J&J to augment surgical offerings with $3.4B acquisition of robotics firm Auris Health
Weeks after Bloomberg reported J&J $JNJ was mulling a bid for robotics firm Auris Health, the health conglomerate on Wednesday said it would fork out $3.4 billion in cash for the privately held developer of robotic tools for lung cancer to beef up its arsenal of surgical interventional and diagnostic products.
The Band-aid maker generated medical device sales of nearly $27 billion last year, of which about $1.34 billion came from surgical product sales. Auris’ product, which is cleared by the FDA for use in bronchoscopic diagnostic and therapeutic procedures, allows doctors to better access small and hard-to-reach lung nodules early. Auris has plans to develop the platform beyond lung cancer, but in its current form, it will complement J&J’s Lung Cancer Initiative, empowering the large pharmaceutical company to help manage lung cancer — one of the most lucrative pharmaceutical fields — from diagnosis to intervention.
The Auris announcement comes nearly a year after J&J agreed to acquire Orthotaxy, a developer of a robotic-assisted orthopedic surgery tool. The company is also developing a surgical platform via a strategic partnership with Verily.
“Collectively, these technologies, together with our…medical implants and solutions, create the foundation of a comprehensive digital ecosystem to help support the surgeon and patient before, during and after surgery,” said Ashley McEvoy, J&J executive VP and worldwide chairman of medical devices, in a statement.
Under the deal, Auris is eligible to receive additional contingent milestone payments of up to $2.35 billion. Auris itself has raised $700 million to date, most recently $220 million last November. The transaction, which is expected to close by the second quarter of 2019, will see Auris chief Frederic Moll join J&J. Moll is a surgical robotics veteran, having founded three public companies prior to Auris, including Intuitive Surgical $ISRG.