JOHNSON Sent Doc

JOHNSON & JOHNSON

INTRODUCTION

Johnson & Johnson was founded more than 120 years ago on a revolutionary idea:

Doctors and nurses should use sterile sutures, dressings and bandages to treat peoples’

wounds. Since then, they have brought to the world, new ideas and products that have

transformed human health and well-being.

Johnson & Johnson is an American multinational pharmaceutical, medical devices

and consumer packaged goods manufacturer founded in 1886. The corporation's headquarters

is located in New Brunswick, New Jersey, United States with the consumer division being

located in Skillman, New Jersey. The corporation includes some 250 subsidiary companies

with operations in over 57 countries and products sold in over 175 countries. Johnson &

Johnson had worldwide pharmaceutical sales of $24.6 billion for the calendar year of 2008.

Its operations are organized into three business segments: pharmaceutical, which

generates 39 percent of revenues and 61 percent of operating income; professional, which

accounts for 36 percent of revenues and 27 percent of operating income; and consumer,

which contributes 25 percent of revenues and 12 percent of operating income. J & J's

pharmaceutical products--which are sold under such brands as Janssen Pharmaceutical,

Ortho-McNeil Pharmaceutical, and Centocor--include drugs for family planning, mental

illness, gastroenterology, oncology, pain management, and other areas. The professional

segment includes surgical and patient care equipment and devices, diagnostic products, joint

replacements, and disposable contact lenses. The company's well-known line of consumer

products includes the Johnson's baby care line, the Neutrogena skin and hair care line,

Tylenol and Motrin pain relievers, o.b. and Stayfree feminine hygiene products, the Reach

oral care line, Band-Aid brand adhesive bandages, Imodium A-D diarrhea treatment, Mylanta

gastrointestinal products, and Pepcid AC acid controller. J & J generates about half of its

revenues outside the United States, through its network of 190 operating companies in 51

countries and its marketing organization that sells in more than 175 countries.

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Johnson & Johnson's brands include numerous household names of medications and

first aid supplies. Among its well-known consumer products are the Band-Aid Brand line of

bandages, Tylenol medications, Johnson's baby products, Neutrogena skin and beauty

products, Clean & Clear facial wash and Acuvue contact lenses.

Robert Wood Johnson, inspired by a speech by antiseptic advocate Joseph Lister,

joined brothers James Wood Johnson and Edward Mead Johnson to create a line of ready-to-

use surgical dressings in 1885. The company produced its first products in 1886 and

incorporated in 1887.

Corporate chairmanship

Robert Wood Johnson I 1887–1910

James Wood Johnson 1910–1932

Robert Wood Johnson II 1932–1963

Philip B. Hofmann 1963–1973

Richard B. Sellars 1973–1976

James E. Burke 1976–1989

Ralph S. Larsen 1989–2002

William C. Weldon 2002–2011

CREDO:

We believe our first responsibility is to the doctors, nurses and patients, to

mothers and fathers and all others who use our products and services. In meeting their

needs everything we do must be of high quality. We must constantly strive to reduce

our costs in order to maintain reasonable prices. Customers' orders must be serviced

promptly and accurately. Our suppliers and distributors must have an opportunity

to make a fair profit.

We are responsible to our employees, the men and women who work with us

throughout the world. Everyone must be considered as an individual. We must respect

their dignity and recognize their merit. They must have a sense of security in their

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jobs. Compensation must be fair and adequate, and working conditions clean, orderly

andsafe.

We must be mindful of ways to help our employees fulfil their family

responsibilities. Employees must feel free to make suggestions and complaints. There

must be equal opportunity for employment, development and advancement for those

qualified. We must provide competent management, and their actions must be just and

ethical.

We are responsible to the communities in which we live and work

and to the world community as well. We must be good citizens – support good works

and charities and bear our fair share of taxes. We must encourage civic improvements

and better health and education. We must maintain in good order the property we are

privileged to use, protecting the environment and natural resources.

