New Venture Opportunities for Johnson & Johnson (NYSE: JNJ)


Johnson & Johnson (NYSE: JNJ), at this moment have given in to complete failure over the prostate cancer market. It’s lost its share to a much smaller company known as Medivation. There is a small set of options left for Johnson & Johnson (NYSE: JNJ).

What is known of Medivation is that it was co-developed with Japanese drug firm Astellas (ASDAQOTH:ALPMY). Medivation’s Xtandi has already managed to successfully trip off Johnson & Johnson (NYSE: JNJ)’s Zytiga to take the top place for post-chemotherapy prostate drug. According to speculations, it won’t be long till it dethrones Zytiga as the best option in pre-chemotherapy treatment.

Research has shown that Xtandi has shown phenomenal results in pre-chemotherapy patients at their last stages of clinical trials as compared to Zytiga. These patients showed a huge improvement in overall survival rate, as compared to placebo and hormone therapy. These results were so outstanding, that many patients on independent trials switched to Xtandi.

This win win situation can result in Xtandi stealing limelight from Zytiga for its pre-chemotherapy patients. Even though Zytiga’s results were exceptionally good too but Zytiga couldn’t provide the sort of benefits that Xtandi seem to be promising. Ever since the FDA approval, Xtandi has taken the market like a storm. Sales have been on the rise, and the company enjoying the benefits is Medivation. The company revealed to its investors that Xtandi will eventually help them exceed their previously forecasted revenue of $600 million to $640 million.

On the other hand, Johnson & Johnson (NYSE: JNJ)’s Zytiga, which was once the best-selling drug in the market with a total of $568 million in revenue worldwide that sums up to a hike of 22.4% from last year, may not be the preferred choice in the near future. The year to date sales were at $1.64 billion, a rise of 36.5%. These figures are more than impressive but what Xtandi has up its sleeves beats it all. Xtandi is growing at a much faster pace, that there is a possibility that Johnson & Johnson (NYSE: JNJ) would want to acquire the entire company.

Analysts believe that Johnson & Johnson (NYSE: JNJ) shouldn’t rush to make an offer at this stage. Even though Xtandi seems very promising with its market share growing rapidly, last summer Johnson & Johnson (NYSE: JNJ) made a purchase that has the potential to outdo Xandi in the long run. That magic drug is Aragon’s ARN-509. It’s a mid-stage prostate cancer drug, made by the same developers that produced Xtandi. This drug, at the moment, seems to have the ability to hit high market shares.  Johnson & Johnson (NYSE: JNJ) has also pushed the drug into the phase 3 trial for non-metastatic prostate cancer, and is expecting results in 2016. The research done to date is predicting a game changer for Johnson & Johnson (NYSE: JNJ).  Hence, at this stage it is better for Johnson & Johnson (NYSE: JNJ) to hold back on making any hasty decision and evaluate its options.