And we tried to arrange everything and make it pretty convenient and nice except for the weather. That's one thing that we probably can't control, but again we really appreciate the effort you made to be here with us today and really welcome to the 2018 Investor Relations Day for both our medical device as well as our consumer segments.
Now I think we've got a really exciting and interesting day planned and I'm not going to spend too much time up here because I don't want to steal the thunder from the people who are actually closest to the business and who are making things happen each and every day. But I'm very excited about what we and particularly with they are going to be talking about with you today.
Now since we're here in New Brunswick, the very home of Johnson & Johnson where we started over 130 years ago, in fact if we get a chance, we took the original building, the powerhouse, and we turned it into a museum. And we've housed it now and it's got some wonderful stories about our heritage and of course a seminal piece of that heritage is our credo. And this year happens to be the 75th anniversary of our credo because it was really institutionalized literally on the eve of the company going public by Robert Wood Johnson.
And what I would say is that it is absolutely relevant today as it was 75 years ago and perhaps even more so given the turbulent world that we live in and we're dealing with everyday. And it starts with our first responsibility, again very first thing to patients, consumers, to doctors, the nurses, mothers, and fathers, all the other customers who use our products each and every day.
It also includes our employees, many of whom you're going to be here today, not only in this room but when you're outside the exhibits, the communities, yes here in New Brunswick, but more broadly now around the world. And of course our commitment to you, our shareholders, many of you are in the audience with us here today.
Now as the management of this great company, I think we've got a real responsibility to keep you informed about our business and our goal today is we want to make sure that you understand not only why, but actually how all of our efforts are really centering on a few primary areas. One, it's about innovation and it's got to be about innovation in everything that we do. Yes about our products, but it's also about the way we're connecting with customers everything that we're doing each and every day.
Next is about our execution, because we can have the best plans, the best power points, but at the end of the day if we're not making that come alive if we're not delivering on that we're not doing our job and what you'll see today is a strong emphasis and focus about making sure that we're delivering on all of our commitments.
And finally, it's about customers, because we think that Johnson & Johnson we're uniquely capable of partnering with doctors, and surgeons, and patients, hospital administrators, trade partners, and other people in that broader healthcare ecosystem. So simply put, we're here to better serve their needs. And all of this of course is designed to consistently and constantly improve our performance.
Now one of the most important reasons I think business reviews like this are critical. It's not only that you get to hear from me directly as I do the introduction her this morning, but also you get to hear from our leaders, the people who are actually in the trenches running our business around the world each and every day. And I've always believed that Johnson & Johnson, one of the most significant sources of competitive advantage that we have mainly is our people.
And it's not only their talent, their experience, entrepreneurial spirit, but it's also their dedication, their purpose and mission. Now today you're going to hear from a wide variety of leaders who truly embody the spirit and I think what you're going to see is they've got a sense of urgency and innovative boldness that's going to accelerate our performance and going to continue to drive our performance for the next 132 years.
I think the other thing that you're going to notice about this group of leaders today, they are diverse, some have been with the company 30 years, some have been with the company three years. They work across sector, across region. They bring a unique perspective to the table and sometimes we debate it out, but always with the best interests ultimately of Johnson & Johnson in mind.
Now in spite of the white carpet and some of the panels, another thing that I want to make clear today is that we're not here to have a Broadway production. We want to be fully transparent. We're going to share with you some of the lessons that we've learned. We're going to show you how we're taking that knowledge and insight that we picked up along the way to better meet the needs of customers and patients going forward and then ultimately improve our success as we look through the remainder of 2018 and beyond.
So look, in this ever evolving, more dynamic competitive environment, certainly and I've seen in 30 years that we're working in now, we've got to be smarter, we've got to be faster, we've got to be more agile, more strategic and execute better than ever before. In our teams the leaders that you're going to be hearing from today are committed to doing just that.
Now the good news is, we lead in many of the markets where we compete. In fact we've got 27, $27 billion or more platforms across our portfolio and 15 of those are within the consumer and the medical device businesses which we're going to be talking about today. And in the areas where we need improvements we are aggressively taking action to position ourselves for better growth.
Now the collective leadership experience of the teams presenting today, they've demonstrated the ability to seize opportunities and execute with excellence, but also they've demonstrated their ability to turn around declining businesses. And in a broad business over the long term you're going to need to do that from time to time and we've got those capabilities and that's evidenced by what we did in OTC in consumer, in our contact lens business just a few years ago in our healthcare. And we are very confident and committed in our ability to replicate the success going forward.