Our final responsibility is to our stockholders. Business must make a sound

profit. We must experiment with new ideas. Research must be carried on, innovative

programs developed and mistakes paid for. New equipment must be purchased, new

facilities provided and new products launched. Reserves must be created to provide

for adverse times. When we operate according to these principles,

the stockholders should realize a fair return.

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INDUSTRIES WHERE JOHNSON & JOHNSON COMPETES

Health Care Products Manufacturing

Consumer Products Manufacturing

Baby Supplies & Accessories Manufacturing

Eyewear Manufacturing

Personal Care Products Manufacturing

Cosmetics & Skin Care Products Manufacturing

COMPETITORS

Clorox

Colgate-Palmolive

Henkel

Procter & gamble

Unilever

Spotless group

MILESTONES

1886

Three brothers, Robert Wood Johnson, James Wood Johnson and Edward Mead

Johnson, found Johnson & Johnson in New Brunswick, New Jersey, U.S.

1888

The Company publishes "Modern Methods of Antiseptic Wound Treatment," which

quickly becomes one of the standard teaching texts for antiseptic surgery. It helps spread the

practice of sterile surgery in the U.S. and around the world.

1888

Johnson & Johnson pioneers the first commercial first aid kits. The initial kits are

designed to help railroad workers, but soon become the standard in treating injuries.

1894

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Johnson & Johnson launches maternity kits to make childbirth safer for mothers and

babies. JOHNSON'S® Baby Powder goes on the market. Its success leads to the Company's

heritage Baby business.

1896-1897

Employees manufacture the first mass-produced sanitary protection products for

women, a huge step forward in women's health.

1898

The Company is the first to mass produce dental floss to make it affordable so that

people can take better care of their teeth. The floss is originally made from leftover suture

silk.

1900

The tradition of providing disaster relief begins when the Company donates products

and money to help the citizens of Galveston, Texas, in the aftermath of a hurricane. Part of its

commitment to first aid, Johnson & Johnson publishes the first First Aid Manuals, using

proven best practices from leading physicians. The manuals are packaged with the

Company's First Aid Kits.

1906

Within hours of the San Francisco Earthquake, Johnson & Johnson donates products

and money to help the citizens of San Francisco, the largest amount of help from any

organization

1910

James Wood Johnson takes over the leadership of Johnson & Johnson until 1932.

BAND-AID Brand Adhesive Bandages, invented by employee Earle Dickson in 1920, go on

the market. They are the first commercial dressings for small wounds that consumers can

apply themselves

1921

BAND-AID Brand Adhesive Bandages, invented by employee Earle Dickson in 1920,

go on the market. They are the first commercial dressings for small wounds that consumers

can apply themselves.

1924

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Our first overseas operating company opens in the United Kingdom

1930-1931

The Company expands to Mexico and South Africa (1930) and to Australia (1931).

Johnson & Johnson operating company pioneers family planning products with ORTHO-

GYNOL®, the first prescription contraceptive gel. This was based on the need for trusted

family planning products

1932

Robert Wood Johnson II, son of the Company founder by the same name, begins

leadership of Johnson & Johnson. Known as General Johnson, he transforms the Company

into a global decentralized Family of Companies.

Ortho Research Laboratories, Inc. is established in Linden, New Jersey, to make

women's health products.

1943

General Robert Wood Johnson writes Our Credo, which remains the guiding

philosophy of Johnson & Johnson

1944

Dr. Philip Levine, the discoverer of the human rH factor, joins Ortho Research

Laboratories, creating the beginnings of the worldwide diagnostics business.

Johnson & Johnson goes public, with a listing on the New York Stock Exchange.

1954

JOHNSON'S Baby Shampoo with NO MORE TEARS® formula enters the market as

the first mild and soap-free shampoo designed to be gentle enough to clean babies' hair but

not irritate their eyes.

1957

The first Johnson & Johnson operating company opens in India.

