JNJ CEO Alex Gorsky On Partnering With Apple [Full Transcript]

CNBC Exclusive: CNBC Transcript: JNJ CEO Alex Gorsky Speaks to CNBC’s Jim Cramer Today

JNJ CEO Alex Gorsky

Image source: CNBC Video Screenshot

WHEN: Today, Friday, February 15, 2019

WHERE: CNBC’s “Mad Money w/ Jim Cramer

The following is the unofficial transcript of a CNBC EXCLUSIVE interview with JNJ CEO Alex Gorsky and CNBC’s Jim Cramer on CNBC’s “Mad Money w/ Jim Cramer” (M-F 6PM – 7PM) today Friday, February 15. The following is a link to video from the interview on CNBC.com:

[REITs]

Q4 hedge fund letters, conference, scoops etc

JNJ CEO On Apple Collaboration: Ultimately, We’re Going To Save Lives’

JNJ CEO on Apple collaboration: ‘Ultimately, we’re going to save lives’ from CNBC.

All references must be sourced to CNBC.

December, his gigantic health care conglomerate was on the defense. The company had just been accused of selling baby powder that contained asbestos, a known carcinogen, and then covering it up for decades – something my research said was just simply not the case. The stock however did plunge from 147 to 133 in a single day. It kept falling to the whole market bottom–. At the time I sold you the stock was overblown. If the allegations were true, JNJ had lost $40 billion in market cap. And that is just not right. Even the lawyers suing them over that said that. Now lately the stock has finally starting to get its groove back up, as it should be, up over 5% since our last interview with Mr. Gorsky, and up almost 13% from the Christmas Eve lows. JNJ has had a series of terrific major announcements this year, partnering with Apple on a new watch and cardiovascular health study, their nasal spray for depression Spravato, used to esketamine — we’ll talk about that – just got a thumbs up from the FDA advisory committee, meaning it’s likely to be approved, and probably quickly. And two days ago we learned about the company acquiring Auris Health, it’s a surgical robotics company – I’ve had — it’s good – for 3.4 billion. There’s a lot to like here let’s check in with Alex Gorsky, he’s the chairman and CEO of Johnson & Johnson, to get a better read on where his company is. Welcome back to “Mad Money.” Good to see you, Alex.

JNJ CEO ALEX GORSKY: Jim, it’s to be here.

JIM CRAMER: Alright. Alex, I’ve not seen JNJ on a roll like this in a long time. And I know you’ve been around for a long time. I’ve been a big supporter since the day you started. Well, for years, JNJ. But there is a series of things whether it be the esketamine, the new drug, whether it be the device– I’ll tell you, the watch, you’re the one — you’re talking about millions of people that can be helped from this stuff. Just kind of give us the panoply here.

ALEX GORSKY: Sure. It couldn’t be a more exciting time at Johnson & Johnson. The past few weeks, first of all, we ended 2018 with great results. Solid performance across our core business, mid-single digits, double digits on the bottom line. But even more importantly, since then, we’ve announced a number of really important agreements that are going to end up impacting patients, consumers and frankly, patients for the next several decades. Now you announced a few of them. Let’s start with the one — the good news we just got with the FDA this past week. As you know, there is more than five million people in this country who are suffering from severe treatment resistant depression. And unfortunately, as a result of that, almost 40,000 suicides are committed every year in this country. And there hasn’t been anything new in almost 30 years. And to finally get a new compound that offers hope for these patients and goes to work in a reasonably short period of time and also has good durability and offers them real hope and that’s going to be esketamine, we could not be more proud.

JIM CRAMER: Now, will it be used in a point of ideation? Or would you go to a Doctor’s office?

> > Well, of course, you’ll need to see the physician first. But then once they are prescribed the product, they can be treated then by a health care practitioner. Immediately you’ll get a few doses. And then after that that, they’ll be treated literally on like, a weekly basis, by weekly basis after.

JIM CRAMER: Will teenagers be using it? Because it’s the leading cause of death of teenagers.

ALEX GORSKY: Well, we’re studying it across a range of patient populations as we speak.

JIM CRAMER: I don’t know if people realize how important this is.

ALEX GORSKY: It’s a very – clearly a huge unmet medical need. All of us probably know veterans, we know family, we know friends who have been afflicted by this. And so to be able to bring something out, we are just, you know, so excited about it.

JIM CRAMER: Well, you should be. And I’m proud that you’re doing it because – you know, my daughter is a counsellor in this area, and there hasn’t been anything new, just like you said and they’re just desperate. We have got to stop the suicide of the younger people.

ALEX GORSKY: We absolutely do.

JIM CRAMER: Okay. So tell me about the watch, I’ve been a big believer that someone is going to take this watch and really develop something that is so useful and it looks like you’re doing it.

