech adjusted operational sales growth for the full year 2024 to be closer to 5% versus the 6% we referenced last quarter. The strength of a diversified business enables us to more than offset volatility in one part of our business, but yet be in a position to once again increase 2024 guidance for the enterprise.

Speaker Change: I will now turn the call over to Joaquin.

Joaquin: Thank you Hello, everyone.

Speaker Change: Additionally, several of the products and compounds discussed today are being developed in collaboration with strategic partners or licensed from other companies. This slide acknowledges those relationships.

Joaquin: Here, we delivered strong results in the third quarter with six 3% operational sales growth.

Our performance once again reflect the unique breadth of our business and our commitment to delivering the next wave of cars getting innovation to patients around the world.

Jessica Moore: Moving to today's agenda, Joaquin Duado, our Chairman and CEO, will kick us off with opening remarks and highlight key catalysts within the segments. I will review the third quarter sales and P&L results for the enterprise, as well as highlights related to our two businesses. Joaqu, our CFO, will then provide an overview of our pipeline advancements, cash position, capital allocation priorities, and guidance for 2024, as well as qualitative considerations for 2025. Jennifer Tabert, John Reed, and Tim Schmid are innovative medicine and MedTech leaders who will be joining us for Q&A. To ensure we provide enough time to address your questions, we anticipate the webcast will last approximately 60 minutes.

Speaker Change: Moving to today's agenda, Joaquin Duato, our chairman and CEO, will kick us off with opening remarks and highlight key catalysts within the segments.

It also reflects the work we have done to shift our pipeline our portfolio through high innovation high growth markets that work continues which you show. We did recently completed up we see huge.

Joe Wolk: Before diving into the results, I'll take a moment to touch on some enterprise-wide updates from the quarter. We are making progress towards resolving talc litigation. Our pre-packaged bankruptcy plan received overwhelming support from the current claimants of roughly 83%, as well as the future claimants' representative. As announced last Thursday, the case will be heard in the Texas bankruptcy court, and while we remain committed to bringing this matter to a resolution, it would be premature to speculate on timing. In addition to the pipeline highlights Watkeene mentioned, there are some additional notable advancements throughout the quarter. In oncology, we received US and EU regulatory approval for RIB Revand in combination with chemotherapy as a second-line treatment for adults with advanced EGFR mutated non-small cell lung cancer.

Speaker Change: I will review the third quarter sales in PNL results for the enterprise, as well as highlights related to our two businesses.

Speaker Change: Joaquin, RCFO, will then provide an overview of our pipeline advance, Cash Position, Capital Allocation Priorities, and Guidance for 2024, as well as qualitative considerations for 2025.

Joaquin: Be with E on.

Joaquin: Brookdale logics on the and then 26 bio specific antibody in innovative medicines and we are pleased with the progress we are making.

Speaker Change: Jennifer Taubert, John Reed, and TimchMed, our innovative medicine and med tech leaders will be joining us for Q&A.

Joaquin: Innovative maybe seen we reported our second consecutive quarter of sales exceeding $4 billion with 11 key brands growing double digits.

Speaker Change: To ensure we provide enough time to address your questions, we anticipate the webcast will last approximately 60 minutes.

Joaquin Duato: I will now turn the call over to Joaquin. Thank you, Jess. Hello, everyone. As you will hear, we delivered strong results in the third quarter with 6.3% operational sales growth. Our performance once again reflects the unique breadth of our business and our commitment to delivering the next wave of health care innovation to patients around the world. It also reflects the work we have done to shift our pipeline and portfolio to high innovation and high growth markets. That work continues, which you saw with the recently completed acquisitions of Shockwave and B-Wave in MedTech and Ambricks Protheologics and the NM26 bias-specific antibody in innovative medicine.

Joaquin: <unk> became the first blow getting our portfolio to reach $3 billion in sales in a single quarter.

Speaker Change: I will now turn the call over to Joaquin.

Joaquin: Thank you, yes, hello, everyone. As you we hear, we delivered strong results in the third quarter with 6.3% operational sales growth.

Joaquin: As you will hear our pipeline of high innovation high growth potential assets you saw a bunch of them rapidly with five major U is E C approvals in the quarter.

Joe Wolk: With FDA priority review underway for a subcutaneous formulation of RIB Revand, along with data supporting a treatment regimen to reduce adverse events, we are building a best-in-class EGFR portfolio. We also presented chaise-1 data for RIB revand with chemotherapy and metastatic polorectal cancer patients, extending the asset's potential beyond lung cancer. In multiple mile-loma, we advanced our leadership position with FDA approval and filing of two Darzilex fast-pro-quad base regimens for newly diagnosed patients. With Carvicti, we announced three-year follow-up data showing significantly extended overall survival and gained approval for commercial production at our GENF facility, further expanding supply capacity.

Joaquin: Our performance once again reflects the uniqueness of our business and our commitment to delivering the next wave of healthcare innovation to patients around the world.

Joaquin: It includes if the approval of ride with them plus law schools as first line treatment for Egfr mutated advanced lung cancer.

Joaquin: It also reflects the work we have done to shift our pipeline and portfolio to high-novation high-growth markets.

Joaquin: I sort of mentioned I'll, just step forward for patients on FDA approval of <unk> for active Saturday call Ids, which represents a significant opportunity for Johnson <unk> Johnson, given 75% of us still out of sales today come from inflammatory bowel disease and with filing sundry.

Joaquin: That work continues, which you show with the recently completed acquisitions of Shokwef and BWF in METEC and Ambrics, Proteologics, and the NM-26 bio-specific antibody in innovative medicine. And we are pleased with the progress we are making.

Joaquin Duato: And we are pleased with the progress we are making. In innovative medicine, we reported a second consecutive quarter of sales exceeding 14 billion dollars, with 11 key brands growing double digits. Darcelex became the first product in our portfolio to reach 3 billion dollars in sales in a single quarter. And as you will hear, our pipeline of high innovation, high growth potential assets is advancing rapidly with 5 major U.S. and EC approvals in the quarter. This includes SDA approval of Vriburban, plus last close as first line treatment for EDFR mutated advanced lung cancer, a transformational step forward for patients and SDA approval of Tremphaya for active ulcerative colitis, which represents a significant opportunity for Johnson & Johnson, given 75% of Stellara sales today come from inflammatory bowel disease.

Joaquin: You send that way for many of our innovative medicines that have the potential to generate $5 billion in peak sales. We are increasingly confident in our near and long term growth trajectory.

Joaquin: In innovative medicine, we reported a second consecutive order of sales, exceeding 14 billion dollars with 11 key brands growing double digits.

Joe Wolk: Finally, in oncology, we added to the growing evidence base for our TARIS platform with positive Phase 2B data in patients with high-risk non-muscle invasive bladder cancer and positive interim Phase 2 data in patients with muscle invasive bladder cancer. In neuroscience, we submitted to the U.S. and European regulatory bodies for what would be the first global approval of NIPPA calamab for the treatment of people living with generalized myasthenia gravis. For the remainder of the year, we expect approval of TRIMFIA sub-Q for Crohn's disease and data readouts on J&J2113, our targeted oral peptide for psoriasis and ulcerous colitis.

Joaquin: Emit deck, you can see the impact of our portfolio shift to high innovation high growth markets.

Joaquin: Darzalex became the first product in our portfolio to reach $3 billion in sales in a single quarter.

Joaquin: In cardiovascular with the recent acquisitions of Shockwave and a b humid we have no category leaders in four of the largest highest growth gotta be a vascular intervention MIT dig markets, which in Q3 translated to another quarter of double digit growth across they've gotta be avascular port.

Joaquin: And as you will hear, our pipeline of high innovation, high growth potential assets is advanced in rapidly, with five major U.S. and EC approvals in the quarter.

Joaquin: This includes FD approval of Rybrevant, plus LASCOS, as first-line treatment for EDFR, mutated advanced lung cancer, a transformational step forward for patients.

Joaquin: <unk>.

Joaquin: Full market launch of show with Ian Bailey for IV got that said, we have seen an immediate impact of this show with acquisition.

Joe Wolk: J&J4804, our co-antibody therapeutic for inflammatory bowel disease, a ticaprant for a jumpative major depressive disorder, and NIPPA Calamab for rheumatoid arthritis. In Medtech, we complete an enrollment of the Omni-IRE clinical trial to evaluate safety and effectiveness in mapping and treating symptomatic paroxysmal atrial fibrillation during standard ablation procedures. Also in cardiovascular, we are preparing for the anticipated approval of Varipulse in the US and the submission of ImpalaECP for regulatory approval. In orthopedics, we launch several exciting new products in the US, including our Vellis spine robot and Vault plating system.

Joaquin: An FDA approval of Tremfya for active ulcerative colitis, which represents a significant opportunity for Johnson & Johnson, given 75% of Estelara sales today, come from inflammatory bowel disease.

Joaquin: In vision growth is accelerating and we expect that to continue with the recent full market release of thickness OTC in the U S and I'll keep you always Sysmex one day contact lenses we.

Joaquin Duato: And with filings and reviews and their way for many of our innovative medicines that have the potential to generate 5 billion dollars in bigger sales, we are increasingly confident in our near- and long-term growth trajectory. Imbetech, you can see the impact of our portfolio shift to high innovation, high growth markets, particularly in cardiovascular. With the recent acquisitions of Shockwave and A Pyramid, we are now category leaders in four of the largest and highest growth cardiovascular intervention Metech markets, which in Q3 translated to another quarter of double digit growth across the cardiovascular portfolio. And with the full market launch of Shockwave E8, peripheral IVL catheter, we are seeing an immediate impact of the Shockwave acquisition.

Joaquin: We are also excited about the future of our business as you will recall in November of 'twenty to 'twenty three we committed to submitting the robotic surgical system for our investigational device exemption or IDE to the U S 58 in the second half of 'twenty 'twenty four to initiate.

Joaquin: and with filings and reviews and their way for many of our innovative medicines that have the potential to generate $5 billion in PID-year sales. We are increasingly confident in our near and long-term growth trajectory.

Joaquin: Imatek, you can see the impact of our portfolio shift to high innovation high growth markets.

Joaquin: Clinical trials I'm pleased to announce that we have met that milestone with the I D application submitted in Q3.

Joaquin: Particularly in cardiovascular, with the recent acquisition of shockwave and abium-ed, we are not category leaders in form of the largest highest growth cardiovascular intervention med-tech markets, which in Q3 translated to another quarter of double digit growth across cardiovascular portfolio.

Joe Wolk: The plentiful pipeline progress across our businesses will ensure continued success.

Joaquin: Looking across the enterprise our high innovation high growth. This strategy is working and our progress this quarter speaks to the strength of our commercial and innovation capabilities.

Joe Wolk: Let's now turn to cash and capital allocation. Free cash flow year-to-date was approximately $14 billion, compared to $12 billion last year, which included eight months' contribution from the consumer health business. We ended the third quarter with $20 billion of cash and marketable securities and $36 billion of debt for a net debt position of approximately $16 billion. Our capital allocation priorities remain unchanged. Our strong balance sheet enables us to strategically invest to grow our business while simultaneously returning capital to our shareholders. Innovation remains core to our strategy. During the quarter, we invested nearly $5 billion in research and development.

Joaquin: We have increased our adjusted operational EPS guidance be M&A for the third quarter in a row, we have invested a deemed billions of dollars in high innovation high growth M&A This year based.

Joaquin: and with the full market launch of ShowWave8, Peripera IVL, Caseter, we are seeing an immediate impact of the ShowWave acquisition.

Joaquin Duato: In vision, growth is accelerating and we expect that to continue with the recent full market release of techniques ODC in the U.S. and active U.S.-max one-day contact lenses. We are also excited about the future of our surge business. As you will recall, in November 2023, we committed to submitting the Otaba Robotics Surgical System for an Investigational Device Exemption or IDE to the U.S. FDA in the second half of 2024 to initiate clinical trials.

Joaquin: Invision, Grothys Accelerating, and we expect that to continue with the recent full market release of Tecnis ODC in the US and Acuvue Oasys Max one day contact lenses.

Joaquin: Based on this quarter's results. We are confident you know what expectations for 2025 through the end of the decade and beyond and with that I will turn the call back to just thank.

Joaquin: We are also excited about the future of our surge business. As you will recall, in November 23, we committed to submitting the Tava Robotics Surdigal System for an investigational device exception or ID to the U.S. FDA in the second half of 2024 to initiate clinical trials.

Speaker Change: Thank you Joaquin moving to our financial results for the quarter, unless otherwise stated the financial results and guidance highlighted today reflect the continuing operations of Johnson <unk>. Johnson. Furthermore, the percentages quoted represent operational results and therefore exclude the impact of currency translation.

Joe Wolk: This is an increase over 2023 levels, even after excluding acquired in-process R&D expense. Thus far in 2024, Johnson and Johnson has deployed approximately $18 billion for strategic acquisitions and licensing agreements, which includes the recent acquisition of VWave, another innovative treatment and heart failure, which closed last week.

Joaquin Duato: I'm pleased to announce that we have met that milestone with the IDE application submitted in Q3. Looking across the enterprise, our high innovation high growth strategy is working, and our progress this quarter speaks to the strength of our commercial and innovation capabilities. We have increased adjusted operational EPS guidance pre-MNA for the third quarter in a row. We have invested $18 billion in high innovation high growth MNA this year, and based on this quarter's results, we are confident in our expectations for 2020-25 to the end of the decade and beyond.

Speaker Change: Worldwide sales were $22 $5 billion for the third quarter of 2024.

Joaquin: And please do announce that we have met that milestone with the ID application submitted in Q3.

Speaker Change: The increased six 3% with growth of seven 6% in the U S and four 6% outside of the U S acquisitions, and divestitures positively impacted worldwide growth by 90 basis points.

Joaquin: Looking across the enterprise, our fine-novation, high-growth strategy is working and our progress this quarter speaks to the strength of our commercial and innovation capabilities.

Joe Wolk: Turning to our full year 2024 guidance, excluding the impact from acquisitions and the divestitures, we are increasing our adjusted operational sales guidance. We now expect growth in the range of 5.7% to 6.2% with a midpoint of 6%. We are also increasing operational sales growth by $200 million to a range of 6.3% to 6.8%, with a midpoint of $89.6 billion or 6.6%. As you know, we don't speculate on future currency movements. For today's call, we are utilizing a euro spot rate relative to the US dollar of 1.10, slightly above last quarter's guidance. This results in an estimated incremental positive foreign currency impact of $200 million, reducing our previous full year negative impact to $1 billion.

Speaker Change: Turning now to earnings.

Joaquin: We have increased adjusted operational EPS guidance PMNA for the third quarter in a row.

For the quarter net earnings were $2 $7 billion and diluted earnings per share was one dollar and 11 cents versus diluted earnings per share of $1.69 a year ago.

Joaquin: We have invested a $10 billion in high-innovation high-growth M&A this year, based on this quarter's results, we are confident in our expectations for 2022-25 through the end of the decade and billion, and with that, I will turn the call back to you.

Speaker Change: Results in the quarter were impacted by the updated talc litigation settlement proposal as well as acquired IP R&D expense associated with the and I'm twenty-six bi specific antibody.

Joaquin Duato: With that, I will turn the call back to you.

Jessica Moore: Thank you, Joaquin. Moving to our financial results for the quarter. Unless otherwise stated, the financial results in guidance highlighted today reflect the continuing operations of Johnson and Johnson. Furthermore, the percentages quoted represent operational results and therefore exclude the impact of currency translation. Worldwide sales were $22.5 billion for the third quarter of 2024. Sales increased 6.3% with growth of 7.6% in the U.S. and 4.6% outside of the U.S. Acquisitions and investitures positively impacted worldwide growth by 90 basis points.

Speaker Change: Thank you, Joaquin, moving to our financial results for the quarter.

Speaker Change: Excluding after tax intangible asset amortization expense and special items for both periods adjusted net earnings for the quarter were $5 $9 billion and adjusted diluted earnings per share was $2.42 representing decreases of 13, 3% and nine person.

Speaker Change: And, less otherwise dated, the financial results in guidance highlighted today reflect the continuing operations of Johnson and Johnson. Furthermore, the percentages quoted represent operational results, and therefore exclude the impact of currency translation.

Joe Wolk: As such, we expect reported sales growth between 5.1% to 5.6%, with a midpoint of $88.6 billion or 5.4%. Regarding the rest of the PNL, with the addition of the VWave transaction, we now anticipate our 2024 adjusted pre-tax operating margin to decline by approximately 200 basis points. Excluding the impact of asset acquisition accounting and related R&D investment, we would be on track to improve operating margins by 50 basis points, which is consistent with what we guided to at the beginning of the year. As we strive to advance and accelerate our pipeline, you can anticipate elevated levels of investment in the fourth quarter.

Speaker Change: Worldwide sales were $22.5 billion for the third quarter of 2024, sales increased 6.3% with growth of 7.6% in the US and 4.6% outside of the US.

Speaker Change: Scent, respectively compared to the third quarter of 2023.

Speaker Change: Results were impacted by the acquired IP R&D expense of one point to $5 billion or approximately 1900 basis points associated with the N M twenty-six bi specific antibody.

Speaker Change: Acquisitions and divestitures positively impacted worldwide growth by 90 basis points.

Jessica Moore: Turning now to earnings. For the quarter, net earnings were $2.7 billion and diluted earnings per share was $1.11 versus diluted earnings per share of $1.69 a year ago. Results in the quarter were impacted by the updated Tauke litigation settlement proposal as well as acquired IPR&D expense associated with the NM26 by specific antibody. Excluding after-tax and tangible asset amortization expense and special items for both periods, adjusted net earnings for the quarter were $5.9 billion and adjusted diluted earnings per share with $2.42. Representing decreases of 13.3% and 9%, respectively, compared to the third quarter of 2023.

Speaker Change: Turning now to earnings.

Speaker Change: I will now comment on business sales performance in the quarter.

Speaker Change: For the quarter, net earnings were $2.7 billion and diluted earnings per share was $1.11, versus diluted earnings per share of $1.69 a year ago.

Speaker Change: Beginning with innovative medicine.

Speaker Change: Worldwide sales of $14 $6 billion increased six 3% with growth of seven 5% in the U S and four 4% outside of the U S.

Joe Wolk: Net interest income is now projected to be between $450 million and $550 million, $150 million greater than our previous guidance. Other income is anticipated to be in the range of $1.9 billion to $2.1 billion and increased versus previous guidance, driven by the one-time monetization of royalty rights, which will be utilized for that higher Q4 investment I referenced a moment ago. Our effective tax rate, consistent with previous guidance, is expected to be between 17.5 percent and 18.5 percent for the full year.

Speaker Change: Results in the quarter were impacted by the updated Tauke litigation settlement proposal, as well as acquired IPR&D expense, associated with the NM26 by specific antibody.

Innovative medicine growth was driven by our key brands and continued uptake from recently launched products with 11 assets delivering double digit growth.

Speaker Change: Results across the portfolio continues to be positively impacted by price increases associated with Argentina, hyperinflation consistent with market practice.

Speaker Change: Excluding after-tax and tangible asset-amortization expense, and special items for both periods, adjusted net earnings for the quarter were $5.9 billion, and adjusted diluted earnings per share, with $2.42.

Speaker Change: We continue to drive strong sales growth across our multiple myeloma portfolio.

Dorsal X growth was 22, 9%, primarily driven by share gains of four points across all lines of therapy with seven seven points of growth in the frontline setting as well as market growth.

Speaker Change: Reresenting D-Creases of 13.3% and 9% respectively, compared to the third quarter of 2023.

Joe Wolk: Similar to last quarter, we are providing an EPS bridge to outline the impact from acquisition activity throughout the year. Before the impact of the V-wave acquisition, our outlook for adjusted operational EPS performance is once again increasing. As the schedule reflects, we are expecting an incremental 10 cents per share increase on our operational performance for a total increase of 18 cents per share for the year. On this basis, when excluding acquisition activity throughout the year, EPS growth is 9.2 percent. To account for the completion of the V-wave transaction, as previously disclosed, our adjusted operational EPS guidance now includes the dilution of 24 cents per share in the fourth quarter and 6 cents per share in 2025.