1959

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Johnson & Johnson acquires McNeil Laboratories in the U.S. and Cilag Chemie, AG

in Europe, giving the Company a significant presence in the growing field of pharmaceutical

medicines. One McNeil product, TYLENOL (acetaminophen) elixir for children, is the first

prescription aspirin-free pain reliever. A year later, it becomes available without a

prescription and earns status as the pain reliever doctors and pediatricians recommend most.

1961

Janssen Pharmaceutica N.V. in Belgium joins the Family of Companies. Its founder,

Dr. Paul Janssen, is recognized as one of the most innovative and prolific pharmaceutical

researchers of the 20th century.

1963-1973

Under Chairman and CEO Philip B. Hofmann's leadership, operating companies

launch new treatments for schizophrenia, family planning and personal care. Also, 1963

marks the last year that JOHNSON'S® Baby Powder is sold in tins.

1978

Johnson & Johnson announces plans to build our new World Headquarters in New

Brunswick, New Jersey, and forms a public-private partnership to revitalize the city.

1976-1989

During James E. Burke's tenure as Chairman and CEO, the Company enters new areas

of health, such as vision care, mechanical wound closure and diabetes management, and

opens the first operating companies in China and Egypt.

1987

Johnson & Johnson is a founding partner in Safe Kids Worldwide, the first national

and then global campaign to reduce accidental childhood injury. By 2008, the campaign helps

reduce the death rate for unintentional injury in children ages 14 and under in the U.S. by 45

percent.

1987

The vision care business introduces ACUVUE Brand Contact Lenses, the first

disposable contact lenses that can be worn for up to a week, thrown away and replaced with a

fresh pair. The lenses eliminate the need for cleaning, disinfecting solutions and storage.

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Later, 1-DAY ACUVUE® Brand Contact Lenses become the first daily disposable contact

lens.

1989-2002

Under Ralph S. Larsen's leadership as Chairman and CEO, Neutrogena Corporation,

Kodak's Clinical Diagnostics business, Cordis Corporation and Centocor join the Family of

Companies; Expansion continues into Russia and Eastern Europe.

1990s

Ethicon Endo-Surgery pioneers minimally invasive surgery, which uses very small

incisions and helps patients recover faster than with traditional surgery.

1994

The PALMAZ-SCHATZ stent, the first coronary stent, revolutionizes cardiology.

Coronary stents keep vessels open so blood can flow to the heart. Later, Cordis Corporation

introduces the first drug-eluting stent, which helps prevent the arteries from re-clogging.

2002

William C. Weldon becomes Chairman and CEO of Johnson & Johnson, only the

eighth person to lead the Company since its founding. Under his leadership, the Company

enters new therapeutic areas such as HIV/AIDS, and health and wellness.

2002

Johnson & Johnson acquires Tibotec-Virco BVBA to help address the vast unmet

needs of patients with HIV/AIDS and other infectious diseases such as tuberculosis

2006

Johnson & Johnson acquires Pfizer Consumer Healthcare, which brings in heritage

consumer brands such as LISTERINE® Antiseptic (first formulated in 1879), BENGAY®,

BENADRYL® and more.

2010

The Company supports the United Nations’ Millennium Development Goals to

improve the health of mothers and children in developing countries. As a founding sponsor,

Johnson & Johnson helps launch the United States’ first free mobile health service, providing

health information via text messages for pregnant women and new mothers.

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2011

Johnson & Johnson celebrates 125 years of caring and looks to the next 125 years of

transforming care for patients, consumers and communities around the world.

ANALYSIS OF MILESTONES OF JOHNSON AND JOHNSON

1888-Johnson & Johnson pioneers the first commercial first aid kits:

Robert wood Johnson learned the art of mixing medicinal plasters before he became a

retail pharmacist at a New York City drug firm. In 1885, he created the world’s first ready-

made surgical dressing. As a proponent of Sir Joseph Lister’s theory of airborne bacteria,

Robert believed that sterile wound dressings could lessen the chance of infection in surgical

wounds, thereby speeding healing.

