Johnson & Johnson announced on July 15 that it is restructuring its pharmaceutical supply chain, offloading certain sites to streamline operations. The changes were detailed in the company’s second-quarter earnings release and follow last year’s $55 billion initiative aimed at producing all of Johnson & Johnson’s advanced medicines for the U.S. market domestically.
Part of this investment includes a recent $1 billion commitment to scale up U.S. manufacturing for vision products, packaging, and distribution capabilities. The restructuring process is expected to cost up to an estimated $750 million and is projected to be largely completed by the end of fiscal year 2029, according to the company.
Johnson & Johnson reported that it has already incurred $200 million in restructuring expenses during the second fiscal quarter of 2026, mainly due to asset impairments. The additional costs are expected to cover further decommissioning and asset impairment expenses as well as site and supplier exit costs.
The announcement comes as Johnson & Johnson raises its financial outlook for the year, with second-quarter sales growing 6.6% compared to the same period in 2025. CEO Joaquin Duato said in a prepared statement, “With raised guidance and quarterly sales surpassing $25 billion, we are on track to meet our 2026 target of more than $100 billion in annual revenue for the first time in our company’s 140-year history.”
The Innovative Medicines unit—formerly known as Pharmaceuticals—generated $16.3 million for the quarter, up from $15.2 million in 2025. BMO analysts described the quarter as “strong” for Johnson & Johnson’s pharmaceutical sector due to an 8% year-over-year increase in revenue.
