Episode summary
J&J’s Billion-Dollar Robot Bet
Wall Street Week
· · 11 min · Hosts: Chrystia Freeland, David Westin
Summary
Johnson & Johnson’s Ottava finally won FDA approval after a long and costly push into robotic soft tissue surgery, positioning the company to enter a market already dominated by Intuitive’s da Vinci system. The host framed the launch as a bet that arriving late can still pay off if the product is meaningfully different and better suited to surgeons and crowded operating rooms.
The company said it has spent years and billions of dollars building the platform, including the purchase of Auris Health for $3.4 billion and an earlier partnership with Alphabet on Verb Surgical. It also acknowledged a $900 million delay after an earlier version of Ottava was shelved in favor of a simpler design. The guest argued that the result is a more integrated robot: the table itself becomes the robot, with arms hidden until needed.
The case for Ottava rests on a market the company says is still early, with robotic surgery only about 8% penetrated globally. Dr. Kristy Hawley said robots do not replace surgeons, but they can make procedures less invasive, reduce pain and hospital stays, and help in settings with fewer assistants. J&J expects the business to become material toward the end of the decade, but success depends on more FDA approvals and adoption in the U.S., Japan and Europe.
Key takeaways
- Johnson & Johnson says Ottava is designed to compete in a robotic surgery market it sees as only about 8% penetrated globally.
- The company spent years, including a $3.4 billion Auris Health acquisition and a $900 million delay, to reach FDA approval.
- The guest argues Ottava’s integrated-table design could differentiate it from modular and boom-style robots.
- The host notes Intuitive’s da Vinci still dominates the field, with around 80 percent market share in 2024.
- Johnson & Johnson expects the business to become material toward the end of the decade, but only after more procedure-specific approvals.
Notable quotes
“the biggest difference here is our robot is the table. The arms are integrated”
“-Robotic surgery, if you look at the total addressable market, the way we look at it, has 8% penetration around the world”
“we expect this to be material towards the end of the decade”
“-Sometimes we're not first, but when it's said and done, we're best”
“-I want to introduce you to Ottava”
How the episode opens
Westin: This is a story about losing the race, at least at the beginning. Inventors become household names when they do something for the first time. Thomas Edison and the light bulb, the Wright brothers and the first manned flight.
With time, their names have become synonymous with their innovations because of the leaps in technology that made their products viable. Everyone always wants to be first. But can it sometimes pay off to be slower out of the gate?
Johnson & Johnson hopes so, at least in the fast-growing field of robotic surgery. -I want to introduce you to Ottava. Westin: Last week, Johnson & Johnson got the green light from the FDA to take its robotic surgery device, Ottava, to market.
It's the latest move by a company whose legacy traces back to the 19th century. Johnson & Johnson was founded by three brothers in 1886 when they created ready-to-use sterile surgical dressings. But the original Johnson brothers could not have anticipated how far surgery would come over the next 140 years.
Ottava is Rocco de Bernardis' baby. He has been with the medtech division of J&J for 14 years. De Bernardis gave us a first-hand look at what the new platform can do at J&J's campus in Santa Clara.
-The ergonomics was an important element. You know, that means, there's improvement where you move as a surgeon from that side to behind the console. -Meet Ottava.
Westin: J&J has traveled a long road to get to the newly approved version of Ottava. Although it has sold robotic systems for other procedures, it started its pursuit of soft tissue robotic surgery 11 years ago when it teamed up with Alphabet to create Verb Surgical, which it ultimately took over. In 2019, the company bought robotics surgery startup Auris Health for $3.4 billion and subsequently invested billions more in the effort.
From the episode’s captions: roughly the first two minutes, lightly cleaned. Keep watching on YouTube →
Topics
- surgical robotics
- fda approval
- healthcare innovation
- medical device competition
- market share
Companies and tickers mentioned
- JNJ
- Johnson & Johnson
Watch the episode
Watch “J&J’s Billion-Dollar Robot Bet” on YouTube
Summary, takeaways and quote selection by Octagon. Quotes are short excerpts; the full conversation is in the episode.
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