In 1886, Robert joined with brothers James Wood Johnson and Edward Mead

Johnson to form Johnson & Johnson. The newly incorporated company’s first products were

medicinal plasters and ready-made, antiseptic surgical dressings. These products were the

early forerunners of the Johnson & Johnson RED CROSS® First Aid Brand gauze pads,

covers, tapes, and other first aid items now used and recommended by doctors throughout the

world. The initial kits are designed to help railroad workers, but soon become the standard in

treating injuries.

1894 LAUNCHING OF BABY PRODUCT:

Some of the most enduring images from the history of Johnson & Johnson are those

associated with the Company’s baby products.  Generations of families have used these

products to care for their children, and consumer identification with them has been so strong

that, despite the depth and breadth of its product lines, the Company has enjoyed a

longstanding reputation as “the Baby Company.”  But the earliest products of Johnson &

Johnson were medical products.  Johnson & Johnson made medicated plasters, some patients

who used medicated plasters had complained to the Company that some of the plasters

irritated their skin.  In response, Scientific Director Fred Kilmer sent them small containers of

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Italian talc to soothe the irritation.  These patients discovered that the talc also helped

alleviate diaper rash, and they told the Company.  As a result, JOHNSON’S® Baby Powder

made its debut in 1893, went on the market in 1894, and the Company’s baby products

business was born.

The Company started from its earliest days with products to ensure the health and

safety of babies and mothers at birth.  But it was the addition of products to help parents care

for their babies and young children that earned Johnson & Johnson the reputation as “The

Baby Company.”

1896-1897 MANUFACTURE THE FIRST MASS-PRODUCED SANITARY

PROTECTION PRODUCTS FOR WOMEN:

Lister’s Towels were the first affordable commercial sanitary pads available to

women. Johnson & Johnson came up with these in 1896, but they soon failed because it

wasn't considered proper to advertise for such a product. Most women didn’t even realize

they were available. It was also a challenge to persuade women to pay for something that

before they had made themselves for free.

Kotex, first called Cellucotton and Cellu-naps, was put on the market around 1920 0r

1921. These didn’t begin to be accepted until about 1926 when Montgomery Ward actually

advertised the product in its catalogue. Finally women began to accept the use of sanitary

napkins as a way of life.

World War I, when women began to help with the war, really helped commercial

sanitary napkins to grow in popularity because of their convenience and ease of use.

Up until 1970, when Stayfree and New Freedom pads were put on the market, all

sanitary napkins required the use of a belt to keep them in place. At present Stayfree is the

leading player.

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1898-THE COMPANY IS THE FIRST TO MASS PRODUCE DENTAL FLOSS:

The first recorded patent for dental floss was issued in 1874 to Asahel M. Shurtleff.   Shurtleff

was a partner in a Massachusetts medical devices company called Codman & Shurtleff, which became

part of the Johnson & Johnson Family of Companies in 1964 and remains a part of it today.  Codman

& Shurtleff started marketing unwaxed silk dental floss in 1882, according to American Heritage

Magazine.  

But it was Johnson & Johnson that first made dental floss widely available.  And the

reason for that?  Sterile sutures.   Since 1887 sterile sutures were a part of the Company’s

product line, and they were a natural outgrowth of the founders’ mission to provide the first

mass-produced sterile dressings for surgery.  Catgut and silk were the most common suture

materials, and the Company bought silk in quantity to use in the manufacture of sterile

sutures.  The Johnson brothers were always looking for ways to improve public health, and

they had the idea of taking the leftover silk that wasn’t used in suture production and making

a dental floss that could be produced in quantity and packaged to make it affordable.   In

keeping with its origins in the Company’s suture product lines, there was even a Lister Dental

Floss that was impregnated with an antiseptic.

