Johnson & Johnson 3Q Net Up 1.1%; Boosts 09 Outlook

Johnson & Johnson (JNJ) eked out a 1.1% increase in third-quarter profit despite generic competition for several former big sellers pushing revenue below expectations.

But earnings beat Wall Street's views, prompting the health-care-products maker to boost its 2009 target to $4.54 to $4.59 a share. The prior target, first given in January and repeatedly affirmed since, was $4.45 to $4.55.

Still, shares fell 2% premarket to $61.25.

J&J's effort to counter drug-patent expirations led to its recent $885 million purchase of an 18% stake in Elan Corp. (ELN).

J&J, whose products range from Band-Aids to the Procrit anemia drug, said profit rose to $3.35 billion, or $1.20 a share, from $3.31 billion, or $1.17 a share, a year earlier.

Revenue fell 5.3% to $15.08 billion, with 2.5 percentage points of the decline coming from currency changes. U.S. sales fell 8.1%. International sales dropped 2.5%, but rose 2.4% on a constant-currency basis.

Analysts surveyed by Thomson Reuters were expecting earnings of $1.13 a share on revenue of $15.22 billion.

Drug sales remained a laggard, falling 14% on the impact from generics. That included a 19% drop in the U.S. The declines included antipsychotic Risperdal and epilepsy and migraine treatment Topamax, both of which lost patent exclusivity in the past year.

The latest quarter saw the formerly fast-growing consumer health-care unit post a 2.7% sales drop; excluding currency changes it would have reported 1.1% growth.

The device unit, which includes contact lenses and diabetes test strips, saw sales rise 2.3%; excluding currency impacts, unit sales rose 4.1%.

Drug-coated stent sales remained weak, falling 7.2% to continue a trend from recent quarters amid increased competition in the U.S. Revenue slumped 10% domestically. J&J late last month said it wrung a $716 million payment from Boston Scientific Corp. (BSX) to settle more than a dozen stent patent-infringement lawsuits, most of which will be recorded in the fourth quarter.

-By Mike Barris, Dow Jones Newswires; 212-416-2330; [e-mail]