Dive Brief:

• Johnson & Johnson is acquiring the remaining stake in Verb Surgical from partner Verily, as the latter exits the robotic surgery venture partnership four years after launch. The deal is expected to close in the first half of 2020.
• Founded in 2015, the collaboration was designed to bring together J&J unit Ethicon's capabilities in surgery and advanced instrumentation with the Alphabet company's expertise in machine learning and data analytics to build robot-assisted interventions for use in open surgery, laparoscopic, percutaneous and endoluminal procedures.
• J&J's takeover of Verb, announced Friday, builds on its $3.4 billion acquisition this year of endoscopy robot creator Auris Health and its 2018 purchase of French company Orthotaxy, which was developing a robot-assisted platform for total and partial knee replacements.

Dive Insight:

At the outset of the venture, then head of J&J medical devices Gary Pruden said Verb "has the potential to change the future of surgery, not just robotic surgery." The vision for the not-yet-commercialized digital surgery platform is to bring together robotics, visualization, advanced instrumentation, connectivity and data analytics.

Now, J&J will be looking to take that platform to market without Verily.

"With Verb Surgical, we set out with an ambitious mission to successfully harmonize the talent and expertise of two pioneers to design a platform with the potential to transform surgery," Verily CEO Andrew Conrad said in a statement Friday. "This evolution in the collaboration recognizes the significant achievement toward that mission and I’m excited for the future of this technology in Johnson & Johnson’s hands."

J&J Medical Devices head Ashley McEvoy noted on the company's most recent earnings call J&J has spent about $12 billion on M&A in medical devices "to make sure that we're playing in the most attractive spaces."

McEvoy said on the same call that J&J and Verb had been preparing for validation studies and "in active discussions" with regulatory authorities in the U.S. and Europe. The Verb platform has conducted "end-to-end procedures in multiple different indications in general surgery​," she said, adding that the company may have updates to share on Verb in the first quarter.

As of July, Verb is under the new leadership of former CONMED executive Kurt Azarbarzin. Inaugural CEO Scott Huennekens' roles now include a board seat at Vicarious Surgical, which said earlier this month it's the first company to win FDA's breakthrough device designation for a surgical robot.

Verb has also gotten some consulting from Auris co-founder Frederic Moll, who notably founded market leader Intuitive Surgical and became chief development officer at Johnson & Johnson's medical devices business after the Auris acquisition. Unlike the Verb and Orthotaxy projects, J&J was able to jump-start its robotic surgery market entry with the addition of Auris, which gained FDA clearance for its Monarch platform in 2018 for diagnostic and therapeutic bronchoscopy procedures.

The news of Verily exiting the Verb collaboration comes a week after Verily was part of another high-profile breakup; drugmaker Sanofi largely backed away from its collaboration with Verily on virtual diabetes clinic Onduo. Verily then said it is upping its investment in Onduo.

Verily's other medtech ventures include helping Dexcom develop the newest version of its continuous glucose monitoring system, called G7, which is expected to begin a limited rollout at the end of 2020, and working with iRhythm on better screening, diagnosis and management of atrial fibrillation.

This fall, Alphabet hired former FDA Commissioner Robert Califf to oversee strategy and policy for both Verily and Google Health.