Jessica Moore: R&D. Results were impacted by the acquired IPR&D expense of $1.25 billion, or approximately 1900 basis points, associated with the NM26 by specific antibody.

Speaker Change: Results were impacted by the acquired IPR&D expense of $1.25 billion or approximately 1900 basis points associated with the NM-26 by specific antibody.

Speaker Change: Perfect. He achieved sales of $286 million with growth of 87, 6% driven by share gains continued capacity expansion and manufacturing efficiencies. This reflects sequential growth of 53, 2% aligned with our expectations of accelerating growth in the back half of the.

Jessica Moore: I will now comment on business sales performance in the quarter, beginning with Innovative Medicine. Worldwide sales of $14.6 billion increased 6.3% with growth of 7.5% in the US and 4.4% outside of the US. Innovative medicine growth was driven by our key brands and continued uptake from recently launched products, with 11 assets delivering double-digit growth. Results across the portfolio continued to be positively impacted by price increases associated with Argentina hyperinflation, consistent with market practice. We continue to drive strong sales growth across our multiple myeloma portfolio. Darzalex growth was 22.9%, primarily driven by share gains of 4 points across all lines of therapy, with 7.7 points of growth in the frontline setting, as well as market growth.

Speaker Change: I will now comment on business sales performance in the quarter.

Speaker Change: Beginning with Innovative Medicine.

Speaker Change: Worldwide sales of $14.6 billion, increased 6.3% with growth of 7.5% in the US and 4.4% outside of the US.

Speaker Change: A year.

Daily sales were $135 million in the quarter with growth of 21, 4%, reflecting a strong launch in the relapse refractory setting demand remains strong while sequential growth was flat due to continued adoption of longer duration dosing intervals.

Speaker Change: Innovative Medicine Growth was driven by our key brands and continued uptake from recently launched products, with 11 assets delivering double-digit growth.

Joe Wolk: Combined, this yields an updated 2024 adjusted operational EPS guidance of $9.91 at the midpoint of the range, basically flat year on year despite absorbing approximately 92 cents of acquisition activity. While not predicting the impact of currency movements, utilizing the recent exchange rate's just reference, a reported adjusted earnings per share for the year now estimates a full year positive impact of 2 cents per share. As such, we expect reported adjusted earnings per share of $9.93 at the midpoint.

Speaker Change: Results across the portfolio continue to be positively impacted by price increases associated with Argentina hyperinflation consistent with market practice.

Finally within our multiple myeloma portfolio Tau. It continued its launch trajectory with another quarter of strong growth, we anticipate disclosing tell they sales in the first quarter of 2025, which are currently reported in other oncology.

Speaker Change: We continue to drive strong sales growth across our multiple Myeloma portfolio.

Speaker Change: Darzalex, Gross with 22.9%, primarily driven by sharegains of 4 points across all lines of therapy, with 7.7 points of growth in the frontline setting, as well as market growth.

Speaker Change: Our leader continues to deliver strong growth of 26, 3%, primarily driven by share gains in metastatic castrate sensitive prostate cancer and favorable inventory dynamics.

Jessica Moore: Pervicti achieved sales of $286 million with growth of 87.6%. Driven by share gains, continued capacity expansion, and manufacturing efficiencies. This reflects sequential growth of 53.2% aligned with our expectations of accelerating growth in the back half of the year. Tech daily sales were $135 million in the quarter with growth of 21.4%. Reflecting a strong launch in the relapse refractory setting, demand remained strong while sequential growth was flat due to continued adoption of longer duration dosing intervals. Finally, within our multiple myeloma portfolio, Tauve continued its launch trajectory with another quarter of strong growth. We anticipate disclosing Tauve sales in the first quarter of 2025, which are currently reported in Other Oncology.

Speaker Change: <unk>, our bi specific antibody for non small cell lung cancer contributed to growth in other oncology as we expand our approved indications. We also anticipate disclosing reiber event sales in the first quarter of 2025.

Speaker Change: achieved sales of $286 million, with growth of 87.6%.

Joe Wolk: We are still finalizing our plans for next year, but let me provide you some preliminary qualitative commentary to inform your modeling for 2025. For innovative medicine, we remain very confident in our ability to deliver growth despite a significant LOE, resulting in sales above the $57 billion commitment we stated in 2021. This will be driven by our in-market brands and continued progress from our recently launched products, including Tronfaya and IBD and Ryber Van in non-small cell lung cancer. Regarding the Stelara LOE, we are planning for biosimilar entries in the U.S. In January, assuming that you may as a Rosen curve is a relatively good proxy for your models.

Speaker Change: Driven by ShareGames, Continued Capacity Expansion, and Manufacturing efficiencies. This reflects sequential growth of 53.2% aligned with our expectations of accelerating growth in the back half of the year.

Speaker Change: In immunology, we saw sales growth in China via a 14, 3% driven by strong market growth and share gains in P. S. O N P. S. A partially offset by unfavorable patient mix.

Speaker Change: Techvayli sales were $135 million in the quarter, with growth of 21.4%. Reflecting a strong launch in the relapse, refractory setting. The man-remain strong, whilst the quenchable growth was flat, due to continued adoption of longer duration dosing intervals.

Speaker Change: Laura declined five 7% driven by unfavorable net patient mix and share loss, partially offset by market growth. As a reminder, biosimilar competition has entered Europe as of July and we anticipate U S. Biosimilar entry in January 2025.

Speaker Change: Finally, within our multiple myeloma portfolio, Talvey continued its launch trajectory with another quarter of strong growth. We anticipate disclosing Talvey sales in the first quarter of 2025, which are currently reported in other oncology.

Joe Wolk: We continue to expect a negative impact associated with the Part D redesign. In our pipeline, we anticipate data readouts across all our priority platforms, anticipated approvals of Tronfaya, sub-Q and Crohn's disease, Ryber Van sub-Q for lung cancer, and Nipokalamab in generalized myasthenia gravis, as well as potential filings for Taurus in bladder cancer and a tick of print in major depressive disorder. As a reminder, Tronfaya, Ryber Van, and Taurus continue to be the three largest under-appreciated assets in terms of our revenue projections versus what analysts are estimating for the back half of this decade. For MedTech, we continue to expect to deliver on our long-term objective, identified at last year's Enterprise Business Review, of growing operational sales in the upper end of the 2022 through 2027 weighted average market growth rate of 5% to 7%.

Speaker Change: In neuroscience provide a growth of 55, 3% continues to be driven by increased physician and patient confidence.

Jessica Moore: Erlina continued to deliver strong growth of 26.3%. Primarily driven by share gains in metastatic, castrate-sensitive, prostate cancer, and favorable inventory dynamics. Ribervant are by specific antibody for non-small cell lung cancer, contributed to growth in other oncology, as we expand approved indications. We also anticipate disclosing Ribervant sales in the first quarter of 2025. Within immunology, we saw sales growth in Tauve of 14.3%. Driven by strong market growth in share gains in PSO and PSA, partially offset by unfavorable patient mix. Solara declined 5.7%, driven by unfavorable net patient mix and share loss, partially offset by market growth.

Speaker Change: Erleada continues to deliver strong growth of 26.3%, primarily driven by sharegains and metastatic castrate sensitive prostate cancer, in favorable inventory dynamics.

Speaker Change: And pulmonary hypertension summit and I've traveled grew 17, 4% and 15.2%, respectively, driven by market growth share gains and patient mix as.

Speaker Change: Rybervant, Arby specific antibody for non-small cell lung cancer contributed to growth in other oncology, as we expand approved indications. We also anticipate disclosing Rybervant sales in the first quarter of 2025.

Speaker Change: As mentioned last quarter, Remicade and Symphony realize limited sales in Europe as we prepare for the return of distribution rights in Q4.

Speaker Change: I'll now turn your attention to med Tech.

Speaker Change: Worldwide sales of $7.9 billion increased six 4% with growth in the U S of seven 8% and 5% outside of the U S.

Speaker Change: Within immunology, we saw Fale's growth in Tremfya of 14.3%, driven by strong market growth in share games in PSO and PSA, partially offset by unfavorable patient mix.

Acquisitions, and divestitures had a net positive impact of 270 basis points on worldwide growth 360 basis points in the U S and 180 basis points outside of the U S.

Speaker Change: Solara, DeKline, 5.7% driven by unfavorable net patient mix and share loss, partially offset by market growth. As a reminder, biosimilar competition has entered Europe as of July, and we anticipate U.S. biosimilar entry in January 2025.

Joe Wolk: We also expect continued adoption of newer products across all MedTech businesses, such as Varipulse and electrophysiology, Vellus enabling technology across orthopedics, Odyssey and PURC and surgical vision, and contributions from our Aviomed and Shockwave innovations. A specific to volume-based pricing in China, we expect continued impacts from the rollout of the 2024 tenders in orthopedic sports and interocular lenses and anticipate VBP to continue expanding across provinces and products.

Jessica Moore: As a reminder, biosimilar competition has entered Europe as of July, and we anticipate US biosimilar entry in January 2025. In neuroscience, Spravato growth of 55.3% continues to be driven by increased physician and patient confidence. Impulmonary hypertension, Op-summit, and Up-travy grew 17.4%, and 15.2%, respectively, driven by market growth, share gains, and patient mix.

Speaker Change: Overall med tech growth was driven by commercial execution and strength of new product introductions, partially offset by continued headwinds in Asia Pacific specifically in China.

Speaker Change: And cardiovascular electrophysiology delivered double digit growth of 10, 7%.

Speaker Change: Nero-Science, Spravato, Growth of 55.3%, continues to be driven by increased position and patient confidence.

Performance was driven by global procedure growth, new product uptake and commercial execution, partially offset by competitive PFA ablation catheter uptake in the U S as well as prior year trade inventory dynamics and V P in China.

Speaker Change: Impulmonary hypertension, Upsummit, and Uptravi, grew 17.4% and 15.2% respectively, driven by market growth, share games, and patient mix.

Jessica Moore: XVIII. As mentioned last quarter, Remicade and Symphony realize limited sales in Europe as we prepare for the return of distribution rights in Q4.

Joe Wolk: Moving to the rest of the PNL, when thinking about operating margin, there are pluses and minuses. Tailwinds include an anticipated reduction of acquired IPR&D expense year-over-year. Continued focus on MedTech margin improvement and continue the OptX optimization benefits post-separation. Working against us is unfavorable product mixed with Triton by Stolaro by a similar entrance and Part D redesign. With a brief look at your models last week, the consensus margin does not appear unreasonable and will provide further clarity in January once we complete our 2025 plan. We do not expect to maintain the heightened levels of interest income due to reduction in interest rates and impact from debt experience in 2024 related to acquisition activity.

Speaker Change: As mentioned last quarter, Remicade and Symphony realize limited sales in Europe, as we prepare for the return of distribution rates in Q4.

Speaker Change: Abby Nomad delivered growth of 16, 3% driven by strong growth in all regions and continued adoption of Impella five five and Impella RP technology.

Jessica Moore: I'll now turn your attention to Medtech. Worldwide sales of $7.9 billion increased 6.4% with growth in the U.S. of 7.8% and 5% outside of the U.S. Acquisitions and divestitures had a net positive impact of 270 basis points on worldwide growth, 360 basis points in the U.S. and 180 basis points outside of the U.S. Overall, Medtech growth was driven by commercial execution and strength of new product introductions, partially offset by continued headwinds in Asia-Pacific, specifically in China. In cardiovascular, electrophysiology delivered double-digit growth of 10.7%. Performance was driven by global procedure growth, new product uptake, and commercial execution, partially offset by competitive PFA, ablation catheter uptake in the U.S., as well as prior year trade inventory dynamics in VBP in China.

Speaker Change: Ambrx, Alvotech, Alvotech, Ambrx,

Speaker Change: Worldwide sales of $7.9 billion increase, 6.4% with growth in the U.S. of 7.8% and 5% outside of the U.S. Acquisitions and disasters had a net positive impact of 270 basis points on worldwide growth, 360 basis points in the U.S. and 180 basis points outside of the U.S.

Cardiovascular results also included $229 million associated with the acquisition of Shockwave.

Speaker Change: Contact lenses and other performance improved to four 7% driven by continued strategic price actions and strong performance in Accu view Oasis one day family of products, a one time benefit from a change in U S contract shipping terms worth approximately 150 basis points as well as <unk>.

Speaker Change: Overall, MedTech Growth was driven by commercial execution and strength of new product introductions. Partly offset by continued headwinds in Asia Pacific, specifically in China.

Lapping prior year impacts from Russia sanctions.

Joe Wolk: Regarding other income and expense, we expect lower net other income due to the non-recurring nature of the monetization of royalty rights experienced in Q3, a lower benefit related to employee benefit programs based on discount rate assumptions, as well as income lost on the CanView dividend.

Speaker Change: Surgical vision grew one 9% driven by Technip piracy and techniques I hands, partially offset by China V P and softness in the U S.

Speaker Change: and Cardio Vascular, Electrophysiology-Deliver double-digit growth of 10.7%.

Speaker Change: Performance with Driven by Global Procedure Growth, New Product Uptake and Commercial Execution. Partially offset by Competitive PFA, Ablation, Catheter Uptake in the U.S., as well as prior year trade inventory dynamics in VBP in China.

Speaker Change: Surgery declined <unk>, 7% with the claret divestiture negatively impacting results by approximately 110 basis points.

Joe Wolk: Lastly, based on what we know today, under current tax law, we anticipate our 2025 tax rate to be slightly lower than our anticipated 2024 tax rate.

Jessica Moore: AvioMed delivered growth of 16.3%, driven by strong growth in all regions and continued adoption of Impella 5.5 and Impella RP technology. Currievascular results also included $229 million associated with the acquisition of Shockwave. Contact lenses and other performance improved to 4.7%. Driven by continued strategic price actions, strong performance and Acuvio-Oasis one-day family of products, a one-time benefit from a change in U.S. contract shipping terms worth approximately 150 basis points, as well as laughing prior year impacts from Russia sanctions. Surgical vision grew 1.9%, driven by Technispurcy and Technispy hands, partially offset by China VBP and softness in the U.S.

Speaker Change: Performance was driven primarily by competitive pressures in energy and Endo cutters as well as V P and the anti corruption campaign in China. This was partially offset by commercial execution strength of new products across wound closure and bio surgery and continued price increases associated with Argentina.

Speaker Change: Abdomed delivered growth of 16.3%, driven by strong growth in all regions and continued adoption of Impala 5.5, and Impala RP Technology.

Joe Wolk: To wrap up prior to Q&A, we are pleased with our underlying 2024 performance that simultaneously fortifies the strong foundation for continued success heading into 2025.

Speaker Change: Vascular results also included $229 million associated with the acquisition of shockwave.

Kevin: With that, I'll now turn over to Kevin to open the call for your questions.

Speaker Change: Inflation consistent with market practice.

Kevin: Thank you, and I'll be conducting your question-and-answer session. If you'd like to be placed into question Q, please press star one on your telephone keypad. If you'd like to withdraw your question, please press star two. Please limit your questions to one question only.

Speaker Change: Contact lenses and other performance improved to 4.7%.

Speaker Change: Orthopedics growth of one 3% was primarily driven by success of recent product launches and commercial execution, partially offset by competitive pressures impacts of China V. P and revenue disruption from the previously announced orthopedics transformation.

Speaker Change: Driven by continued strategic price actions.

Speaker Change: Strong Performance and Acuvue Oasys, One Day Family, A Products, One Time Benefit, From A Change in U.S. Contracts, Shipping Terms, Worth Approximately 150 Bases Points, as well as Lapping Prior Year Impacts from Russia Sanctions.

Chris Schott: Our first question is coming from Chris Shop from JP Morgan; your line is now live. Great. Thanks so much for the question. Maybe just one on talc here. I know this still limited comments, but it seems though the company's obviously made some advancements here into getting this behind the organization. Maybe just, can you help us a little bit in terms of, from your perspective, next key steps to watch from here? And what is J&J's overall level of confidence that you have a path to resolve this in a relatively near term for the story? Thanks so much.

Speaker Change: Now turning to our consolidated statement of earnings for the third quarter of 2024, I'd like to highlight a few noteworthy items that have changed compared to the same quarter of last year. We continue to invest strategically in research and development at competitive levels investing nearly $5 billion or 22% of sales, which.

Speaker Change: surgical vision group 1.9% driven by technist, PRC, and technist I-Hands, partially offset by China, VBP, and softness in the US.

Jessica Moore: Surgery declined 0.7% with the apparent divestiture negatively impacting results by approximately 110 basis points. Performance was driven primarily by competitive pressures in energy and endocutters, as well as VBP in the anti-corruption campaign in China. This was partially offset by commercial execution, strength of new products across one closure and biosurgery, and continued price increases associated with Argentina hyperinflation, consistent with market practice. Orthopedics growth of 1.3% was primarily driven by success of recent product launches and commercial execution, partially offset by competitive pressures, impacts of China VBP, and revenue disruption from the previously announced orthopedics transformation.

Speaker Change: Surgery declined to 0.7% with the Acclarant to Vestiture, negatively impacting results by approximately 110 BC points.

Speaker Change: <unk> includes a 1.25 billion dollar payment to secure the global rights to and am twenty-six bi specific antibody even when excluding this investment R&D as a percent of sales increased to 30 basis points selling.

Speaker Change: Performance was driven primarily by competitive pressures in energy and endocutters, as well as VBP in the anti-corruption campaign in China. This was partially offset by commercial execution, strength of new products across one closure and biosurgery, and continued pricing creases associated with Argentina hyperinflation consistent with market practice.

Joe Wolk: Yeah, thank you, Chris. And as you have heard me before, our intention with respect to that litigation is to bring a responsible final and comprehensive resolution to these claims. And we are making meaningful progress to do just that. We have filed our pre-package organization plan with the support of 83% of the claimants. And also we have had a decision of the court to keep the filing in Houston. So, as I said, we are making progress in this resolution that I refer to as far as next steps.

Speaker Change: Selling marketing and administrative expense as a percent of sales with leveraged 100 basis points driven by the realization of optimization efforts following the <unk> separation.

Speaker Change: Interest income was $99 million as compared to $182 million of income last year, driven by a higher net debt position primarily related to the financing impacts of the Shockwave acquisition.

Speaker Change: Orthopedics growth of 1.3% with primarily driven by success of recent product launches and commercial execution. Partially offset by competitive pressures, impacts of China VBP and revenue disruption from the previously announced orthopedics transformation.

Speaker Change: Other income and expense was a net expense of $1 $8 billion compared to an expense of point $5 billion in the prior year. The increase in expense was driven by a 1.75 billion dollar charge related to the talc litigation settlement proposal, partially offset by prior year high.

Jessica Moore: Now turning to our consolidated statement of earnings for the third quarter of 2024. I'd like to highlight a few noteworthy items that have changed compared to the same quarter of last year. We continue to invest strategically in research and development at competitive levels, investing nearly $5 billion or 22% of sales, which includes a $1.25 billion payment to secure the global rights to NM26 by Specific Antibody. Even when excluding this investment, R&D as a percent of sales increased 30 basis points. Selling, marketing, and administrative expense as a percent of sales was leveraged 100 basis points, driven by the realization of optimization efforts following the Kenview separation.

Unknown Executive: Edic?

Speaker Change: Now, turning to our consolidated statement of earnings for the third quarter of 2024.

Eric Coste: Hi, thanks, Chris.

Eric Coste: This is Eric Coste. I had a World Bud litigation. Judge Lopez, last week on Thursday, after ruling that the case properly and appropriately should remain in Texas, ordered the parties to meet and confer an agreed to a schedule for the expeditious resolution of the case. And by that, it means setting forth a schedule to get through to the confirmation procedure, addressing any ancillary motions, whether the motions to dismiss or issues relating to the votes. And the parties are in that process. We contemplate putting forth a schedule that resolves those issues through the end of the year for a confirmation hearing sometime at the beginning of next year.

Speaker Change: I'd like to highlight a few noteworthy items that have changed compared to the same quarter of last year.

