Johnson & Johnson plans to split into two publicly traded companies. And in case you're wondering, no, they won't be called "Johnson I" and "Johnson II." Johnson & Johnson will keep its name and its title as the world's largest health-products company by sales as it retains its pharmaceutical and medical-devices businesses, including the one that makes its COVID-19 vaccine, the Wall Street Journal reports. The change will be in shedding its $15 billion-a-year consumer division, which is home to brands like Johnson's, Band-Aid, Tylenol, Neutrogena, Aveeno, and Listerine.
"The best path forward to ensure sustainable growth over the long term and better meet patient and consumer demands is to have our consumer business operate as a separate healthcare company," Chief Executive Alex Gorsky tells the Journal, noting the businesses, customers, and markets have diverged greatly in recent years. The new company, still unnamed, is expected to form within two years. Chief Financial Officer Joseph Wolk says the new Johnson & Johnson will remain the largest health-products company with close to $80 billion in annual sales. The consumer division will also be among the industry's largest after Procter & Gamble, Nestle, and L'Oreal, per the Journal.
This follows similar moves from Pfizer, which shed its consumer health business in 2019, and Merck, which combined its women's health unit and biosimilars business into a new company in June, per the AP. General Electric announced it would split into three companies on Tuesday. Additionally, Toshiba announced Thursday that it also plans to split into three companies by March 2024, the Journal reports. One company will focus on infrastructure, another on electronic devices, and a third, which will hang onto the name Toshiba, is to manage remaining assets like flash memory company Kioxia Holdings Corp. The company plans to seek shareholder approval for the dismantling early next year. (Read more Johnson & Johnson stories.)