J&J may nab surgical robotics company Auris Health

Johnson & Johnson (NYSE:JNJ) intends to acquire surgical robotics company Auris Health, according to a report by Bloomberg News.

In May 2018, Auris inked an agreement with J&J’s division Ethicon’s NeuWave Medical subsidiary to develop systems for the robotically-assisted bronchoscopic ablation of lung lesions. J&J has been working with Alphabet‘s (NSDQ:GOOGL) Verily Life Sciences on Verb Surgical’s prototype robot-assisted surgery platform.

J&J wants to spend more for Auris than the smaller company’s $2 billion valuation from its latest funding round, the Bloomberg report said, citing anonymous sources. Redwood City, Calif.-based Auris closed on a $220 million equity financing round in November to help support its next-generation Monarch robotic interventional platform. The funding round brings the total raised for the Monarch platform up to $700 million, Auris Health said.

The Monarch platform has FDA clearance for diagnostic and therapeutic bronchoscopic procedures. The system features a controller interface for navigating the integrated flexible robotic endoscope into the periphery of the lung and combines traditional endoscopic views with computer-assisted navigation based on 3D patient models, the company said.

Auris’ system uses a game-like controller that allows for more direct control than existing one-handed interfaces to maneuver the endoscope.

Formed by Intuitive Surgical (NSDQ:ISRG) founder Dr. Frederic Moll, closely held Auris bought Hansen Medical, which Moll co-founded, for $80 million in 2016.

Under the Auris-NeuWave agreement, both companies are helping to develop an integrated system for robotic control, navigation and application of bronchoscope-delivered microwave ablation. The bronchoscope in development will be equipped with a small camera and accessory channel to allow tools to enter the lungs through the mouth, Auris said in May.

Yesterday, J&J reported a return to black ink for the fourth quarter and set its financial forecast for the rest of the year. The New Brunswick, N.J.-based healthcare giant posted profits of $3.04 billion, or $1.12 per share, on sales of $20.39 billion for the quarter, for a 1.0% top-line gain over Q4 2017, when J&J posted losses of -$10.71 billion.

Auris declined to comment on the possible acquisition. J&J did not respond to a request for comment. J&J closed the $2.1 billion sale of its LifeScan blood glucose monitoring subsidiary to private equity player Platinum Equity in October 2018.

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