NYSE:JNJ Johnson & Johnson Q4 2023 Earnings Report $167.33 +2.59 (+1.57%) Closing price 08/1/2025 03:59 PM EasternExtended Trading$167.30 -0.03 (-0.01%) As of 08/1/2025 07:59 PM Eastern Extended trading is trading that happens on electronic markets outside of regular trading hours. This is a fair market value extended hours price provided by Polygon.io. Learn more. ProfileEarnings HistoryForecast Johnson & Johnson EPS ResultsActual EPS$2.29Consensus EPS $2.28Beat/MissBeat by +$0.01One Year Ago EPS$2.35Johnson & Johnson Revenue ResultsActual Revenue$21.40 billionExpected Revenue$21.02 billionBeat/MissBeat by +$373.40 millionYoY Revenue Growth-9.70%Johnson & Johnson Announcement DetailsQuarterQ4 2023Date1/23/2024TimeBefore Market OpensConference Call DateTuesday, January 23, 2024Conference Call Time8:30AM ETUpcoming EarningsJohnson & Johnson's Q3 2025 earnings is scheduled for Tuesday, October 21, 2025, with a conference call scheduled on Tuesday, October 14, 2025 at 7:00 AM ET. Check back for transcripts, audio, and key financial metrics as they become available.Conference Call ResourcesConference Call AudioConference Call TranscriptSlide DeckPress Release (8-K)Annual Report (10-K)Earnings HistoryCompany ProfileSlide DeckFull Screen Slide DeckPowered by Johnson & Johnson Q4 2023 Earnings Call TranscriptProvided by QuartrJanuary 23, 2024 ShareLink copied to clipboard.Key Takeaways Johnson & Johnson delivered a **remarkable 2023**, with Innovative Medicine operational sales up 9% (ex-COVID vaccine) and MedTech adjusted operational sales up 9.1% in Q4, driving full-year operational sales growth of 9% (ex-vaccine) and 10.8% adjusted EPS growth. The company achieved **key pipeline milestones** in 2023, including over 10 positive Phase 3 readouts (e.g., CARVICTI, DARZALEX frontline, TREMFYA in ulcerative colitis), FDA breakthrough designation for TAR-200, 19 U.S. and EU filings, and agreed to acquire Ambrx for next-generation antibody-drug conjugates. MedTech set a **record $30 billion+ in annual sales** with 12.4% full-year growth, successfully integrated Abiomed, acquired Laminar for left atrial appendage closure, and advanced its pipeline with the OTTAVA surgical robot, Monarch bronchoscopy approval in China, Belong knee robot expansion, and multiple PFA approvals. In 2023 J&J generated over **$18 billion in free cash flow**, ended the year with $23 billion in cash, increased its dividend for the 61st consecutive year, deployed $3 billion in strategic M&A and partnerships, and reduced share count by 7% via the Kenvue separation. For **2024**, J&J forecasts 5–6% operational sales growth, 7.4% adjusted EPS growth ($10.55–$10.75/share), approximately 50 bps pretax margin improvement, and continued momentum in both Innovative Medicine and MedTech (excluding COVID-19 vaccine sales). AI Generated. May Contain Errors.Conference Call Audio Live Call not available Earnings Conference CallJohnson & Johnson Q4 202300:00 / 00:00Speed:1x1.25x1.5x2xThere are 15 speakers on the call. Operator00:00:00Good morning, and welcome to Johnson and Johnson's 4th Quarter 2023 Earnings Conference Call. This call is being recorded. I would now like to turn the conference call over to Johnson and Johnson. You may begin. Speaker 100:00:29Good morning. This is Jessica Moore, Vice President of Investor Relations for Johnson and Johnson. Welcome to our company's review of business results for the Q4 full year 2023 and our financial outlook for 2024. Joining me on today's call are Joaquin Duado, Chairman and Chief Executive Officer and Joe Wach, Executive Vice President, Chief Financial Officer. As a reminder, you can find additional materials, including today's presentation and associated schedules on the Investor Relations section of the Johnson and Johnson website at investor. Speaker 100:01:08Jandj.com. Please note that this presentation contains forward looking statements regarding, among other things, the company's future operating and financial performance, market position and business strategy. You are cautioned not to rely on these forward looking statements, which are based on current expectations of future events using the information available as of the date of this recording and are subject to certain risks and uncertainties that may cause the company's actual results to differ materially from those projected. A description of these risks, uncertainties and other factors can be found in our SEC filings, including our 2022 Form 10 ks, which is available at investor. Jnj.com and on the SEC's website. Speaker 100:01:59Additionally, several of the products and compounds discussed today are being developed in collaboration with strategic partners or licensed from other companies. This slide acknowledges those relationships. Moving to today's agenda. Joaquin will open with a few comments on our 2023 performance and key milestones, as well as highlights from our enterprise business review. I will then review the 4th quarter sales and P and L results as well as full year 2023 results for the enterprise. Speaker 100:02:31Joe will then close by sharing an overview of our cash position, capital allocation priorities and guidance for 2024. The remaining time will be available for your questions. To ensure we provide enough time to address your questions, we anticipate the webcast will last a little over 60 minutes. I am now pleased to turn the call over to Joaquin. Speaker 200:02:56Thank you, Jess, and good morning, everyone. 2023 was a remarkable year for Johnson and Johnson. In becoming a 2 sector company focused on innovative medicine and medtech, we strengthened our position as an innovation powerhouse. With breakthrough science and transformative technology, we innovate across the entire patient pathway in ways no other company can. And as we share at our Enterprise Business Review, we have a stronger growth and margin profile and are more focused and agile than ever before, which is what you see with today's results. Speaker 200:03:44I'm particularly proud of our Q4 results with innovative medicine operational sales, excluding the COVID-nineteen vaccine growing by 9.5%, and MedTech adjusted operational sales growing by an impressive 9.1%. For the full year, we delivered strong and sustained performance with 9% operational sales growth excluding the COVID-nineteen vaccine and 10.8% adjusted operational earnings per share growth. These results reflect the breadth and competitiveness of our portfolio. And when I look at the milestones we achieve in 2023 and the promise of our pipeline, I have confidence in our guidance for 2024 and beyond. So let's take a deeper look at the business and what we achieved last year. Speaker 200:04:48Starting with Innovative Medicine for the full year, we delivered above market operational sales growth of 7.2% excluding the COVID-nineteen vaccine. Our innovative medicine business continues to be fueled by growth from key brands and the acceleration of sales of new products. Our multiple myeloma portfolio is a good example with significant contribution from recently launched products including CARAVICTI, TEGVAILI and TALVE. Turning to clinical trials. Key results from the year included positive Phase 3 readouts for more than 10 of our in line and pipeline medicines, including CARVICTI in 1 to 3 prior lines of therapy in multiple myeloma, DARZALEX in frontline multiple myeloma transplant eligible patients, Ribrevand in combination with chemotherapy and Ribrevand plus lacertinib in non small cell lung cancer. Speaker 200:05:57And finally, TREMFYA monotherapy in ulcerative colitis. In addition, we saw positive Phase 1 and Phase 2 readouts for nipocalimab and TAR-two hundred and TAR-two ten and we initiated our Phase 3 clinical development programs for Milvexian and our targeted oral peptide, JNJ-two thousand one hundred and hundred and thirteen. Beyond that, we received FDA breakthrough designation for TAR-two hundred for the treatment of bladder cancer and fast track designations for milvexian in atrial fibrillation, stroke and acute coronary syndrome. And with 19 U. S. Speaker 200:06:42And EU filings across our Innovative Medicine business in 2023, we have high expectations for the year ahead. Our recent announcement of a definitive agreement to acquire Ambrx to develop next generation antibody drug conjugates further strengthens our oncology pipeline. Now moving to MedTech. In 2023, we delivered full year operational sales growth of 12.4% and 4 year adjusted operational sales growth of 7.8%. For the first time, our medtech team delivered more than EUR 30,000,000,000 in sales as we continue to build a best in class business. Speaker 200:07:32We are accelerating growth through commercial execution, differentiated innovation and moving into higher growth markets. As you saw with our successful integration of Abiomed and our recent acquisition of Laminar, who is focused on eliminating the left atrial appendage in patients with non valvular atrial fibrillation. And at the same time, we are making strong progress in our pipeline, including advancing our OTTABA surgical robot, Monarch approval in China for bronchoscopy and continued market expansion for Bellys, our robotic assisted solution for total knee replacement with CE Mark approval in 2023. In electrophysiology, we have a lot of momentum in our post field ablation portfolio. We announced regulatory approval a few weeks ago for the Varipulse PFA platform in Japan and have submitted for CE Mark approval in the EU. Speaker 200:08:38The true pulse generator has received approval in the EU and we received 1st and only approval from the U. S. FDA for a 0 fluoroscopy workflow for cardiac ablation. And in the Q4, findings from our QDOT Micro Casacer Q Efficiency Study showed that very high power, short duration ablations, improved quality of life and reduced healthcare utilization for atrial fibrillation patients. In vision, we are driving strong performance across our Technis IOLs and Oasis 1 day family of contact lenses, including our most premium lens, Acivu Oasis Max 1 Day, which has proven superiority in comfort and clarity versus the competition. Speaker 200:09:32Turning to Abiomed, we recently completed our Impella ECP pivotal clinical trial. In Q4, we also enrolled our first patient in the Abiomed RECOVER 4 randomized controlled trial. As we look ahead, I have never been more excited about the future of our business. At our enterprise business review, we share that we expect our innovative medicine business to grow 5% to 7% from 2025 to 2,030 with our industry leading pipeline and portfolio delivering more than 10 assets that have the potential to generate over $5,000,000,000 in peak year sales by 2,030. We also expect a further 15 assets to have the potential for $1,000,000,000 to $5,000,000,000 in peak year sales. Speaker 200:10:29In 2024, we expect data readouts for many of these assets, including Phase III trials for TREMFYA in IBD, ERLEADA in early stage prostate cancer, our targeted oral peptide, JNJ-two thousand one hundred and thirteen in psoriasis, nipocalimab in myasthenia gravis as well as aticaprant and seltorexant in major depressive disorder. We also expect Phase 2 readouts for our combination therapy, guselkumab and golinumab, GNJ-four thousand eight hundred and four in psoriatic arthritis, nipocalimab in Sjogren's disease and TAR-two hundred in non muscle invasive bladder cancer. In metric, we share that we expect to grow at the upper range of our markets, which are anticipated to grow by 5% to 7% between 20222027. And that by 2027, we expect 1 third of our revenue to be generated by new products. In 2024, we'll see strong progress towards these goals. Speaker 200:11:41In electrophysiology, that includes the full U. S. Market release of QDOT Microcatheter and we are expecting CE Mark approval for our post field ablation catheter, body post in Europe in the first half of 2024. We plan to submit an investigational device exemption to the FDA for OTTAVA in the second half of twenty twenty four. And in Abeoment, we expect U. Speaker 200:12:11S. Commercial launch of Impella RP Flex with SmartAssist and an Impella ECP submission in 2024. As you can see, our pipeline is advancing. Our business is transforming. Before I turn the call to Jess and Joe, I want to thank our teams around the world for everything they do to help our patients. Speaker 200:12:36We have entered 2024 from a position of strength and I'm confident in our ability to lead the next wave of health innovation. With that, I'll turn the call over to Jess. Speaker 100:12:49Thanks, Joaquin. Unless otherwise stated, the financial results and guidance highlighted reflects the continuing operations of Johnson and Johnson. We will report the consumer health financial results as discontinued operations. Furthermore, the percentages quoted represent operational results and therefore exclude the impact of currency translation. Starting with Q4 2023 sales results. Speaker 100:13:17Worldwide sales were $21,400,000,000 for the Q4 of 2023. Sales increased 7.2% with 11% in the U. S. And 2.7% outside of the U. S. Speaker 100:13:31Excluding the net impact of acquisitions and divestitures, adjusted operational sales growth was 5.7% worldwide, 8.8% in the U. S. And 2.1% outside the U. S. It is important to note that sales in Europe were negatively impacted by the COVID-nineteen vaccine and loss of exclusivity of ZYTIGA by approximately 1500 basis points operationally. Speaker 100:14:00Turning now to earnings. For the quarter, net earnings were $4,100,000,000 and diluted earnings per share was 1 point $7.0 versus diluted earnings per share of $1.22 a year ago. Excluding after tax intangible asset amortization expense and special items for both periods, adjusted net earnings for the quarter were $5,600,000,000 and adjusted diluted earnings per share was $2.29 representing increases of 2.4% and 11.7%, respectively, compared to the Q4 of 2022. On an operational basis, adjusted diluted earnings per share increased 11.2%. For the full year 2023, sales were $85,200,000,000 Sales grew 7.4% with 10.6% in the U. Speaker 100:15:00S. And 3.8% outside of the U. S. Excluding the net impact of acquisition and divestitures, adjusted operational sales growth was 5.9% worldwide, 8.2% in the U. S. Speaker 100:15:16And 3.4% outside the U. S. Sales in Europe were negatively impacted by the COVID-nineteen vaccine and loss of exclusivity of ZYTIGA by approximately 1,000 basis points operationally. Net earnings for the full year 2023 were $13,300,000,000 and diluted earnings per share was $5.20 versus diluted earnings per share of $6.14 a year ago. Full year 2023 adjusted net earnings were $25,400,000,000 and adjusted diluted earnings per share was $9.92 representing increases of 6.8% and 11.1%, respectively, versus full year 2022. Speaker 100:16:07On an operational basis, adjusted diluted earnings per share increased by 10.8%. I will now comment on business sales performance in the quarter. Beginning with Innovative Medicine. Worldwide Innovative Medicine sales of 13 point $7,000,000,000 increased 4% with growth of 9.5% in