Johnson & Johnson announced its intent to acquire California-based Auris Health, a developer of robotic technologies, for $3.4 billion. The purchase will allow Johnson & Johnson to have access to Auris Health’s surgical robotic scope, which is used in respiratory procedures and lung cancer detection.
The deal is expected to close by the end of the second quarter of 2019.
Additional combined contingent payments of up to $2.35 billion may be payable to Auris Health upon reaching certain predetermined milestones, according to a prepared statement. Frederic Moll, MD, Founder and CEO of Auris Health will join Johnson & Johnson’s team upon completion of the transaction.
“We’re thrilled to be joining Johnson & Johnson to help push the boundaries of what is possible in medical robotics and improve the lives of patients across the globe,” Moll said in the same statement. “Together, we will be able to dramatically accelerate our collective product innovation to develop new interventional solutions that redefine optimal patient outcomes.”
Auris Health’s Monarch Platform was cleared by the FDA in March 2018; the system is a flexible endoscopic robotic device that allows providers to biopsy and treat cancerous tumors in the lungs.
Industry experts suggest the robotics market in healthcare will surge over the next several years due to continuous technological advances. Market intelligence firm BIS Research predicts the global healthcare robotics market will reach $11.4 billion by 2025.
“In this new era of healthcare, we’re aiming to simplify surgery, drive efficiency, reduce complications and improve outcomes for patients, ultimately making surgery safer,” Ashley McEvoy, executive vice president and worldwide chairman, of medical devices at Johnson & Johnson, said in the statement. “We believe the combination of best-in-class robotics, advanced instrumentation and unparalleled end-to-end connectivity will make a meaningful difference in patient outcomes.”
Auris Health’s robotic technology will be used within Johnson & Johnson’s Lung Cancer Initiative (LCI), which will enable the development of a separate digital solution that addresses key steps lung cancer care—from diagnosis to early-stage interventions.
“We look forward to continuing to shape the future of intervention with the added expertise and resources of the world’s largest healthcare organization,” Moll noted.
The closing is subject to antitrust clearance and other conditions. Johnson & Johnson will outline further details of the transaction during its next quarterly earnings call on April 16, 2019.
As a senior news writer for TriMed, Subrata covers cardiology, clinical innovation and healthcare business. She has a master’s degree in communication management and 12 years of experience in journalism and public relations.