1921-Ready-Made Bandages came into the market:

BAND-AID® Brand Adhesive Bandages are one of the most recognizable of the

Company’s products. They were invented in 1920 by an employee named Earle Dickson,

who worked as a cotton buyer. His wife Josephine was prone to kitchen accidents. Earle

wanted a bandage his wife could apply herself, so he took two of the Company’s early

products – adhesive tape and gauze – and combined them by laying out a long piece of

surgical tape and placing small pieces of gauze on it in intervals. To keep the adhesive from

sticking, he covered it with crinoline fabric. Whenever his wife cut herself, she cut a piece of

the tape and gauze pad and used it as a bandage.

Dickson mentioned his invention at work, and a new product was born. The first

BAND-AID® Brand Adhesive Bandages went on the market in 1921, and were the first

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ready-made adhesive bandages that consumers could apply themselves. Earle Dickson was

made a vice president at Johnson & Johnson. 

1987-The vision care business introduces ACUVUE Brand Contact Lenses:

Johnson & Johnson Vision Care.Inc traces its origin back to Frontier Contact Lenses,

a company founded in Buffalo, New York, in 1959 by Dr. Allen Isen, George Sitterle and Dr.

Feinbloom. With 30 employees, Frontier manufactured a line of hard contact lenses through

the 1970’s. Its early growth was attributed to its highly successful toric lens.

The company added soft lenses to the product line in the late 1970’s, and shortly

afterwards began making its own soft lens plastic blanks (Frontier was among the first in the

US to take this material, widely used in Europe, and combined it with the lathe cutting

process to produce soft contact lenses. Johnson & Johnson acquired Frontier in 1981 and

renamed it Vistakon – this was to be the beginning of a very exciting three decades in our

history.

In 1987, Vistakon changed the vision care industry forever with the invention of

ACUVUE® the world’s first disposable soft contact lens. The launch of this product was first

in the US and then the UK became the first European market to bring this unique product to

Eye Care Professionals during 1988/89. The response was amazing and this new way of

wearing contact lenses completely revolutionised the UK market. Patients and practitioners

alike embraced the idea of throwing contact lenses away after one or two weeks of wear

dependent on the recommendation for the patient.

ACUVUE® was followed by the introduction of SUREVUE®, a monthly frequent

replacement lens which enabled Eye care Professionals to offer patients more choice.

By 1994, ACUVUE® and SUREVUE® accounted for nearly two-thirds of all new patients

coming into contact lenses within the US contact lens market.

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DIVERSIFICATION:

Since the 1900s, the company has pursued steady diversification. It added consumer

products in the 1920s and created a separate division for surgical products in 1941 which

became Ethicon. It expanded into pharmaceuticals with the purchase of McNeil Laboratories,

Inc., Cilag, and Janssen Pharmaceutical, and into women's sanitary products and toiletries in

the 1970s and 1980s. In recent years, Johnson & Johnson has expanded into such diverse

areas as biopharmaceuticals, orthopaedic devices, and Internet publishing. Recently, Johnson

& Johnson has purchased Pfizer's Consumer Healthcare department. The transition from

Pfizer to Johnson and Johnson was completed December 18, 2006.

Johnson & Johnson has been consistently named one of the 100 Best Companies for

Working Mothers by Working Mother. Along with Gatorade, Johnson & Johnson is one of

the founding sponsors of the National Athletic Trainers' Association.

ENVIRONMENTAL RECORD:

Johnson & Johnson has set several positive goals to keep the company

environmentally friendly and was ranked third among the United States’ largest companies in

Newsweek's "Green Rankings". Some examples are the reduction in water use, waste, and

energy use and an increased level of transparency. Johnson & Johnson agreed to change its

packaging of plastic bottles due to harmful chemicals used in the manufacturing process,

switching their packaging of liquids to safe non-polycarbonate containers. The corporation is

working with the Climate Northwest Initiative and the EPA National Environmental

Performance Track program.[17] As a member of the national Green Power Partnership,

Johnson & Johnson operates the largest solar power generator in Pennsylvania at its site in

Spring House, PA

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JOHNSON AND JOHNSON INDIA

Johnson & Johnson (J&J) India, a subsidiary of Johnson & Johnson USA, is one of

the leading players in the Indian pharmaceutical and consumer products business. It has

employee strength of over 1,800.