the U. S. Speaker 100:16:29And a decline of 3.1% outside of the U. S. Excluding COVID-nineteen vaccine sales, worldwide and U. S. Sales growth was 9.5% and growth outside of the U. Speaker 100:16:42S. Was 9.4%. Sales outside the U. S. Excluding the COVID-nineteen vaccine were negatively impacted by approximately 120 basis points due to the loss of exclusivity of ZYTIGA in Europe. Speaker 100:16:59Innovative medicine growth was driven by our key brands and continued uptake from recently launched products, with 9 assets delivering double digit growth. We continue to drive strong sales growth for both DARZALEX and ARLYADA, with increases of 22.2% and 19%, respectively. Within immunology, we saw sales growth in both STELARA and TREMFYA with increases of 14.5% and 20.5%, respectively. This growth was driven by market growth and share gains as well as favorable patient mix in Tremfya. Growth of 17.4% in pulmonary hypertension was driven by favorable patient mix, share gains and market growth. Speaker 100:17:46Turning to newly launched products. We continue to make progress on our launches of CARVICTI and SPRAVATO. We are also encouraged by the early success of our launches of TEGVELLI and TALVAY, sales of which are driving the growth in other oncology. As a reminder, we expect to begin disclosing TEGFALI sales in Q1 twenty twenty four. Total Innovative Medicines sales growth was partially offset by unfavorable patient mix in XARELTO, a decrease in IMBRUVICA sales due to competitive pressures and the loss of exclusivity of ZYTIGA, REMICADE and PROCISTTA. Speaker 100:18:24I'll now turn your attention to MedTech. Worldwide MedTech sales of $7,700,000,000 increased 13.4% with Abiomed contributing 4.5% to growth. Growth in the U. S. Was 14.1 percent and 12.8 percent outside of the U. Speaker 100:18:43S. Excluding the impact of acquisitions and divestitures, worldwide adjusted operational sales growth was 9.1%. MedTech was negatively impacted by international sanctions in Russia worth approximately 50 basis points, primarily in Advanced Surgery and Vision. Electrophysiology delivered double digit growth of 25.2% with strong growth in all regions, including Europe. This growth was driven by our global market leading portfolio, including the most recently launched QDOT RF Ablation and Octere catheters. Speaker 100:19:22Abiomed contributed $340,000,000 in sales within the quarter, driven by continued strong adoption of Impella 5.5 technology. Growth of 6.4% in surgery was driven primarily by procedure recovery and strength of our biosurgery and wound closure portfolios. Growth was partially offset by volume based procurement in China, primarily in Endocutters. Orthopedics growth of 5% reflects procedure growth, success of recently launched products such as global expansion of our Velas digital solutions and expansion in ambulatory surgical centers as well as lapping of prior year China VBP price concessions in spine. Growth of 6.6% actions and contact lenses as well as strength of new products, including Acuvue Oasis 1 day family of products and contact lenses and TECNIS eye hands, our monofocal interocular lens and surgical vision. Speaker 100:20:29Growth of contact lenses was partially offset by U. S. Stocking dynamics. Global Vision growth was negatively impacted by 140 basis points due to the Blank divestiture in Q3. Now turning to our consolidated statement of earnings for the Q4 of 2023. Speaker 100:20:49I'd like to highlight a few noteworthy items that have changed compared to the same quarter of last year. Cost of products sold margin deleveraged by 130 basis points due to commodity inflation and unfavorable product mix in medtech, partially offset by favorable patient mix and lower COVID-nineteen vaccine supply network related exit cost in innovative medicine. We continue to invest strategically in research and development at competitive levels, investing $4,500,000,000 or 20.9 percent of sales this quarter. We invested $3,400,000,000 or 24.5 percent of sales in Innovative Medicine with the increase in investment being driven by higher milestones, partially offset by portfolio prioritization. In MedTech, R and D investment was $1,100,000,000 or 14.6 percent of sales, with the increase in investment primarily driven by the Laminar acquisition. Speaker 100:21:53Interest income was $212,000,000 in the Q4 of 2023 as compared to $77,000,000 of income in the Q4 of 2022. The increase in income was driven by higher interest rates earned on cash balances and a lower average debt balance. The other income and expense line was income of $421,000,000 in the Q4 of 2023 compared to an expense of $795,000,000 in the Q4 of 2022. This was primarily driven by higher unrealized gains on securities and lower COVID-nineteen vaccine related exit costs. Regarding taxes in the quarter, our effective tax rate was 14.4% versus 16% in the same period last year. Speaker 100:22:47This decrease was primarily driven by the net decrease of tax liabilities, including the settlement of the 2013 through 2016 U. S. Tax audit. Excluding special items, the effective tax rate was 10.8% versus 16.2% in the same period last year. I encourage you to review our upcoming 2023 10 ks filing for additional details on specific tax related matters. Speaker 100:23:19Lastly, I'll direct your attention to the Box section of the slide, where we have also provided our income before tax, net earnings and earnings per share adjusted to exclude the impact of intangible amortization expense and special items. Now let's look at adjusted income before tax by segment. In the Q4 of 2023, our adjusted income before tax for the enterprise as a percentage of sales decreased from 32.5 percent to 29.2 percent. Innovative Medicine margins declined from 37.7 percent to 37.4 percent, primarily driven by higher R and D milestones, partially offset by favorable patient mix and leveraging and selling and marketing expense. Medtech margins declined from 24.5 percent to 15.5 percent, primarily driven by in process research and development expense from the Laminar acquisition, commodity inflation and unfavorable product mix, partially offset by selling and marketing expense leverage. Speaker 100:24:32This concludes the sale and earnings portion of the call. I'm now pleased to turn it over to Joe. Speaker 300:24:39Thank you, Jessica, and thanks everyone for joining us today. As Joaquin and Jessica commented, 2023 was a strong year for Johnson and Johnson, evidenced by notable top and bottom line performance beats relative to what we guided to 2023 at this time last year. We are particularly proud of the innovation we advanced to strengthen our development pipelines, the continued expansion of our portfolio and investments made for future success. All of this provides us with a strong foundation as we enter 2024. Thus far during the call, you've heard about sales and income performance in 2023. Speaker 300:25:19So now let's dive into some detail on capital allocation highlights. We generated free cash flow of more than $18,000,000,000 in 2023. At the end of the year, we had approximately $23,000,000,000 of cash and marketable securities and approximately $29,000,000,000 of debt for a net debt position of $6,000,000,000 We maintained a healthy balance sheet and robust credit rating underscoring the strength of Johnson and Johnson's financial position, which enables us to strategically invest and deploy capital to unlock value. To that end, we executed against all of our capital allocation priorities in 2023. For starters, we invested more than $15,000,000,000 in research and development or 17.7 percent of sales, an all time high for the company as we remain one of the top investors in R and D across all industries. Speaker 300:26:18Jessica provided R and D investment by business segment, information we will continue to provide on a quarterly basis moving forward. As far as dividends, 2023 marked the 61st consecutive year in which we increased our dividend. We know this use of capital is a priority for our investors and we plan to continue to increase our dividend annually. We also deployed, announced or committed over $3,000,000,000 in strategic value creating inorganic growth opportunities in the last 12 months. This amount includes the recent Ambrex and Laminar transactions as well as more than 50 smaller early stage licensing deals and partnerships that complement our current innovative medicine and medtech pipelines. Speaker 300:27:05Finally, share repurchases. In early 2023, we completed the $5,000,000,000 share repurchase program initiated in late 2022 and in combination with our dividend returned over $14,000,000,000 to shareholders last year. Through the Canvue separation, we further reduced the Johnson and Johnson's outstanding share count by 191,000,000 shares or approximately 7% without the use of cash and in a tax free manner. Looking ahead to 2024, Johnson and Johnson's robust free cash flow generation should continue to solidify our already strong financial foundation and fuel further investment leading to growth for our business or returns to shareholders. Now turning to our full year 2024 guidance. Speaker 300:27:55Today, we are confirming the 2024 guidance for those items previewed at our enterprise business review in early December, while filling in some of the details. We expect operational sales growth for the full year to be in the range of 5% to 6% or $88,200,000,000 to $89,000,000,000 As a reminder, our sales guidance continues to exclude any impact from COVID-nineteen vaccine sales. In Innovative Medicine, we expect 2024 to deliver a 13th consecutive year of above market growth, driven by market share gains from key brands such as DARZALEX, Tremfya and ERLEADA as well as continued adoption of recently launched newer products such as CARVICTI, TEGVELLI, TALVE and SPRAVATO. In medtech, we remain focused on executing our key value drivers. 1st, advancing our differentiated pipeline such as programs in pulse field ablation, Abiomed and surgical robotics, further shifting our portfolio into high growth markets. Speaker 300:29:022nd, expanding our reach and scale around the world and third, building operational resilience across our portfolio. We don't speculate on future currency movements, but utilizing the euro spot rate relative to the U. S. Dollar as of last week at 1.09 as well as other major currencies, we estimate there would be a slight unfavorable impact of $400,000,000 or a negative 0.5% on reported sales growth for the year. Turning to other items on our P and L. Speaker 300:29:37We expect our 2024 adjusted pretax operating margin to improve by approximately 50 basis points, driven primarily by a continuation of efficiency programs across the organization. We expect this to be partially offset by anticipated STELARA biosimilar entrants in Europe in the second half of this year and some lingering inflation impact in medtech inventory that will flow through 2024's P and L. This margin improvement encompasses dilution of additional investment associated with our planned acquisition of Ambrex, which will be treated as a business combination. Now we do acknowledge that this 50 basis point improvement simply gets us back to what your models expected given the elevated Q4 2023 R and D investment for new pipeline assets. Regarding other income and expense, we anticipate income to be $1,200,000,000 to $1,400,000,000 for 2024. Speaker 300:30:39This is less than the 2023 amount driven by the impact of actuarial assumptions on certain employee benefit programs such as lower discount rates. We are comfortable with you modeling net interest income between $450,000,000 $550,000,000 consistent with 2023 levels. Finally, we are projecting an effective tax rate for 2024 in the range of 16% to 17% based on current tax laws and anticipated geographic income mix across our businesses. This tax rate takes into account an increase of approximately 1.5% or 150 basis points relative to the recently enacted Pillar 2 legislation. We continue to believe the U. Speaker 300:31:27S. Treasury's current perspective on Pillar 2 is harmful, reducing U. S. Incentives for innovation and resulting in U. S.-based multinational companies paying more tax revenue to foreign governments. Speaker 300:31:41Our full year share count calculation for adjusted earnings per share in 20.24 will include the remaining benefit equal to approximately 120,000,000 shares from the approximately 191,000,000 net share reduction in outstanding J and J shares following the Canvue exchange offer. Given all these factors, we expect adjusted operational earnings per share to grow 7.4% at the midpoint for a range of $10.55 to $10.75 Based on the euro spot rate of 1.09 from last week, we do not estimate any currency impact on earnings per share. I'll now provide some qualitative considerations on quarterly phasing for your models. We expect innovative medicine sales growth be slightly stronger in the first half of the year compared to the second half given the anticipated entry of Stelara biosimilars in Europe towards the middle of the year. This headwind will be partially offset by continued uptake from our recently launched products. Speaker 300:32:46We project MedTech operational sales growth to be relatively first half of the year will continue to have modest impact from Russia sanctions as our licenses are approved. We anticipate China VBP pricing for surgical IOLs and orthopedic sports to begin in 2024 with impacts from 2023 VBP in electrophysiology, Endocutters, Energy, Spine and Trauma to begin to anniversary throughout 2024. Regarding EPS phasing, it is important to highlight that the first half of the year will benefit from the full 191,000,000 net share reduction following the Canvue exchange offer with only a partial comparative benefit in the Q3 2023 and the Q4 being neutral versus Q4 2023. So based on the foundation strengthened in 2023 and numerous catalysts that Joaquin outlined across our business in 2024, we are confident in our ability to achieve both near and long term financial targets. I'd like to close by thanking our colleagues for their dedication and commitment to benefit patients around the world. Speaker 300:34:04It is their effort that enables Johnson and Johnson to deliver innovative therapies and solutions that address serious unmet medical needs and creates long term sustainable value for shareholders. With that, I am now pleased to turn the call over to Kevin to begin the Q and A portion of the call. Speaker 200:34:23Thank Operator00:34:38Our first question today is coming from Joanne Wuensch from Citi. Your line is now live. Speaker 100:34:44Good morning and thank you for taking the questions. With my one question, I'm curious why you're looking for 2024 procedure volumes to remain above pre COVID levels and your expectations for how long that will last? Thank you. Speaker 200:34:58Thank you, Joanne, and good morning, everyone. First, let me remark the strong close of our medtech business in 2023. We delivered annually more than $30,000,000,000 in sales, which is our all time high in our