Johnson & Johnson and Microsoft have embarked on a partnership to support development of the drug and device company's digital surgery products, the companies announced Monday.
Johnson & Johnson Medical Devices will collaborate with the software company to advance its digital surgery platform and internet-connected medical devices. The deal establishes Microsoft as Johnson & Johnson's preferred cloud vendor for digital surgery tools, according to a news release.
The companies plan to apply Microsoft's artificial intelligence, data analytics and "internet of things" capabilities to improve connectivity between Johnson & Johnson's surgical robotics, visualization and other digital tools. The companies plan to develop digital tools that streamline surgical workflow or support surgical decision-making.
The Microsoft partnership is an "exciting step towards creating a connected patient journey across the entire care continuum, before, during and after a procedure," Larry Jones, Johnson & Johnson's group chief information officer and global vice president of medical devices, said in a news release.
Devicemakers such as Johnson & Johnson have been pursuing more digitally connected surgical tools in recent years, including AI, pre-, intra- and post-operative care and "smart" surgical implants that send data directly to physicians. DePuy Synthes, the orthopedics arm of Johnson & Johnson's medical devices group, also has been researching how to incorporate sensors into patient care.
Johnson & Johnson has previously cited digital surgery as an area for growth.
Not a Modern Healthcare subscriber? Sign up today.
The company is in the midst of restructuring, with plans focus on pharmaceuticals and medical devices as it spins off its consumer health operation into a separate publicly traded company. Johnson & Johnson, which announced plans to break out its consumer business in November, expects to complete the separation by late 2023.
Johnson & Johnson intends to accelerate its work in orthopedics, surgery and vision with a focus on digital surgery and to focus on oncology, immunology, and new cell and gene therapies in its pharmaceutical business, company executives said at the time.
Johnson & Johnson recorded $23.3 billion in sales during the third quarter, the most recent quarter for which it filed an earnings report, including $13 billion from pharmaceuticals, $6.6 billion from medical devices and $3.7 billion from the consumer health products. Sales rose 10.7% from the year-ago quarter and net earnings increased 3.2% to $3.7 billion.
Johnson & Johnson has three core priorities for this year, Duato said at the J.P. Morgan event: preparing to spin off its consumer operations; achieving 5% compounded average annual growth in prescription drug revenue; and rejuvenating its medical device business.
Those plans will include entering into adjacent and higher-growth medical technology markets through research and development and acquisitions, Duato said. Over the past five years, Johnson & Johnson has spent $10 million on medical device mergers and acquisitions, he said.
"M&A is a key element of our growth moving forward, in every segment—pharmaceuticals and medical devices," Duato said.