Speaker Change: We continue to invest strategically in research and development at competitive levels, investing nearly $5 billion or 22% of sales, which includes $1.25 billion payment to secure the global rights to NM-26 by specific antibody.

Speaker Change: Your unrealized mark to market losses on public securities as well as the monetization of royalty rights.

Regarding taxes in the quarter, our effective tax rate was 19, 3% versus 17, 4% in the same period last year. This increase was primarily driven by the tax treatment of the N M. Twenty-six bi specific antibody acquisition and O E C D pillar two.

Speaker Change: Even when excluding this investment, R&D as a percent of sales increased to 30 basis points.

Speaker Change: Selling, marketing, and administrative expense at the percent of sales, was leveraged 100 basis points, driven by the realization of optimization efforts following the Kenvue separation.

Speaker Change: Leading special items, the effective tax rate was 19, 3% versus 15, 6% in the same period last year.

Jessica Moore: Interest income was $99 million as compared to $182 million of income last year, driven by a higher net debt position primarily related to the financing impacts of the Shockwave acquisition. Other income and expense was a net expense of $1.8 billion, compared to an expense of $0.5 billion in the prior year. The increase in expense was driven by a $1.75 billion charge related to the talc litigation settlement proposal, partially offset by prior year, higher unrealized mark-to-market losses on public securities, as well as the monetization of royalty rights. Regarding taxes in the quarter, our effective tax rate was 19.3% versus 17.4% in the same period last year.

Eric Coste: So that's the schedule on. Thank you.

Speaker Change: Interest Income was $99 million as compared to $182 million of Income last year, driven by a higher net debt position primarily related to the financing impacts of the shock wave acquisition.

Larry Biegelsen: Next question is coming from Larry Beegelson from Wells Fargo. Your line is out live. Good morning. Thanks for taking the question.

Speaker Change: I encourage you to review our upcoming third quarter 10-Q filing for additional details on specific tax related matters.

Tim Schmid: Tim, on MedTech, maybe help us understand the impact of the one-time items in Q3, such as the ortho, you know, skeurationalization, how you're thinking about the impact from the hurricanes in Q4 and what gives you confidence you can deliver the high end of that 5 to 7 percent next year. Thanks for taking the question. Larry, thank you for the question. And we're proud of the 6.4 percent operational growth for the quarter. 5.7 percent for full year. And I think the results really talk of the success of our deliberate move into higher growth, higher margin categories, especially in the cardiovascular space.

Speaker Change: Lastly, I'll direct your attention to the box section of the slide where we have also provided our income before tax net earnings and earnings per share adjusted to exclude the impact of intangible amortization expense and special items.

Speaker Change: Other incoming expense with the net expense of $1.8 billion, compared to an expense of $.5 billion in the prior year.

Speaker Change: The increase in expense which driven by a $1.75 billion charge related to the Talquidigation Settlement Proposal.

Speaker Change: Now, let's look at adjusted income before tax.

Speaker Change: Okay.

Speaker Change: Innovative medicines margin declined from 45, 4% to 37, 9%, primarily driven by the 1.25 billion dollar acquired IP R&D expense to secure the global rights for and I'm twenty-six bi specific antibody, partially offset by the monetization of royalty.

Speaker Change: Partially offset by prior year higher unreliive mark-to-market losses on public securities, as well as the monetization of royalty rights.

Speaker Change: Regarding taxes in the quarter, our effective tax rate was 19.3%, versus 17.4% in the same period last year. This increase was primarily driven by the tax treatment of the NM26 bi-specific antibody acquisition and OECD Pillar 2.

Tim Schmid: You'll recall, and you'll see that from our results, almost $300 million is being added from the Shockwave acquisition, which continues to perform to expectations. As does Abby Ahmed, and we've also added to the portfolio with the acquisition of Lamanar in the fourth quarter of last year, and then more recently, the announced closure of the acquisition of E-Wave, which once again takes us into even more exciting high growth, high margin opportunities within cardiovascular. And as we look to the full year, we expect a return to significantly better performance, especially in orthopedics, which typically has a stronger fourth quarter.

Jessica Moore: This increase was primarily driven by the tax treatment of the NM26 by specific antibody acquisition and OECD Pillar 2, excluding special items. The effective tax rate was 19.3% versus 15.6% in the same period last year.

Speaker Change: Right.

Speaker Change: Med Tech margin declined from 24, 7% to 24, 1% driven by increased R&D investment and lapping of a prior year divestiture gain partially offset by supply chain efficiencies.

Speaker Change: Excluding special items, the effective tax rate was 19.3%, versus 15.6% in the same period last year. I encourage you to review our upcoming 3rd quarter 10Q filing for additional details on specific tax-related matters.

Speaker Change: As a result adjusted income before tax for the enterprise as a percentage of sales decreased from 37, 6% to 32, 4% with acquired IP R&D expense impacting results by 560 basis points.

Jessica Moore: I encourage you to review our upcoming third quarter 10-Q filing for additional details on specific tax-related matters. Lastly, I'll direct your attention to the box section of this slide, where we have also provided our income before tax, net earnings, and earnings per share adjusted to exclude the impact of intangible amortization expense and special items. Now, let's look at adjusted income before tax by segment. Innovative medicine margin declined from 45.4% to 37.9%, primarily driven by the $1.25 billion acquired IPR&D expense to secure the global rights for NM26 by specific antibody, partially offset by the monetization of royalty rights.

Speaker Change: Lastly, I'll direct your attention to the box section of this slide, where we have also provided our income before tax. Net earnings and earnings for share adjusted to exclude the impact of intangible amortization expense and special items.

Speaker Change: Starting in 2025 aligned with recent FASB reporting disclosure requirements, we will begin providing additional P&L details by segment.

Speaker Change: This concludes the sales and earnings portion of the call I'm now pleased to turn it over to Joe.

Speaker Change: Now, let's look at a Justin income before tax by segment. Innovative medicine margin declined from 45.4% to 37.9%. Primarily, driven by the $1.25 billion acquired IPR&D expense to secure the global rights for NM-26 by specific antibody, partially offset by the monetization of royalty rights.

Joe Walk: Thank you Jessica and the third quarter Johnson <unk> Johnson delivered results that illustrate not only the breadth of the business, but our ability to consistently beat financial expectations innovative medicine continued to build on strong first half revenue momentum, we are advancing our pharmaceutical pipeline, achieving significant clinical and regulatory milestones across key.

Tim Schmid: And we are seeing tremendous performance, specifically within the hips and knees categories, growing 6 percent and 7 percent. And I think that's really been enabled by the success of our enabling technologies in Dallas. In knees, which also, by the way, we've added the indication of the uni knee, as well as our kin size and hip navigation systems within hips. I also add to the orthopedics performance; we are significantly addressing portfolio gaps within our trauma portfolio, with the launch of tri-leap virtual guide and vault in the back half of the year.

Jessica Moore: Medtech margin declined from 24.7% to 24.1%, driven by increased R&D investment and lapping of a prior year divestiture gain, partially offset by supply chain efficiencies. As a result, adjusted income before tax for the enterprise as a percentage of sales decreased from 37.6% to 32.4%, with acquired IPR&D expense impacting results by 560 basis points.

Speaker Change: Therapeutic areas or.

Speaker Change: Medtech margin declined from 24.7% to 24.1%. Driven by increased R&D investment and lapping of a prior year divestiture gain, partially offset by supply chain efficiency.

Speaker Change: Our med Tech business with the addition of Shockwave delivered operational growth of six 4% in the quarter, but did experience headwinds in the Asia Pacific region, We continued to fortify our future advancing of the ottava robotic surgery system to I D E expanding villus use and launching new intraocular lenses.

Speaker Change: As a result, adjusted income before tax for the enterprise, as a percentage of sales, decreased from 37.6% to 32.4%, with acquired IPR&D expense impacting results by 560 basis points.

Speaker Change: Due to dynamics in the Asia Pacific region, specifically in China. We are taking are responsibly conservative approach, but assuming no material improvement in that part of the business for the remainder of this year and as such we expect med Tech adjusted operational sales growth for the full year 'twenty 'twenty four to be closer to 5% versus the 6% we referenced.

Tim Schmid: And I think you know our spine portfolio has been challenged. And we're addressing that with the launch of Telogen, our new Trieltus thoracolumbar system and the new spine robot, which we just received approval for. As relates to the hurricanes, we did see the impact certainly of Hurricane Helene in the final weeks of the third quarter and continue to see the impact of Milton over the last coming days, especially in the areas most impacted by those storms. I do think to watch out that we all need to watch carefully is certainly the impact of the recently announced IV saline shortages, which, if they do persist, could potentially impact surgical procedures across our portfolio.

Jessica Moore: Starting in 2025, aligned with recent FASB reporting disclosure requirements, we will begin providing additional P&L details by segment.

Speaker Change: Starting in 2025, aligned with recent FastB reporting disclosure requirements, we will begin providing additional PNL details by segment. This concludes the sales and earnings portion of the call. I'm now pleased to turn it over to Joe.

Jessica Moore: This concludes the sales and earnings portion of the call.

Joe Wolk: I'm now pleased to turn it over to Joe. Thank you, Jessica. In the third quarter, Johnson & Johnson delivered results that illustrate not only the breadth of the business but our ability to consistently beat financial expectations. Innovative medicine continued to build on strong first half revenue momentum. We are advancing our pharmaceutical pipeline, achieving significant clinical and regulatory milestones across key therapeutic areas. or Medtech business with the addition of Shockwave delivered operational growth of 6.4% in the quarter, but did experience headwinds in the Asia-Pacific region. We continue to fortify our future, advancing the OTAVO Robotic Surgery System to IDE, expanding Velis use, and launching new interocular lenses.

Speaker Change: Last quarter.

Speaker Change: The strength of a diversified business enables us to more than offset volatility in one part of our business, but yet be in a position to once again increased 2024 guidance for the enterprise.

Joe: Thank you, Jessica. In the third quarter, Johnson & Johnson delivered results that illustrate not only the breath of the business but our ability to consistently beat financial expectations. Innovative medicine continued to build on strong first half revenue momentum. We are advancing our pharmaceutical pipeline, achieving significant clinical and regulatory milestones across key therapeutic areas.

Speaker Change: Before diving into the results I'll take a moment to touch on some enterprise wide updates from the quarter.

Speaker Change: We are making progress towards resolving talc litigation are pre package bankruptcy plan received overwhelming support from the current claimants of roughly 83% as well as the future Claimants' representative.

Tim Schmid: Thank you, Larry.

Joe: or MetTech Business with the addition of Shockwave delivered operational growth of 6.4% in the quarter, but did experience headwinds in the Asia Pacific region.

Louise Chen: Thank you. Next question is coming from Louise Chen from Cancer Pistoral Drill Line. Is that live? Hi. Thank you for taking my question here.

As announced last Thursday, the case will be heard in the Texas bankruptcy court and while we remain committed to bringing this matter to a resolution it would be premature to speculate on timing.

Louise Chen: I wanted to ask you how you see trim via J&J 2113 and some of your other pipeline products coming together to replace sales loss to Salara and then take share from entrenched competitors. Thank you.

Joe: We continue to fortify our future, advancing the Otava Robotics Surgery System to IDE, expanding Belarus use and launching new interocular lenses.

Speaker Change: In addition to the pipeline highlights Joaquin mentioned there was some additional notable advancements throughout the quarter in.

Joe Wolk: Due to dynamics in the Asia-Pacific region, specifically in China, we are taking a responsibly conservative approach by assuming no material improvement in that part of the business for the remainder of this year. And as such, we expect Medtech adjusted operational sales growth to the full year 2024 to be closer to 5% versus the 6% we referenced last quarter. The strength of a diversified business enables us to more than offset volatility in one part of our business, but yet be in a position to once again increase 2024 guidance for the enterprise.

Joe: Due to dynamics in the Asia Pacific region, specifically in China, we are taking a responsibly conservative approach by assuming no material improvement in that part of the business for the remainder of this year. And as such, we expect MedTech adjusted operational sales growth to the full year 2024 to be closer to 5% versus the 6% we referenced last quarter.

Jennifer Taubert: Hi, Louise, it's Jennifer, and good morning, everyone. I wanted to start off by having a chance to really recognize and thank all my innovative medicine colleagues around the world for a fabulous quarter in the third quarter. We really continue to deliver against our strategy with 11 key brands, having double-digit growth and achieving a few really notable milestones, notably the Tremfya approval and launch and ulcerative colitis, also Rybrevant plus last clues in first-line non-small cell lung cancer, and we also completed the acquisition of NM-26, which is a phase 2 ready asset for a topic dermatitis. So as we take a look at the immunology portfolio, we're really excited about Tremfya and what we see as the prospects ahead.

Speaker Change: In oncology, we received U S and EU regulatory approval for <unk> in combination with chemotherapy as a second line treatment for adults with advanced Egfr mutated non small cell lung cancer.

Speaker Change: With F D. A priority review underway for a subcutaneous formulation of <unk>.

Speaker Change: Along with data supporting a treatment regimen to reduce adverse events. We are building a best in class Egfr portfolio.

Joe: The strength of a diversified business enables us to more than offset volatility in one part of our business, but yet being a position to once again increase 2024 guidance for the enterprise. Before diving into the results, I'll take a moment to touch on some enterprise-wide updates from the quarter.

Joe Wolk: Before diving into the results, I'll take a moment to touch on some enterprise-wide updates from the quarter. We are making progress towards resolving talc litigation. Our pre-packaged bankruptcy plan received overwhelming support from the current claimants of roughly 83%, as well as the future claimants representative. As announced last Thursday, the case will be heard in the Texas bankruptcy court, and while we remain committed to bringing this matter to a resolution, it would be premature to speculate on timing. In addition to the pipeline highlights Watkein mentioned, there are some additional notable advancements throughout the quarter. In oncology, we received US and EU regulatory approval for Ryber Van in combination with chemotherapy as a second-line treatment for adults with advanced EGFR-mutated non-small cell lung cancer.

We also presented phase one data for Robert Van with chemotherapy in metastatic colorectal cancer patients extending the assets potential beyond lung cancer.

Speaker Change: In multiple myeloma, we advanced our leadership position with FDA approval and filing of two doors like SaaS PROQUAD based regimens for newly diagnosed patients.

Joe: We are making progress towards resolving calculation, our pre-packaged bankruptcy plan received overwhelming support from the current claimants of roughly 83% as well as the future claimants representative.

Jennifer Taubert: I just mentioned that we got approval during the quarter for that product in Ulcerative Colitis. We believe we truly have a winning proposition for that asset in IBD, and it's off to a really nice start with a really strong reception amongst the medical community, and we see that product having a lot of strengths because it's the only dual active IL-23, so it blocks both IL-23 and the CD64 receptor cells. It really sets what we believe is a new bar in terms of efficacy, with the highest rate of endoscopic normalization, and we've got really rigorous head-to-head data versus Stelara, showing superiority in Crohn's disease, and we think that we've got unrivaled flexibility and what will ultimately be the sub-Q, both induction and maintenance dose for Tremfya.

Speaker Change: With core Vicky, we announced three year follow up data showing significantly extended overall survival and gained approval for commercial production at our against facility further expanding supply capacity.

Joe: As announced last Thursday, the case will be heard in the Texas Bankruptcy Court, and while we remain committed to bringing this matter to a resolution, it would be premature to speculate on timing.

Speaker Change: Finally in oncology, we added to the growing evidence base for tourists platform with positive phase <unk> data in patients with high risk non muscle invasive bladder cancer and positive interim phase two data in patients with muscle invasive bladder cancer.

Joe: In addition to the Pipeline Highlights, Joaquin mentioned, there are some additional notable advancements throughout the quarter.

Joe: In oncology, we received U.S. and EU regulatory approval for Rybrevant, in combination with chemotherapy as a second-line treatment for adults with advanced EGFR, mutated non-small cell lung cancer.

Speaker Change: In neuroscience, we submit it to the U S and European regulatory bodies for what would be the first global approval of nipple calum up for the treatment of people living with generalized myasthenia gravis.

Joe Wolk: With FDA priority review underway for a subcutaneous formulation of Ryber Van, along with data supporting a treatment regimen to reduce adverse events, we are building a best-in-class EGFR portfolio. We also presented chaise-one data for Ryber Van with chemotherapy and metastatic colorectal cancer patients, extending the asset's potential beyond lung cancer. In multiple myeloma, we advanced our leadership position with FDA approval and filing of two Darzilex fast-pro quad-based regimens for newly diagnosed patients. With Carvicti, we announced three-year follow-up data showing significantly extended overall survival and gained approval for commercial production at our GENT facility, further expanding supply capacity.

Joe: With FDA priority review underway for a subcutaneous formulation of Rybrevant, along with data supporting a treatment regimen to reduce adverse events, we are building a best-in-class EGFR portfolio.

For the remainder of the year, we expect approval of Trump via sub Q for Crohn's disease and data Readouts on J&J to 113, our targeted oral peptide for psoriasis and ulcerative colitis J&J for age zero for Arco antibody therapeutic for inflammatory bowel disease a.

Joe: We also presented Chase-1 data for Rybrevant with chemotherapy and metastatic colorectal cancer patients, extending the assets potential beyond lung cancer.

Jennifer Taubert: So Tremfya was 4 billion in sales for the quarter, and that was really on psoriasis and psoriatic arthritis alone. When we take a look going forward and what we had seen with Stelara in terms of the strength in IBD and the potential, we think that Tremfya definitely is an asset that is Stelara size or bigger and better, so a lot of exciting opportunity for us ahead.

Joe: In multiple mile Loma, we advance our leadership position with FDA approval and filing of two Darzalex fast-proquad based regiments for newly diagnosed patients.

Took a print for adjunctive major depressive disorder, and Nip Ocala Mab for rheumatoid arthritis.

Speaker Change: In Med Tech, we completed enrollment of the omni I or a clinical trial to evaluate safety and effectiveness in mapping in treating symptomatic paroxysmal atrial fibrillation during standard ablation procedures.

Joe: We announced three-year follow-up data showing significantly extended overall survival and gained approval for commercial production at our again facility further expanding supply capacity.

Joe Wolk: Finally, in oncology, we added to the growing evidence base for our Taurus platform with positive phase 2B data in patients with high-risk non-muscle invasive bladder cancer and positive interim phase 2 data in patients with muscle invasive bladder cancer. In neuroscience, we submitted to the U.S. and European regulatory bodies for what would be the first global approval of NIPPA calamab for the treatment of people living with generalized myasthenia gravis. For the remainder of the year, we expect approval of TRIMFIAS sub-Q for Crohn's disease and data readouts on J&J2113, our targeted oral peptide for psoriasis and ulcerative colitis, J&J4804, our co-antibody therapeutic for inflammatory bowel disease, a ticaprant for adjunctive major depressive disorder, and NIPPA Calamab for rheumatoid arthritis.

John Reed: For 2113, we're really excited about our oral asset that we're developing, and I'll let John read. My colleague John Reed actually talked about why we're so excited about it and some of the data, upcoming data there, but we do think that being able to have that advanced efficacy and known safety profile and its simple oral tablet is not only going to be great for the existing, you know, biologics appropriate patients, but we think it gives us a great market expansion opportunity moving into earlier lines of therapy as well. John, me. Yeah, thanks. The 2113 is really moving along nicely.

Speaker Change: Also in cardiovascular we are preparing for the anticipated approval of variables in the U S and the submission of Impella ECP for regulatory approval.

Joe: Finally, in oncology, we added to the growing evidence base for a TARIS platform with positive phase to be data in patients with high risk, non-Muslimvasive bladder cancer and positive interim phase to data in patients with muffler invasive bladder cancer.

Speaker Change: Orthopedics, we launched several exciting new products in the U S, including our Vela spine robot and volt plating system, the plentiful pipeline progress across our businesses will ensure continued success.

Joe: In neuroscience, we submit it to the U.S. and European regulatory bodies for what would be the first global approval of Nipocalimab for the treatment of people living with generalized Myciniagravus.

Speaker Change: Let's now turn to cash and capital allocation.

Speaker Change: Free cash flow year to date was approximately $14 billion compared to $12 billion last year, which included eight months contribution from the consumer health business.