company history with operational adjusted operational growth in the Q4 of 9.1%. So very strong results across the board in electrophysiology, in heart recovery, in surgery, in orthopedics and in vision. So when we think about our results in 2023, we think it's going to be aligned with our competitor composite for the year, but ahead of our competitor composite in the Q4. Speaker 200:35:45Now certainly, COVID-nineteen impacts have stabilized globally. And while we continue to see some challenges, macro challenges from the point of view of inflation, hospital staffing and the like. There is a pulse of patients coming out into the market after COVID-nineteen, which has made 2023 market growth faster than historical averages. And we see that trend continuing into a good part of 2024 and therefore being a tailwind into 2024. There's a lot of factors playing into that. Speaker 200:36:33But overall, we see the augmented procedures continuing into at least the first half of twenty twenty four. Now, we also have a number of tailwinds on our side other than the procedures that make me optimistic about 2024. We have the trajectory of Abeomed in heart recovery, which is very strong with the adoption of Impella 5 point 5. We filed already for our Impella ECP, which is the smaller version of Impella CP. In orthopedics, we continue to move into higher growth markets with the expansion of our Bellys robotic assisted solution. Speaker 200:37:17We obtained CE Mark in Europe. In surgery, we continue to launch innovations across our surgery business with the Incl X1 curve jaw tissue sealer in energy and HCLN 3000 assess stapler. And we continue to see good expansion of our plus shooters too. In our Vision business, we are expanding our Technics family into the premium segment of IOLs. And finally, and Speaker 300:37:48I know this is an area Speaker 200:37:48of interest to you in electrophysiology, we continue to expand our PFA portfolio of catheters. We obtained approval for our radiofrequency ablation catheter. So overall, radiofrequency ablation catheter. So overall, a number of catalysts and tailwinds into our medtech business into 2024. As we discussed in our enterprise business review, we continue to see our medtech business growing at the upper end of our market and becoming a best in class competitor in medtech. Operator00:38:42Thank you. Next question is coming from Terence Flynn from Morgan Stanley. Your line is now live. Speaker 400:38:47Great. Thanks so much for taking the question. Maybe a 2 part for me on CARVICTI. I noticed that an ODAC panel was just announced to review the CARTTITUDE 4 data. I was just wondering if you can talk about the focus of that upcoming meeting and your confidence in an on time label expansion for Cartitude 4? Speaker 400:39:08And then the second part of the question is, I know in manufacturing, you've been ramping up in Belgium and I believe that facility is now up and running. So how should we think about supply for 2024 broadly for CARVICTI? Thank you. Thank Speaker 200:39:22you, Terence. So with more than 2,000 patients treated CARVICTI, it's already launch CAR T in the market overall. And we are pleased to continue to see quarter over quarter sequential growth in CARBT. And overall, we remain confident in 2 things, both the risk benefit of CARBICTI in the indications that has been studied and at the same time on the potential of CARBICTI to be €5,000,000,000 plus asset at peak year sales. Regarding the order that you commented, we are very confident on the data of our Phase III CARTITUDE-four study that as a reminder supports the efficacy and safety of CARBICTI in 1, 2, prior lines in the treatment of patients with relapsedrefractory multiple myeloma. Speaker 200:40:19We presented the results at ASCO, as you know. And we also published those results in the New England Journal of Medicine. And we very much look forward to review the updated survival and safety data with the FDA ODAC in the future. We are committed to work with the FDA in the continued to multiple myeloma patients in earlier lines of therapy. To multiple myeloma patients in earlier lines of therapy. Speaker 200:40:54We are working with the FDA towards a PDUFA date for our CARTITUDE 4 indication in April 5 and with EMEA towards unanticipated CHMP opinion in the Q1 of 2024. So overall, we feel confident about the risk benefit profiling this indication and about the future of CARB 2019. Regarding your manufacturing question, we've done significant progress in our manufacturing capacity, which is a major driver in the continuous growth of CARBICTI. On the cell processing side, we have doubled our cell processing capacity in our Raditan facility since 2023. We are making progress to your point, Terence, in our European cell processing facilities. Speaker 200:41:45We are already manufacturing the first batches of CARB T for clinical use this month of January. And we also have contracted additional capacity external capacity to scale up production and increase our ability moving forward that will start mid this year. On the other hand, we have also made significant progress in the internalization and the scale up of our Lentivirus production. We have increased capacity in Switzerland in our Switzerland site. And at the same time, we continue to progress with new U. Speaker 200:42:20S. Capacity and addition site in the Netherlands to produce our lentivirus. Late December, we received approval to expand our lentivirus capacity from 20 liter tanks to 50 liter tanks of lentivirus production in our U. S. Facility. Speaker 200:42:40So overall, we feel good that we are progressing with CARBICTI, that we will continue to deliver quarter over quarter growth in 2024. And we are working towards building this $5,000,000,000 plus product and continue to transform the treatment paradigm in multiple myeloma, as we have discussed in the past, moving from treating to progression to treating to cure as we move CARBICTI into earlier lines of therapy. Operator00:43:17Next question is coming from Larry Biegelsen from Wells Fargo. Your line is now live. Speaker 500:43:24Congrats to a nice finish to the year here. Joe or Joaquin, I'd love to hear just a general update on your M and A appetite and expand on your recent comments about Abiomed being a gateway in cardiovascular devices, which you Joaquin commented on earlier this month? Thanks so much for taking the question. Speaker 300:43:47Yes. So Larry, let me start. Good morning and then I can turn it over to Joaquin. So we are very well positioned to continue to entertain many types of deals. As you know, we have the parameters of making sure that they're a strategic fit so that we've got scientific expertise and insights. Speaker 300:44:05A familiarity with the space has proven to be our most successful platforms. We want to make sure that we're earning a fair return to compensate shareholders for the risk that we're bearing on their behalf. It was only 13 months ago we were able to deploy $17,000,000,000 in capital for Abiomed. We're very pleased with that acquisition. Not only has it beat our internal deal models, but it also is performing better than what The Street had called for that business prior to the announcement of the acquisition. Speaker 300:44:36So it's been a really nice fit. What I would say is we also deployed or announced, as I said in my prepared remarks, over $3,000,000,000 in capital for more than 50 smaller licensing partnerships or deals. And while those may have not made headlines, they usually are headlines when they become products for patients. And so that we think about our history of DARZALEX, IMBRUVICA, CARVICTI for 1, it's been that's kind of been our track record. Our appetite is still, I would say, interested in moving into spaces that complement our existing portfolio, whether that be for the near or long term? Speaker 200:45:26Thank you. And Luca, talking about that larvae, let me say, we are agnostic to sector and agnostic to size. And as Joe commented, our preference is clearly to be in areas in which we have internal capabilities and know how and also to go into products that represent a significant progress from the point of view of improving the current standard of care and that are 1st in class and best in class. To illustrate that, the 2 deals that we completed this year, Laminar and Ambriggs would be in that direction. So for example, laminar is a deal in an area we know well, which is atrial fibrillation and we believe could be 1st in class to be a device that can eliminate the left atrial appendage. Speaker 200:46:22When it comes to Ambrx, it's ideally an area that we have strong legacy like prostate cancer with a number of products marketed already. And this could be a 1st in class antibody drug conjugate in order to address a significant medical need in metastatic castell resistant prostate cancer in patients that have failed androgen therapy. So very much so and in that context, we continue to see also opportunities when it comes to innovative medicines in neuroscience and in immunology. And when it comes to medtech, to your point, in other cardiology areas, based on the strength that we have now with Biosense Webster and Biomed and not excluding also the potential for other areas like robotic surgery or segments of orthopedics that are growing faster and also areas of vision. So overall, that's our approach. Speaker 200:47:18We try to put this strategic, scientific and to Joe's point, scientific lens in order to be able to deliver value for patients and also value for our shareholders. Operator00:47:31Thank you. Next question is coming from Chris Schott from JPMorgan. Your line is now live. Speaker 600:47:36Great. Thanks so much. Just Joe, a question for you. How should we think about gross margins in 2024 and beyond? I know you've talked about operating margins, but it did seem like adjusted gross margins came down in 4Q. Speaker 600:47:47And I'm just wondering if that's a one off result or a longer term trend we need to think about and as we think about kind of the cadence of your P and L over the next few years? Thank you. Yes. Speaker 300:47:57Good morning, Chris. Thanks for the question. I think as you look at that specifically for the Q4, what you have in our operating margins is obviously the Laminar transaction that was part of that mix. So on our slide that details IBT, you likely saw a quarterly reduction in medtech specifically of about 9 points, about 2 points for the full year. I would say 2 thirds of that is represented by the Laminar transaction. Speaker 300:48:23And then you have the inflation And then you have the inflationary impact obviously with higher levels of inventory on our balance sheet that flow through the P and L that is occurring throughout 2023 and we expect it to occur throughout at least the first half of twenty twenty four. We're not seeing any incremental inflation in, I'll call it, current activity. So it's not being additive to inventory, but it's also not subsiding either. So we're kind of at a new, I'd say, water level, if you will, that should be going forward, but not, hurting the P and L as we look out beyond the second half of twenty twenty four. Operator00:49:10Thank you. Next question is coming from Shagun Singh from RBC Capital Markets. Your line is now live. Speaker 700:49:16Great. Thank you so much. I was just wondering if we could get your latest thoughts on the potential impact of Nova's osteoarthritis data on orthopedic utilization given the focus on WOMAC or pain scores? I believe the presentation could be here soon. Just curious to hear your thoughts and also what kind of scores could or may not have a potential impact? Speaker 700:49:39Thank you for taking the question. Speaker 200:49:44So overall, look, osteoarthritis is a contributor to knee surgery. Sometimes I am asked about osteoarthritis in the context of the GLP-1s and weight is not a factor in osteoarthritis. We continue to look at this data and it's early for us to give you an answer there. Now what we can tell you is that we continue to see an increased volume of procedures in orthopedics based on coming out of COVID. And we don't see any change in that neither in the hips or in the knee area or in any of the segments that we compete. Speaker 200:50:24So we are optimistic about our orthopedics trajectory. Specifically, we are optimistic about how we are progressing with our Bellys robotic system for total knee replacement. We have already have 30,000 procedures with very positive feedback from the surgeons, especially in the ambulatory surgical centers. We are now working to submit our 510 for our Velis Uni Knee application. And we are seeing a strong recovery also in our hip business with a combination of new products like Actis, King-size and Bellyship Navigation. Speaker 200:51:08So we feel good about our orthopedics business as we continue to see global procedure recovery in most markets. We continue to succeed with our new products. And we lap also part of the headwind that we had Speaker 300:51:34reminder what we provide as a reminder what we commented to last quarter and that's we're looking very hard at improving the profitability of the Orthopaedics unit. So being very selective as to what geographies we play in and what SKUs are actually going to be offered. So not only will you see some of the strength in the top line as Joaquin outlined, but you should see an improved margin profile for that business as well. Operator00:52:00Thank you. Our next question today is coming from Vamil Divan from Guggenheim Securities. Your line is now live. Speaker 800:52:07Great. Thanks so much for taking my question. So just maybe an area we don't spend as much time on is on the respiratory side, especially PAH. So just sort of a 2 part question, but that franchise of yours continues to sort of outperform expectations. So curious if you can talk about sort of what's driving success there. Speaker 800:52:26There's also an area where you don't have a lot of sort of longer term investment. So going back to sort of the business development question, I'm just curious in your interest in sort of PAH or respiratory more generally as an area of further focus given your key franchises are going to going away, but you do have the infrastructure there already? Speaker 200:52:45So first, let me underline the great results of our PAH franchise in 2023. Mix, market growth coming out of COVID-two. This was an area that was heavily impacted by COVID. As pulmonologists were working at COVID and not diagnosing new patients. So overall, it's been a very positive trajectory of our PAH business. Speaker 200:53:19And we remain confident about the short term future of this business into 2024. We are working towards the combination of macitenta and opsamid with tadalafil, which the trademark would be OBSIMBI and that would being another option for patients there to enhance compliance. And in my talks with physicians treating pulmonary hypertension, they seem very positive about it, and we expect an approval of that combination in 2024. So that's the outlook for