(This July 17 story has been corrected to clarify that the CFO did not suggest that the outstanding Stelara insurance policies would be “favorable,” in paragraph 4)

By Patrick Wingrove and Bhanvi Satija

(Reuters) – Johnson & Johnson (NYSE: ) beat estimates for second-quarter profit and revenue on Wednesday, driven by strong sales of its drugs, including cancer treatment Darzalex and blockbuster psoriasis drug Stelara.

Stelara has long been a key driver of revenue growth for J&J, with analysts forecasting sales of more than $10 billion this year. But that could drop to about $7 billion in 2025, when up to six close copies of the drug are due to hit the U.S.

Shares of the drug and medical device maker rose nearly 3% to $155.4 in morning trading.

J&J Chief Financial Officer Joe Wolk said he expects to finalize contracts within the next three months that will determine US insurance coverage for Stelara in 2025.

“I will remind you that we are still looking for growth in our pharmaceutical business despite the biosimilar competition that we intend to face next year,” he said.

In the second quarter, Stelara’s sales rose 3.1 percent to $2.89 billion, beating analysts’ estimate of $2.77 billion, according to LSEG data. Sales of the blood cancer drug Darzalex rose 18.4% to $2.88 billion, beating LSEG estimates of $2.86 billion.

Wolk said on a post-earnings conference call that sales growth for the company’s pharmaceuticals business will be lower in the second half of this year as Stelara biosimilars enter the European market later this month.

Total revenue of $22.4 billion beat the consensus estimate of $22.3 billion, according to LSEG data. Adjusted earnings of $2.82 per share beat analysts’ expectations of $2.70 per share.

The New Jersey-based pharmaceutical company said it now expects total sales in 2024 of $89.2 billion to $89.6 billion, compared with its previous forecast of $88.7 billion to $89.1 billion.

J&J also cut its full-year guidance per share to a range of $10 to $10.10 from $10.60 to $10.75, which includes a 68-cent hit from costs related to deals including the company’s $13 billion purchase shockwave cardiac medical devices.

That was among J&J’s many deals this year, including buying experimental skin disease drugs in May in two acquisitions worth $2.1 billion.

TALC FORECAST, MEDICAL DEVICE SOFT UNIT

Shares of J&J also lifted shares of other device makers, with Abbott, Stryker (NYSE:) and Medtronic (NYSE: ) rose about 3% each on Wednesday.

Sales for the medical technology business rose 2.2 percent to $7.96 billion from $7.79 billion a year earlier, but missed analysts’ estimates of $8.17 billion as sales of its surgical devices fell from last year.

“We’d like to see MedTech grow a little faster than that,” said James Harlow, senior vice president at Novare Capital Management, which owns about 138,000 shares of J&J.

J&J said sales of devices used in surgical procedures were affected by competition and supply constraints, as well as lower demand for bariatric procedures. Chief Financial Officer Wolk said on the conference call that sales from its vision business and China were lower than expected.

“China … right now is a very volatile market,” he said, adding that negotiations with China over the massive medical device market could be “short-term pain” for J&J.

J&J investors are also awaiting a decision on lawsuits the company is facing over its talc products.

J&J still faces tens of thousands of lawsuits alleging its talc-based products caused cancer. Several plaintiffs face a July 26 deadline to vote on J&J’s third attempt at a bankruptcy maneuver for a subsidiary that would limit the drugmaker’s liability and set up a fund to pay victims.

J&J’s Wolk said the company in recent weeks had received settlement approvals from three major law firms representing the plaintiffs.

“It’s going to be difficult for the stock to go forward until we get some sort of analysis on talc and a little more certainty on the contours of that (sales) erosion in Stelara,” Harlow said.