It started business in India in 1947 in Bombay with Johnson’s Baby Powder, and, over

time, introduced other products like toothbrushes, Johnson’s Baby Cream and Prickly Heat

Powder.

In the 50 years since its establishment as a modest 12 employee outfit, Johnson &

Johnson India has gained a reputation for delivering high-quality products at competitive

prices. Today J&J is a household name with several popular brands like Band-Aid, J&J Baby

Powder and Prickly Heat Powder. Stayfree Secure has become the leading sanitary napkin in

the country with a volume market share of 46 per cent. Ethicon, a franchise of J&J Medical

India, is a leading manufacturer of surgical material. Eprex launched in 1995 was one of the

first successful biotech brands to be marketed in India. J&J also has a strong presence in the

contact lenses market in the country.

J&J India is considered one of the best places to work and has many firsts to its credit:

J&J became the first company in India to successfully eliminate CFCs from its

manufacturing operations. This required the company to modify the sterilisation

processes at its Ethicon suture finishing plant

Six Sigma Awarded to Johnson & Johnson Consumer Products by the Indian

Statistical Institute and the National Institute of Quality & Reliability

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AWARDS

As a manufacturer of health care products, as well as a provider of related services,

every division of J&J works towards making their positive contribution to the relevant

industries. Recognition and awards have poured in acknowledgement of this fact, both from

within the company, and externally. 

J&J India is Best Company to work for in Healthcare sector:

Johnson & Johnson Limited India has been ranked as the Best Company to Work for

amongst Healthcare companies in India and as one of the top 10 MNCs in India. The

Company got an overall ranking of 22 in a study by the Great Places to Work Institute in

partnership with The Economic Times, India's No 1 business daily. This was the biggest

study of 2009 and more than 373 companies participated in it. Only 50 made it to the Best

Companies to Work For list, making it one of the toughest contests of this kind globally. This

is a tribute to all J&J India Employees and stands testimony to the strong CREDO culture and

HR programs. Around 360 employees participated in the Survey conducted by the Great

Places to Work Institute.

Factors for success of Johnson & Johnson India:

• Ethical practices leading to a strong brand

• Focus on customers

• Decentralised organisation

• Focus on product development

Consistent ethical practices:

The credo articulated by its founder continues to bethe guiding light for all of J&J’s

activities in India and around the world. J&J has focused on ethical practices all through.

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For example – for one of its drugs, the most popular way of dispensing was through

subcutaneous (SC) injections. J&J discovered that there may be some side-effects due to this

and identified intra-venous (IV) administration, as the better option. Even though IV is a

more tedious procedure and requires hospitalisation as against SC that can be administered

anywhere, J&J proactively informed all the doctors about the change. This meant a decline in

J&J’s sales, but the company’s only consideration remained patient wellness.

Such consistent practices over a period of time have led to a very strong franchise for

J&J amongst doctors and patients in the country. There have been cases of patients

postponing their heart surgery to use a newly introduced stent by J&J with a waiting period of

over 3 months. Such is the trust and brand equity that J&J enjoys in India today.

Constant focus on educating customers:

J&J attaches great importance to developing an understanding about its products

among consumers, doctors and medical professionals. There is also a constant focus on

educating customers. J&J makes investments to educate and train doctors and nurses.

For example, J&J established centres in Bombay, Chennai and Delhi for training OT

staff in sutures and medical equipment handling. These initiatives have resulted in

augmenting the brand image of J&J.

R&D for better products:

J&J has set up Johnson & Johnson Technical Laboratory (JJTL) as an initiative to

foray into research and development in India. A team of scientists works in partnership with

the marketing and product supply teams to improve products, packaging and support

advertising claims. Several new products have been developed and launched successfully by

understanding consumer requirements.