our pulmonary franchise. Are we looking at other areas there? Speaker 200:54:02There we are looking at the space and see if there are potential opportunities to be able to improve the standard of care. And we continue to look to see how we can continue to extend the success of our pulmonary franchise into the future. But overall, we are very happy with the trajectory of our pulmonary franchise in 2023. And we expect a similar trajectory as Masitend and Upsamy and Uptravi become standard of care clearly established in this area. Operator00:54:33Our next question today is coming from Louise Chen from Cantor Fitzgerald. Your line is now live. Speaker 900:54:38Hi, thank you for taking my question here. I just wanted to ask you with respect to your oncology franchise, do you have any thoughts on CAR Ts for autoimmune disease at all? And then secondly, radiopharmaceuticals? Speaker 200:54:55So thank you, Luis. And we have a strong oncology franchise in different areas. I commented earlier in prostate cancer with ERIDA that I discussed before, we see data in high risk localized prostate cancer in 2024. With the addition of Ambrx now, an antibody drug conjugate in this area, we are very, very excited about dribrevant and the combination of dribrevant plus lacertinib. We have Phase 3 studies completed. Speaker 200:55:28We expect we have filed all the 3 indications and we expect approval of that in 2024. So we are very excited about Ribrevand and the combination of Ribrevand plus lacertiniv in EGFR mutated non small cell lung cancer in first line. Moving into bladder cancer, you also will see data with that is 2 hundred and that is 2 10 in non muscle invasive localized bladder cancer. And we receive FDA breakthrough designation for that is 200 in 2023. And then we continue our progress in our multidylmyeloma franchise. Speaker 200:56:13We talk about CARVICTI, but it's important to recognize how well TEGVILI and TALVE, our 2 bispecific antibodies, are performing in the marketplace and the continued growth of DARTHALEX with the impressive per sales data that we presented in first line in newly diagnosed transplant eligible multiple myeloma patients. So we are looking at CAR T in autoimmune diseases to your question, yes, but it's early data. As you know, we did a deal earlier in 2023 to partner to Cartesa CD19 and CD19 CD20 bicar. So we are looking at that and it's early data. It looks promising. Speaker 200:57:02We are interested in radiopharmaceuticals. We believe that the avenue that we are doing with antibody drug conjugates, it's an important therapeutic option. And when it comes to radiopharmaceuticals, we did a deal earlier this year with nanobiotics for a radio enhancer that is being developing head and neck cancer. We expanded our rights at the end of the year and this could be another avenue to be there for us in which we could combine our expertise in medical devices, in medical technology and pharmaceuticals, and we plan to do a broader development plan of our radio enhancement and we'll provide you more information about it as we continue to move. So overall, we are very pleased with the progress that we see in our oncology franchise, both in solid tumors and in hematology. Speaker 200:57:55And it remains a core strength of our innovative medicine group. Operator00:58:03Thank you. Next question is coming from Matt Miksic from Barclays. Your line is now live. Speaker 1000:58:10Hi, thanks so much for taking the question. I wanted to follow-up on some of the comments you made about medtech trends and margins. And I think you mentioned some of the headwinds there were patient mix. We'd love to get an idea maybe kind of in the middle of the P and L on the operating line in terms of margin progression throughout the year, which ones of those of your business lines is there kind of more reflecting that negative mix that you described and how that progresses during the year? Thanks. Speaker 300:58:50Yes, Matt. I apologize, but it was a little bit tough to hear your question entirely. I think it was around margin specifically in medtech and how that may progress through the year. So as I stated earlier, I would say that the margin profile is going to be impacted by inflationary pressures that were incurred really in 2022, sit on our balance sheet as inventory and then kind of flow through the P and L throughout the corresponding 2023 and probably a good piece of 2024. That being said, Tim and the team are doing magnificent work in terms of finding efficiencies across the business. Speaker 300:59:25I highlighted one of the earlier ones with respect to Orthopaedics. But we're quite frankly doing that across the entire medtech portfolio at this point in time, looking for opportunities whether it be aided by artificial intelligence or just infrastructure overall as to how we can further improve the medtech profitability profile. Right now, we stand a little bit above the middle of the pack in terms of our peer set on margin, and we're looking to get towards the upper end of that peer set. Operator01:00:00Thank you. Our next question today is coming from Geoff Meacham from Bank of America. Your line is now live. Speaker 1101:00:06Great. Thanks so much for the question. Just wanted to ask you about the XARALTO patient mix that you guys called out. Just help us with kind of current dynamics and maybe looking forward whether this trend you expect to continue? Thank you. Speaker 101:00:21Yes, Jeff, I can answer that one. So specifically on XARELTO in the quarter, we would say there's 2 items. It's patient mix, but there is also a one time entry. Moving forward in 2024, we do expect that there will be a decline, but not to the extent that you saw in Q4. Operator01:00:43Thank you. Speaker 1201:00:54Joe, sorry to harp on the MedTech margin side of things. I appreciate everything you're saying for going forward. But just as we look at Q4 specifically, even adding back Laminar, we're still getting to sort of down 400 basis points year over year in the quarter. And I was just hoping maybe you could bridge us a little bit more. Is there any component of that sort of price increases taken in late 'twenty 2023 rolling off or anything that you would highlight there? Speaker 1201:01:22Thanks so much. Speaker 301:01:25No, Danielle. I think it's really the inflationary impacts out of the 9% drop that you saw in Q4, 5 points are really laminar. The other balance of 4 points I would chalk up to the inflationary impact that I spoke of earlier. And then the mix component whereby Orthopaedics, which is our lowest margin portfolio within the medtech portfolio overall performed a little bit better. So there's really nothing magical behind it other than the explanations that were already given on the call. Speaker 301:02:00Again, we are looking at cost improvement initiatives, specifically in Orthopedics but across the entire portfolio as we move through 2024. But there's nothing that happened maybe this is the best way to state it. There's nothing that happened in Q4 that has us concerned about our outlook or calls around margin profile or EPS for the balance of this upcoming year. Operator01:02:28Thank you. Our next question is coming from David Risinger from Leerink Partners. Your line is now live. Speaker 1301:02:35Yes. Thanks very much, and thanks for all of the details today. So notwithstanding the recently announced Ambrx acquisition, in recent years, J and J has executed more medtech M and A than pharma M and A. And I don't mean to belabor the point, I know that you got some specific therapeutic area questions. But could you just comment at a high level on what has held J and J back in pharma M and A in recent years and whether we should expect greater cash deployment to accelerate long term pharma revenue growth going forward? Speaker 1301:03:13Thank you. Speaker 201:03:15So thank you, David. And M and A has been M and A and external innovation has been the core of our pharma portfolio growth and transformation. As I said initially, we are agnostic to sector. In the case of pharma, our preferred mode has been trying to go to assets that were around proof of concept. So generally speaking, from a size perspective, it's been about deals that have been either of a smaller size or have been different modalities like client census or partnerships. Speaker 201:03:54Just last year, we completed overall at Johnson and Johnson more than 50 deals. The thing is that the headlines are only made by the ones that are M and A. So we've done multiple deals in our pharmaceutical side in order to be able to enhance our existing portfolio. And our bias is to go for transactions that are going to enable us to create more value by leveraging our clinical development strength, our manufacturing capabilities and our commercial reach. So hence, why the majority of the deals that you see in our pharmaceutical side are at an earlier stage. Speaker 201:04:32But mainly, we find But mainly, we find more opportunities to create value at an earlier stage. For example, this year, we did a number of deals that went less publicized. We did, as I commented before, a deal with CMBG, now called Avelcida in CAR T with C19 and C20, which we believe could be a best in class CAR T in this area that could launch in this decade. Or at the end of the year, we also did another deal in antibody drug conjugates with a Korean company called Legochem, which was underreported. But we continue to work in identifying deals in our pharmaceutical space that enables us to be able to put all our clinical development side, in manufacturing and in commercial. Speaker 201:05:38And that's been the source of very significant value creation in products that all of you know like DARFALEX or CARAVICTI that come from that type of approach of going earlier on into the development process. Speaker 101:05:54Thank you, David. We have time for one last question. Operator01:05:58Our final question today is coming from Rick Wise from Stifel. Your line is now live. Speaker 1401:06:04Good morning. Thank you. Maybe you could expand a little bit more on your electrophysiology comments. You had an extraordinary quarter. I'm guessing the new products helped. Speaker 1401:06:14Maybe you could give us a little more color on maybe quantify the impact, the negative impact from China VBP. And looking ahead, we've got not we've got one PFA device approved in the U. S, another one seemingly coming in the next month or 3 maybe. How should we think about the EP franchise as we look ahead to 2024? What are you incorporating in your thinking? Speaker 201:06:44Thank you so much. So thank you for the question. Great and strong results of our EP franchise in 2023. And you should think about our EP franchise in 2024 as also a strong year, another year of growth, a strong growth for our EP franchise. If I look at the to your point out, the drivers of growth in 2023, it was across the board. Speaker 201:07:10I mean, it was in Asia Pacific, in the U. S. And EMEA. It was driven by the procedural recovery, but also by the new product performance and some offset also a slight offset of value based procurement in China. The new products that we introduced this year are the engine generator, our mapping catheters Octarai and Octrel and also importantly our QDOT microcatheter in radiofrequency ablation that has efficacy results higher than any PFA catheter. Speaker 201:07:48And that together with our strong commercial execution and broad clinical support across the board has driven these results in electrophysiology that in the Q4 was 25% growth globally, 22% growth in the U. S. And 29% outside of the U. S, so very strong results. So we have a strong leadership in electrophysiology and 20 years of understanding this field. Speaker 201:08:16And when it comes to our strategy in cardiac ablation, we have multiple strategies. But one core strategy is our carto mapping system. That is a fundamental pillar of our strategy in cardiac ablation that supports procedural efficiency and very importantly now low to 0 fluoroscopy workflow. For the electrophysiologist, it's very important to know where they are and what are they doing to the heart anatomy. Otherwise, they are flying blind if they don't have a mapping system. Speaker 201:08:55And the CARTO system, it's providing the electrophysiologist real time feedback and very important parameters like tissue proximity, contact force measurement and ablation indexes that give them an idea of how durable the lesion is going to be and what are going to be the outcomes of the procedure. So that's key for us to be able to have a workflow that enables the type of progress that electrophysiologist have been already used to with radio frequency ablation. And hence, all our suite of catheters, it's going to be from day 1 fully integrated in our mapping system. We have 5,000 CARTO systems already deployed globally and an extensive network of mappers to support the electrophysiologist. When it comes to our catheters, we are developing a full portfolio of options. Speaker 201:09:52You commented on Maripulse, our multi electrode catheter that was approved in Japan. We are developing a focal and a large focal catheter and also a single shot one. So, electrophysialists are going to be able to choose the catheter that is more appropriate for their anatomy and for the workflow that they are selecting. We have 5 clinical trials active, 3 of them have completed and we have submitted our Varipulse catheter for CE Mark and we plan submitting the Varipulse catheter for to the U. S. Speaker 201:10:29FDA in 2024. Ultimately, PFA is an important option, but Aref is also here to stay. That's why we believe that having the workflow and the procedure efficiency that Carto gives you plus the option of having a catheter like our dual energy catheter that would enable electrophysiologist to simply change depending on the anatomy of deletion from PSA to RFA. It's going to be important for the future and it's going to help them adopting PSA as this is the most widely used catheter in the world. So very positive about our growth in 2024 based on the strength that we have in this area and positive about the outlook of our ablation business moving forward. Speaker 201:11:18As we have commented in multiple occasions, atrial fibrillation, it's an area that is still undertreated. And the outcomes of radiofrequency ablation and most likely the outcomes of PSA have shown significant improvement even compared to medical therapy. So very positive about the outlook of our and the strength of our atrial fibrillation business. Speaker 101:11:44Thank you, Rick, and thanks to everyone for your questions and your continued interest in our company. We apologize to those we couldn't get to because of time, but don't hesitate to reach out to the Investor Relations team with any remaining questions you may have. I will now turn the call back over to Joaquin for some brief closing remarks. Speaker 201:12:02Thank you, Jess. The strong performance we delivered in 2023 gives me great confidence in the trajectory of our business. As I said earlier, we are entering 2024 from a position of strength, and we have multiple catalysts for growth. No other company is as well positioned as Johnson and Johnson to lead the next wave of health care innovation. And we look forward to sharing our progress in the year ahead. Speaker 201:12:31Thank you. Operator01:12:34Thank you. This concludes today's Johnson and Johnson's 4th quarter 2023 earnings conference call. You may now disconnect.Read morePowered by Earnings DocumentsSlide DeckPress Release(8-K)Annual report(10-K) Johnson & Johnson Earnings HeadlinesThe 3 Things That Matter for Johnson & Johnson Now5 hours ago | fool.com4 Very Safe Dividend Stocks on Goldman Sachs' August Conviction Buy ListAugust 1 at 2:44 PM | 247wallst.comTrump’s national nightmare is herePorter Stansberry and Jeff Brown say a new U.S. national emergency is already underway — and it could trigger the biggest forced rotation of capital since World War II. 