Lt. Col. Daniel Washburn (right) demonstrates refractive eye surgery on equipment in the Warfighter Refractive Eye Surgery Center at the William Beaumont Army Medical Center, USA. [Image: Jennifer Clampet]
In early March, the Johnson & Johnson Company (J&J), New Brunswick, N.J., USA, wrapped up its previously announced acquisition of the Santa Ana, Calif.-based Abbott Medical Optics (AMO), for US$4.33 billion in cash. J&J will now fold the AMO operations in with its existing Acuvue contact lens business into a new division, Johnson & Johnson Vision.
Cataracts, Lasik and drops
First announced last September, the AMO deal appears to represent a significant new commitment for J&J to the ophthalmic market.
AMO, which booked US$1.1 billion in revenues during 2015, brings a suite of capabilities in three broad areas. One is cataract surgery products, including replacement intraocular lenses for cataract surgery (in which AMO is said to be a market and technology leader) and a precision laser system, Catalys, for executing cataract operations. The second area is laser refractive surgery (Lasik) products, including excimer lasers and other equipment. And a third line for AMO is a variety of eyedrops and other corneal products.
One particularly interesting bit of recent technology for AMO is the iDesign Advanced WaveScan Studio, which received approval from the U.S. Food and Drug Administration in 2015, following earlier approvals in Europe and China. The iDesign—said by the company to be based on the same technology being used to shape the exquisitely tuned mirrors of the James Webb Space Telescope—is a device that creates a 3-D map of the eye to allow Lasik surgery to be highly customized to the individual patient’s eye structure.
US$70 billion market
On announcement of the acquisition in September, J&J noted that the eye-health business—which some sources estimate at a US$70 billion global market—is “one of the largest, fastest growing and most underserved segments in health care today.” With the completion of the purchase, noted J&J Consumer Medical Devices chairman Ashley McEvoy in a press release, “J&J is poised to become a world leader in eye health.”
When the deal was announced, J&J noted that it expected it to be modestly accretive to the company’s earnings per share.