Joe: For the remainder of the year, we expect approval of Tremfya sub-Q for Crohn's disease and data readouts on JNJ-2113, our targeted oral peptide for psoriasis and ulcerative colitis, JNJ-4804, our co-anther body therapeutic for inflammatory bowel disease.

John Reed: You know, this is our targeted oral peptide, a very exquisite, eloquently designed molecule that binds to and blocks the IL-23 receptor and is orally bi-available with a once-stayly dosing. The psoriasis indication is fully enrolled now for phase three studies, which are quite broad and include head-to-heads against tick-to inhibitors, as well as both adult and adolescent patients, as well as a study in patients that have disease-affecting heart to treat areas, scalp, and other parts of the anatomy that can be very difficult to clear typically. So we're really looking quite comprehensively there, and the data will be rolling out the next few months, so we look forward to sharing those at the appropriate time in inflammatory bowel disease.

Speaker Change: We ended the third quarter was $20 billion of cash and marketable securities and $36 billion of debt for a net debt position of approximately $16 billion.

Joe: Atecvayriant, for a jump of major depressive disorder, and Nipocalimab, Farumatoid Arthritis.

Speaker Change: Our capital allocation priorities remain unchanged, our strong balance sheet enables us to strategically invest to grow our business, while simultaneously returning capital to our shareholders.

Joe Wolk: In Medtech, we complete an enrollment of the Omni-IRE clinical trial to evaluate safety and effectiveness in mapping and treating symptomatic paroxysmal atrial fibrillation during standard ablation procedures. Also in cardiovascular, we are preparing for the anticipated approval of Varipulse in the US and the submission of Intella ECT for regulatory approval. In orthopedics, we launch several exciting new products in the US, including our Vellis spine robot and Vault plating system. The plentiful pipeline progress across our businesses will ensure continued success.

Joe: In Metac, we completed enrollment of the Omni-IRI clinical trial to evaluate safety and effectiveness in mapping and treating symptomatic, pyrixis, mole, atrial fervolation during standard abolation procedures.

Innovation remains core to our strategy during the quarter, we invested nearly $5 billion in research and development. This is an increase over 2023 levels, even after excluding acquired in process R&D expense.

Joe: Also in Cardio Vascular, we are preparing for the anticipated approval of varipulse in the U.S. and the submission of Impala ECT for Regulatory Approval.

Speaker Change: Thus far in 2020 for Johnson <unk> Johnson has deployed approximately $18 billion for strategic acquisitions and licensing agreements, which includes the recent acquisition of V wave another innovative treatment in heart failure, which closed last week.

Joe: In order to pedics, we want several exciting new products in the U.S. including our Velis, Spine Robot, and Volta Plating System. The Clinical Pipeline Progress across our businesses will ensure it continues success.

Speaker Change: Turning to our full year 2024 guidance, excluding the impact from acquisitions and divestitures, we are increasing our adjusted operational sales guidance. We now expect growth in the range of five 7% to six 2% with a midpoint of 6%.

Joe Wolk: Let's now turn to cash and capital allocation. Free cash flow year-to-date was approximately $14 billion, compared to $12 billion last year, which included eight months' contribution from the consumer health business. We ended the third quarter with $20 billion of cash and marketable securities and $36 billion of debt for a net debt position of approximately $16 billion. Our capital allocation priorities remain unchanged. Our strong balance sheet enables us to strategically invest to grow our business while simultaneously returning capital to our shareholders. Innovation remains core to our strategy. During the quarter, we invested nearly $5 billion in research and development.

John Reed: We're in a single-seeking phase two study and also colitis where we're exploring different doses before moving into more advanced studies, given that the IL-23 that way is well-balanced and inflammatory bowel disease, thanks to our intranpia. We're quite confident that those studies will come through for us, but we'll wait for those data later this year to see how that oral medication is fairing there.

Joe: Let's now turn to Cash and Capital Education.

Speaker Change: Free Cash Flow year-to-date was approximately $14 billion, compared to $12 billion last year, which included 8 months contribution from the Consumer Health Business.

Speaker Change: We're also increasing operational sales growth by $200 million to a range of six 3% to six 8% with a midpoint of $89 $6 billion or six 6%.

Speaker Change: We ended the third quarter with $20 billion of cash and marketable securities, and $36 billion of debt for net debt position of approximately $16 billion. Our capital allocation priorities remain unchanged, our strong balance sheet enables us to strategically invest to grow our business, while simultaneously returning capital to our shareholders.

Speaker Change: As you know, we don't speculate on future currency movements.

Speaker Change: For today's call, we are utilizing a euro spot rate relative to the U S. Dollar of 1.10 slightly above last quarter's guidance. This results in an estimated incremental positive foreign currency impact of $200 million, reducing our previous full year negative impact to $1 billion as such we expect reported sales growth.

John Reed: The other thing I've maybe mentioned in just in case it's not on your radar is we also have a co-antibody approach we call it 48-04 where Gus and Gold, Trampaya, and RTNF inhibitor are combined for patients who tend to be on the more refractory side, and we're in the middle of inflammatory bowel disease studies there that we'll read out next year, so I'm really excited about that antibody combination as well. So all together the immunology portfolio is really quite robust, and particularly in inflammatory bowel disease in the areas of dermatology where we've had traditional strengths.

Speaker Change: Innovation remains core to our strategy. During the quarter, we invested nearly $5 billion in research and development. This is an increase over 2023 levels, even after excluding acquired in-process R&D expense.

Joe Wolk: This is an increase over 20-23 levels, even after excluding acquired in-process R&D expense. Thus far in 2024, Johnson and Johnson has deployed approximately $18 billion for strategic acquisitions and licensing agreements, which includes the recent acquisition of V-Wave, another innovative treatment and heart failure, which closed last week. Turning to our full year 2024 guidance, excluding the impact from acquisitions and the vestigers, we are increasing our adjusted operational sales guidance. We now expect growth in the range of 5.7 percent to 6.2 percent, with a midpoint of 6 percent. We are also increasing operational sales growth by $200 million to a range of 6.3 percent to 6.8 percent, with a midpoint of $89.6 billion or 6.6 percent.

Between five 1% to five 6% with a midpoint of $88 $6 billion or five 4%.

Speaker Change: That's far in 2024. Johnson & Johnson has deployed approximately $18 billion for strategic acquisitions and licensing agreements, which includes the recent acquisition of V-Wave, another innovative treatment in our failure, which closed last week.

Speaker Change: Regarding the rest of the P&L with the addition of the V wave transaction. We now anticipate our 2024 adjusted pretax operating margin to decline by approximately 200 basis points, excluding the impact of asset acquisition accounting and related R&D investment, we would be on track to improve operating margins by 50 basis.

Speaker Change: Turning to our full year 2024 guidance, excluding the impact from acquisitions and the vestitors, we are increasing our adjusted operational sales guidance. We now expect growth in the range of 5.7% to 6.2% with a midpoint of 6%.

John Reed: We really do think that we've got a winning portfolio for inflammatory bowel diseases, and maybe just one addition because I know we've had questions on this in the past on 2113. We're going to be developing that really across the spectrum, so both ulcerative colitis as well as Crohn's disease. So we're starting off in ulcerative colitis, but absolutely have plans to develop it in Crohn's as well.

Speaker Change: Points, which is consistent with what we guided to at the beginning of the year.

Speaker Change: We are also increasing operational sales growth by 200 million dollars to a range of 6.3% to 6.8% with a midpoint of 89.6 billion dollars or 6.6%.

Speaker Change: As we strive to advance and accelerate our pipeline you can anticipate elevated levels of investment in the fourth quarter.

Joe Wolk: As you know, we don't speculate on future currency movements. For today's call, we are utilizing a Euro spot rate relative to the US dollar of 1.10, slightly above last quarter's guidance. This results in an estimated incremental positive foreign currency impact of $200 million, reducing our previous full year negative impact to $1 billion. As such, we expect reported sales growth between 5.1 percent to 5.6 percent, with a midpoint of $88.6 billion or 5.4 percent. Regarding the rest of the PNL, with the addition of the V-wave transaction, we now anticipate our 2024 adjusted pre-tax operating margin to decline by approximately 200 basis points. Excluding the impact of asset acquisition accounting and related R&D investment, we would be on track to improve operating margins by 50 basis points, which is consistent with what we guided to at the beginning of the year.

Speaker Change: Net interest income is now projected to be between $450 million and $550 million $150 million greater than our previous guidance. Other income is anticipated to be in the range of $1 9 billion to $2 1 billion, an increase versus previous guidance driven by the one time monetization of royalty rights with Jessica referenced.

Speaker Change: As you know, we don't speculate on future currency movements.

John Reed: Thank you.

Terence Bloom: Next question today is coming from Terence Bloom from Morgan Stanley; your line is now. Great, thanks so much for taking the question. Maybe just on the multiple myeloma portfolio, obviously very nice growth in Carvykti this quarter. I know you spoke to some of the drivers, but just was wondering if you can elaborate on what you're seeing in the second line setting at this point. And then, as you look at Techvayli, you know, through the rest of this year, into next year, what's it going to take to really see an acceleration and growth in this product, or do we have to wait until we get to earlier lines of treatment here to see growth again on that franchise?

Speaker Change: For today's call, we are utilizing a EuroSpotrate relative to the US dollar of $1.10, slightly above last quarter's guidance.

Speaker Change: This results in an estimated incremental positive foreign currency impact of $200m, reducing our previous full year-negative impact to $1 billion. As such, we expect reported sales growth between 5.1% to 5.6% with a midpoint of $88.6 billion or 5.4%.

Speaker Change: That will be utilized for that higher Q4 investment I referenced a moment ago.

Speaker Change: Our effective tax rate consistent with previous guidance is expected to be between 17, 5% 18, 5% for the full year.

Speaker Change: Similar to last quarter, we have provided an EPS bridge to outline the impact from acquisition activity throughout the year.

Speaker Change: regarding the rest of the pnl

Speaker Change: With the addition of the V-wave transaction, we now anticipate our 2024 adjusted pretext operating margin to decline by approximately 200 basis points, excluding the impact of asset acquisition, accounting, and related R&D investment, we would be on track to improve operating margins by 50 basis points, which is consistent with what we guided to at the beginning of the year.

Jennifer Taubert: Thank you. Hi, Terence, thanks so much for the question on multiple myeloma, and I won't go into a lot of detail on Darzelex, but it's worth noting that we had 3 billion in sales, more than 20 percent growth, and that Darzelex really continues to perform quite strongly for us as we continue to grow, share particularly in front line in both transplant-eligible and ineligible patients. I really appreciate the question on Carvykti, so 286 million in sales, 88 percent growth year over year, and 53 percent quarter over quarter, and we're really seeing that continued growth for a number of reasons. So first, we're seeing very strong demand based on the Carditude for approval for that second line and beyond patients. In addition, overall survival data was just presented for Carvykti, and this line, which was very, very significant, further adds to the importance of this medicine for patients with multiple myeloma.

Speaker Change: Before the impact of the Z wave acquisition, our outlook for adjusted operational EPS performance is once again increasing.

As the schedule reflects we are expecting an incremental 10 cents per share increase on our operational performance for a total increase of 18 <unk> per share for the year.

Joe Wolk: As we strive to advance and accelerate our pipeline, you can anticipate elevated levels of investment in the fourth quarter. Net interest income is now projected to be between $450 million and $550 million, $150 million greater than our previous guidance. Other income is anticipated to be in the range of $1.9 billion to $2.1 billion and increased versus previous guidance driven by the one-time monetization of royalty rights, which will be utilized for that higher Q-form investment I referenced a moment ago. R, effective tax rate, consistent with previous guidance, is expected to be between 17.5% and 18.5% for the full year.

Speaker Change: On this basis, when excluding acquisition activity throughout the year EPS growth is nine 2%.

Speaker Change: As we strive to advance and accelerate our pipeline, you can anticipate elevated levels of investment in the fourth quarter.

To account for the completion of the V wave transaction as previously disclosed our adjusted operational EPS guidance now includes dilution of <unk> 24 cents per share in the fourth quarter and six cents per share in 2025.

Speaker Change: Net interest income is now projected to be between $450 million and $550 million, $150 million greater than our previous guidance. Other income is anticipated to be in the range of $1.9 billion to $2.1 billion, and increase versus previous guidance, driven by the one-time monetization of royalty rights, Jessica Reference, that will be utilized for that higher Q-Forn investment I referenced a moment ago.

Speaker Change: Combined this yields an updated 2020 for adjusted operational EPS guidance of $9.91 at the midpoint of the range basically flat year on year. Despite absorbing approximately 92 cents of acquisition activity.

Speaker Change: Our effective tax rate consistent with previous guidance is expected to be between 17.5% and 18.5% for the full year.

Speaker Change: While not predicting the impact of currency movements utilizing the recent exchange rates just referenced our reported adjusted earnings per share for the year now estimates full year positive impact of <unk> <unk> per share as such we expect reported adjusted earnings per share of $9 93 at the midpoint.

Joe Wolk: Similar to last quarter, we have provided an EPS bridge to outline the impact from acquisition activity throughout the year. Before the impact of the V-wave acquisition, our outlook for adjusted operational EPS performance is once again increasing. As the schedule reflects, we are expecting an incremental 10 cents per share increase on our operation. For a total increase of 18 cents per share for the year. On this basis, when excluding acquisition activity throughout the year, EPS growth is 9.2%. To account for the completion of the V-wave transaction, as previously disclosed, our adjusted operational EPS guidance now includes dilution of 24 cents per share in the fourth quarter and 6 cents per share in 2025.

Speaker Change: 2. Similar to last quarter, we have provided an EPS bridge to outline the impact from acquisition activity throughout the year. Before the impact of the V-wave acquisition, our outlook for adjusted operational EPS performance is once again increasing. As the schedule reflects, we are expecting an incremental 10 cents per share increase on our operational performance for a total increase of 18 cents per share for the year. On this basis, when excluding acquisition activity throughout the year, EPS growth is 9.2 percent.

Jennifer Taubert: In the other aspect, as we continue to progress really nicely with our continued capacity expansion, both in terms of number of slots per day. In Raritan, we gained approval for our Ghent Manufacturing site in Europe for commercial production that is now underway and able to serve patients, and our CMO in the United States as well is producing on the clinical end, and so all the way around from performance of the product, from new data, as well as continued capacity expansion, we continue to see very strong performance for Carvykti. And as we've discussed before, I don't know that we will see that as a complete exact linear growth curve quarter to quarter simply because the capacity expansion works in a bit more of a stair step fashion. But as we've discussed, you know, second quarter for us being definitely more robust than the first half that's playing through, and I think if you think about that going forward, that makes a lot of sense.

Speaker Change: We are still finalizing our plans for next year, but let me provide you some preliminary qualitative commentary to inform your modeling for 2025.

Speaker Change: For innovative medicine, we remain very confident in our ability to deliver growth. Despite a significant low resulting in sales above the $57 billion commitment. We stated in 2021. This will be driven by our in market brands and continued progress from our recently launched products, including from fire and IBD and river.

Speaker Change: To account for the completion of the V-wave transaction, as previously disclosed, or adjusted operational EPS guidance, now includes the completion of 24 cents per share in the fourth quarter, and six cents per share in 2025.

Joe Wolk: Combined, this yields an updated 2024 adjusted operational EPS guidance of $9.91 at the midpoint of the range, basically flat year on year despite absorbing approximately 92 cents of acquisition activity. While not predicting the impact of currency movements, utilizing the recent exchange rates just for reference, our reported adjusted earnings per share for the year now estimates a full-year positive impact of 2 cents per share. As such, we expect reported adjusted earnings per share of $9.93 at the midpoint.

Speaker Change: In non small cell lung cancer.

Speaker Change: Guarding this the Lora L. O. We are planning for Biosimilar entries in the U S. In January assuming that Humira erosion curve as a relatively good proxy for your models.

Speaker Change: Combined, this yields an updated 20-24 adjusted operational EPS guidance of $9.91 at the midpoint of the range, basically flat you're on your despite absorbing approximately 92 cents of acquisition activity.

Speaker Change: We continue to expect a negative impact associated with the part D redesign.

Speaker Change: While not predicting the impact of currency movement, utilizing the recent exchange rates, just for reference, a reported adjusted earnings per share for the year, now has made a full-year positive impact of two cents per share. As such, we expect reported adjusted earnings per share of $9.93 at the midpoint.

Speaker Change: Pipeline, we anticipate data readouts across all our priority platforms anticipated approvals of Trump fire sub Q in Crohn's disease, Rob prevent sub Q for lung cancer, and Nip Ocala Mab in generalized myasthenia gravis as well as potential filings for tourists and bladder cancer and a ticker print in major depressive. This.

Jennifer Taubert: We're over 4,200 patients now with Carvykti, and it is the most successful CAR-T launch for across, you know, throughout the industry across all CAR-T's.

Joe Wolk: We are still finalizing our plans for next year, but let me provide you some preliminary qualitative commentary to inform your modeling for 2025. For innovative medicine, we remain very confident in our ability to deliver growth despite a significant LOE, resulting in sales above the $57 billion commitment we stated in 2021. This will be driven by our in-market brands and continue progress from our recently launched products, including Tronfaya and IBD and RyberVant in non-small cell lung cancer. Regarding the Stelara LOE, we are planning for biosimilar entries in the US in January, assuming that Humerus erosion curve is a relatively good proxy for your models.

Speaker Change: We are still finalizing our plans for next year, but let me provide you some preliminary qualitative commentary to inform your modeling for 2025.

Speaker Change: Jordan.

Speaker Change: As a reminder, trump via <unk> and tourists.

Jennifer Taubert: Then last to you, you asked about Tech-Valley and Teleketomaps, so if we take a look at, start off basically with Tech. Tech sales were 135 million and 21 percent growth for the quarter, but it was flat sequentially. We're seeing really nice uptake in the market in terms of new patients, but there's also a dynamic where physicians are treating with longer treatment durations. So we do think that there's a lot of continued growth and expansion for the product. It's performing very well for patients, and not only in its current lines of therapy, but we're also taking a look and studying it in combinations, whether with Darzelec's, whether with Tal. And so we do believe that there's a lot of growth potential on there.

Speaker Change: <unk> to be the three largest underappreciated assets in terms of our revenue projections versus what analysts are estimating for the back half of this decade.

Speaker Change: For Innovative Medicine, we remain very confident in our ability to deliver growth, despite a significant LAW, resulting in sales above the $57 billion commitment, we stated in 2021.

Speaker Change: For Med Tech, we continue to expect to deliver on our long term objective identified at last year's Enterprise business review of growing operational sales in the upper end of the 2022 through 2020 seven weighted average market growth rate of 5% to 7%.

Speaker Change: This will be driven by our in-market brands and continue progress from our recently launched products, including from FIA and IBD and Rybrevant in non-small cell loan cancer.

Speaker Change: We also expect continued adoption of newer products across all med tech businesses, such as Vera Paulson electrophysiology zealous, enabling technology across orthopedics Odyssey in PRC and surgical vision and contributions from our abiomed and Shockwave integrations.

Speaker Change: Regarding the Stelara LOE, we are planning for biosimilar entries in the U.S. in January, assuming that you may as erosion curve is a relatively good proxy for your models.

Joe Wolk: We continue to expect a negative impact associated with the Part D redesign. In our pipeline, we anticipate data readouts across all our priority platforms, anticipated approvals of Tronfaya sub-Q in Crohn's disease, RyberVant sub-Q for lung cancer, and Nippocalamab in generalized myasthenia gravis, as well as potential filings for Taurus in bladder cancer and a tick of print in major depressive disorder. As a reminder, Tronfaya, RyberVant, and Taurus continue to be the three largest under-appreciated assets in terms of our revenue projections versus what analysts are estimating for the back half of this decade. For METEC, we continue to expect to deliver on our long-term objective, identified at last year's Enterprise Business Review, of growing operational sales in the upper end of the 2022 through 2027 weighted average market growth rate of 5% to 7%.

Speaker Change: We continue to expect a negative impact associated with a part D redesign.