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Email Address About Johnson & JohnsonJohnson & Johnson (NYSE:JNJ) is a holding company, which engages in the research, development, manufacture, and sale of products in the healthcare field. It operates through the Innovative Medicine and MedTech segments. The Innovative Medicine segment focuses on immunology, infectious diseases, neuroscience, oncology, cardiovascular and metabolism, and pulmonary hypertension. The MedTech segment includes a portfolio of products used in the interventional solutions, orthopaedics, surgery, and vision categories. The company was founded by Robert Wood Johnson I, James Wood Johnson, and Edward Mead Johnson Sr. in 1887 and is headquartered in New Brunswick, NJ.View Johnson & Johnson ProfileRead more More Earnings Resources from MarketBeat Earnings Tools Today's Earnings Tomorrow's Earnings Next Week's Earnings Upcoming Earnings Calls Earnings Newsletter Earnings Call Transcripts Earnings Beats & Misses Corporate Guidance Earnings Screener Earnings By Country U.S. Earnings Reports Canadian Earnings Reports U.K. Earnings Reports Latest Articles Amazon's Earnings: What Comes Next and How to Play ItApple Stock: Big Earnings, Small Move—Time to Buy?Microsoft Blasts Past Earnings—What’s Next for MSFT?Visa Beats Q3 Earnings Expectations, So Why Did the Market Panic?Spotify's Q2 Earnings Plunge: An Opportunity or Ominous Signal?RCL Stock Sinks After Earnings—Is a Buying Opportunity Ahead?Amazon's Pre-Earnings Setup Is Almost Too Clean—Red Flag? 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There are 15 speakers on the call. Operator00:00:00Good morning, and welcome to Johnson and Johnson's 4th Quarter 2023 Earnings Conference Call. This call is being recorded. I would now like to turn the conference call over to Johnson and Johnson. You may begin. Speaker 100:00:29Good morning. This is Jessica Moore, Vice President of Investor Relations for Johnson and Johnson. Welcome to our company's review of business results for the Q4 full year 2023 and our financial outlook for 2024. Joining me on today's call are Joaquin Duado, Chairman and Chief Executive Officer and Joe Wach, Executive Vice President, Chief Financial Officer. As a reminder, you can find additional materials, including today's presentation and associated schedules on the Investor Relations section of the Johnson and Johnson website at investor. Speaker 100:01:08Jandj.com. Please note that this presentation contains forward looking statements regarding, among other things, the company's future operating and financial performance, market position and business strategy. You are cautioned not to rely on these forward looking statements, which are based on current expectations of future events using the information available as of the date of this recording and are subject to certain risks and uncertainties that may cause the company's actual results to differ materially from those projected. A description of these risks, uncertainties and other factors can be found in our SEC filings, including our 2022 Form 10 ks, which is available at investor. Jnj.com and on the SEC's website. Speaker 100:01:59Additionally, several of the products and compounds discussed today are being developed in collaboration with strategic partners or licensed from other companies. This slide acknowledges those relationships. Moving to today's agenda. Joaquin will open with a few comments on our 2023 performance and key milestones, as well as highlights from our enterprise business review. I will then review the 4th quarter sales and P and L results as well as full year 2023 results for the enterprise. Speaker 100:02:31Joe will then close by sharing an overview of our cash position, capital allocation priorities and guidance for 2024. The remaining time will be available for your questions. To ensure we provide enough time to address your questions, we anticipate the webcast will last a little over 60 minutes. I am now pleased to turn the call over to Joaquin. Speaker 200:02:56Thank you, Jess, and good morning, everyone. 2023 was a remarkable year for Johnson and Johnson. In becoming a 2 sector company focused on innovative medicine and medtech, we strengthened our position as an innovation powerhouse. With breakthrough science and transformative technology, we innovate across the entire patient pathway in ways no other company can. And as we share at our Enterprise Business Review, we have a stronger growth and margin profile and are more focused and agile than ever before, which is what you see with today's results. Speaker 200:03:44I'm particularly proud of our Q4 results with innovative medicine operational sales, excluding the COVID-nineteen vaccine growing by 9.5%, and MedTech adjusted operational sales growing by an impressive 9.1%. For the full year, we delivered strong and sustained performance with 9% operational sales growth excluding the COVID-nineteen vaccine and 10.8% adjusted operational earnings per share growth. These results reflect the breadth and competitiveness of our portfolio. And when I look at the milestones we achieve in 2023 and the promise of our pipeline, I have confidence in our guidance for 2024 and beyond. So let's take a deeper look at the business and what we achieved last year. Speaker 200:04:48Starting with Innovative Medicine for the full year, we delivered above market operational sales growth of 7.2% excluding the COVID-nineteen vaccine. Our innovative medicine business continues to be fueled by growth from key brands and the acceleration of sales of new products. Our multiple myeloma portfolio is a good example with significant contribution from recently launched products including CARAVICTI, TEGVAILI and TALVE. Turning to clinical trials. Key results from the year included positive Phase 3 readouts for more than 10 of our in line and pipeline medicines, including CARVICTI in 1 to 3 prior lines of therapy in multiple myeloma, DARZALEX in frontline multiple myeloma transplant eligible patients, Ribrevand in combination with chemotherapy and Ribrevand plus lacertinib in non small cell lung cancer. Speaker 200:05:57And finally, TREMFYA monotherapy in ulcerative colitis. In addition, we saw positive Phase 1 and Phase 2 readouts for nipocalimab and TAR-two hundred and TAR-two ten and we initiated our Phase 3 clinical development programs for Milvexian and our targeted oral peptide, JNJ-two thousand one hundred and hundred and thirteen. Beyond that, we received FDA breakthrough designation for TAR-two hundred for the treatment of bladder cancer and fast track designations for milvexian in atrial fibrillation, stroke and acute coronary syndrome. And with 19 U. S. Speaker 200:06:42And EU filings across our Innovative Medicine business in 2023, we have high expectations for the year ahead. Our recent announcement of a definitive agreement to acquire Ambrx to develop next generation antibody drug conjugates further strengthens our oncology pipeline. Now moving to MedTech. In 2023, we delivered full year operational sales growth of 12.4% and 4 year adjusted operational sales growth of 7.8%. For the first time, our medtech team delivered more than EUR 30,000,000,000 in sales as we continue to build a best in class business. Speaker 200:07:32We are accelerating growth through commercial execution, differentiated innovation and moving into higher growth markets. As you saw with our successful integration of Abiomed and our recent acquisition of Laminar, who is focused on eliminating the left atrial appendage in patients with non valvular atrial fibrillation. And at the same time, we are making strong progress in our pipeline, including advancing our OTTABA surgical robot, Monarch approval in China for bronchoscopy and continued market expansion for Bellys, our robotic assisted solution for total knee replacement with CE Mark approval in 2023. In electrophysiology, we have a lot of momentum in our post field ablation portfolio. We announced regulatory approval a few weeks ago for the Varipulse PFA platform in Japan and have submitted for CE Mark approval in the EU. Speaker 200:08:38The true pulse generator has received approval in the EU and we received 1st and only approval from the U. S. FDA for a 0 fluoroscopy workflow for cardiac ablation. And in the Q4, findings from our QDOT Micro Casacer Q Efficiency Study showed that very high power, short duration ablations, improved quality of life and reduced healthcare utilization for atrial fibrillation patients. In vision, we are driving strong performance across our Technis IOLs and Oasis 1 day family of contact lenses, including our most premium lens, Acivu Oasis Max 1 Day, which has proven superiority in comfort and clarity versus the competition. Speaker 200:09:32Turning to Abiomed, we recently completed our Impella ECP pivotal clinical trial. In Q4, we also enrolled our first patient in the Abiomed RECOVER 4 randomized controlled trial. As we look ahead, I have never been more excited about the future of our business. At our enterprise business review, we share that we expect our innovative medicine business to grow 5% to 7% from 2025 to 2,030 with our industry leading pipeline and portfolio delivering more than 10 assets that have the potential to generate over $5,000,000,000 in peak year sales by 2,030. We also expect a further 15 assets to have the potential for $1,000,000,000 to $5,000,000,000 in peak year sales. Speaker 200:10:29In 2024, we expect data readouts for many of these assets, including Phase III trials for TREMFYA in IBD, ERLEADA in early stage prostate cancer, our targeted oral peptide, JNJ-two thousand one hundred and thirteen in psoriasis, nipocalimab in myasthenia gravis as well as aticaprant and seltorexant in major depressive disorder. We also expect Phase 2 readouts for our combination therapy, guselkumab and golinumab, GNJ-four thousand eight hundred and four in psoriatic arthritis, nipocalimab in Sjogren's disease and TAR-two hundred in non muscle invasive bladder cancer. In metric, we share that we expect to grow at the upper range of our markets, which are anticipated to grow by 5% to 7% between 20222027. And that by 2027, we expect 1 third of our revenue to be generated by new products. In 2024, we'll see strong progress towards these goals. Speaker 200:11:41In electrophysiology, that includes the full U. S. Market release of QDOT Microcatheter and we are expecting CE Mark approval for our post field ablation catheter, body post in Europe in the first half of 2024. We plan to submit an investigational device exemption to the FDA for OTTAVA in the second half of twenty twenty four. And in Abeoment, we expect U. Speaker 200:12:11S. Commercial launch of Impella RP Flex with SmartAssist and an Impella ECP submission in 2024. As you can see, our pipeline is advancing. Our business is transforming. Before I turn the call to Jess and Joe, I want to thank our teams around the world for everything they do to help our patients. Speaker 200:12:36We have entered 2024 from a position of strength and I'm confident in our ability to lead the next wave of health innovation. With that, I'll turn the call over to Jess. Speaker 100:12:49Thanks, Joaquin. Unless otherwise stated, the financial results and guidance highlighted reflects the continuing operations of Johnson and Johnson. We will report the consumer health financial results as discontinued operations. Furthermore, the percentages quoted represent operational results and therefore exclude the impact of currency translation. Starting with Q4 2023 sales results. Speaker 100:13:17Worldwide sales were $21,400,000,000 for the Q4 of 2023. Sales increased 7.2% with 11% in the U. S. And 2.7% outside of the U. S. Speaker 100:13:31Excluding the net impact of acquisitions and divestitures, adjusted operational sales growth was 5.7% worldwide, 8.8% in the U. S. And 2.1% outside the U. S. It is important to note that sales in Europe were negatively impacted by the COVID-nineteen vaccine and loss of exclusivity of ZYTIGA by approximately 1500 basis points operationally. Speaker 100:14:00Turning now to earnings. For the quarter, net earnings were $4,100,000,000 and diluted earnings per share was 1 point $7.0 versus diluted earnings per share of $1.22 a year ago. Excluding after tax intangible asset amortization expense and special items for both periods, adjusted net earnings for the quarter were $5,600,000,000 and adjusted diluted earnings per share was $2.29 representing increases of 2.4% and 11.7%, respectively, compared to the Q4 of 2022. On an operational basis, adjusted diluted earnings per share increased 11.2%. For the full year 2023, sales were $85,200,000,000 Sales grew 7.4% with 10.6% in the U. Speaker 100:15:00S. And 3.8% outside of the U. S. Excluding the net impact of acquisition and divestitures, adjusted operational sales growth was 5.9% worldwide, 8.2% in the U. S. Speaker 100:15:16And 3.4% outside the U. S. Sales in Europe were negatively impacted by the COVID-nineteen vaccine and loss of exclusivity of ZYTIGA by approximately 1,000 basis points operationally. Net earnings for the full year 2023 were $13,300,000,000 and diluted earnings per share was $5.20 versus diluted earnings per share of $6.14 a year ago. Full year 2023 adjusted net earnings were $25,400,000,000 and adjusted diluted earnings per share was $9.92 representing increases of 6.8% and 11.1%, respectively, versus full year 2022. Speaker 100:16:07On an operational basis, adjusted diluted earnings per share increased by 10.8%. I will now comment on business sales performance in the quarter. Beginning with Innovative Medicine. Worldwide Innovative Medicine sales of 13 point $7,000,000,000 increased 4% with growth of 9.5% in the U. S. Speaker 100:16:29And a decline of 3.1% outside of the U. S. Excluding COVID-nineteen vaccine sales, worldwide and U. S. Sales growth was 9.5% and growth outside of the U. Speaker 100:16:42S. Was 9.4%. Sales outside the U. S. Excluding the COVID-nineteen vaccine were negatively impacted by approximately 120 basis points due to the loss of exclusivity of ZYTIGA in Europe. Speaker 100:16:59Innovative medicine growth was driven by our key