J&J medtech revenue growth stalls amid Abiomed setback

Johnson & Johnson’s medtech division experienced weaker-than-anticipated revenue growth in the third quarter, missing internal projections for the second straight period. The unit’s total revenue reached $8.64 billion, reflecting a 2.5% increase compared to the same period last year—a marked slowdown from the 7% plus growth observed in the first quarter and the fourth quarter of 2022.

The decline was most pronounced in the cardiovascular segment, where Abiomed, acquired by J&J for $16.6 billion in 2022, reported a 2.3% drop in sales during Q3. Overall cardiovascular revenue totaled $2.31 billion, up 4.3% year-over-year, a pace far below the double-digit gains seen in earlier periods.

Abiomed’s performance has been impacted by findings from a U.K. clinical trial involving its Impella heart-assist device. The study, which tracked 300 patients with severe heart failure undergoing high-risk procedures, revealed that standard treatment produced 43% better outcomes than Impella, while patients using the device faced a higher mortality rate. These results have led to greater surgeon hesitation, reducing patient volumes for the technology.

Tim Schmid, J&J’s global medtech chairman, said the challenges were short-term in nature. “But our conviction in the long-term opportunity has not changed at all,” he said. Schmid added that J&J does not view these challenges as structural or as having a long-term impact on the business, noting no changes in patient need, reimbursement, access, or meaningful competitive pressures. The company has questions about the study, such as whether best practices were used, and is focused on education and advancing the clinical evidence base to demonstrate Impella’s impact.

J&J continues to anticipate a recovery, pointing to the upcoming PROTECT IV study of nearly 1,300 patients, which is expected to be released next year. Schmid reiterated confidence that the business will return to growth and remain a strong contributor for J&J going forward.

While international medtech sales also faced headwinds, Schmid characterized the broader procedural environment as stable. The company is focused on actions needed to deliver stronger results in the fourth quarter and beyond.

Separately, J&J’s medtech division has maintained steady growth in other areas, including orthopedics and vision care, where demand remains robust. These segments offset some of the cardiovascular slowdown, though overall revenue growth remains below historical levels.