Speaker Change: In our pipeline, we anticipate data read-outs across all priority platforms, anticipated approvals of Tremfya, SubQ, and Crohn's Disease, Rybrevant, SubQ for lung cancer, and Nipocalimab in generalized my Senior Grabis, as well as potential filings for TAR-Us in bladder cancer, and a tickle print in major depressive disorder.

Speaker Change: Specific to volume based pricing in China, We expect continued impacts from the rollout of the 'twenty 'twenty four tenders in orthopedic sports and intraocular lenses and anticipate V. B P to continue expanding across provinces and products.

Jennifer Taubert: For Tal, we're not reporting out the sales yet. I think we'll start on that probably next year, but both Tal and Tech, we continue to expand not only with the academic community, but also out into the community setting, and so we think there's a lot of growth ahead.

Speaker Change: Moving to the rest of the P&L when thinking about operating margin there are pluses and minuses tail wins include an anticipated reduction of acquired IP R&D expense year over year.

Speaker Change: As a reminder, Tremfya, Rybervant, and TAR-S continue to be the three largest, under-appreciated assets in terms of our revenue projections versus what analysts are estimating for the back half of this decade.

Jennifer Taubert: Maybe just a couple of things to highlight as well. You know, with Tech, that is not only the first in-class BCMA targeting T-cell engager, but the data really show it also is best in class relative to other molecules in that type. The deepest responses, complete response rates are approaching 50 percent, about half of patients. Duration of response is nearly two years, and very low discontinuation rate plus 5 percent, showing that the weight adjusted, both dosing where we can really optimize for the patients. It's really playing out there. Very excited about the early data we're seeing when we combine Tech with Dira.

Speaker Change: <unk> focus on Med Tech margin improvement and continued opex optimization benefits post separation.

Speaker Change: For MedTech, we continue to expect to deliver on our long-term objective identified at last year's enterprise business review of growing operational sales in the upper end of the 2022 through 2022-27 weighted average market growth rate of 5-7%.

Speaker Change: Working against US is unfavorable product mix, driven by still Aro biosimilar entrants and part D redesign.

With a brief look at your models last week. The consensus margin does not appear unreasonable and will provide further clarity in January once we complete our 2025 plan.

Joe Wolk: We also expect continue the adoption of newer products across all METEC businesses, such as varipals and electrophysiology, vellis enabling technology across orthopedics, odyssey and pure sea and surgical vision, and contributions from our abumed and shockwave innovations. TAR-200, Velys, Zytiga, Zytiga, Zytiga, Zytiga, Zytiga, Zytiga, Zytiga, Zytiga, Zytiga. Tailwinds include an anticipated reduction of acquired IPR&D expense year-over-year, continued focus on MedTech margin improvement, and continued OptX optimization benefits post-separation. Working against us is on a favorable product mixed to driven by Stelara by a similar entrance and part D redesign. With a brief look at your models last week, the consensus margin does not appear unreasonable and will provide further clarity in January, once we complete our 2025 plan.

Speaker Change: We also expect to continue the adoption of newer products across all medtech businesses, such as Veyra-Pulse and Electrophysiology, Velys and Abelink technology across orthopedics, Autocyti and PURC in surgical vision, and contributions from our Abium Ed and Shockwave integrations.

We do not expect to maintain the heightened levels of interest income due to a reduction in interest rates and impact from that experienced in 2024 related to acquisition activity.

Speaker Change: Regarding other income and expense, we expect lower net other income due to the nonrecurring nature of the monetization of royalty rates experienced in Q3, a lower benefit related to employee benefit programs based on discount rate assumptions as well as income lost on the can view dividend.

Speaker Change: Specific to volume-based pricing in China. We expect continued impacts from the rollout of the 2024 Tenders in North-Apedic Sports and Interocular lenses and anticipate VBP to continue expanding across provinces and products.

Jennifer Taubert: We're seeing really high response rates in patients who have been mostly treated and now in phase 3 studies, in patients with 1-3 prior lines. And in similar story with Tal, that is a B-cell preserving target, as you know, to their fewer risks of severe infections with Tal. And it has shown in the late line the highest overall response rates of any T-cellingager by specific 4-mile LOMA. So, you know, we think there's a lot of upside the opportunity there. And again, the data in combo with DARA are really impressive. So, we're marching along with that combination and where we can have the benefits of both the T-cellingager together with the CD-38 class, and really only JNJ is positioned to do that.

Speaker Change: Lastly.

Speaker Change: Based on what we know today under current tax law, we anticipate our 2025 tax rate to be slightly lower than our anticipated 2020 for tax rate.

Speaker Change: Moving to the rest of the PNL, when thinking about Papariyumarjan, there are pluses and minuses. Tailwinds include an anticipated reduction of acquired IPR and D expense year-over-year, continued focus on net-tech margin improvement, and continued off-ex optimization benefits post-deceporation.

Speaker Change: To wrap up prior to Q&A, we are pleased with our underlying 2020 for performance that simultaneously fortify. The strong foundation for continued success heading into 2025 with that I'll now turn it over to Kevin to open the call for your questions.

Speaker Change: Working against us is unfavorable product mixed through them by Stelara by a similar entrance and part D redesign.

Kevin: Thank you and I'll be conducting a question and answer session, if you'd like to be placed into the question queue. Please press star one on your telephone keypad, if you'd like to withdraw your question. Please press star two please limit your questions to one question only.

Speaker Change: With a brief look at your models last week, the consensus margin does not appear unreasonable and will provide further clarity in January once we complete our 2025 plan.

Joe Wolk: We do not expect to maintain the heightened levels of interest income due to a reduction in interest rates and impact from debt experience in 2024 related to acquisition activity. Regarding other income and expense, we expect lower net other income due to the non-recurring nature of the monetization of royalty rights experienced in Q3, a lower benefit related to employee benefit programs based on discount rate assumptions, as well as income lost on the Kenview dividend. Lastly, based on what we know today, under parent tax law, we anticipate our 2025 tax rate to be slightly lower than our anticipated 2024 tax rate.

Speaker Change: We do not expect to maintain the height and levels of interest income, tutorial adoption and interest rates and impact from that experience in 2024 related to acquisition activity.

Danielle Antalfi: Thank you.

Danielle Antalfi: Our next question is coming from Danielle Antalfi from UBS. Remind us our lives. Hey, good morning, everyone. Thanks so much for taking the question. Just a quick question on the EP business. I mean, obviously, that's very possible. You hadn't really seen much of a slow down. I appreciate Q3 was probably arguably the first quarter where we had a more full quarter of PFA launching. I guess I'm just curious about what you think the underlying market is growing and where PFA is versus RF. And also, as we look ahead to 2025 and Verapult, how that changes dynamics for JNJ's EP business.

Speaker Change: Our first question is coming from Chris Schott from JP Morgan. Your line is now live.

Chris Schott: Great. Thanks, so much for the question, maybe just one on talc here I know, there's still limited comments, but it seems as though the company has obviously made some some advancements here in getting this behind the organization. Maybe just can you help us a little bit in terms of from your perspective next key steps to watch from here and what does J&J is overall level of confidence.

Speaker Change: Regarding other income and expense, we expect lower net other income due to the non-recurring nature of the monetization of royalty rights experienced in Q3, a lower benefit related to employee benefit programs based on discount rate assumptions, as well as income loss on the can view dividend.

Chris Schott: Since that you have a path to resolve this in the relative near term for the story. Thanks, so much.

Speaker Change: Lastly, based on what we know today, under current tax law, we anticipate our 2025 tax rate to be slightly lower than our anticipated 2024 tax rate.

Speaker Change: Thank you Kris and US you have heard me before our intention with respect to the litigation is to bring a response you will find a comprehensive resolution to these claims.

Joe Wolk: To wrap up prior to Q&A, we are pleased with our underlying 2024 performance that simultaneously fortifies the strong foundation for continued success heading into 2025.

Speaker Change: To wrap up prior to Q&A, we are pleased with our underlying 2024 performance that Simultaneously fortified a strong foundation for continued success heading into 2025. With that, I'll now turn over to Kevin to open the call for your questions.

Danielle Antalfi: Thanks so much.

Danielle Antalfi: Thank you, Daniel. And, as you said, it is a really exciting time to be in electrophysiology. And we couldn't be more proud of the significant leadership position we've held in this category for more than 20 years. And just to put our performance in context, our EP business is a $5 billion business, which grew 11% in the third quarter and 17% year-to-date. We are actively progressing at a launch of Verapult in May and in Japan, where we still are executing against our soft launches. We've had over 800 successful cases. We shared the data from our admire study at the recent HRS meeting, showing 85% primary effectiveness in that portfolio and that product.

Kevin: With that, I'll now turn over to Kevin to open the call for your questions. Thank you, and I'll be conducting your question and answer session. If you'd like to be placing the question, Q, please press star one on your telephone keypad. If you'd like to withdraw your question, please press star two. Please limit your questions to one question only.

We are making meaningful progress to do just that.

We have filed our prepackaged reorganization.

Kevin: Thank you, and I'll be giving you a question and answer session. If you'd like to be placing the question, please press star one on your telephone keypad. If you'd like to withdraw your question, please press star two. Please limit your questions to one question only.

Speaker Change: With the support of 83% of the claimants and also we have a lot of that decision of the court to keep the filing in Houston. So as I said, we are we are making progress in these resolutions that they refer as far as mix of steps.

Chris Schott: Our first question is coming from Chris Shop from JPMorgan. You're lying in our life. Great, thanks so much for the question. Maybe just one on talc here. I know this is still limited comments, but it seems though the company's obviously made some advancements here into getting this behind the organization. Maybe just can you help us a little bit in terms of, from your perspective, next key steps to watch from here? And what is J&J's overall level of confidence that you have a path to resolve this in a relatively near term for the story? Thanks so much.

Speaker Change: Our first question is coming from Chris Shop from JP Morgan, your line is now live.

Speaker Change: Alright. Thanks, Chris. This is Eric has had a worldwide litigation Judge Lopez last week on Thursday after ruling that the case properly and appropriately should remain in Texas or do the parties to meet and confer and agreed to a schedule for the expeditious resolution.

Chris Shop: Great, thanks so much for the question. Just one on Talk here, I know this still limited comments, but it seems though the company's obviously made some advancements here and to game this behind the organization. Maybe just, can you help us a little bit in terms of from your perspective next key steps to watch from here? And what is J&J's overall level of confidence that you have a path to resolve this in a relative near term for the story? Thanks so much.

Danielle Antalfi: And we believe we've got a product that really will hunt. As it relates to the US, you're right. We're seeing continued competition, especially in the ablation space, given that we don't currently have a PFA product. But having spent a lot of time in EP labs over the last couple of weeks, I can tell you that we are incredibly excited for the availability of Verapults, which we expect to have approval sometime later this quarter or in Q1 of next year. We are still, by the way, mapping the majority of those cases, Daniel. That's what most people don't see is that while we may not have that product in the portfolio, we are mapping more than 50% of competitive cases.

Speaker Change: Of the case and by that it mean.

Speaker Change: Means setting forth is schedule to get through to the confirmation procedure addressing any ancillary motions, whether the motions to dismiss or issues relating to the votes and the parties are in that process, we contemplate putting forth a schedule that resolve those issues through the end of the year for a.

Joe Wolk: Yeah, thank you, Chris. And as you have heard me before, our intention with respect to the litigation is to bring a responsible final and comprehensive resolution to these claims. And we are making meaningful progress to do just that. We have filed our prepackage interventions on plan with the support of 83% of the claimants. And also we have that decision of the court to keep the filing in Houston. So, as I said, we are making progress in these resolutions that I refer.

Speaker Change: Yeah, thank you, Chris. And as you have heard me before, our intention with respect to the validation is to bring a responsible, final and comprehensive resolution to these claims. And we are making meaningful progress to do just that. We have filed our prepackage interventions on plan with the support of 83% of the claimants, and also we have had a decision of the court to keep the filing in Houston. So as I said, we are making progress in this resolution that I refer, as far as next steps, Edic.

Asian hearings sometime at the beginning of next year. So that's the schedule around.

Speaker Change: Yeah.

Speaker Change: Thank you. Your next question is coming from Larry <unk> from Wells Fargo. Your line is now lives.

Danielle Antalfi: In fact, we've updated our market-leading carto software to actually reflect better visualization for competitive products. This winning strategy in RF has been a full portfolio. And similarly in PFA, beyond our first launch with the VARAPALS, you will see a full portfolio of focal, large, focal single shot, and dual energy catheters. By the way, we're ready applied for CE marking for our dual energy catheter. And so we're confident in our leadership position in EP and our sources of differentiation for the future.

Good morning, Thanks for taking the question.

Speaker Change: Jim on a med tech maybe help us understand the impact of the onetime items in Q3, such as the ortho SKU rationalization, how youre thinking about the impact from the Hurricanes in Q4. It what gives you confidence you can deliver the high end of that 5% to 7% next year. Thanks for taking the question.

Erik Haas: As far as next steps, Eric. Hi, thanks, Chris. This is Eric Haas, head of World by Litigation. Judge Lopez last week on Thursday after ruling that the case properly and appropriately should remain in Texas or to the parties to meet and confer and agree to a schedule for the expeditious resolution of the case. And by that, it means setting forth a schedule to get through to the confirmation procedure, addressing any ancillary motions, whether the motions to dismiss or issues relating to the votes. And the parties are in that process. We contemplate putting forth a schedule that resolve those issues through the end of the year for a confirmation hearing sometime at the beginning of next year.

Speaker Change: Hi, thanks, Chris. This is Eric Haas, I had a World Bud litigation. Judge Lopez, last week, on Thursday, after ruling that the case properly and appropriately should remain in Texas, order the parties to meet and confer an agreed to a schedule for the expeditious resolution of the case. And by that, it means setting forth a schedule to get through to the confirmation procedure addressing any ancillary motions, whether the motions to dismiss or issues relating to the votes. And the parties are in that process, we contemplate putting forth a schedule that resolve those issues through the end of the year for a confirmation hearing some time at the beginning.

Speaker Change: Larry Thank you for the question and where we're proud of the six 4% operational growth for the quarter are.

Speaker Change: 757% for full year, and I think the results really talk to the success of our deliberate move into higher growth higher margin categories, especially in the in the cardiovascular space Youll recall and Youll see that from our results almost $300 million isn't being added from the Shockwave.

Speaker Change: Acquisition, which continues to perform to expectations as does abiomed and we've also added to the portfolio with the acquisition of lamina in the fourth quarter of last year, and then more recently the announced closure of the acquisition of Z wave, which once again takes us into even more exciting high growth high margin opportunities within.

Erik Haas: So that's the schedule around.

Speaker Change: and NipNex here, so that's the schedule around.

Erik Haas: Thank you.

Larry Biegelsen: Next question is coming from Larry Beegelson from Wells Fargo. Your line is out live. Good morning. Thanks for taking the question.

Speaker Change: Thank you, next question is coming from Larry Beerlson from Wells Fargo, your line is now live.

Tim Schmid: Tim, on MedTAC, maybe help us understand the impact of the one-time items in Q3, such as the ortho, you know, skeurationalization, how you're thinking about the impact from the hurricanes in Q4 and what gives you confidence you can deliver the high end of that five to seven percent next year. Thanks for taking the question. Larry, thank you for the question. And we're proud of the 6.4 percent operational growth for the quarter; sorry, 5.7 percent for full year. And I think the results really talk at the success of our deliberate move into higher growth, higher margin categories, especially in the cardiovascular space.

Speaker Change: Within cardiovascular.

Larry Beerlson: Good morning. Thanks for taking the question. Tim, on MedTAC, maybe help us understand the impact of the one-time items in Q3, such as the ortho, you know, skew rationalization. How you're thinking about the impact from the hurricanes and Q4, and what gives you confidence you can deliver the high end of that 5% next year? Thanks for taking the question.

Speaker Change: Specifically to orthopedics. We believe this is going to be another solid year for orthopedics, three 2% growth for the.

Danielle Antalfi: Thank you, Daniel.

Danielle Antalfi: Thank you.

Shagun Chadha: Next question today is coming up from Schudren Singh from RBC Capital Market, provided in our lives. Oh, great. Thank you so much. I was hoping you could elaborate on the dynamics that you're seeing in the Asia-Pacific region in Medtech, specifically China. You know, could you quantify the headwinds when you expected to normalize and you did talk about China, VPP and that is expanded into additional provinces and products. So could you just elaborate on the impact there and how we should think about it in 25? Thank you. Thank you, Shagun.

Speaker Change: For the for the for the for the for the year.

Speaker Change: We did have a slightly softer third quarter, which was a result to your point of the restructure within orthopedics orthopedics.

Speaker Change: Larry, thank you for the question and we're we're proud of the 6.4% operational growth for the quarter 7, sorry 5.7% for full year and I think the results really talk to the success of our deliberate move into higher growth, higher margin categories especially in in the cardiovascular space. You'll recall and you'll see that from our results almost $300 million is being added from the shockwave acquisition which continues to perform to expectations as does Ave Omed and we've also added to the portfolio with the acquisition of Lamanar and the fourth quarter of last year and then more recently the announced closure of the acquisition of E-Wave which once again takes us into even more

Speaker Change: And as we look to the full year, we expect a return to a significantly better performance, especially in orthopedics, which typically has a stronger fourth quarter and we are seeing tremendous performance, specifically within the hips and knees categories growing 6% and 7% and I think that's really been enabled by the success of our enabling technology.

Tim Schmid: You'll recall, and you'll see that from our results, almost $300 million is being added from the Shockwave acquisition, which continues to perform to expectations. As does Abby Ahmed, and we've also added to the portfolio with the acquisition of Lamanar in the fourth quarter of last year, and then more recently, the announced closure of the acquisition of the Wave, which once again takes us into even more exciting high growth, high margin opportunities within cardiovascular. And as we look to the full year, we expect a return to significantly better performance, especially in orthopedics, which typically has a stronger fourth quarter.

Shagun Chadha: Yes, we've had a myriad of issues hitting us in the Asia-Pacific region of late, and let me just highlight a couple, and I'll certainly get to your question on China. First of all, you may know that in February of this year in Korea, the government initiated, or at least a strike was initiated, among the healthcare professional community. Unfortunately, we don't see any end in sight to that, and so that certainly has been a headwind. We're seeing macroeconomic pressures in Japan. And then, more importantly, to your question, the ongoing impact of volume-based procurement, which has also been exacerbated by the anti-corruption campaign.

Speaker Change: And Dallas.

Speaker Change: In in knees, which also by the way we've added indication of the Uni knee.

As well as our concise and hip.

Speaker Change: Hip navigation systems with our within hips.

Speaker Change: I'd also add to the orthopedics performance, we are significantly addressing.

Portfolio gaps within our trauma portfolio with the launch of Tri Leap, a virtual guide and volt in the back half of the year and I think you know our spine portfolio has been challenged and we're addressing that with the launch of TV, our new trial to cervical lumbar system and the new spine robot, which we just received approval for.

Speaker Change: for Exciting High Growth, High March and Opportunities within Cardio Vascular. Specifically to Orthopedics, we believe this is going to be another solid year for Orthopedics, 3.2% growth for the...

Shagun Chadha: And by the way, while we believe this is absolutely the right thing to do, and we support it for the long term, it is impacting procedures and the engagement by healthcare professionals with companies like ours, especially on premium products. We have a leadership position. We have the largest meta-company in China, and given the high leadership positions, we are seeing a disproportionate impact from VBP. We have five major categories impacted through tenders in 2023: electrophysiology, trauma, spine, endocuters, and energy, and more recently IOLs and sports in our orthopedics business. We do believe that this will be a headwind through the remainder of 24 and enter 25.

Speaker Change: , for the year, we did have a slightly softer third quarter, which was a result to your point of the restructure within orthopedics. And as we look to the full year, we expect a return to significantly better performance, especially in orthopedics, which typically has a stronger fourth quarter. And we are seeing tremendous performance specifically within the hips and knees, categories, growing 6% and 7%, and I think that's really been enabled by the success of our enabling technologies in Dallas, in knees, which also, by the way, we've added the indication of the uni-me, as well as our kin-size and...

