JNJ is absorbing STELARA, but new headwinds test growth
- Q2 2026 sales grew 5.6% even with a 460 basis point headwind from STELARA.
- Excluding STELARA, Johnson & Johnson grew double digits in the quarter.
- TREMFYA grew 71% as its bowel disease launch gained share.
- MedTech is still growing, but Abiomed sales fell 2% after doctors became more selective.
- New generic competition for OPSUMIT and SIMPONI adds pressure to the drug segment.
A patent cliff expands, mostly contained
Johnson & Johnson is proving the main bull case. STELARA is falling hard after biosimilar copies entered the market, but the rest of the company is still growing. In Q2 2026, STELARA declined 55.7%, yet total sales still rose 5.6%. Excluding STELARA, the company grew double digits.
The best signs are in Innovative Medicine. Oncology drugs such as DARZALEX and CARVYKTI are growing, while TREMFYA is turning into a strong immunology launch in bowel disease. The segment is also taking on a new $650 million supply chain restructuring to streamline operations.
However, the patent cliff is widening. The recent 10-Q disclosed that SIMPONI biosimilars entered Europe and OPSUMIT generics entered the U.S. market in Q2 2026. These newly realized losses of exclusivity mean the new launches have more lost revenue to replace.
The new worry is MedTech. Abiomed had been a key growth engine in cardiovascular devices, but sales fell 2% after doctors reacted to a neutral UK trial and used the product more carefully. Management says the shift is behavioral, not a sign that demand has vanished. Finn's view is balanced. JNJ has real growth engines, but the stock still has to earn its price.
Patents, hospitals, and trust
Johnson & Johnson makes money in two main ways. Innovative Medicine sells patented prescription drugs. MedTech sells devices used by surgeons, heart doctors, eye doctors, and hospitals.
The drug business can be very profitable while a product has patent protection. The risk is that sales can fall fast when cheaper copies arrive, as STELARA, SIMPONI, and OPSUMIT show. That is why JNJ needs new launches like TREMFYA, ICOTYDE, and oncology drugs to keep replacing older products.
The device business depends on hospital budgets, doctor training, procedure volumes, and clinical data. A single study can change behavior quickly. Abiomed's Q2 2026 decline shows that MedTech is exposed to sudden shifts in doctor confidence.
JNJ's moat comes from research spending, patents, global sales reach, and long relationships with healthcare providers. Those strengths are real, but they do not remove legal risk, pricing pressure, or product cycle risk.
The products that now matter
DARZALEX
DARZALEX is JNJ's largest product and treats multiple myeloma, a blood cancer. It drives significant growth for the company.
STELARA, SIMPONI, and OPSUMIT
These legacy drugs were major profit pools but now face cheaper generic or biosimilar competition, driving steep sales declines.
TREMFYA
TREMFYA is now the main immunology growth story. It grew 71% in Q2 2026 as the bowel disease launch gained momentum.
CARVYKTI and ERLEADA
These oncology products support the drug segment's growth. CARVYKTI grew 47.7% in Q2 2026.
Abiomed and Shockwave
These cardiovascular devices are meant to power MedTech growth. Abiomed is under pressure after a neutral trial, while Shockwave continues to grow.
Orthopaedics
Orthopaedics sells implants and related surgical products. JNJ plans to separate this business, which could change the company's growth mix.
Two businesses, one bigger drug engine
Segment mix uses Q2 2026 sales. Innovative Medicine generated $16.4 billion and MedTech generated $8.9 billion. DARZALEX concentration and STELARA erosion are important caveats inside the drug segment.
What could break the thesis
Generics fall faster than replacements grow
High impact · High oddsSTELARA biosimilars are already hurting sales, and SIMPONI and OPSUMIT just lost exclusivity. The key question is whether oncology and new immunology drugs can keep offsetting multiple declining legacy products.
Abiomed weakness becomes structural
High impact · Medium oddsAbiomed sales fell 2% in Q2 2026 after doctors reacted to a neutral UK trial. Management called the effect behavioral, but doctor behavior can stick. If growth does not recover before the PROTECT IV readout in 2027, a key MedTech growth pillar may be stalled.
Talc lawsuits cost more than expected
High impact · Medium oddsJNJ still faces tens of thousands of talc claims. The company believes in its legal defenses, but the final cost and timing are not settled. Legal reserves can move reported earnings without ending the risk.
Drug pricing pressure cuts returns
Medium impact · Medium oddsJNJ sells into healthcare systems that want lower drug costs. U.S. policy such as the IRA and global price rules can limit how much the company earns on mature drugs. This matters most when a few large products carry a big share of profit.
Orthopaedics separation disappoints
Medium impact · Medium oddsJNJ plans to separate Orthopaedics. The move could sharpen the remaining company's growth profile, but it also brings execution risk. Investors still need details on debt, margins, and the growth profile of the separated company.
In one breath
What does Johnson & Johnson do now?
After separating consumer health, JNJ is mainly a drug and medical device company. Its two segments are Innovative Medicine and MedTech.
Why are STELARA, SIMPONI, and OPSUMIT losing sales?
These drugs face biosimilar or generic competition, which means cheaper versions can take share. STELARA declined 55.7% in Q2 2026, so JNJ must replace that lost sales base with newer drugs.
Why does Abiomed matter?
Abiomed is part of JNJ's cardiovascular device growth plan. Its 2% sales decline in Q2 2026 raised a new question about whether doctor caution is temporary or lasting.
Is Johnson & Johnson cheap?
Finn's valuation score is below the middle of the range, so the price is not an obvious bargain. The company has quality assets, but investors still need proof that growth can keep compounding through patent losses and MedTech bumps.
Sources and research notes
This page combines Finn's company research with public filings and other cited materials. The thesis is reviewed when material company information changes; Finn Scores use the latest available scoring data.
- Thesis reviewed
- August 16, 2026
- Score data
- September 6, 2026
- Reviewed by
- Shivam Bharuka
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