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| J&J Worldwide Chairman of Medical Devices and EVP Gary Pruden |
Johnson & Johnson ($JNJ) laid out its plans to turn around its medical device business--pledging annual growth for it of about 4% to 6% through 2020. To drive that, it's looking to further enhance its fastest growing market segments--such as electrophysiology and neurovascular--while getting to market in surgical robotics and entering structural heart devices, the company told investors on May 18.
In addition, J&J detailed its efforts in 3-D printing and hinted at a next-gen approach to consumer wearables that would draw on the strengths of both its consumer and medical device businesses. It also highlighted a handful of recent deals, including its JV with the former Google Life Sciences known as Verb Surgical, a partnership with IBM Watson and Apple ($AAPL) as well as recent acquisitions of microwave ablation startup NeuWave Medical and stroke prevention player Coherex Medical.
"What are the fastest growing markets in medical device that have scale?" queried J&J Worldwide Chairman of Medical Devices and EVP Gary Pruden. "These are markets that are growing 10% and above. So, the ones that are growing 10% and above, with scale, that are key. So, one is EP [electrophysiology], the other one by the way is robotics, the other one is neurovascular, the other one by the way is Endocutters, and the last one is in structural heart."
"So, we're in three of the four already, we're going to make an entry in the fourth one--we're just not in structural heart right now," he summed up. Pruden went on to detail the market need in heart failure and atrial fibrillation. He also spent some time discussing structural heart interventions such as aortic and mitral valve technologies, which are focused largely on transcatheter applications.
"When we're talking about structural heart, aortic is one. But actually the big, large untapped need is mitral right, which is right now, it's a horse race. On the aortic side, it's probably duopoly right now, and probably that's the way it'll play out in the foreseeable future. But the other one is a wide-open race," he said.
A handful of major medical device players already made significant mitral valve repair and replacement deals last year.
On surgical robotics, Pruden said to expect an "important milestone at the end of the year when we transition from concept development to full product development." At that time, Verb should be ready to share how its surgical robotics system works, looks and feels, he added.
The Verb robotic surgical system is expected to transition into more difficult-to-target areas.
"The sweet spot for really transforming surgery is in areas where it's deep, it's confined its inaccessible like that the thoracic cavity like low anterior resection. These are two areas where the penetration of minimally invasive surgery, has not been as good as the other areas. So this is where we believe that we're the better surgical platform robotics capabilities that we will be able to penetrate," Pruden said.
"We are creating a platform with the potential that we can give every patient access to the outcomes of the best surgeon," he continued. "Our focus will be to help drive complex surgical oncology procedures to minimally invasive approaches and to help improve and standardize the outcomes in challenging procedures such as thoracic lobectomy, gastrectomy and low anterior resection. The unique workflow, advanced imaging, data analytics expanded reach to all four quadrants of the body along with the vast instrumentation has the potential to advance robotic minimally invasive surgery with great benefit for patients."
On the 3-D printing front, J&J has already done more than 50 collaborations with external technology, academic groups and government entities, the company said. Earlier this week, it disclosed a 3-D printing partnership with HP ($HPQ). It expects that 3-D printing will be key to true personalization of healthcare products.
Pruden highlighted a 3-D printed bone graft to serve as a scaffold for tissue regeneration and 3-D printed, patient-specific hip system Tri-Flange Acetabular, as well as personalized cutting guides for use in its Attune knee implant.
Finally, J&J Worldwide Group Chairman Sandra Peterson mentioned the conglomerate's efforts to develop next-gen consumer wearables. She noted the inadequacy and limited usefulness of current wearable options.
She said J&J is "trying to figure out which metrics matter the most. Let's measure those, not just everything, and let's bring our knowledge and expertise into the businesses to support better engagement, better compliance and better inherence in a much more sustainable way." These efforts are being conducted via its Human Performance Institute.