Johnson & Johnson (JNJ) announced plans to separate its orthopedics business, DePuy Synthes, within 18-24 months due to its lower growth and lower margins compared to other medical-device units like heart devices, surgical products, and vision care. The separation, potentially via a spinoff to shareholders, follows J&J’s strategy to focus on faster-growing, higher-margin businesses, as it did in its 2023 consumer-health spinoff, Kenvue. DePuy Synthes, with $9.2 billion in 2024 sales (10% of J&J’s revenue), will become the world’s largest orthopedics-focused company, and will be led by Namal Nawana. This move will unwind J&J’s $21 billion acquisition of Synthes in 2012, shifting its medical-device focus to cardiovascular, surgical, and vision-care products.
Current J&J shareholders could receive shares in the new standalone orthopedics company providing shareholders with ownership in the two entities.