Johnson & Johnson to cut about 3000 jobs in medical devices

Global health giant Johnson & Johnson plans to shed about 3,000 jobs as the strong US dollar takes a toll on the company’s medical devices division.

“The savings will help us grow our (device) business”, Knewitz said.

Based on conversations with the medical device group’s management, Antalffy declared that the New Jersey company is not interested in stents and other cardiac rhythm management products.

Johnson & Johnson, with headquarters in New Brunswick and major facilities in Somerset County, said it would be restructuring its Medical Devices businesses to “better served the needs of customers and patients in today’s evolving healthcare marketplace”, according to a statement.

The company’s consumer medical devices, vision care and diabetes care will not be affected, J&J said. J&J expects the cuts will save between $800 million and $1 billion a year before taxes, some of which will be invested in new-product development.

The move will also lead to a change in reporting structure with a change in names of the medical device business segments. In October the company said device sales dropped 7.3 percent to $6.1 billion in the previous fiscal quarter.

J&J will also also expects to add between $2 billion and $2.4 billion in pre-tax restructuring charges to its books within the next two years, according to the filing.

“We continue to believe JNJ is an active acquirer with a focus likely heavily weighted toward its lagging Medical Devices business…it’s a matter of when, not if, JNJ does a deal”, they wrote in a note. Most of the savings was expected before 2018 year end, including over $200 million during 2016.

The Band-Aid maker is expected to report its fourth quarter results on January 26.

Shares of Johnson & Johnson were trading up 0.6% at $97.57 on Tuesday, with a consensus analyst price target of $108.00 and a 52-week trading range of $81.79 to $105.49. Its shares have fallen more than 6 percent over the past year.