brands and continued uptake from recently launched products, with 9 assets delivering double digit growth. We continue to drive strong sales growth for both DARZALEX and ARLYADA, with increases of 22.2% and 19%, respectively. Within immunology, we saw sales growth in both STELARA and TREMFYA with increases of 14.5% and 20.5%, respectively. This growth was driven by market growth and share gains as well as favorable patient mix in Tremfya. Growth of 17.4% in pulmonary hypertension was driven by favorable patient mix, share gains and market growth. Speaker 100:17:46Turning to newly launched products. We continue to make progress on our launches of CARVICTI and SPRAVATO. We are also encouraged by the early success of our launches of TEGVELLI and TALVAY, sales of which are driving the growth in other oncology. As a reminder, we expect to begin disclosing TEGFALI sales in Q1 twenty twenty four. Total Innovative Medicines sales growth was partially offset by unfavorable patient mix in XARELTO, a decrease in IMBRUVICA sales due to competitive pressures and the loss of exclusivity of ZYTIGA, REMICADE and PROCISTTA. Speaker 100:18:24I'll now turn your attention to MedTech. Worldwide MedTech sales of $7,700,000,000 increased 13.4% with Abiomed contributing 4.5% to growth. Growth in the U. S. Was 14.1 percent and 12.8 percent outside of the U. Speaker 100:18:43S. Excluding the impact of acquisitions and divestitures, worldwide adjusted operational sales growth was 9.1%. MedTech was negatively impacted by international sanctions in Russia worth approximately 50 basis points, primarily in Advanced Surgery and Vision. Electrophysiology delivered double digit growth of 25.2% with strong growth in all regions, including Europe. This growth was driven by our global market leading portfolio, including the most recently launched QDOT RF Ablation and Octere catheters. Speaker 100:19:22Abiomed contributed $340,000,000 in sales within the quarter, driven by continued strong adoption of Impella 5.5 technology. Growth of 6.4% in surgery was driven primarily by procedure recovery and strength of our biosurgery and wound closure portfolios. Growth was partially offset by volume based procurement in China, primarily in Endocutters. Orthopedics growth of 5% reflects procedure growth, success of recently launched products such as global expansion of our Velas digital solutions and expansion in ambulatory surgical centers as well as lapping of prior year China VBP price concessions in spine. Growth of 6.6% actions and contact lenses as well as strength of new products, including Acuvue Oasis 1 day family of products and contact lenses and TECNIS eye hands, our monofocal interocular lens and surgical vision. Speaker 100:20:29Growth of contact lenses was partially offset by U. S. Stocking dynamics. Global Vision growth was negatively impacted by 140 basis points due to the Blank divestiture in Q3. Now turning to our consolidated statement of earnings for the Q4 of 2023. Speaker 100:20:49I'd like to highlight a few noteworthy items that have changed compared to the same quarter of last year. Cost of products sold margin deleveraged by 130 basis points due to commodity inflation and unfavorable product mix in medtech, partially offset by favorable patient mix and lower COVID-nineteen vaccine supply network related exit cost in innovative medicine. We continue to invest strategically in research and development at competitive levels, investing $4,500,000,000 or 20.9 percent of sales this quarter. We invested $3,400,000,000 or 24.5 percent of sales in Innovative Medicine with the increase in investment being driven by higher milestones, partially offset by portfolio prioritization. In MedTech, R and D investment was $1,100,000,000 or 14.6 percent of sales, with the increase in investment primarily driven by the Laminar acquisition. Speaker 100:21:53Interest income was $212,000,000 in the Q4 of 2023 as compared to $77,000,000 of income in the Q4 of 2022. The increase in income was driven by higher interest rates earned on cash balances and a lower average debt balance. The other income and expense line was income of $421,000,000 in the Q4 of 2023 compared to an expense of $795,000,000 in the Q4 of 2022. This was primarily driven by higher unrealized gains on securities and lower COVID-nineteen vaccine related exit costs. Regarding taxes in the quarter, our effective tax rate was 14.4% versus 16% in the same period last year. Speaker 100:22:47This decrease was primarily driven by the net decrease of tax liabilities, including the settlement of the 2013 through 2016 U. S. Tax audit. Excluding special items, the effective tax rate was 10.8% versus 16.2% in the same period last year. I encourage you to review our upcoming 2023 10 ks filing for additional details on specific tax related matters. Speaker 100:23:19Lastly, I'll direct your attention to the Box section of the slide, where we have also provided our income before tax, net earnings and earnings per share adjusted to exclude the impact of intangible amortization expense and special items. Now let's look at adjusted income before tax by segment. In the Q4 of 2023, our adjusted income before tax for the enterprise as a percentage of sales decreased from 32.5 percent to 29.2 percent. Innovative Medicine margins declined from 37.7 percent to 37.4 percent, primarily driven by higher R and D milestones, partially offset by favorable patient mix and leveraging and selling and marketing expense. Medtech margins declined from 24.5 percent to 15.5 percent, primarily driven by in process research and development expense from the Laminar acquisition, commodity inflation and unfavorable product mix, partially offset by selling and marketing expense leverage. Speaker 100:24:32This concludes the sale and earnings portion of the call. I'm now pleased to turn it over to Joe. Speaker 300:24:39Thank you, Jessica, and thanks everyone for joining us today. As Joaquin and Jessica commented, 2023 was a strong year for Johnson and Johnson, evidenced by notable top and bottom line performance beats relative to what we guided to 2023 at this time last year. We are particularly proud of the innovation we advanced to strengthen our development pipelines, the continued expansion of our portfolio and investments made for future success. All of this provides us with a strong foundation as we enter 2024. Thus far during the call, you've heard about sales and income performance in 2023. Speaker 300:25:19So now let's dive into some detail on capital allocation highlights. We generated free cash flow of more than $18,000,000,000 in 2023. At the end of the year, we had approximately $23,000,000,000 of cash and marketable securities and approximately $29,000,000,000 of debt for a net debt position of $6,000,000,000 We maintained a healthy balance sheet and robust credit rating underscoring the strength of Johnson and Johnson's financial position, which enables us to strategically invest and deploy capital to unlock value. To that end, we executed against all of our capital allocation priorities in 2023. For starters, we invested more than $15,000,000,000 in research and development or 17.7 percent of sales, an all time high for the company as we remain one of the top investors in R and D across all industries. Speaker 300:26:18Jessica provided R and D investment by business segment, information we will continue to provide on a quarterly basis moving forward. As far as dividends, 2023 marked the 61st consecutive year in which we increased our dividend. We know this use of capital is a priority for our investors and we plan to continue to increase our dividend annually. We also deployed, announced or committed over $3,000,000,000 in strategic value creating inorganic growth opportunities in the last 12 months. This amount includes the recent Ambrex and Laminar transactions as well as more than 50 smaller early stage licensing deals and partnerships that complement our current innovative medicine and medtech pipelines. Speaker 300:27:05Finally, share repurchases. In early 2023, we completed the $5,000,000,000 share repurchase program initiated in late 2022 and in combination with our dividend returned over $14,000,000,000 to shareholders last year. Through the Canvue separation, we further reduced the Johnson and Johnson's outstanding share count by 191,000,000 shares or approximately 7% without the use of cash and in a tax free manner. Looking ahead to 2024, Johnson and Johnson's robust free cash flow generation should continue to solidify our already strong financial foundation and fuel further investment leading to growth for our business or returns to shareholders. Now turning to our full year 2024 guidance. Speaker 300:27:55Today, we are confirming the 2024 guidance for those items previewed at our enterprise business review in early December, while filling in some of the details. We expect operational sales growth for the full year to be in the range of 5% to 6% or $88,200,000,000 to $89,000,000,000 As a reminder, our sales guidance continues to exclude any impact from COVID-nineteen vaccine sales. In Innovative Medicine, we expect 2024 to deliver a 13th consecutive year of above market growth, driven by market share gains from key brands such as DARZALEX, Tremfya and ERLEADA as well as continued adoption of recently launched newer products such as CARVICTI, TEGVELLI, TALVE and SPRAVATO. In medtech, we remain focused on executing our key value drivers. 1st, advancing our differentiated pipeline such as programs in pulse field ablation, Abiomed and surgical robotics, further shifting our portfolio into high growth markets. Speaker 300:29:022nd, expanding our reach and scale around the world and third, building operational resilience across our portfolio. We don't speculate on future currency movements, but utilizing the euro spot rate relative to the U. S. Dollar as of last week at 1.09 as well as other major currencies, we estimate there would be a slight unfavorable impact of $400,000,000 or a negative 0.5% on reported sales growth for the year. Turning to other items on our P and L. Speaker 300:29:37We expect our 2024 adjusted pretax operating margin to improve by approximately 50 basis points, driven primarily by a continuation of efficiency programs across the organization. We expect this to be partially offset by anticipated STELARA biosimilar entrants in Europe in the second half of this year and some lingering inflation impact in medtech inventory that will flow through 2024's P and L. This margin improvement encompasses dilution of additional investment associated with our planned acquisition of Ambrex, which will be treated as a business combination. Now we do acknowledge that this 50 basis point improvement simply gets us back to what your models expected given the elevated Q4 2023 R and D investment for new pipeline assets. Regarding other income and expense, we anticipate income to be $1,200,000,000 to $1,400,000,000 for 2024. Speaker 300:30:39This is less than the 2023 amount driven by the impact of actuarial assumptions on certain employee benefit programs such as lower discount rates. We are comfortable with you modeling net interest income between $450,000,000 $550,000,000 consistent with 2023 levels. Finally, we are projecting an effective tax rate for 2024 in the range of 16% to 17% based on current tax laws and anticipated geographic income mix across our businesses. This tax rate takes into account an increase of approximately 1.5% or 150 basis points relative to the recently enacted Pillar 2 legislation. We continue to believe the U. Speaker 300:31:27S. Treasury's current perspective on Pillar 2 is harmful, reducing U. S. Incentives for innovation and resulting in U. S.-based multinational companies paying more tax revenue to foreign governments. Speaker 300:31:41Our full year share count calculation for adjusted earnings per share in 20.24 will include the remaining benefit equal to approximately 120,000,000 shares from the approximately 191,000,000 net share reduction in outstanding J and J shares following the Canvue exchange offer. Given all these factors, we expect adjusted operational earnings per share to grow 7.4% at the midpoint for a range of $10.55 to $10.75 Based on the euro spot rate of 1.09 from last week, we do not estimate any currency impact on earnings per share. I'll now provide some qualitative considerations on quarterly phasing for your models. We expect innovative medicine sales growth be slightly stronger in the first half of the year compared to the second half given the anticipated entry of Stelara biosimilars in Europe towards the middle of the year. This headwind will be partially offset by continued uptake from our recently launched products. Speaker 300:32:46We project MedTech operational sales growth to be relatively first half of the year will continue to have modest impact from Russia sanctions as our licenses are approved. We anticipate China VBP pricing for surgical IOLs and orthopedic sports to begin in 2024 with impacts from 2023 VBP in electrophysiology, Endocutters, Energy, Spine and Trauma to begin to anniversary throughout 2024. Regarding EPS phasing, it is important to highlight that the first half of the year will benefit from the full 191,000,000 net share reduction following the Canvue exchange offer with only a partial comparative benefit in the Q3 2023 and the Q4 being neutral versus Q4 2023. So based on the foundation strengthened in 2023 and numerous catalysts that Joaquin outlined across our business in 2024, we are confident in our ability to achieve both near and long term financial targets. I'd like to close by thanking our colleagues for their dedication and commitment to benefit patients around the world. Speaker 300:34:04It is their effort that enables Johnson and Johnson to deliver innovative therapies and solutions that address serious unmet medical needs and creates long term sustainable value for shareholders. With that, I am now pleased to turn the call over to Kevin to begin the Q and A portion of the call. Speaker 200:34:23Thank Operator00:34:38Our first question today is coming from Joanne Wuensch from Citi. Your line is now live. Speaker 100:34:44Good morning and thank you for taking the questions. With my one question, I'm curious why you're looking for 2024 procedure volumes to remain above pre COVID levels and your expectations for how long that will last? Thank you. Speaker 200:34:58Thank you, Joanne, and good morning, everyone. First, let me remark the strong close of our medtech business in 2023. We delivered annually more than $30,000,000,000 in sales, which is our all time high in our company history with operational adjusted operational growth in the Q4 of 9.1%. So very strong results across the board in electrophysiology, in heart recovery, in surgery, in orthopedics and in vision. So when we think about our results in 2023, we think it's going to be aligned with our competitor composite for the year, but ahead of our competitor composite in the Q4. Speaker 200:35:45Now certainly, COVID-nineteen impacts have stabilized