Johnson & Johnson said Nov. 12 it will split into two public companies: one for consumer health products and another for pharmaceuticals and medical devices.
The company expects the separation to be complete in 18 to 24 months.
On Jan. 3, Johnson & Johnson CEO Alex Gorsky will begin serving as the company's executive chair, and he will transition the CEO role to Joaquin Duato, who is currently vice chair of the company's executive committee. Mr. Duato will lead the pharmaceutical and medical device company following the completion of the separation.
The consumer health company's board and executive leadership will be announced as the separation progresses.
Johnson & Johnson said the separation is expected to achieve the following goals: creating more focused capital allocation, providing each company with a financial profile that more accurately reflects its strengths and opportunities, aligning corporate and operational structures, and increasing management focus, resources, agility and speed.
The pharmaceutical and medical device company will be "the world's largest and most diverse healthcare company," according to Johnson & Johnson's news release. Johnson & Johnson's pharmaceutical and medical device segments are expected to produce a revenue of about $77 billion in 2021.
The consumer health division will comprise four $1 billion megabrands and 20 brands that are each worth more than $150 million. Some include Band-Aid, Tylenol, Neutrogena and Listerine.
"We believe that the new Johnson & Johnson and the new consumer health company would each be able to more effectively allocate resources to deliver for patients and consumers, drive growth and unlock significant value," Mr. Duato said.