Johnson & Johnson has decided to split off its $15-billion-a-year consumer division that sells many well-known brands, including Tylenol medicines produced in Fort Washington, into a separate company, write Jonathan D. Rockoff and Peter Loftus for The Wall Street Journal.
The company’s storied but slower growing group will separate from the prescription-drug and medical-device businesses within 18 to 24 months, according to J&J Chief Executive Alex Gorsky.
J&J decided to separate the two divisions because their businesses, customers, and markets have diverged drastically in recent years, including during the COVID-19 pandemic.
“The best path forward to ensure sustainable growth over the long term and better meet patient and consumer demands is to have our consumer business operate as a separate healthcare company,” said Gorsky.
The consumer business, which is the home base to Tylenol and Band-Aid brands, will be separate within 24 months
It is still unknown what the new consumer-oriented company will be called or who will lead it. It is likely that it will be spun off and that J&J will hold a stock offering.
Once it becomes a separate entity, the new consumer company will be one of the largest in the industry, after competitors like Procter & Gamble, Nestlé, and L’Oréal.
Read more about Tylenol and Johnson & Johnson in The Wall Street Journal.