Investors aren’t usually fond of pharmaceuticals and biotech companies. The reason is simple: There is simply too much risk to undertake which nobody wants to be a part of. Investors aren’t known for their financial courage, they spend every penny after thinking four times. Johnson & Johnson (NYSE:JNJ) though isn’t one of those investors. Johnson & Johnson (NYSE:JNJ) is always thinking ahead, always making plans about expanding its portfolio.
Johnson & Johnson (NYSE:JNJ) bought Alios Biopharma for 1.75 billion last month. The reason behind the decision was that Johnson & Johnson (NYSE:JNJ) wants to expand its pharmaceutical portfolio. Alios Biopharma is a clinical stage biopharmaceutical that has a lot of potential for growth. It has some drugs and therapies that Johnson & Johnson (NYSE:JNJ) deems profitable. These therapies are known as nucleoside analogs.
These therapies prevent duplication of cells that are infected with the virus. Along with Johnson & Johnson (NYSE:JNJ)’s drug Olysio, the hepatitis C drug made by Alios Biopharma could be helpful in counterattacking liver diseases. Johnson & Johnson (NYSE:JNJ)’s expertise and inventory would help Alios Biopharma become a household name. Johnson & Johnson (NYSE:JNJ) would also be facilitating the company’s Hepatitis C drugs and other drugs.
The idea is to go against the main competition Gilead Sciences’s (NASDAQ: GILD). The only problem is that Alios Biopharma’s Hepatitis C drugs haven’t really been tested yet. So it’s a long way to go during which the drug will get the Food and Drug Administration approval and then be deployed into the market. What attracted Johnson & Johnson (NYSE:JNJ)’s interest was the respiratory disease drug which is currently in phase 2. The drug will be a major hit if everything goes according to plan.
The drug will help fight one disease that has been troubling children for a long time and has not been met with any significant counterattack yet. Respiratory Syncytical Virus is the only major children disease that hasn’t got any drug approved for treatment. Johnson & Johnson (NYSE:JNJ), along with Alios Biopharma could be the first to come up with a drug to help the situation. Johnson & Johnson (NYSE:JNJ) has been making big money when it comes to sales, roping in 18.5 billion in the last quarter.
With its pharmacy portfolio expanding, this could mean that more revenue is to be made in the future and we can expect a substantial increase in the revenue and the profits. It’s good news for the shareholders, those who’ve invested in the company for a long term. They can now expect healthy dividends and additional payouts. The nexus between Johnson & Johnson (NYSE:JNJ) and Alios Biopharma will complement the individual companies and will help resurrect Johnson & Johnson (NYSE:JNJ)’s waning Olysio drug.
The Olysio drug was being threatened by drugs produced by Gilead Sciences’s (NASDAQ:GILD). But now Alios Biopharma is standing by Johnson & Johnson (NYSE:JNJ)’s side and that means Gilead Sciences’s (NASDAQ:GILD) will think twice before crossing them. Good days are ahead of these two companies and we’ll certainly be hearing more about them and their widespread dominion in the future.