A healthcare giant is banking heavily on hearts. Johnson & Johnson says its MedTech unit is on course to expand at the top of its stated goal of 5% to 7% operational market growth through 2027, thanks to a tighter emphasis on cardiovascular offerings such as Abiomed, Shockwave and electrophysiology.
During a fireside chat hosted by Wells Fargo MedTech Analyst Larry Biegelsen, MedTech Chairman Tim Schmid detailed the company’s shift from a highly centralized structure toward a business-unit model. The move is aimed at boosting specialization, decision-making speed and accountability. Johnson & Johnson’s MedTech organization counts some 75,000 employees among its ranks.
Schmid said J&J is looking at several ways to split off its orthopedics business around mid-2027, with the focus on building value rather than settling on a particular approach like a sale or a spin-off. The company expects to provide more details about how it plans to do this by the end of the year.
Cardiovascular Becomes the Growth Engine
Schmid described cardiovascular as the largest and fastest-growing MedTech market, and it is expected to become Johnson & Johnson’s biggest and quickest-growing MedTech business by the first quarter of next year. The growth comes from the purchases of Abiomed and Shockwave, along with the company’s electrophysiology, or EP, operations.
Schmid admitted that the competitive situation differs by region. He noted persistent pressure in EP, especially beyond the United States. The shift from radiofrequency ablation to pulsed field ablation, or PFA, has progressed more slowly abroad, including in Asia-Pacific regions. Competition from both multinational and local companies, especially in China, has contributed to these pressures.
Johnson & Johnson expects China’s volume-based procurement program to eventually affect the EP market, according to Schmid, who said the impact could come later this year and continue into 2027. No specific timetable was given.
The company is sticking with its Biosense Webster EP franchise despite tough conditions, as Schmid noted. He pointed to the CARTO mapping systems found in 6,300 catheterization labs around the world and the company’s combined supply of mapping, navigation and ablation catheters. He also mentioned that J&J has passed the 100,000-case mark using its VARIPULSE catheter and has rolled out VARIPULSE Pro in Europe, with U.S. approval and a launch expected later this year.
A Pipeline of New Ablation Catheters
Schmid said that over the next three to five years, Johnson & Johnson will bring one significant PFA catheter into its lineup each year. The company’s planned offerings include OMNYPULSE, which is a large-tip focal catheter, as well as ISOPULSE, a single-shot catheter.
Schmid stated that the trial for OMNYPULSE has finished, but the company has yet to give a timeline for submitting paperwork to regulators.
A constant stream of fresh offerings aims to keep J&J ahead in an industry where technological change moves fast.
Abiomed Faces a Data Debate
The BCIS3 study, which examined patients undergoing complex, high-risk percutaneous coronary intervention, spurred discussion that affected Abiomed’s business, Schmid said. That research prompted interventional cardiologists to talk about appropriate patient selection, influencing some treatment decisions both in the U.S. and abroad.
Schmid said the company is looking at the wider set of evidence, putting money into more data and focusing on doctor training and choosing patients carefully. He noted the running PROTECT IV study, which he expects will include over 1,250 patients, against 300 patients in BCIS3. He added that PROTECT IV builds in different ways of picking patients and better methods that BCIS3 did not have.
The difference in size matters most for how J&J sees things. Right now, the company is looking at the bigger body of evidence as a whole, while PROTECT IV carries on gathering its own data using revised procedures.
OTTAVA Wins Early Praise
Schmid said surgeons have responded with “resoundingly positive” feedback on the OTTAVA system, which recently won FDA approval. The architecture, automation, advanced instruments and digital infrastructure of the system have impressed them, he said. Hospital systems have also expressed interest in its smaller footprint and capability to fit into existing operating rooms without needing major new capital investments.
OTTAVA is choosing its pilot launch locations, with more specifics expected to be shared during the company’s Investor Day event on Dec. 8.
The Monarch robotic platform, together with OTTAVA, has the potential to become a significant contributor to Johnson & Johnson’s performance by the end of the decade, according to Schmid.
Vision Improves After Supply Fixes
Schmid said that the company’s contact-lens business has improved, including in Asia-Pacific, following the resolution of earlier supply issues. The company is regaining market share in contact lenses once more, and it expects the business to drive growth in vision.
Schmid said the company’s latest quarter saw lackluster results for U.S. vision surgery, even as adoption of the PureSee premium intraocular lens picked up speed. He added that the firm anticipates a significant improvement in second-quarter performance across both U.S. and global surgical vision.
A look at the two vision segments side by side makes clear the unequal return to health. The contact lens market is coming back, whereas surgical vision remains caught up in a weak period.
Outlook Holds Despite Uncertainty
Despite international competition, risks tied to Chinese procurement and geopolitical uncertainty, Johnson & Johnson is holding firm on its outlook.
The division focused on bones is still on schedule, and the firm plans to make clear by year’s end what course it intends to take: whether it will sell the business, separate it as its own entity, or follow some other arrangement.
| Key Event | Timing |
|---|---|
| Orthopedics separation expected | Mid-2027 |
| Separation structure clarity | Before year-end |
| Cardiovascular becomes largest MedTech business | Q1 next year |
| VARIPULSE Pro U.S. approval expected | Later this year |
| OTTAVA pilot launch sites selected | Ongoing |
| Investor Day details | Dec. 8 |
| China EP procurement impact possible | Later this year into 2027 |
J&J is sticking to its plan, which calls for doubling down on heart-focused products, cutting back on orthopedics, and building up its robotics business as the foundation for the next ten years. The company has not said whether competition in electrophysiology and uncertainty around Abiomed will alter its growth path. For now, it is keeping its position unchanged.
Source: finance.yahoo.com
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