ALEX GORSKY: Well, Jim, one of the most exciting parts of my job right now is to see the technology that is usually equated with California and the West Coast. And whether it’s AI, machine learning, and, you know, robotics. And you’re seeing it more and more integrated into health care. And so with this remarkable partnership that we have now with Apple, we’re taking this technology built into the iWatch to help detect things like atrial fibrillation or when you get a heart fluttering earlier. Because we know there is over 35 million people around the world that suffer from this condition. If we can detect that earlier, we can get them the right medication, we can help them be compliant on the medications over a longer period of time, ultimately we’re going to save lives. I think it really shows how some of this new technology is coming to health care in new, innovative, unique ways that frankly wouldn’t have even imagined a few years ago.

JIM CRAMER: Do you think through artificial intelligence you’ll be able to monitor a pattern? If the pattern deviates you can go to the doctor. And look, this is the leading cause of heart attacks. Heart attacks are preventable.

ALEX GORSKY: Absolutely. That’s exactly what we’re talking about. We’re talking about algorithms that are built into the watch that are monitoring it real time. It can detect the anomalies, you know, far before something really manifests itself and the patient is going to recognize in terms of symptoms.

JIM CRAMER: I think it can save billions of dollars in health care and lives are obviously what matters. This is what we need is preventative. Now the Auris acquisition is unbelievable. Robotics is way things are. And the best hospitals have been using. But most of them, you could expand this around the world.

ALEX GORSKY: Well another great example of how this technology is fundamentally changing the way we’re thinking about health care. You know, today less than 5% of surgeries are done with a robot or digitally. In the future, we think that’s going to be significantly greater. And what we’re so excited about is just as technology has changed the way we drive a car, you know, think about it, you pull up the map system, whether you see that light go on if you start to change lanes, think about that in surgery, where suddenly a surgeon can go in preoperatively, get utilized imaging to help him or her really navigate the way specifically to the lesion. They can actually get guidance. And we know that that’s going to lead to better precision, better outcomes for the patient and frankly better value overall for the health care system.

JIM CRAMER: Yeah, I mean, well — my doctor used it. He said, mistakes — I’m not saying anything is mistake free but there are huge number of mistakes, and this ends most of them.

ALEX GORSKY: Well, absolutely. You know, to think of it with Auris’ new monarch system which is used for something called bronchoscopy. So you know, now if you happen to have a lesion or a tumor on the very far out section of your lung, they, of course, would have to go in through minimally invasive surgery, do a biopsy, to better diagnose what you have. So imagine you have a tree, you take that tree and turn it upside down. That tree is your lung. We can run this wire down through the system way out to the outer end of the leaf – think of it almost like an acorn. And once we get there, we can do a biopsy. We can use imaging in the future to actually, you know, determine what kind of a cancer it is. Or we can deliver a therapeutic perhaps a new kind of immunology agent to that specific lesion or we can go ahead and cut it out. Tthose are the kind of things being made possible by the new technology at a company like ours.

JIM CRAMER: It’s so exciting. I did see you last time. Anything new Talc to update? There really is not much since we talked, right?

ALEX GORSKY: We put safety and quality first in all of our products and you know, we believe in the more than 100 years of experience with that product. And we’ll defend it appropriately through the course,

JIM CRAMER: Right. I know there say company that filed bankruptcy. But it seems like you guys are – you have your position. The position has been fought over for a long time. And you’ve done, you know, more than your fair share. I think you tried to explain what is really going on here.

ALEX GORSKY: We do. And what is most important is people get the facts and we continue to educate and look we think this will play out in an appropriate way.

JIM CRAMER: That’s exactly how I felt. You gave me the facts. I looked at the facts from the other side. You know how I’ve concluded. But I’m just one person. I’m not the jury but I’m one person. That’s Alex Gorsky, he is the Chairman and CEO of JNJ. I hope you understand all the exciting things that they are working on, they’re a true health care company, saving a lot of lives.




About the Author

Jacob Wolinsky
Jacob Wolinsky is the founder of ValueWalk.com, a popular value investing and hedge fund focused investment website. Prior to ValueWalk, Jacob was VP of Business Development at SumZero. Prior to SumZero, Jacob worked as an equity analyst first at a micro-cap focused private equity firm, followed by a stint at a smid cap focused research shop. Jacob lives with his wife and three kids in Passaic NJ. - Email: jacob(at)valuewalk.com - Twitter username: JacobWolinsky - Full Disclosure: I do not purchase any equities to avoid even the appearance of a conflict of interest and because at times I may receive grey areas of insider information. I have a few existing holdings from years ago, but I have sold off most of the equities and now only purchase mutual funds and some ETFs. I also own 2.5 grams of Gold