Speaker Change: As it relates it relates to the Hurricanes, we did see the impact certainly of Hurricane Helene in the final weeks of the third quarter and continue to see the impact of Milton over the last coming days, especially in the areas most impacted by those storms.

Tim Schmid: And we are seeing tremendous performance, specifically within the hips and knees categories, growing 6 percent and 7 percent. And I think that's really been enabled by the success of our enabling technologies in Dallas, in knees, which also, by the way, we've added indication of the uni-me, as well as our kin size. And hip navigation systems within hips. I'll also add to the orthopedics performance; we are significantly addressing portfolio gaps within our trauma portfolio, with the launch of Tri-Leap virtual guide and vault in the back half of the year. And I think you know our spine portfolio has been challenged, and we're addressing that with the launch of Telogen, our new Trieltus thoracolumbar system, and the new spine robot, which we just received approval for.

Speaker Change: I do think the watch out that we all need to watch carefully is certainly the impact of the recently announced.

Speaker Change: Announced IV saline shortages would you if they do persist could potentially impact our surgical procedures across our portfolio. Thank you Larry.

Speaker Change: Thank you next question is coming from Louise Chen from Cantor Fitzgerald. Your line is now live.

Shagun Chadha: That said, we are absolutely confident that China continues and will continue to be an important part of our portfolio. Even with the impact of VBP, we believe we can deliver tremendous growth in returns for our shareholders. And I think this really talks to the strength of our global portfolio across Medtech, the fact that we can offset headwinds in one geography with data performance in places like Europe and the US. Please rest assured, we also believe that this part of the world, especially in Asia-Pacific, will continue to be a growth opportunity. And let me tell you why: 60% of the world's patients live in that part of the world, and we're proud of the fact that we've been in many of these markets for many, many years, and expect to continue to do so.

Speaker Change: HIP navigation systems within HIPs. I also add to the orthopedics performance we are significantly addressing portfolio gaps within our trauma portfolio with the launch of Tri-Leap, VirtueGuyde and Volt in the back half of the year. And I think you know our spine portfolio has been challenged, and we're addressing that with the launch of Telogen, our new trieltis thoracolumbar system and the new spine robot which we just received approval for. As relates to the hurricanes we did see the impact certainly of Hurricane Helene in the final weeks of the third quarter and continue to see the impact of Milton over the last coming days, especially in the areas most impacted by those storms.

Louise Chen: Hi, Thank you for taking my question here I wanted to ask you how you see Trump buy at J&J to 113 in some of your other pipeline products coming together to replace the old block just a lora and then take share from competitors. Thank you.

Jennifer Taubert: Hi, Louise it's Jennifer and good morning, everyone and I wanted to start off by having a chance to really recognize and thank all of my innovative medicine colleagues around the world for a fabulous quarter in the third quarter, we really continues to deliver against our strategy with 11 key brands, having double digit growth and achieving.

Tim Schmid: As relates to the hurricanes, we did see the impact, certainly, of Hurricane Helene in the final weeks of the third quarter, and continue to see the impact of Milton over the last coming days, especially in the areas most impacted by those storms. I do think to watch out that we all need to watch carefully is certainly the impact of the recently announced IV saline shortages, which, if they do persist, could potentially impact surgical procedures across our portfolio. Thank you, Larry.

Jennifer Taubert: A few really notable milestones, notably the Trumpf fire approval and launch in all sorts of colitis also riper event plus last clues in first line non small cell lung cancer and we also completed the acquisition of N. M 26, which is a phase II ready asset for.

Shagun Chadha: The final point I'll make is, let's remember, while this is a headwind for Medtech, this is not material to Johnson and Johnson. When we look at our global sales across Johnson and Johnson, less than 5% of our businesses in China. Thank you again. Thank you.

Speaker Change: Storms, I do think the watch out that we all need to watch carefully is certainly the impact of the recently announced IV, Sailing Shortages, which if they do persist, could potentially impact surgical procedures across Apple Tvalyam, thank you very much.

Jennifer Taubert: For atopic dermatitis, so as we take a look at our immunology portfolio, we're really excited about <unk> and what we see as the prospects ahead I just mentioned that we got approval during the quarter for that product in ulcerative colitis. We believe we truly have a winning proposition for that.

Vamil Divan: Next question is coming from VAMO DAVAN from Blue and the LARAS. You mentioned the US sales for both those projects were a little bit lighter, and we were expecting, and you mentioned this unfavorable patient mix impacting the quarters. So I'm just curious if you can just go in a little more detail in what you've seen for those products in the US specifically, and is this patient mix issue sort of this quarter today? Is it adjustments from prior quarters? Is it something specific to Johnson and Johnson, or is it maybe something broader to the immunology market?

Louise Chan: Thank you. Next question is coming from Louise Chan from Cancer Pistoral Drill Line. Is that live?

Speaker Change: Thank you. Next question is coming from the least chat from Cantor Pistral, July, and is not live.

Jennifer Taubert: Hi, thank you for taking my question here. I wanted to ask you how you see trim via J&J 2113, some of your other pipeline products coming together to replace sales loss to Salara, and then take share from entrenched competitors. Thank you.

Speaker Change: Hi, thank you for taking my question here. I wanted to ask you how you see Tremfya, JNJ-2113, some of your other pipeline products coming together to replace SIL's Blossoms to Stelara and then take share from Entrench competitors. Thank you.

Jennifer Taubert: Asset in IBD.

Jennifer Taubert: And it's off to a really nice start with a good risk really strong reception.

Jennifer Taubert: Amongst the medical community and we see that product, having a lot of strength.

Jennifer Taubert: Hi, Louise, it's Jennifer, and good morning, everyone. And I wanted to start off by having a chance to really recognize and thank all my innovative medicine colleagues around the world for a fabulous quarter in the third quarter. We really continue to deliver against our strategy with 11 key brands, having double-digit growth and achieving a few really notable milestones, notably the Tremfya approval and launch in ulcerative colitis, also Rybrevant plus last clues, in first-line non-small cell lung cancer, and we also completed the acquisition of NM-26, which is a phase 2 ready asset for atopic dermatitis. So as we take a look at the immunology portfolio, we're really excited about Tremfya and what we see as the prospects ahead.

Speaker Change: Hi, Louise. It's Jennifer, and good morning everyone, and I wanted to start off by having a chance to really recognize and thank all my innovative medicine colleagues around the world for a fabulous quarter in the third quarter. We really continue to deliver against our strategy with 11 key brands, having double-digit growth, and achieving a few really notable milestones, notably the Tremfya approval and launch and ulcerative colitis, also Rybrevant plus last clues, in first line non- small cell lung cancer, and we also completed the acquisition of NM-26, which is a phase two ready asset for atopic dermatitis. So as we take a look at the immunology portfolio, we're really excited about Tremfya and what we...

Jennifer Taubert: It's the only dual active IL 23, so it blocks, both IL 23, and <unk> 64 receptor cells.

Jennifer Taubert: It really sets what we believe is a new bar in terms of efficacy with the highest rate of endoscopic normalization and we've got really rigorous head to head data versus to Lora showing superiority in crohn's disease, and we think that we've got unrivaled flexibility in and what will ultimately be.

Jennifer Taubert: Thank you.

Jennifer Taubert: Yeah, Vamo. If you talk about with patient mix, this would be something that is specific to some of the true ups that we do. As you are all aware, we end up having to make an assessment on our growth to net reduction. And as we get final bills in, there always are some true-ups. Sometimes they're for the positive; sometimes it is a negative reduction. So when we refer to patient mix, this is different patients coming through different channels, as well as some of the accounting through ups for the final payments that we make.

Jennifer Taubert: Sub Q, both induction and maintenance dose for Drumfire, so sort of transpire with 4 billion and sales for the quarter and that was really on psoriasis and psoriatic arthritis alone. When we take a look going forward and what we had seen with to Laura in terms of the strength in IBD and the potential we think.

Jennifer Taubert: I just mentioned that we got approval during the quarter for that product in Ulcerative Colitis. We believe we truly have a winning proposition for that asset. That in IBD, and it's off to a really nice start with a really strong reception amongst the medical community. And we see that product having a lot of strengths, because it's the only dual active IL-23. So it blocks both IL-23 and the CD-64 receptor cells. It really sets what we believe is a new bar in terms of efficacy, with the highest rate of endoscopic normalization. And we've got really rigorous head-to-head data versus Stelara, showing superiority in Crohn's disease.

Speaker Change: BC as the prospects ahead. I just mentioned that we got approval during the quarter for that product in all sort of colitis. We believe we truly have a winning proposition for that asset in IBD. And it's off to a really nice start with a good really strong reception amongst the medical community. And we see that product having a lot of strengths because it's the only dual active IL-23. So it blocks both IL-23 and the CD64 receptor cells. It really sets what we believe is a new bar in terms of efficacy with the highest rate of endoscopic normalization. And we've got really rigorous head-to-head data versus Stolara showing superiority.

Jennifer Taubert: Then I will hand it over to Jennifer to specifically talk about the performance and the commercial perspective of Tremfya and Solar in the US. And I think so, if we take a look for Tremfya outside the US, really nice growth at 27% in the US; it was a little over 9%, specifically for that patient mix issue that just spoke about. We do think that the prospects are very strong for continued Tremfya growth. Based on what I articulated before around the launches in ulcerative colitis and the upcoming launches that we're planning for in Crohn's disease as well.

Trump fire definitely is an asset that is is still our size or bigger and better. So a lot of exciting opportunity for us our head for 2113, we're really excited about our oral asset that we're developing and I'll, let John read My colleague John Reid actually talk about why we're so excited about it.

John Reid: And some of the data upcoming data there, but we do think that being able to have that advanced efficacy and known safety profile and its simple oral tablet is not only going to be great for the existing biologics appropriate patients, but we think it gives us a great market expansion opportunity moving into earlier lines of therapy is.

Jennifer Taubert: I think for Stellara, we did see a decline, and that again sort of similar patient mix piece in the US. We've also, and also we've noted the decline ex-US, particularly in Amia due to biosimilar competition. We know that Stellara is near at its end of life. And really that Tremfya and across the rest of our portfolio, we've got a very robust stable of products with pretty significant growth. Thank you, Vamo.

Jennifer Taubert: And we think that we've got unrivaled flexibility in what will ultimately be subcue both induction and maintenance dose for Tremfya. So Tremfya was 4 billion in sales for the quarter, and that was really on psoriasis and psoriatic arthritis alone. When we take a look going forward and what we had seen with Stelara in terms of the strength in IBD and the potential, we think that Tremfya definitely is an asset that is Stelara size or bigger and better. So a lot of exciting opportunity for us ahead.

Jennifer Taubert: Well John.

Speaker Change: and Crone's Disease, and we think that we've got unrivaled flexibility in what will ultimately be the sub-Q, both induction and maintenance dose for Tremfya's. So Tremfya was 4 billion in sales for the quarter, and that was really on psoriasis and psoriatic arthritis alone. When we take a look going forward, and what we had seen with Stelara in terms of the strength in IBD and the potential, we think that Tremfya definitely is an asset. That is, you know, a Stelara size or bigger and better. So a lot of exciting opportunity for us ahead. For 2113, we're really excited about our oral asset that we're developing. And I'll let John read, my colleague John Read.

John Reid: John.

Yeah. Thanks for the two of them went three is really moving along nicely.

John: As you know this is our targeted oral peptide a very exquisite.

John: Designed molecule that binds to and blocks the IL 23 receptor.

John: So orally bio available where the once daily dosing.

John:

Kevin: Kevin, we have time for one last question.

John: Psoriasis indication.

Kevin: Thank you.

Jason Bedford: Our final question today is coming from Jason Bedford from Raymond James; our line is now live. Good morning. Maybe just a question for other Tim or Joe. Appreciate the color on MedTech, but the 5% bogie for the year still implies a decent acceleration in 4Q off a tougher comp. What gets better in 4Q and then just a quick clarification. The obvious solutions dynamic from Halein. Are you seeing an impact on volumes outside of Western North Carolina in Florida? Thanks. Jason, thank you for the question.

John: Fully enrolled now for phase III studies, which are quite broad.

And include head to heads against took two inhibitors as well as both adult and adolescent patients as well as a study.

John Reed: For 2113, we're really excited about our oral asset that we're developing. And I'll let John read. My colleague John Read actually talked about why we're so excited about it and some of the data, upcoming data there. But we do think that being able to have that advanced efficacy and known safety profile and its simple oral tablet is not only going to be great for the existing biologics appropriate patients. But we think it gives us a great market expansion opportunity moving into earlier lines of therapy as well. John me. Yeah, thanks. The 2113 is really moving along nicely.

John: Patients, who have disease affecting hard to treat areas scope.

Speaker Change: actually talk about why we're so excited about it and some of the data, upcoming data there. But we do think that being able to have that advanced efficacy and known safety profile and its simple oral tablet is not only going to be great for the existing, you know, biologics, appropriate patients, but we think it gives us a great market expansion opportunity moving into earlier lines of therapy as well. Yeah, thanks. The 2-1-3 is really moving along nicely. You know, this is our targeted oral peptide, a very exquisite, eloquently designed molecule that binds to and blocks the IL-23 receptor and is orally bi-available with a once-stay lead dose.

John: And.

John: Other parts of the anatomy of it can be very difficult to clear typically so we're really looking quite comprehensively there and that the data will be rolling out in the next few months. So we look forward to sharing those would be appropriate time.

John: In inflammatory bowel disease, where in a single seeking phase two study in ulcerative colitis, where we're exploring different doses.

Tim Schmid: Let me hit the last one first. No, we have seen the majority of the impact in the areas impacted by that storm, as I mentioned earlier. I think the watch out is any potential impact from additional shortage of IV fluid, which may impact elective procedures, and certainly were continuing to monitor that very carefully. As Joe mentioned, we expect, now on the back of the headwinds we mentioned earlier in Asia Pacific, to deliver adjusted operational growth of around 5% and north of 6% on an operational basis for the year. We believe that the momentum we're carrying into the fourth quarter, especially in our cardiovascular businesses with our winning portfolio and electrophysiology, strong double-digit growth in Shockwave, AbiumEd.

John: Moving into more advanced studies, given that the IL 23 pathway as well, but elevated inflammatory bowel disease links to still our interim via we're quite confident that those studies that will come through for us, but we will wait.

John Reed: You know, this is our targeted oral peptide of very exquisite, eloquently designed molecule that binds to and blocks the aisle 23 receptor and is orally bioavailable with a once daily dosing. The psoriasis indication is fully enrolled now for phase three studies, which are quite broad and include head-to-heads against tick two inhibitors, as well as both adult and adolescent patients, as well as a study in patients that have disease affecting heart-to-treat area, scalp, and other parts of the anatomy that can be very difficult to clear typically. So we're really looking quite comprehensively there, and the data will be rolling out the next few months.

John: We will wait for those data later this year to see how that oral medication is very rare.

Speaker Change: Losing, the, um...

Speaker Change: So, Ryus' indication is fully enrolled now, 4-phase, 3 studies, which are quite broad, and include head-to-heads against Tic-2 inhibitors as well as both adult and adolescent patients, as well as the study in...

John: Other thing I, maybe mentioned just in case it was not on your radar as we also have.

John: A.

John: Co antibody approach, we call. It 40, 804, where Gus go tripwire, and our TNF inhibitor or combined for patients who tend to be more on the more refractory side and we're in the middle of inflammatory bowel disease studies, there that will read out next year. So I'm really excited about.

Speaker Change: Patients that have disease affecting hard-to-treat areas scalp, and...

Tim Schmid: I mean, those are, as you can see, from the performance, absolute home runs. The other important dynamic here is that, as we signaled in the first and second quarter, we expected the improvement within our vision business, which typically has delivered solid mid-single-digit growth. We had a tremendous third quarter, which really gives us confidence in even stronger force. This was delivered by much better performances, especially in our contact lens business. In fact, here in the US, are most important market double-digit growth for contact lenses in the quarter. And that's just really been delivered from a stabilization of our distributor inventory in the US, the fact that we're able to get back to taking new wearer share, now that we have unconstrained supplies, especially within our A-stig portfolio.

Speaker Change: and other parts of the anatomy that can be very difficult to clear typically. So, we're really looking quite comprehensively there and the data will be rolling out the next few months, so we look forward to sharing those at the appropriate time. In inflammatory bowel disease, we're in a single-seeking phase-2 study and also colitis where we're exploring different doses before moving into more advanced studies, given that the IL-23 that way as well, validated inflammatory bowel disease, thanks to Stelara and Tremfya. We're quite competent that those studies will come through for us, but we'll wait for those data later this year to see how that oral medication is going to work.

John: That antibody combination as well so altogether.

John Reed: So we look forward to sharing those at the appropriate time. In inflammatory bowel disease, we're in a single seeking phase two study and also politice where we're exploring different doses before moving into more advanced studies given that the aisle 23 that way is well validated inflammatory bowel disease. Thanks to our interim via, we're quite confident that those studies will come through for us, but we'll wait for those data later this year to see how that oral medication is fairing there. The other thing I may be mentioned in just in case is not on your radar is we also have a co-antibody approach we call it 4804 where Gus and gold, Trempia and RTNF inhibitor are combined for patients who tend to be on the more refractory side and we're in the middle of inflammatory bowel disease studies there that we'll read out next year.

John: Immunology portfolio was really quite robust and particularly unemployment Tory mild disease and the areas of dermatology, where we've had the traditional shrinks.

John: We really do think that we've got a winning portfolio for inflammatory bowel diseases and maybe just one addition, because I know we've had questions on this in the past onto 113, we're gonna be developing that really across the spectrum. So both ulcerative colitis as well as crohn's disease. So we're starting off in ulcerative colitis, but absolutely have plans to develop it in crohn's as well.

Speaker Change: Thank you. Our next question today is coming from turn splitting from Morgan Stanley. Your line is now live.

Speaker Change: and the other thing I've mentioned just in case it's not on your radar as we also have a...

Tim Schmid: And so we do believe that vision has a very strong quarter ahead. And then, finally, across the portfolio, we're benefiting from tremendous new product launches, both within cardiovascular, the E8 peripheral catheter within Shockwave, continued performance within AbiumEd with our broad portfolio of pumps, and then within our surgery business, as well as, as orthopedics, as I mentioned earlier, tremendous new products to add differentiation to the portfolio. And typically, that fourth quarter also is a stronger one for us. So once again, very confident in our performance at around 5% on an adjusted basis and north of 6% operationally.

Speaker Change: Great. Thanks, so much for taking the question maybe just on the multiple myeloma portfolio, obviously very nice growth in <unk>. This quarter I know you spoke to some of the drivers, but just I was wondering if you can elaborate on what youre seeing in the second line setting at this point and then as you look at Tech Valley, you know through the rest of this year into next year.

Speaker Change: Co-antomoddy approach, we call it 48-04, where Gus Angol, Tremfya, and RTNF inhibitor are combined for patients who tend to be on the more refractory side and we're in the middle of inflammatory bowel disease studies there that we'll read out next year, so I'm really excited about that antibody combination as well, so all together, the immunology portfolio is really quite robust and particularly in inflammatory bowel disease and the areas of dermatology where we've had traditional strengths.

Speaker Change: What's it going to take to really see an acceleration in growth in this product or is this or do you have to wait until we get to earlier lines of treatment here to see growth again in that franchise. Thank you.

John Reed: So I'm really excited about that antibody combination as well. So all together, the immunology portfolio is really quite robust, and particularly in inflammatory bowel disease, in the areas of dermatology where we've had traditional strengths. We really do think that we've got a winning portfolio for inflammatory bowel diseases, and it may be just one addition because I know we've had questions on this in the past on 2113. We're going to be developing that really across the spectrum, so both ulcerative colitis as well as Crohn's disease. So we're starting off in ulcerative colitis, but absolutely have plans to develop it in Crohn's as well.

Hi, Terence Thanks, so much for the question on multiple myeloma and I won't go into a lot of detail on doors of lax, but it's worth noting that we had 3 billion in sales more than 20% growth and that <unk> really continues to perform quite strongly for us as we continue to grow share, particularly in frontline.