globally. And while we continue to see some challenges, macro challenges from the point of view of inflation, hospital staffing and the like. There is a pulse of patients coming out into the market after COVID-nineteen, which has made 2023 market growth faster than historical averages. And we see that trend continuing into a good part of 2024 and therefore being a tailwind into 2024. There's a lot of factors playing into that. Speaker 200:36:33But overall, we see the augmented procedures continuing into at least the first half of twenty twenty four. Now, we also have a number of tailwinds on our side other than the procedures that make me optimistic about 2024. We have the trajectory of Abeomed in heart recovery, which is very strong with the adoption of Impella 5 point 5. We filed already for our Impella ECP, which is the smaller version of Impella CP. In orthopedics, we continue to move into higher growth markets with the expansion of our Bellys robotic assisted solution. Speaker 200:37:17We obtained CE Mark in Europe. In surgery, we continue to launch innovations across our surgery business with the Incl X1 curve jaw tissue sealer in energy and HCLN 3000 assess stapler. And we continue to see good expansion of our plus shooters too. In our Vision business, we are expanding our Technics family into the premium segment of IOLs. And finally, and Speaker 300:37:48I know this is an area Speaker 200:37:48of interest to you in electrophysiology, we continue to expand our PFA portfolio of catheters. We obtained approval for our radiofrequency ablation catheter. So overall, radiofrequency ablation catheter. So overall, a number of catalysts and tailwinds into our medtech business into 2024. As we discussed in our enterprise business review, we continue to see our medtech business growing at the upper end of our market and becoming a best in class competitor in medtech. Operator00:38:42Thank you. Next question is coming from Terence Flynn from Morgan Stanley. Your line is now live. Speaker 400:38:47Great. Thanks so much for taking the question. Maybe a 2 part for me on CARVICTI. I noticed that an ODAC panel was just announced to review the CARTTITUDE 4 data. I was just wondering if you can talk about the focus of that upcoming meeting and your confidence in an on time label expansion for Cartitude 4? Speaker 400:39:08And then the second part of the question is, I know in manufacturing, you've been ramping up in Belgium and I believe that facility is now up and running. So how should we think about supply for 2024 broadly for CARVICTI? Thank you. Thank Speaker 200:39:22you, Terence. So with more than 2,000 patients treated CARVICTI, it's already launch CAR T in the market overall. And we are pleased to continue to see quarter over quarter sequential growth in CARBT. And overall, we remain confident in 2 things, both the risk benefit of CARBICTI in the indications that has been studied and at the same time on the potential of CARBICTI to be €5,000,000,000 plus asset at peak year sales. Regarding the order that you commented, we are very confident on the data of our Phase III CARTITUDE-four study that as a reminder supports the efficacy and safety of CARBICTI in 1, 2, prior lines in the treatment of patients with relapsedrefractory multiple myeloma. Speaker 200:40:19We presented the results at ASCO, as you know. And we also published those results in the New England Journal of Medicine. And we very much look forward to review the updated survival and safety data with the FDA ODAC in the future. We are committed to work with the FDA in the continued to multiple myeloma patients in earlier lines of therapy. To multiple myeloma patients in earlier lines of therapy. Speaker 200:40:54We are working with the FDA towards a PDUFA date for our CARTITUDE 4 indication in April 5 and with EMEA towards unanticipated CHMP opinion in the Q1 of 2024. So overall, we feel confident about the risk benefit profiling this indication and about the future of CARB 2019. Regarding your manufacturing question, we've done significant progress in our manufacturing capacity, which is a major driver in the continuous growth of CARBICTI. On the cell processing side, we have doubled our cell processing capacity in our Raditan facility since 2023. We are making progress to your point, Terence, in our European cell processing facilities. Speaker 200:41:45We are already manufacturing the first batches of CARB T for clinical use this month of January. And we also have contracted additional capacity external capacity to scale up production and increase our ability moving forward that will start mid this year. On the other hand, we have also made significant progress in the internalization and the scale up of our Lentivirus production. We have increased capacity in Switzerland in our Switzerland site. And at the same time, we continue to progress with new U. Speaker 200:42:20S. Capacity and addition site in the Netherlands to produce our lentivirus. Late December, we received approval to expand our lentivirus capacity from 20 liter tanks to 50 liter tanks of lentivirus production in our U. S. Facility. Speaker 200:42:40So overall, we feel good that we are progressing with CARBICTI, that we will continue to deliver quarter over quarter growth in 2024. And we are working towards building this $5,000,000,000 plus product and continue to transform the treatment paradigm in multiple myeloma, as we have discussed in the past, moving from treating to progression to treating to cure as we move CARBICTI into earlier lines of therapy. Operator00:43:17Next question is coming from Larry Biegelsen from Wells Fargo. Your line is now live. Speaker 500:43:24Congrats to a nice finish to the year here. Joe or Joaquin, I'd love to hear just a general update on your M and A appetite and expand on your recent comments about Abiomed being a gateway in cardiovascular devices, which you Joaquin commented on earlier this month? Thanks so much for taking the question. Speaker 300:43:47Yes. So Larry, let me start. Good morning and then I can turn it over to Joaquin. So we are very well positioned to continue to entertain many types of deals. As you know, we have the parameters of making sure that they're a strategic fit so that we've got scientific expertise and insights. Speaker 300:44:05A familiarity with the space has proven to be our most successful platforms. We want to make sure that we're earning a fair return to compensate shareholders for the risk that we're bearing on their behalf. It was only 13 months ago we were able to deploy $17,000,000,000 in capital for Abiomed. We're very pleased with that acquisition. Not only has it beat our internal deal models, but it also is performing better than what The Street had called for that business prior to the announcement of the acquisition. Speaker 300:44:36So it's been a really nice fit. What I would say is we also deployed or announced, as I said in my prepared remarks, over $3,000,000,000 in capital for more than 50 smaller licensing partnerships or deals. And while those may have not made headlines, they usually are headlines when they become products for patients. And so that we think about our history of DARZALEX, IMBRUVICA, CARVICTI for 1, it's been that's kind of been our track record. Our appetite is still, I would say, interested in moving into spaces that complement our existing portfolio, whether that be for the near or long term? Speaker 200:45:26Thank you. And Luca, talking about that larvae, let me say, we are agnostic to sector and agnostic to size. And as Joe commented, our preference is clearly to be in areas in which we have internal capabilities and know how and also to go into products that represent a significant progress from the point of view of improving the current standard of care and that are 1st in class and best in class. To illustrate that, the 2 deals that we completed this year, Laminar and Ambriggs would be in that direction. So for example, laminar is a deal in an area we know well, which is atrial fibrillation and we believe could be 1st in class to be a device that can eliminate the left atrial appendage. Speaker 200:46:22When it comes to Ambrx, it's ideally an area that we have strong legacy like prostate cancer with a number of products marketed already. And this could be a 1st in class antibody drug conjugate in order to address a significant medical need in metastatic castell resistant prostate cancer in patients that have failed androgen therapy. So very much so and in that context, we continue to see also opportunities when it comes to innovative medicines in neuroscience and in immunology. And when it comes to medtech, to your point, in other cardiology areas, based on the strength that we have now with Biosense Webster and Biomed and not excluding also the potential for other areas like robotic surgery or segments of orthopedics that are growing faster and also areas of vision. So overall, that's our approach. Speaker 200:47:18We try to put this strategic, scientific and to Joe's point, scientific lens in order to be able to deliver value for patients and also value for our shareholders. Operator00:47:31Thank you. Next question is coming from Chris Schott from JPMorgan. Your line is now live. Speaker 600:47:36Great. Thanks so much. Just Joe, a question for you. How should we think about gross margins in 2024 and beyond? I know you've talked about operating margins, but it did seem like adjusted gross margins came down in 4Q. Speaker 600:47:47And I'm just wondering if that's a one off result or a longer term trend we need to think about and as we think about kind of the cadence of your P and L over the next few years? Thank you. Yes. Speaker 300:47:57Good morning, Chris. Thanks for the question. I think as you look at that specifically for the Q4, what you have in our operating margins is obviously the Laminar transaction that was part of that mix. So on our slide that details IBT, you likely saw a quarterly reduction in medtech specifically of about 9 points, about 2 points for the full year. I would say 2 thirds of that is represented by the Laminar transaction. Speaker 300:48:23And then you have the inflation And then you have the inflationary impact obviously with higher levels of inventory on our balance sheet that flow through the P and L that is occurring throughout 2023 and we expect it to occur throughout at least the first half of twenty twenty four. We're not seeing any incremental inflation in, I'll call it, current activity. So it's not being additive to inventory, but it's also not subsiding either. So we're kind of at a new, I'd say, water level, if you will, that should be going forward, but not, hurting the P and L as we look out beyond the second half of twenty twenty four. Operator00:49:10Thank you. Next question is coming from Shagun Singh from RBC Capital Markets. Your line is now live. Speaker 700:49:16Great. Thank you so much. I was just wondering if we could get your latest thoughts on the potential impact of Nova's osteoarthritis data on orthopedic utilization given the focus on WOMAC or pain scores? I believe the presentation could be here soon. Just curious to hear your thoughts and also what kind of scores could or may not have a potential impact? Speaker 700:49:39Thank you for taking the question. Speaker 200:49:44So overall, look, osteoarthritis is a contributor to knee surgery. Sometimes I am asked about osteoarthritis in the context of the GLP-1s and weight is not a factor in osteoarthritis. We continue to look at this data and it's early for us to give you an answer there. Now what we can tell you is that we continue to see an increased volume of procedures in orthopedics based on coming out of COVID. And we don't see any change in that neither in the hips or in the knee area or in any of the segments that we compete. Speaker 200:50:24So we are optimistic about our orthopedics trajectory. Specifically, we are optimistic about how we are progressing with our Bellys robotic system for total knee replacement. We have already have 30,000 procedures with very positive feedback from the surgeons, especially in the ambulatory surgical centers. We are now working to submit our 510 for our Velis Uni Knee application. And we are seeing a strong recovery also in our hip business with a combination of new products like Actis, King-size and Bellyship Navigation. Speaker 200:51:08So we feel good about our orthopedics business as we continue to see global procedure recovery in most markets. We continue to succeed with our new products. And we lap also part of the headwind that we had Speaker 300:51:34reminder what we provide as a reminder what we commented to last quarter and that's we're looking very hard at improving the profitability of the Orthopaedics unit. So being very selective as to what geographies we play in and what SKUs are actually going to be offered. So not only will you see some of the strength in the top line as Joaquin outlined, but you should see an improved margin profile for that business as well. Operator00:52:00Thank you. Our next question today is coming from Vamil Divan from Guggenheim Securities. Your line is now live. Speaker 800:52:07Great. Thanks so much for taking my question. So just maybe an area we don't spend as much time on is on the respiratory side, especially PAH. So just sort of a 2 part question, but that franchise of yours continues to sort of outperform expectations. So curious if you can talk about sort of what's driving success there. Speaker 800:52:26There's also an area where you don't have a lot of sort of longer term investment. So going back to sort of the business development question, I'm just curious in your interest in sort of PAH or respiratory more generally as an area of further focus given your key franchises are going to going away, but you do have the infrastructure there already? Speaker 200:52:45So first, let me underline the great results of our PAH franchise in 2023. Mix, market growth coming out of COVID-two. This was an area that was heavily impacted by COVID. As pulmonologists were working at COVID and not diagnosing new patients. So overall, it's been a very positive trajectory of our PAH business. Speaker 200:53:19And we remain confident about the short term future of this business into 2024. We are working towards the combination of macitenta and opsamid with tadalafil, which the trademark would be OBSIMBI and that would being another option for patients there to enhance compliance. And in my talks with physicians treating pulmonary hypertension, they seem very positive about it, and we expect an approval of that combination in 2024. So that's the outlook for our pulmonary franchise. Are we looking at other areas there? Speaker 200:54:02There we are looking at the space and see if there are potential opportunities to be able to improve the standard of care. And we continue to look to see how we can continue to extend the success of our pulmonary franchise into the future. But overall, we are very happy with the trajectory of our pulmonary franchise in 2023. And we expect a similar trajectory as Masitend