Healthcare conglomerate Johnson & Johnson on Tuesday took a $13.6-billion charge related to the new US tax law and plans to bring back billions of dollars from overseas immediately. The company reported a quarterly loss due to the charge, but beat analysts' profit estimates excluding items, helped by growth in cancer drugs and treatments from its $30-billion purchase of Actelion last year.
Still, J&J shares fell 4.2 percent to $141.97 in afternoon trading as investors sold off after the shares closed just below ttheir all-time high on Monday "It's just kind of a low-quality earnings beat," said Jeff Jonas, a portfolio manager at Gabelli Funds. He noted that the company's fourth-quarter tax rate was only 9 percent, "so maybe the beat wasn't as big as it looked on a headline basis."
Also on Tuesday, US appeals court upheld a ruling that invalidated a crucial J&J patent on its blockbuster rheumatoid arthritis drug Remicade. US President Donald Trump signed the new US tax law late last year, and many large US corporations and drugmakers have said they will take advantage of its new, lower tax rate on repatriated foreign earnings and cash.
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