Tim Schmid: Thank you. Thank you, Jason, and thanks to everyone for your questions and your continued interest in our company. We apologize to those we couldn't get to because of time, but don't hesitate to reach out to the investor relations team with any remaining questions that you may have.

Speaker Change: We really do think that we've got a winning portfolio for inflammatory bowel diseases and maybe just one addition because I know we've had questions on this in the past on 2113. We're going to be developing that really across the spectrum, so both ulcerative colitis as well as Crohn's disease. So we're starting often in ulcerative colitis, but absolutely have plans to develop it in Crohn's as well.

Speaker Change: In both transplant eligible and ineligible patients.

Joaquin Duato: I would now turn the call over to Joaquin for some brief closing remarks. Thank you, everyone, for joining the poll today. As you have heard, we delivered strong results in the third quarter. Our high innovation and high growth portfolio on pipelines are advancing rapidly, and we are increasingly confident in our expectations for 2025 and beyond.

I really appreciate the question on car victory, So 286 million in sales, 88% growth year over year, and 53% quarter over quarter, and we're really seeing that continued growth for a number of reasons. So first we're seeing very strong demand based on.

John Reed: Thank you.

Terence Spoon: Next question today is coming from Terence Spoon from Morgan Stanley. Your line is now live. Great. Thanks so much for taking the question. Maybe just on the multiple myeloma portfolio, obviously very nice growth in Carvykti this quarter. I know you spoke to some of the drivers, but just was wondering if you can elaborate on what you're seeing in the second line setting at this point. And then as you look at Techvayli, you know, through the rest of this year, into next year, what's it going to take to really see an acceleration and growth in this product, or do you have to wait until we get to earlier lines of treatment here to see growth again on that franchise?

Speaker Change: Thank you. Next question today is coming from TAR-200 from Morgan Stanley, Irvine, is now live.

Speaker Change: Great. Thanks so much for taking the question. Maybe just on the multiple myeloma portfolio, obviously very nice growth in Carvykti, this quarter. I know you spoke to some of the drivers, but just was wondering if you can elaborate on what you're seeing in the second line setting at this point. And then as you look at Techvayli, you know, through the rest of this year, into next year, what's it going to take to really see an acceleration and growth in this product? Or is this, or do we have to wait until we get to earlier lines of treatment here to see growth again in that franchise? Thank you.

Speaker Change: Card attuned for approval for that second line and beyond patients. In addition, overall survival data was just presented for car victory in this line, which is what was is.

Unknown Executive: Enjoy the rest of your day. Thank you.

Operator: This concludes today's Johnson & Johnson's third quarter 2024 earnings conference call. You may now disconnect.

Speaker Change: Very very significant and further adds to the importance of this medicine for patients with multiple myeloma.

Terence Spoon: Thank you.

Terence Spoon: Hi, Terence. Thanks so much for the question on multiple myeloma. And I won't go into a lot of detail on Darzalex, but it's worth noting that we had 3 billion in sales, more than 20% growth, and that Darzalex really continues to perform quite strongly for us as we continue to grow share, particularly in front line, in both transplant eligible and ineligible patients. I really appreciate the question on Carvykti. So 286 million in sales, 88% growth, year over year, and 53% quarter over quarter. And we're really seeing that continued growth for a number of reasons. So first, we're seeing very strong demand based on the cartoon for approval for that second line and beyond patients.

Speaker Change: And the other aspect is we continue to progress really nicely with our continued capacity expansion. Both in terms of number of slots per day and Raritan. We gained approval for our manufacturing site in Europe for commercial production that is now underway and enable.

Speaker Change: Hi, Terence, thanks so much for the question on multiple myeloma, and I won't go into a lot of detail on Darzalex, but it's worth noting that we had 3 billion in sales, more than 20% growth, and that Darzalex really continues to perform quite strongly for us as we continue to grow, share particularly in front line in both transplant eligible and ineligible patients. I really appreciate the question on Carvykti, so 286 million in sales, 88% growth, year over year, and 53% quarter over quarter, and we're really seeing that that continued growth for a number of reasons, so first we're seeing very strong demand based on the...

Speaker Change: To serve patients and our CMO in the United States as well as producing on the clinical and and so all the way around from performance of the product from new data as well as continued capacity expansion. We continue to see very strong performance for car victory.

Speaker Change: As we discussed before I don't know that we will see that as a complete exact linear.

Speaker Change: Growth curve quarter to quarter simply because the capacity expansion works in a bit more of a stair step fashion.

Speaker Change: Cartitude-4, Approval for that second line and beyond patients in addition overall survival data was just presented for CAR-Victi in this line which is very, very significant and further adds to the importance of this medicine for patients with multiple myeloma. In the other aspect as we continue to progress really nicely with our continued capacity expansion. Both in terms of number of slots per day, in Raritan we gained approval for our GENT manufacturing site in Europe for commercial production that is now underway and able to serve patients and our CFS.

Terence Spoon: In addition, overall survival data was just presented for Carvykti, and this line, which is very, very significant, further adds to the importance of this medicine for patients with multiple myeloma. And the other aspect is we continue to progress really nicely with our continued capacity expansion, both in terms of number of slots per day. In Raritan, we gained approval for our GENT manufacturing site in Europe for commercial production that is now underway and able to serve patients. And our CMO in the United States as well is producing on the clinical end. And so all the way around from performance of the product, from new data as well as continued capacity expansion, we continue to see very strong performance for Carvykti.

Speaker Change: But as we have discussed second quarter for us being definitely more robust than the first half that's playing through and I think if you think about that going forward that makes a lot of stuff a lot of sense and we're over 4200 patients now with car Vicki and and it is the most successful car T laws.

Speaker Change: <unk> four across the fleet.

The industry across all car Ts.

Speaker Change: Then last year, you asked about Tac daily and and tell kind of map. So if we take a look at them.

Speaker Change: Start off basically with an attack so tech sales were 135 million and 21% growth for the quarter, but it was flat sequentially, we're seeing really nice uptake in the market in terms of of new patients, but there's also a dynamic where physicians are treating.

Speaker Change: Mow in the United States, as well, is producing on the clinical end. And so all the way around from performance of the product, from new data as well as continued capacity expansion, we continued to see very strong performance for CAR-Victi. And as we discussed before, I don't know that we will see that as a complete exact linear growth curve quarter to quarter simply because the capacity expansion works in a bit more of a stair-step fashion. But as we have discussed, you know, second quarter for us being definitely more robust than the first half that's playing through. And I think if you think about that going forward, that makes a lot of sense. We're over 4,200 patients now.

Terence Spoon: And as we've discussed before, I don't know that we will see that as a complete exact linear growth curve quarter to quarter simply because the capacity expansion works in a bit more of a stair-step fashion. But, as we have discussed, you know, second quarter for us being definitely more robust than the first half that's playing through. And I think if you think about that going forward, that makes a lot of sense. We're over 4,200 patients now with Carvykti, and it is the most successful CAR-T launch for across, you know, throughout the industry across all CAR-T's.

Speaker Change: Adding with longer treatment durations. So we do think that there's a lot of continued growth and expansion for the <unk> for the product is performing very well.

Speaker Change: For patients and not only in its current lines of therapy, but we're also taking a look and studying it and and combinations, whether it's ours or lacks weather whether it with.

And so we do believe that that there's a lot of growth potential on their foretell. They were not reporting out the sales yet I think we will start on that probably next year.

Speaker Change: and it is the most successful, CAR-T launch for across, you know, the Serylty industry across all CAR-Ts.

Speaker Change: But both.

Speaker Change: Tao and tech, we continue to expand not only with the academic community, but also out into the community setting and so we think theres a lot of growth ahead.

Terence Spoon: Then last to you, you asked about Tech-Valey and Talcatamap. So, if we take a look at, start off basically with tech. So tech sales were 135 million and 21% growth for the quarter, but it was flat sequentially. We're seeing really nice uptake in the market in terms of new patients. But there's also a dynamic where physicians are treating with longer treatment duration. So, we do think that there's a lot of continued growth in expansion for the product. It's performing very well for patients, and not only in its current lines of therapy, but we're also taking a look and studying in combinations, whether with Darzalex, whether with Tal.

Speaker Change: Then last you asked about Techvayli and Talcatamap, so if we take a look at start off basically with Tech. So Tech sales were 135 million and 21% growth for the quarter, but it was flat sequentially. We're seeing really nice uptake in the market in terms of new patients, but there's also a dynamic where physicians are treating with longer treatment duration. So we do think that there's a lot of continued growth and expansion for the product. It's performing very well for patients and not only in its current lines of therapy, but we're also taking

Speaker Change: A couple of things to highlight as well.

Speaker Change: You know with tech that is not only the first in class B C. I'm really targeting T cell engaging but the data really show would also as best in class relative to other molecules in that.

Speaker Change: Of that type.

Speaker Change: Deepest.

Responses complete response rates are approaching 50% about half of patients duration of responses nearly two years and very low discontinuation rates for some 5% showing that the the weight adjusted both dosing, where we can really optimize for their patients is really playing out there.

Speaker Change: I'm very excited about the early data, we're seeing when we combine tech with Dara.

Speaker Change: in the look and studying it in combinations, whether with Darzalex, whether with Tal, and so we do believe that there's a lot of growth potential on there. For Talvey, we're not reporting out the sales yet, I think we'll start on that probably next year, but both Tal and Tech, we continue to expand not only with the academic community, but also out into the community setting and so we think there's a lot of growth ahead.

Terence Spoon: And so, we do believe that there's a lot of growth potential on there.

Speaker Change: Where were seeing really high response rates in patients who had been multiply treated and now in phase III studies in patients with one to three prior lines.

Terence Spoon: For Tal-V, we're not reporting out the sales yet. I think we'll start on that probably next year. But both Tal and Tech, we continue to expand not only with the academic community, but also out into the community setting. And so, we think there's a lot of growth ahead. Maybe just a couple of things to highlight as well. You know, with Tech, that is not only the first in-class BCMA targeting T-selling gager, but the data really show it also as best in class relative to other molecules in that type. The deepest responses, complete response rates are approaching 50% about half of patients.

Speaker Change: And then similar story with Tao.

Speaker Change: That is a MISO preserving.

Speaker Change: As you know so there are fewer risks.

Speaker Change: Infections with Tao.

Speaker Change: It is shown in the late line the highest overall response rates sort of any T cell engaging bispecific.

Speaker Change: Maybe just a couple of things to highlight as well, you know, with Tech, that is not only the first in-class BCMA targeting T-cellingager, but the data really show it also is best in class relative to other molecules in that type, the deepest responses, complete response rates are approaching 50% about half a patient's duration of response is nearly two years, and very low discontinuation rate plus 5% showing that the weight adjusted by dosing where we can really optimize for the patients is really playing out there, very excited about the early data we're seeing when we combine Tech with Dira.

Speaker Change: For myeloma so we.

Speaker Change: We think theres a lot of upside opportunity there and again the data in combo with their own.

Speaker Change: A really impressive so where we're marching along with that combination.

Speaker Change: And where we can have the benefits of both a T cell, we're engaged or together with the CD 38 class and really only J&J is positioned to do.

Terence Spoon: Duration of response is nearly two years, and very low discontinuation rates, less than 5%, showing that the weight adjusted both dosing where we can really optimize for the patients is really playing out there. I'm very excited about the early data we're seeing when we combine Tech with Dira. where we're seeing really high response rates and patients who have been mostly treated and now in phase three studies in patients with one to three prior lines. And in a similar story with Tal, that is a B-cell preserving target, as you note, so there are fewer risks of severe infections with Tal.

Yeah.

Speaker Change: Thank you. Our next question is coming from Daniela and tells me from UBS. Your line is now live.

Daniela: Hi, good morning, everyone. Thanks, so much for taking the question.

Speaker Change: Quick question on the <unk> business I mean, obviously, that's very topical you haven't really seen much of a slowdown I. Appreciate Q3 was probably arguably the first quarter, where we had.

Speaker Change: Where we're seeing really high response rates in patients who have been mostly treated and now in phase 3 studies in patients with one to three prior lines.

Speaker Change: A more of a full quarter of PSA launching I guess I'm just curious about what you think the underlying market is growing and where.

Speaker Change: First is our Aspen and also as we look ahead to 2025 and favorable.

Terence Spoon: And it has shown in the late line the highest overall response rates of any T-cellingager by specific 4-mile loma. So, you know, we think there's a lot of upside the opportunity there. And again, the data in combo with DARA are really impressive. So, we're marching along with that combination and where we can have the benefits of both the T-cellingager together with the CD-38 class, and really only JNJ is positioned to do that.

Speaker Change: How that changes dynamics murky.

Speaker Change: Thanks, so much.

Speaker Change: Thank you Daniel and as you said it is a really exciting time to be in our electrophysiology and we couldnt be more proud of the significant leadership position. We've held in this category for more than 20 years and just to put our performance in context, you know our EP business is a $5 billion business, which grew.

Speaker Change: 11% in the third quarter and 17% year to date.

Danielle Antalffy: Thank you. Next question is coming from Danielle and Tal. If you from UBS, remind us our lives. Hey, good morning, everyone. Thanks so much for taking the question. Just a quick question on the EP business. I mean, obviously, that's very possible. You hadn't really seen much of a slow down. I appreciate Q3 was probably arguably the first quarter where we had a more full quarter of PFA launching. I guess I'm just curious about what you think the underlying market is growing and where PFA is versus RF. And also as we look ahead to 2025 and Verapult, how that changes dynamics for JNJ's EP business.

Speaker Change: We are actively progressing our launch of <unk> in EMEA and in Japan, where we still are executing against our soft launches. We've had over 800 successful cases when we.

Speaker Change: Thank you, and our question is coming from Danielle and Talvey from UBS, Revive as well as. Hi, good morning, everyone. Thanks so much for taking the question.

Speaker Change: Shared the data from our admire study it reached at the recent HRS meeting showing 85% primary effectiveness in that portfolio and that product and we believe we've got a product that really will hunt.

Speaker Change: Just a quick question on the EP business. I mean, obviously that's very powerful. You hadn't really seen much of a slowdown, I appreciate Q3 was probably arguably the first quarter where we had a more full quarter of PFA launching. I guess I'm just curious about what you think the underlying market is growing and where PFA is versus RF and also as we look ahead to 2025 and Varipulse, how that changes dynamics for JNJ's EP business. Thanks so much.

Speaker Change: As it relates to the U S. You're right, we're seeing continued competition, especially in the the ablation space given that we don't currently have a PFA product, but having spent a lot of timing in EP labs over the last couple of weeks I can tell you that we are incredibly excited for the availability of Aeropulse, which we expect to have approval sometime.

Danielle Antalffy: Thanks so much.

Danielle Antalffy: Thank you, Danielle. And as you said, it is a really exciting time to be in electrophysiology, and we couldn't be more proud of the significant leadership position we've held in this category for more than 20 years. And just to put our performance in context, you know, our EP business is a $5 billion business, which grew 11% in the third quarter and 17% year to date. We are actively progressing at a launch of Verapult in May and in Japan, where we still are executing against our soft launches. We've had over 800 successful cases. We shared the data from our admire study at the recent HRS meeting, showing 85% primary effectiveness in that portfolio and that product.

Speaker Change: Thank you, Daniel. And as you said, it is a really exciting time to be in electrophysiology and we couldn't be more proud of the significant leadership position we've held in this category for more than 20 years. And just to put our performance in context, you know, our EP business is a $5 billion business which grew 11% in the third quarter and 17% year-to-date. We are actively progressing a launch of Varipulse in May and in Japan where we still are executing against our soft launches. We've had over 800 successful cases. We shared the data from our Admire Study at the recent HRS meeting showing 85% primary effectiveness in that portfolio.

Speaker Change: Later, this quarter or in Q1 of next year.

Speaker Change: We are still by the way of mapping the majority of those cases, Daniel that's what most people don't see is that while we may not have that product in the portfolio. We are mapping more than 50% of competitive cases in fact, we've updated our market leading cargo software to actually reflect better visualization for competitive products and what we've seen in the market and I can't.

Speaker Change: Give you specific data, but a significant increase in procedures on the time, it's taking EPS to perform ablation procedures with PSA and by the way today, we're benefiting from the volume increase from PFA, even though we don't have that catheter and so that combination of the 5500 installed base of cargo systems best in class mapping.

Danielle Antalffy: And we believe we've got a product that really will hunt. As it relates to the US, you're right. We're seeing continued competition, especially in the ablation space given that we don't currently have a PFA product. But having spent a lot of time in EP labs over the last couple of weeks, I can tell you that we are incredibly excited for the availability of Verapulse, which we expect to have approval sometime later this quarter or in Q1 of next year. We are still, by the way, mapping the majority of those cases, Daniel. That's what most people don't see is that while we may not have that product in the portfolio, we are mapping more than 50% of competitive cases.

Speaker Change: Zolio, and that product. And we believe we've got a product that really will hunt. As it relates to the US, you're right. We're seeing continued competition, especially in the Appalachian space given that we don't currently have a PFA product, but having spent a lot of time in EP labs over the last couple of weeks, I can tell you that we are incredibly excited for the availability of varipulse, which we expect to have approval sometime later this quarter or in Q1 of next year. We are still, by the way, mapping the majority of those cases, Daniel. That's what most people don't see is that while we may not have that product in the portfolio, we are mapping more than 50% of competitive cases. In fact, we've updated our market leading cardo software to actually reflect better.

Speaker Change: And highly trained Mappers, we believe is a significant advantage and positions us extremely well when it comes to market.

Speaker Change: I'll also say that similar to RF, which by the way we still believe has a play within the portfolio. We have the best in class RF catheter with cute at 86% primary effectiveness. These winning strategy and RF has been a full portfolio and similarly in PFA beyond our first launch with variables you will see a full portfolio of focal and <unk>.

Speaker Change: Large vocal single shot and dual energy catheters and by the way, we already applied for CE, marking for our dual energy catheter and so we're confident in our leadership position in EP and our sources of differentiation for the future. Thank you Daniel.

Danielle Antalffy: In fact, we've updated our market-leading carto software to actually reflect better visualization for competitive products. And so that combination of the 5,500 installed base of carto systems, best in class mapping and highly trained mappers, we believe is a significant advantage and positions that's extremely well when PFA comes to market. I will also say that, similar to RF, which by the way we still believe has a play within the portfolio. We have the best-in-class RF catheter with Q. 86% primary effectiveness. This winning strategy in RF has been a full portfolio and similarly in PFA. Beyond our first launch with the varipulse, you will see a full portfolio of focal, large, focal, single shot.

Speaker Change: ization for competitive products and what we seen in the market i can't give you specific data but a significant increase in procedures on the time it's taking e p to perform a placeation procedures with p and the way today benefiting from the volume increase from p f a even though we don't have that cater and so that combination of the five thousand five hundred stoalled base of cdo systems best in class mapping and highly training mappers we believe 'is a significant advantage and positions are extremely well when p f a comes to market i will also say that similar to f which by the way we still believe has a play within the portfoli we have the best in class are of c with q eight y six percent primary effectiveness

Speaker Change: Thank you next question today is coming from sequencing from RBC capital markets. Your line is now live.

Speaker Change: Great. Thank you so much I was hoping you could elaborate on the dynamics that you're seeing in the Asia Pacific region.

Speaker Change: Specifically China.

Could you quantify the headwind when do you expect it to normalize and you did talk about China V. B B embed has expanded into additional Robinson and products. So could you just elaborate on the impact there and how we should think about it in 25. Thank you.

Thank you should goon and and yes, we've had a a myriad of issues hitting us in the Asia Pacific region of late and let me just highlight a couple and I'll certainly get to your question on China. Firstly, you may know that in February of this year in Korea are the government initiated or at least a strike was initiated among the health.

Speaker Change: The winning strategy in RF has been a full portfolio and similarly in PFA. Beyond our first launch with Varipulse, you will see a full portfolio of focal, large, focal, single shot and dual energy catheters. By the way, we already applied for CE marking for our dual energy catheter and so we're confident in our leadership position in EP and our sources of differentiation for the future. Thank you, Daniel.

Danielle Antalffy: And dual energy catheters, by the way, will ready applied for CE marking for our dual energy catheter. And so we're confident in our leadership position in EP and our sources of differentiation for the future.