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Decentralised organisation:

J&J operates in different business segments like pharmaceuticals, consumer products

and medical equipments etc., which have different industry and competitive dynamics. To

manage the different environments, J&J has adopted a decentralised operational style in India

with each business focusing on its industry with an independent supply chain. Resources are

shared in a planned manner wherever synergies exist, as in non-stock activities like IT,

treasury management, audit, insurance, travel and hotel bookings etc.

IT for business processes enhancement:

J&J has deployed information technology solutions extensively to increase

productivity and automate various business processes. It has implemented enterprise resource

planning (ERP) for different business groups within the company.

Leveraging the India Advantage:

• J&J India is at the leading edge of global product launches. In some cases J&J India has

launched new products in India even before in the US (for example, the cipher stent). Indian

doctors’ ability to quickly learn and apply new techniques provides the company with quick

feedback and faster launches.

• The Indian R&D and testing centres provide services to J&J worldwide. Jansen Cilag (the

pharma division of J&J) has a stability centre in India. Indian managers are constantly

promoted to overseas operations. An Indian team is also managing the supply chain planning

for the Asia-Pacific region.

• J&J India is manufacturing baby soaps for other countries. Some speciality soaps for the US

too are manufactured in India.

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Future plans:

J&J Corporation has a very good perception of India. This has been supported by

good results in the country. The outlook is bullish, and is supported by a high level of

confidence in the Indian management team and more investments likely in the coming years.

Double-digit growth is forecast for the India operations. India would be a key growth driver

for J&J worldwide. J&J is also exploring the opportunities for setting up BPO operations in

the country.

COMPANY STRUCTURE

Johnson & Johnson has more than 250 companies located in 57 countries around the

world. Their Family of Companies is organized into several business segments comprised of

franchises and therapeutic categories.

Consumer Health Care :

The Consumer segment includes a broad range of consumer health and personal care

products in the beauty, baby, oral care and women’s health categories, as well as nutritional

products and over-the-counter medicines and wellness and prevention platforms.

Medical Devices & Diagnostics :

The Medical Devices & Diagnostics segment focuses on technologies, solutions and

services in the fields of cardiovascular disease, diabetes care, orthopaedics, vision care,

wound care, aesthetics, sports medicine, infection prevention, minimally invasive surgery,

and diagnostics.

Pharmaceuticals :

The Pharmaceutical segment's broad portfolio focuses on unmet medical needs across

several therapeutic areas: oncology; infectious disease; immunology; neuroscience;

cardiovascular and metabolism. It includes products in the anti-infective, antipsychotic,

cardiovascular, contraceptive, dermatology, gastrointestinal, hematology, immunology,

neurology, oncology, pain management, urology and virology fields.

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SWOT ANALYSIS

STRENGTHS

Worldwide sales have grown 14% indicating a strong position for the global group.

The business model adapted by Johnson and Johnson fundamentally uses the adaptation of

entrepreneurial values in order to retain an edge within the market place.

Working with intensive scientific notions Johnson and Johnson utilise a varied expanse of

problem solving techniques in order to challenge the standard practice and capitalise on

growth through emerging markets which enables associated growth.

The use of independent offices working as standalone units provides the opportunity to

develop concepts with cultural considerations which can prove important when taking a

product to global markets.

WEAKNESSES

There is increasing pressure within pharmaceutical markets to reduce prices in line with

medical budgets and maintain patent expirations to ensure generic programmes are updated

within critical path movements.

Challenges have been faced within Johnson and Johnson where a reduction in the market

demand for key products has been identified; some of these products were branded and have

been replaced by generic programmes at the end of patent time lines.

Internal weakness across the industry and not isolated to Johnson and Johnson would be the

level of theft and counterfeiting of drugs managed through internal personnel.

OPPORTUNITY

Whilst the recent acquisition of Pfizer Consumer Healthcare will act as an opportunity in its

own right to promote growth for the organisation through alternative routes there is the added

value capitalised through the return on investment which will be realised 12 months before

plan releasing funds back into the bottom line.

Johnson and Johnson have highlighted new developments in pharma products with five

undergoing regulatory review which provides the opportunity to grow the existing product

portfolio.

