But net earnings for the New Brunswick, N.J.-based company grew 2.2% to $3.4 billion, or $1.23 per share, thanks to a weaker dollar and growth in the pharmaceutical and medical devices segments, which offset the decline in the consumer segment. While earnings beat analysts' estimates of $1.15 a share, revenues were shy of the $15.2 billion expected.
Because of the continued weakness of the dollar, the giant health care company raised its 2010 earnings forecast by 5 cents to $4.70 to $4.80 a share.
"We continue to deliver solid earnings while investing in our future through complementary strategic partnerships and acquisitions," said Chairman and CEO William Weldon, alluding to the company's recent purchases of vaccine maker Crucell and device maker Micrus Endovascular. "Our pharmaceutical business has returned to growth this year and we continue to advance our pipeline with promising clinical data in key therapeutic areas."
McNeil Issues Hit the Bottom Line
Investors, however, weren't as impressed and J&J shares fell 1.7% in premarket trading. While the weak dollar is helping the bottom line for now, operational improvements count for more in the eyes of the market, and in the consumer segment, J&J disappointed.
Worldwide Medical Devices and Diagnostics sales increased 1.3% to $5.9 billion in the third quarter. In the pharmaceutical segment, worldwide sales increased 4.7% to $5.5 billion for the third quarter, with domestic sales up 6.9% and international sales growth of 2.0%.
Several products had strong operational growth during the quarter. Sales of Remicade -- a treatment of a number of autoimmune inflammatory diseases such as rheumatoid arthritis and Crohn's -- grew 18.6% to $1.2 billion. Sales of Prezista, an HIV drug, also grew 52% to $230 million. But revenues from other drugs declined considerably: Sales of Procrit, used to treat anemia in cancer patients, fell 25% because of safety concerns. Sales of Risperdal, an anti-psychotic drug, and Topamax, used to treat epilepsy and other disorders, decreased 37% and 27% respectively.