Johnson & Johnson battle against generics

Johnson & Johnson

One of the pharmaceutical industry's most pressing issues right now is increased competition being caused by the rise in generic products.

For Johnson & Johnson, deep cuts into pharma sales, caused by this rise, had led to expectations that the firm would fail to see a big boost in the third quarter profits.

However, today, despite a dip in turnover, the firm posted a significant rise for Q3. According to reports, net earnings across the company's divisions rose 1.1 percent to $3.4 billion, despite a 5.3 percent dip to $15.1 billion.

Reports now suggest that the boost was largely thanks to savings that had been made in the firm's operating costs, which include a 10 percent reduction to sales and marketing costs and 12 percent being cut from R&D overheads.

Understandably the news has cheered investors, who had expected to see a fall following the five percent dip.

Despite the good news however, some analysts have speculated that there was a "steep decline" in the sale of some of Johnson & Johnson's products, causing concern. As such, analysts have highlighted that global pharma sales for the firm fell by 14.1 percent, as many of its biggest earners suffered from patent loss or declining markets.

Referring to the results William Weldon, chairman and chief executive of the firm told reporters: "We hope to continue to successfully manage our broad base of businesses and deliver solid earnings despite the impact of patent expirations and the challenges posed by the current economy."

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