and Upsamy and Uptravi become standard of care clearly established in this area. Operator00:54:33Our next question today is coming from Louise Chen from Cantor Fitzgerald. Your line is now live. Speaker 900:54:38Hi, thank you for taking my question here. I just wanted to ask you with respect to your oncology franchise, do you have any thoughts on CAR Ts for autoimmune disease at all? And then secondly, radiopharmaceuticals? Speaker 200:54:55So thank you, Luis. And we have a strong oncology franchise in different areas. I commented earlier in prostate cancer with ERIDA that I discussed before, we see data in high risk localized prostate cancer in 2024. With the addition of Ambrx now, an antibody drug conjugate in this area, we are very, very excited about dribrevant and the combination of dribrevant plus lacertinib. We have Phase 3 studies completed. Speaker 200:55:28We expect we have filed all the 3 indications and we expect approval of that in 2024. So we are very excited about Ribrevand and the combination of Ribrevand plus lacertiniv in EGFR mutated non small cell lung cancer in first line. Moving into bladder cancer, you also will see data with that is 2 hundred and that is 2 10 in non muscle invasive localized bladder cancer. And we receive FDA breakthrough designation for that is 200 in 2023. And then we continue our progress in our multidylmyeloma franchise. Speaker 200:56:13We talk about CARVICTI, but it's important to recognize how well TEGVILI and TALVE, our 2 bispecific antibodies, are performing in the marketplace and the continued growth of DARTHALEX with the impressive per sales data that we presented in first line in newly diagnosed transplant eligible multiple myeloma patients. So we are looking at CAR T in autoimmune diseases to your question, yes, but it's early data. As you know, we did a deal earlier in 2023 to partner to Cartesa CD19 and CD19 CD20 bicar. So we are looking at that and it's early data. It looks promising. Speaker 200:57:02We are interested in radiopharmaceuticals. We believe that the avenue that we are doing with antibody drug conjugates, it's an important therapeutic option. And when it comes to radiopharmaceuticals, we did a deal earlier this year with nanobiotics for a radio enhancer that is being developing head and neck cancer. We expanded our rights at the end of the year and this could be another avenue to be there for us in which we could combine our expertise in medical devices, in medical technology and pharmaceuticals, and we plan to do a broader development plan of our radio enhancement and we'll provide you more information about it as we continue to move. So overall, we are very pleased with the progress that we see in our oncology franchise, both in solid tumors and in hematology. Speaker 200:57:55And it remains a core strength of our innovative medicine group. Operator00:58:03Thank you. Next question is coming from Matt Miksic from Barclays. Your line is now live. Speaker 1000:58:10Hi, thanks so much for taking the question. I wanted to follow-up on some of the comments you made about medtech trends and margins. And I think you mentioned some of the headwinds there were patient mix. We'd love to get an idea maybe kind of in the middle of the P and L on the operating line in terms of margin progression throughout the year, which ones of those of your business lines is there kind of more reflecting that negative mix that you described and how that progresses during the year? Thanks. Speaker 300:58:50Yes, Matt. I apologize, but it was a little bit tough to hear your question entirely. I think it was around margin specifically in medtech and how that may progress through the year. So as I stated earlier, I would say that the margin profile is going to be impacted by inflationary pressures that were incurred really in 2022, sit on our balance sheet as inventory and then kind of flow through the P and L throughout the corresponding 2023 and probably a good piece of 2024. That being said, Tim and the team are doing magnificent work in terms of finding efficiencies across the business. Speaker 300:59:25I highlighted one of the earlier ones with respect to Orthopaedics. But we're quite frankly doing that across the entire medtech portfolio at this point in time, looking for opportunities whether it be aided by artificial intelligence or just infrastructure overall as to how we can further improve the medtech profitability profile. Right now, we stand a little bit above the middle of the pack in terms of our peer set on margin, and we're looking to get towards the upper end of that peer set. Operator01:00:00Thank you. Our next question today is coming from Geoff Meacham from Bank of America. Your line is now live. Speaker 1101:00:06Great. Thanks so much for the question. Just wanted to ask you about the XARALTO patient mix that you guys called out. Just help us with kind of current dynamics and maybe looking forward whether this trend you expect to continue? Thank you. Speaker 101:00:21Yes, Jeff, I can answer that one. So specifically on XARELTO in the quarter, we would say there's 2 items. It's patient mix, but there is also a one time entry. Moving forward in 2024, we do expect that there will be a decline, but not to the extent that you saw in Q4. Operator01:00:43Thank you. Speaker 1201:00:54Joe, sorry to harp on the MedTech margin side of things. I appreciate everything you're saying for going forward. But just as we look at Q4 specifically, even adding back Laminar, we're still getting to sort of down 400 basis points year over year in the quarter. And I was just hoping maybe you could bridge us a little bit more. Is there any component of that sort of price increases taken in late 'twenty 2023 rolling off or anything that you would highlight there? Speaker 1201:01:22Thanks so much. Speaker 301:01:25No, Danielle. I think it's really the inflationary impacts out of the 9% drop that you saw in Q4, 5 points are really laminar. The other balance of 4 points I would chalk up to the inflationary impact that I spoke of earlier. And then the mix component whereby Orthopaedics, which is our lowest margin portfolio within the medtech portfolio overall performed a little bit better. So there's really nothing magical behind it other than the explanations that were already given on the call. Speaker 301:02:00Again, we are looking at cost improvement initiatives, specifically in Orthopedics but across the entire portfolio as we move through 2024. But there's nothing that happened maybe this is the best way to state it. There's nothing that happened in Q4 that has us concerned about our outlook or calls around margin profile or EPS for the balance of this upcoming year. Operator01:02:28Thank you. Our next question is coming from David Risinger from Leerink Partners. Your line is now live. Speaker 1301:02:35Yes. Thanks very much, and thanks for all of the details today. So notwithstanding the recently announced Ambrx acquisition, in recent years, J and J has executed more medtech M and A than pharma M and A. And I don't mean to belabor the point, I know that you got some specific therapeutic area questions. But could you just comment at a high level on what has held J and J back in pharma M and A in recent years and whether we should expect greater cash deployment to accelerate long term pharma revenue growth going forward? Speaker 1301:03:13Thank you. Speaker 201:03:15So thank you, David. And M and A has been M and A and external innovation has been the core of our pharma portfolio growth and transformation. As I said initially, we are agnostic to sector. In the case of pharma, our preferred mode has been trying to go to assets that were around proof of concept. So generally speaking, from a size perspective, it's been about deals that have been either of a smaller size or have been different modalities like client census or partnerships. Speaker 201:03:54Just last year, we completed overall at Johnson and Johnson more than 50 deals. The thing is that the headlines are only made by the ones that are M and A. So we've done multiple deals in our pharmaceutical side in order to be able to enhance our existing portfolio. And our bias is to go for transactions that are going to enable us to create more value by leveraging our clinical development strength, our manufacturing capabilities and our commercial reach. So hence, why the majority of the deals that you see in our pharmaceutical side are at an earlier stage. Speaker 201:04:32But mainly, we find But mainly, we find more opportunities to create value at an earlier stage. For example, this year, we did a number of deals that went less publicized. We did, as I commented before, a deal with CMBG, now called Avelcida in CAR T with C19 and C20, which we believe could be a best in class CAR T in this area that could launch in this decade. Or at the end of the year, we also did another deal in antibody drug conjugates with a Korean company called Legochem, which was underreported. But we continue to work in identifying deals in our pharmaceutical space that enables us to be able to put all our clinical development side, in manufacturing and in commercial. Speaker 201:05:38And that's been the source of very significant value creation in products that all of you know like DARFALEX or CARAVICTI that come from that type of approach of going earlier on into the development process. Speaker 101:05:54Thank you, David. We have time for one last question. Operator01:05:58Our final question today is coming from Rick Wise from Stifel. Your line is now live. Speaker 1401:06:04Good morning. Thank you. Maybe you could expand a little bit more on your electrophysiology comments. You had an extraordinary quarter. I'm guessing the new products helped. Speaker 1401:06:14Maybe you could give us a little more color on maybe quantify the impact, the negative impact from China VBP. And looking ahead, we've got not we've got one PFA device approved in the U. S, another one seemingly coming in the next month or 3 maybe. How should we think about the EP franchise as we look ahead to 2024? What are you incorporating in your thinking? Speaker 201:06:44Thank you so much. So thank you for the question. Great and strong results of our EP franchise in 2023. And you should think about our EP franchise in 2024 as also a strong year, another year of growth, a strong growth for our EP franchise. If I look at the to your point out, the drivers of growth in 2023, it was across the board. Speaker 201:07:10I mean, it was in Asia Pacific, in the U. S. And EMEA. It was driven by the procedural recovery, but also by the new product performance and some offset also a slight offset of value based procurement in China. The new products that we introduced this year are the engine generator, our mapping catheters Octarai and Octrel and also importantly our QDOT microcatheter in radiofrequency ablation that has efficacy results higher than any PFA catheter. Speaker 201:07:48And that together with our strong commercial execution and broad clinical support across the board has driven these results in electrophysiology that in the Q4 was 25% growth globally, 22% growth in the U. S. And 29% outside of the U. S, so very strong results. So we have a strong leadership in electrophysiology and 20 years of understanding this field. Speaker 201:08:16And when it comes to our strategy in cardiac ablation, we have multiple strategies. But one core strategy is our carto mapping system. That is a fundamental pillar of our strategy in cardiac ablation that supports procedural efficiency and very importantly now low to 0 fluoroscopy workflow. For the electrophysiologist, it's very important to know where they are and what are they doing to the heart anatomy. Otherwise, they are flying blind if they don't have a mapping system. Speaker 201:08:55And the CARTO system, it's providing the electrophysiologist real time feedback and very important parameters like tissue proximity, contact force measurement and ablation indexes that give them an idea of how durable the lesion is going to be and what are going to be the outcomes of the procedure. So that's key for us to be able to have a workflow that enables the type of progress that electrophysiologist have been already used to with radio frequency ablation. And hence, all our suite of catheters, it's going to be from day 1 fully integrated in our mapping system. We have 5,000 CARTO systems already deployed globally and an extensive network of mappers to support the electrophysiologist. When it comes to our catheters, we are developing a full portfolio of options. Speaker 201:09:52You commented on Maripulse, our multi electrode catheter that was approved in Japan. We are developing a focal and a large focal catheter and also a single shot one. So, electrophysialists are going to be able to choose the catheter that is more appropriate for their anatomy and for the workflow that they are selecting. We have 5 clinical trials active, 3 of them have completed and we have submitted our Varipulse catheter for CE Mark and we plan submitting the Varipulse catheter for to the U. S. Speaker 201:10:29FDA in 2024. Ultimately, PFA is an important option, but Aref is also here to stay. That's why we believe that having the workflow and the procedure efficiency that Carto gives you plus the option of having a catheter like our dual energy catheter that would enable electrophysiologist to simply change depending on the anatomy of deletion from PSA to RFA. It's going to be important for the future and it's going to help them adopting PSA as this is the most widely used catheter in the world. So very positive about our growth in 2024 based on the strength that we have in this area and positive about the outlook of our ablation business moving forward. Speaker 201:11:18As we have commented in multiple occasions, atrial fibrillation, it's an area that is still undertreated. And the outcomes of radiofrequency ablation and most likely the outcomes of PSA have shown significant improvement even compared to medical therapy. So very positive about the outlook of our and the strength of our atrial fibrillation business. Speaker 101:11:44Thank you, Rick, and thanks to everyone for your questions and your continued interest in our company. We apologize to those we couldn't get to because of time, but don't hesitate to reach out to the Investor Relations team with any remaining questions you may have. I will now turn the call back over to Joaquin for some brief closing remarks. Speaker 201:12:02Thank you, Jess. The strong performance we delivered in 2023 gives me great confidence in the trajectory of our business. As I said earlier, we are entering 2024 from a position of strength, and we have multiple catalysts for growth. No other company is as well positioned as Johnson and Johnson to lead the next wave of health care innovation. And we look forward to sharing our progress in the year ahead. Speaker 201:12:31Thank you. Operator01:12:34Thank you. This concludes today's Johnson and Johnson's 4th quarter 2023 earnings conference call. You may now disconnect.Read morePowered by