Speaker Change: Professional community. Unfortunately, we don't see any end in sight to that and so that certainly has been a headwind we're seeing macro economic pressures in Japan, and then more importantly to your question the ongoing impact of volume based procurement, which has also been exacerbated by the.

Danielle Antalffy: Thank you, Daniel.

Shagun Chadha: Thank you.

Shagun Chadha: Next question today is coming from Schudren Singh from RBC Capra Market for liners. Now live. Oh, great. Thank you so much. I was hoping you could elaborate on the dynamics that you're seeing in the Asia Pacific region in Medtech, specifically China. You know, could you quantify the headwinds when you expected to normalize and you did talk about China, VPP and that is expanded into additional provinces and products. So could you just elaborate on the impact there and how we should think about it in 25. Thank you. Thank you, Shagun.

The the anticorruption campaign and by the way while we believe this is absolutely the right thing to do and we support it for the long term it is impacting procedures and engagement by health care professionals with companies.

Speaker Change: Thank you next question today, it's coming from Shudon Singh from RBC Capromaculture line, it's now live.

Shudon Singh: Thank you so much. I was hoping you could elaborate on the dynamics that you've seen in the Asia Pacific region, in MedTech, specifically China. You know, could you quantify the headwinds when you expected to normalise and you didn't talk about China, VBP and that is expanded into additional provinces and products. So, could you just elaborate on the impact there and how we should think about it in 25? Thank you.

Speaker Change: Companies like ours, especially on premium products.

Speaker Change: We you know we have a leadership position we have the largest med Tech company in China and given the high leadership positions. We are seeing a disproportionate impact from V. P.

Speaker Change: We have five major categories impacted through tenders in 2023, and electrophysiology trauma spine.

Shagun Chadha: And yes, we've had a myriad of issues hitting us in the Asia-Pacific region of late, and let me just highlight a couple, and I'll certainly get to your question on China. First, you may know that in February of this year in Korea, the government initiated, or at least a strike was initiated, among the healthcare professional community. Unfortunately, we don't see any end in sight of that. And so that certainly has been a headwind. We're seeing macroeconomic pressure in Japan. And then, more importantly, to your question, the ongoing impact of volume-based procurement, which has also been exacerbated by the anti-corruption campaign.

Speaker Change: Thank you, Shagun, and yes, we've had a myriad of issues hitting us in the Asia Pacific region of late, and let me just highlight a couple, and I'll certainly get to your question on China. Firstly, you may know that in February of this year in Korea, the government initiated, or at least a strike was initiated among the healthcare professional community. Unfortunately, we don't see any end in sight to that, and so that certainly has been a headwind. We're seeing macroeconomic pressures in Japan, and then, more importantly, to your question, the ongoing impact of volume-based procurement, which has also been exacerbated by the anti-corruption campaign. And by the way, while we believe this is absolutely the right thing to do, and we support it for the long term, it is impacting procedures and things...

Speaker Change: Endo cutters, and energy and more recently I OLS and sports in our orthopedics business. We do believe that this will be a.

Speaker Change: A headwind through the remainder of 'twenty four and into 'twenty. Five that said, we are absolutely confident that China continues and will continue to be an important part of our portfolio, even with the impact of V. P. We believe we can deliver tremendous growth and returns for our shareholders and I think this really talks to the strength of our.

Speaker Change: Global portfolio across Med Tech. The fact that we can offset headwinds in one geography with better performance in places like Europe and in the U S.

Shagun Chadha: And by the way, while we believe this is absolutely the right thing to do and we support it for the long term, it is impacting procedures and the engagement by healthcare professionals with companies like ours, especially on premium products. We have a leadership position. We have the largest Medtech company in China. And given the high leadership positions, we are seeing a disproportionate impact from VBP. We have five major categories impacted through tenders in 2023 and in electrophysiology, trauma, spine, endocuters, and energy. And more recently, IOLs and sports in our orthopedics business, we do believe that this will be a headwind through the remainder of 24.

Speaker Change: Please rest assured we also believe that this part of the world, especially in Asia Pacific will continue to be a growth opportunity and let me tell you why 60% of the world's patients live in that part of the world and we're proud of the fact that we've been in many of these markets for many many years and expect to continue to do so the final point I'll make is let's let's.

Speaker Change: Engagement by Healthcare Professionals with companies like ours, especially on premium products. We have a leadership position, we have the largest metric company in China, and given the high leadership positions, we are seeing a disproportionate impact from VBP. We have five major categories impacted through tenders in 2023 and electrophysiology, trauma, spine, endocutters, and energy, and more recently, IOLs and sports in our orthopedics business. We do believe that this will be a...

Speaker Change: Remember this is a headwind for med Tech. This is not material to Johnson <unk> Johnson and when we look at our global sales across Johnson, <unk> Johnson less than 5% of our businesses in China. Thank you again.

Thank you next question is coming from normal demand from Guggenheim Securities. Your line is now live.

Shagun Chadha: And enter 25. That said, we are absolutely confident that China continues and will continue to be an important part of our portfolio. Even with the impact of VBP, we believe we can deliver tremendous growth and returns for our shareholders. And I think this really talks to the strength of our global portfolio across medtech, the fact that we can offset headwinds in one geography with better performance in places like Europe and the US. Please rest assured, we also believe that this part of the world, especially in Asia Pacific, will continue to be a growth opportunity. And let me tell you why: 60% of the world's patients live in that part of the world.

Speaker Change: Edwin, through the remainder of 24 and into 25, that said we are absolutely confident that China continues and will continue to be an important part of our portfolio even with the impact of VBP. We believe we can deliver tremendous growth in returns for our shareholders. And I think this really talks to the strength of our global portfolio across Medtech, the fact that we can offset Edwin's in one geography with better performance in places like Europe . Please rest assured, we also believe that this part of the world, especially in Asia Pacific, will continue to be a growth opportunity. And let me tell you why, 60% of the world's patients live in that part of the world and we're proud of the fact that we...

Speaker Change: Alright, Thanks for taking my question.

Speaker Change: I have a question on the immunology side just on <unk>.

Speaker Change: Yeah.

Speaker Change: Laura you mentioned you have both those probably were a little bit lighter than we were.

Expecting you mentioned unfavorable patient.

Speaker Change: In fact in the quarter. So I'm just curious if you can just go into a little more detail on what youre seeing for those products.

Speaker Change: Specifically.

Speaker Change: And this patient mix issues or this quarter's at it does it justice from prior quarters.

Speaker Change: Nothing specific.

Speaker Change: Jonathan Jonathan or is it maybe something broader immunology market. Thank you.

Speaker Change: Yeah, if you could talk about with patient mix. This would be something that is specific to some of the true ups that we do as you are all aware, we end up having to make an assessment on our gross to net reduction and as we get final bills in there always are some true ups, sometimes therefore the positive sometimes.

Shagun Chadha: And we're proud of the fact that we've been in many of these markets for many, many years and expect to continue to do so. So the final point to our make is, let's remember, well, this is a headwind for MedTech. This is not material to Johnson & Johnson. When we look at our global sales across Johnson & Johnson, less than 5% of our businesses in China. Thank you again.

Speaker Change: Been in many of these markets for many, many years and expect to continue to do so. The final point I'll make is let's remember, well, this is a headwind for Medtech. This is not material to Johnson & Johnson. When we look at our global sales across Johnson & Johnson, less than 5% of our businesses in China. Thank you again.

Is a negative reduction so when we refer to patient mix. This is different patients coming through different channels as well as some of the accounting true up for the final payments that we make and then I will hand, it over to Jennifer to specifically talk about the performance in the commercial perspective of try and fire and still are in the U S and I think so.

Speaker Change: Thank you, next question is coming from Wammeldebahn, from Glutinheim Security, Rwannis Alvite.

Speaker Change: Thank you for taking my question. So I have a question on the immunology side just on Tremfya and Stelara, so you mentioned the US sales for both of those products were a little bit lighter and we were expecting and you mentioned this unfavorable patient mix impact in the quarters. So I'm just curious if you can just go in a little more detail on what you're seeing for those products in the US specifically and is this patient mix issue sort of this quarters today? Is it adjustments from prior quarters? Is it something specific to Johnson & Johnson or is it maybe something broader to the immunology market? Thank you.

Vamil Divan: Thank you. We want to say also about this project, we're a little bit lighter and we are expecting, and you mentioned this unfavorable patient mix impacting the quarters. So I'm just curious if you can just go in a little more detail on what you're seeing for those products in the US specifically. And is this patient mix issues or this quarter's today? Is it adjustments from prior quarters? And is it something specific to the Johnson & Johnson, or is it maybe something broader to the immunology market? Thank you.

Jennifer Taubert: If we take a look for Trumpf flyer outside the U S really nice growth at 27% in the U S. It was a little over 9% specifically for that patient mix issue that that just just spoke about we do think that the prospects are very strong for continued drumfire growth based on what I articulated before around the launches.

Jennifer Taubert: <unk> in ulcerative colitis, and the upcoming launches that we're planning for in Crohn's disease, as well I think I'm forced to Laura we did see we did see a decline and that again sort of similar patient mix piece in the U S. We've also and also we've noted the decline ex U S, particularly in EM.

Vamil Divan: Vomal, if you talk about with patient mix, this would be something that is specific to some of the true ups that we do. As you are all aware, we end up having to make an assessment on our growth to net reduction, and as we get final bills in, there always are some true-ups. Sometimes they're for the positive; sometimes it is a negative reduction. So when we refer to patient mix, this is different patients coming through different channels, as well as some of the accounting true-ups for the final payments that we make.

Speaker Change: Yeah, Vamo, if you talk about with patient mix, this would be something that is specific to some of the true ups that we do. As you are all aware, we end up having to make an assessment on our growth to net reduction, and as we get final builds in, there always are some true ups. Sometimes they're for the positive, sometimes it is a negative reduction, so when we refer to patient mix, this is different patients coming through different channels, as well as some of the accounting true ups for the final payments that we make. Then I will hand it over to Jennifer to specifically talk about the performance and the commercial perspective of Trump-Vaya and Stellar in the US. And I think so, if we take a look for Trump-Vaya outside the US, really nice growth at 20 cents.

Jennifer Taubert: Due to Biosimilar competition, we know that still are as is near at its end of life and really that Trump fire in across the rest of our portfolio. We've got a very robust stable of products with pretty significant growth.

Speaker Change: Thank you Rommel, Kevin we have time for one last question.

Vamil Divan: Then I will hand it over to Jennifer to specifically talk about the performance and the commercial perspective of Tremfya and Stellar in the US. And I think so, if we take a look for Tremfya outside the US, really nice growth at 27% in the US; it was a little over 9%, specifically for that patient mix issue that just spoke about. We do think that the prospects are very strong for continued Tremfya growth. Based on what I articulated before around the launches in ulcerative colitis and the upcoming launches that we're planning for in Crohn's disease as well.

Speaker Change: Thank you. Our final question today is coming from Jayson Bedford from Raymond James Your line is not a lot.

Jayson Bedford: Good morning, maybe just a question for either Tim or Joe I appreciate the color on med tech, but the 5% bogie for the year still implies a decent acceleration in for two off a tougher comp.

Jennifer Taubert: 7% in the U.S. It was a little over 9% specifically for that patient mix issue that just spoke about. We do think that the prospects are very strong for continued Tremfya growth based on what I articulated before around the launches in ulcerative colitis and the upcoming launches that we're planning for in Crohn's disease as well. I think for Stelara, we did see a decline and that, again, sort of similar patient mix piece in the U.S. We've also, and also we've noted the decline X-U.S., particularly in Amia, due to biosimilar competition. We know that Stelara is near at its end of life and really that Tremfya and across the rest of our portfolio.

Jayson Bedford: What gets better in <unk> and then just a quick clarification.

Jayson Bedford: <unk> solutions dynamic from Helane are you seeing an impact on volumes outside of Western North Carolina and Florida.

Vamil Divan: I think for Stellara, we did see a decline, and that again sort of similar patient mix piece in the US. We've also, and also we've noted the decline X, U, S, particularly in Amia due to biosimilar competition. We know that Stellara is near at its end of life, and really that Tremfya and across the rest of our portfolio, we've got a very robust stable of products with pretty significant growth. Thank you, Vamo.

Speaker Change: Jason. Thank you for the question, let me hit the last one first no. We have seen the majority of the impact in our in the areas impacted by that storm as I mentioned earlier I think the watch out is any potential impact from additional shortage of IV fluids, which may impact our elective procedures in.

Speaker Change: Certainly we're continuing to monitor that very.

Speaker Change: Very carefully as Joe mentioned, we expect are now on the back of the headwinds we mentioned earlier in Asia Pacific to deliver adjusted.

Speaker Change: We've got a very robust stable of products with pretty significant growth.

Kevin: Kevin, we have time for one last question.

Jason Bedford: Thank you.

Speaker Change: Thank you, Vamo, Kevin, we have time for one last question.

Jason Bedford: Our final question today is coming from Jason Bedford from Raymond James; our line is now live. Good morning. Maybe just a question for either Tim or Joe. Appreciate the color on MedTech, but the 5% vulgy for the year still implies a decent acceleration in 4Q off a tougher comp. What gets better in 4Q and then just a quick clarification. The other solutions dynamic from Halein, are you seeing an impact on volumes outside of Western North Carolina in Florida? Thanks. Jason, thank you for the question.

Speaker Change: Thank you for your final question today, is coming from Jason Bedford from Raming James, Arlaid, is now a lot.

Speaker Change: Operational growth of around 5% in north of 6% on an op or operational basis for the year, we believe that the momentum we're carrying into the fourth quarter, especially in our cardiovascular businesses with a winning portfolio and electrophysiology strong double digit growth in N Shockwave abiomed.

Speaker Change: I'm warning, maybe just a question for either Tim or Joe, appreciate the color on MedTech, but the 5% bulbie for the year still implies a decent acceleration in 4Q off a tougher comp, but what gets better in 4Q and then just a quick clarification, the AV solutions dynamic from Halein, are you seeing an impact on volumes outside of Western North Carolina in Florida? Thanks.

Speaker Change: Those are as you can see them for the from the performance absolute home runs the other important dynamic here is that as we signaled in the first and second quarter, we expected to see improvement within our vision business, which typically has delivered solid single mid single digit growth, we had a tremendous third third quarter, which really gives us confidence.

Jason Bedford: Let me hit the last one first. No, we have seen the majority of the impact in the areas impacted by that storm. As I mentioned earlier, I think the watch out. Is any potential impact from additional shortage of IV fluid, which may impact elective procedures and certainly will continue in Tim on that very carefully. As Joe mentioned, we expect now, on the back of the headwinds we mentioned earlier in Asia Pacific, to deliver adjusted operational growth of around 5% and north of 6% on an operational basis for the year. We believe that the momentum we're carrying into the fourth quarter, especially in our cardiovascular businesses with our winning portfolio and electrophysiology, strong double-digit growth in Shockwave, Abium Ed.

Speaker Change: Jason, thank you for the question. Let me hit the last one first. No, we have seen the majority of the impact in the areas impacted by that storm, as I mentioned earlier. I think the watch out is any potential impact from additional shortage of IV fluid which may impact elective procedures and certainly were continuing to monitor that very carefully. As Joe mentioned, we expect now, on the back of the headwinds, we mentioned earlier in Asia, which is very specific to deliver adjusted operational growth of around 5% and north of 6% on an operational basis for the year. We believe that the momentum we're carrying into the fourth quarter, especially in our cardiovascular businesses.

Speaker Change: An even stronger fourth.

Speaker Change: This was delivered by much better performance is especially in our contact lens business. In fact here in the U S. Our most important market double digit growth for contact lenses in in the quarter and that's just really the.

Speaker Change: Been delivered from a.

Speaker Change: Stabilization of our distributor inventory in the U S. The fact that we're able to get back to taking new where a share now that we have unconstrained supply, especially within our <unk> portfolio.

Speaker Change: And so we do believe that our that vision has a very strong quarter ahead.

And then finally across the portfolio, we're benefiting from tremendous new product launches both within cardiovascular the E. Eight a peripheral catheter within Shockwave continued performance within Abu Ahmed with our broad portfolio of pumps, and then within our surgery business as well as as orthopedics as I mentioned.

Speaker Change: Coaches with our winning portfolio and electrophysiology, strong double-digit growth in Shockwave, Abiumed. I mean, those are, as you can see, from the performance, absolute home runs. The other important dynamic here is that, as we signaled in the first and second quarter, we expected the improvement within our vision business, which typically has delivered, you know, solid, single mid-single-digit growth. We had a tremendous third quarter, which really gives us confidence in even stronger force. This was delivered by much better performances, especially in our contact lens business. In fact, here in the US, our most important market double-digit growth for contact lenses in the quarter, and it's just really, it has been delivered from a stabilization of our

Jason Bedford: I mean, those are, as you can see, from the performance, absolute home runs. The other important dynamic here is that, as we signaled in the first and second quarter, we expected the improvement within our vision business, which typically has delivered solid, mid-single-digit growth. We had a tremendous third quarter, which really gives us confidence in even stronger force. This was delivered by much better performances, especially in our contact lens business. In fact, here in the U.S. most important market double-digit growth for contact lenses in the quarter, and that's just really been delivered from a stabilization of our distributor inventory in the U.S.

Speaker Change: Earlier tremendous new products to add differentiation to the portfolio and typically that fourth quarter. Also is a is a stronger one for us. So once again I'm very confident that performance at around 5% on an adjusted basis and north of 6% operationally. Thank you.

Speaker Change: Thank you, Jason and thanks to everyone for your questions and your continued interest in our company, we apologize to those we couldn't get to because of time, but don't hesitate to reach out to the investor relations team with any remaining questions that you may have.

Speaker Change: I would now turn the call over to Joaquin for some brief closing remarks. Thank you everyone for joining the call today as you have heard we delivered strong results in the third quarter, our high innovation, a high growth portfolio and pipelines.

Jason Bedford: The fact that we're able to get back to taking new wearer share, now that we have unconstrained supplies, especially within our A-stig portfolio. We do believe that vision has a very strong quarter ahead. Finally, across the portfolio, we're benefiting from tremendous new product launches, both within cardiovascular, the E-8, peripheral catheter within Shockwave, continued performance within Abium Ed, with our broad portfolio of pumps, and then within our surgery business, as well as, as orthopedics, as I mentioned earlier, tremendous new products to add differentiation to the portfolio. Typically, that fourth quarter also is a stronger one for us, so once again, very confident that performance at around 5% on an adjusted basis and north of 6% operationally.

Speaker Change: Bidra, Inventory in the US, the fact that we're able to get back to taking new wearer share now that we have unconstrained supply especially within our A-Stig portfolio. And so we do believe that that vision has a very strong quarter ahead. And then finally across the portfolio, we're benefiting from tremendous new product launches both within Cardio Vascular, the E8, peripheral catheter within shockwave, continued performance within Abiumed with our broad portfolio of pumps. And then within our surgery business as well as as orthopedics as I mentioned earlier, tremendous new products to add differentiation to the portfolio. And typically that fourth quarter also is a stronger one for us. So once again, very confident.

Speaker Change: Dancing rapidly and we are increasingly confident in our expectations for 2025 M. B, you and enjoy the rest of your day.

Speaker Change: Thank you. This concludes today's Johnson <unk> Johnson's third quarter 2024 earnings Conference call you may now disconnect.

Speaker Change: Performance at around 5% on an adjusted basis, and north of 6% operationally. Thank you.

Jason Bedford: Thank you.

Joe Wolk: Thank you, Jason, and thanks to everyone for your questions and your continued interest in our company. We apologize to those we couldn't get to because of time, but don't hesitate to reach out to the investor relations team with any remaining questions that you may have.

Joaquin Duato: I would now turn the call over to Joaquin for some brief closing remarks. Thank you everyone for joining the poll today. As you have heard, we delivered strong results in the third quarter. Our high innovation and high growth portfolio on pipelines are advancing rapidly, and we are increasingly confident in our expectations for 2025 and beyond.

Enjoy the rest of your day. Thank you.