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Development into new functions of medical devices and diagnostics will provide new

markets to entry which will result in business growth.

With the development of WTO rules to prevent the availability of cheap generic drugs there

is the opportunity to reduce the level of lost profit due to generic introduction as patents run

out. Whilst this will aid Johnson and Johnson where they own the brand where they are

looking to capitalise on introducing generic drugs to market this ruling will become a

hindrance.

THREATS

Generally within the main pharmaceutical companies there is a high level of competition for

the generics markets where patents finish and it is the first to entry where success will

generally be determined.

Technological developments with bio-tech concepts will potentially move the traditional

pharmaceutical methods out of the market place in the long term although there is an

economical argument that this form of development can be segregated to run alongside

traditional methods and complement as opposed to replace. "

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CASE STUDY: THE JOHNSON & JOHNSON TYLENOL CRISIS

WHAT HAPPENED?

In 1982, Johnson & Johnson's Tylenol medication commanded 35 per cent of the US

over-the-counter analgesic market - representing something like 15 per cent of the company's

profits.

Unfortunately, at that point one individual succeeded in lacing the drug with cyanide.

Seven people died as a result. After that the news spread across the world.

By the end of this incident everyone know that Tylenol was associated with the scare.

The company's market value fell by $1bn as a result.

When the same situation happened in 1986, the company had learned its lessons well.

It acted quickly - ordering that Tylenol should be recalled from every outlet .

ACTIONS TAKEN:

The company's first actions were to immediately alerted consumers across the nation,

via the media, not to consume any type of Tylenol product. They told consumers not to

resume using the product until the extent of the tampering could be determined. Johnson &

Johnson, along with stopping the production and advertising of Tylenol, withdraw all Tylenol

capsules from the store shelves in Chicago and the surrounding area. After finding 2 more

contaminated bottles Tylenol realized the vulnerability of the product and ordered a national

withdraw of every capsule (Broom, 1994).

Not only that, but the company decided the product would not be re-established on the

shelves until something had been done to provide better product protection.

SOLUTION:

As a result, Johnson & Johnson developed the tamperproof packaging that would

make it much more difficult for a similar incident to occur in future.

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Johnson & Johnson communicated their new triple safety seal packaging- a glued

box, a plastic sear over the neck of the bottle, and a foil seal over the mouth of the bottle,

with a press conference at the manufacturer's headquarters. Tylenol became the first product

in the industry to use the new tamper resistant packaging just 6 months after the crisis

occurred (Berge, 1990).

RESULT:

Within five months of the disaster, the company had recovered 70% of its market

share for the drug - and the fact this went on to improve over time showed that the company

had succeeded in preserving the long term value of the brand.

In fact, there is some evidence that it was rewarded by consumers who were so

reassured by the steps taken that they switched from other painkillers to Tylenol.

CONCLUSION:

The features that made Johnson & Johnson's handling of the crisis a success included the

following:

They acted quickly, with complete openness about what had happened, and immediately

sought to remove any source of danger based on the worst case scenario - not waiting for

evidence to see whether the contamination might be more widespread

Having acted quickly, they then ensure that measures were taken which would prevent the

problem .

They showed themselves to be prepared to bear the short term cost in the name of consumer

safety. That more than anything else established a basis for trust with their customers

The Johnson & Johnson Tylenol crisis is an example of how an organization should

communicate with the various publics during a crisis. The organization's leadership set the

example from the beginning by making public safety the organizations number one concern.

Today Johnson & Johnson has completely recovered its market share lost during the

crisis. The organization was able to re-establish the Tylenol brand name as one to the most

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trusted over-the-counter consumer products in American. Johnson & Johnson's handing of

the Tylenol crisis is clearly the example other companies should follow if the find themselves

on the brink of losing everything.

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SOURCES

• www.jnjindia.com

• www.jnj.com

• www.fundinguniverse.com

• www.kilmerhouse.com

• www.investor.jnj.com

• www.johnsonsbaby.com

• www.mallenbaker

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