Are Antibiotics Dead Weight for Johnson & Johnson (JNJ)?

Other than Johnson & Johnson (NYSE:JNJ), the only other members of Big Pharma pursuing antibiotics or anti-infectious drugs are the ailing AstraZeneca plc (ADR) (NYSE:AZN) and GlaxoSmithKline plc (ADR) (NYSE:GSK) . Whether or not the poor outlooks for the two will jeopardize the future of their respective infectious disease businesses remains to be seen.

Dead weight or opportunity?
It may be difficult to believe, but Levaquin had peak sales of $1.6 billion, and represented 6.4% of total pharmaceutical revenue for Johnson & Johnson (NYSE:JNJ) in 2007. It’s not alone: Zithromax from Pfizer Inc. (NYSE: PFE) nearly touched $2 billion in peak sales within the last decade, although it, too, has fallen from grace. Are these antibiotics flukes or examples of how to be successful?

To say that antibiotics cannot be blockbusters is a bit misguided. As long as a novel therapy can be safely developed, there will always be blockbuster potential. What the drugs lack in selling prices, they make up in target market, which includes, well, everyone — with a pulse. The problem may be in finding new molecules. Consider that in the 1980s, a total of 42 antibiotics were approved, followed by 20 approvals in the next decade, and just six since 2000. That represents the fewest approvals or releases of anti-infective therapies in any 13-year span, since 1912 to the early 1930s.

As long as the company keeps churning out blockbuster biologics and oncology drugs, I don’t see antibiotic research becoming a burden on the bottom line. I’m hopelessly optimistic that the growing problem of microbial resistance will eventually create a sense of urgency within the industry. Essentially, by not acting in full force now, the industry is creating a potentially huge future opportunity for a world with limited options in responding to common infectious diseases.

The article Are Antibiotics Dead Weight for Johnson & Johnson? originally appeared on Fool.com and is written by Maxx Chatsko

Fool contributor Maxx Chatsko has no position in any stocks mentioned. Check out his personal portfolio, his CAPS page, or follow him on Twitter @BlacknGoldFool to keep up with his writing on energy, bioprocessing, and emerging technologies.The Motley Fool recommends Johnson & Johnson. The Motley Fool owns shares of Johnson & Johnson.

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