So let me make one point absolutely clear. Our number one priority is to drive superior performance within each one of our business segments. And to do this we benchmark track and hold every one of our Johnson & Johnson leaders accountable for metrics to focus on things like innovation, execution, customer satisfaction, financial performance, portfolio management, long term sustainability, and very importantly, credo values and leadership.
Now it's no secret that some of the changes that we're seeing in healthcare today they do reflect in essence a new normal. So as we talk about a lot among our leadership team, get used to it, this is the way we're going to have to function, it's constant. It never stops. It's global. Challenges, opportunities are happening every day with breathtaking speed. And we've got to ensure that we actually thrive in this environment, that it inspires us to do even better.
Now we feel after a lot of debate, discussion, that our broad-base in healthcare is a source of competitive advantage and also a source of true strength. By being positioned across three vital aspects of healthcare, pharmaceuticals, consumer and medical devices, we've got a unique line of sight across the entire healthcare system. And our broad-based well it's not just about heritage, but it's a strategic choice that's grounded in long-term performance and we believe an understanding of healthcare in the future.
And if you think about it our broad-base well that it enables us to first create and access growth opportunities across multiple sectors of the healthcare market all at once. It also positions us better to be the strategic partner of choice for technology companies and innovative startups for sciences, for entrepreneurs who benefit from the deep healthcare expertise that only Johnson & Johnson can provide across so many different sectors.
Additionally, we're able to work with local governments, public health organizations, where we're collaborating more than ever to address the world's most pressing healthcare challenges. And we're doing all this while providing our customers with a broader range of products and solutions and the opportunity to partner with us, particularly in large healthcare systems on attracting patients, improving patient outcomes, and ultimately reducing the costs for episodes of care.
And finally, we can realize significant advantages and scale that give us the ability to achieve more efficiencies, better effectiveness across all the sectors, that also allow us to invest in growth for the future. So we operate under this manner and we continue to do so in the future, we think it's produced significant long term results.
Now it's important to recognize there are markets ebbs and flows, we're seeing that today. However, we've got a long term proven track record of strong shareholder returns which we believe is a result of managing our business for the long-term. Having that relentless drive for innovation, our passion around execution, strong customer focus and disciplined portfolio management which continually allows us to invest and drive future performance.
Our capital allocation priorities, well they remain consistent and we believe that the recent tax reform, it actually provides us with even greater flexibility. And we regularly review and discuss these priorities as part of an ongoing strategic dialogue and planning with our senior leadership team, but also with our entire board of directors. And as you know, our first priority is investing in organic growth through R&D in commercial activities and driving operational efficiencies through other investments in our business and you're going to see many, many examples as we go through the discussions today.
Our next priority is delivering strong dividends to our shareholders and as we recently announced in April, we increased our dividend by 7.1% which I'm proud to say represents the 56th consecutive year that we've increased our dividend. And then we target value creating M&A and licensing deals. In fact we've executed over 20 deals and we've invested more than $40 billion over the last two years.
And this includes companies like Actelion which added the sixth therapeutic area to our pharmaceutical business. Medical Optics, which allows us to expand into new areas in the eye health care space and Vogue which we believe provides a compelling beauty growth opportunity. Now when you combine all these acquisitions, we think they're contributing in a very meaningful way to our growth.
And lastly, we also consider other prudent ways to return value to shareholders such as stock repurchase programs. And as we've demonstrated our financial strength well it gives us the ability to do all of these things simultaneously.
So now what I'd like to do is take just a few moments to highlight the strengths and the opportunities for each of our different business segments, but first I think it's important to emphasize what we're going to be talking about today is a 132-year-old company that we're very proud of, but has got a sense of urgency, is not complacent, that it's not looking back but moving forward as fast as the change happening around us.
You just think about all the global, technological, economic, political and healthcare industry fronts and in fact we think of ourselves much more as 132-year-old startup, that's innovating, executing each and every day to win our customers and shareholders trust, your confidence and support. And look we're not afraid to acknowledge areas that we need to fix. We want to talk about them learn from them to make us better going forward and we firmly believe that Johnson & Johnson is strongly positioned for continued and future growth.
So let me start with our pharmaceutical business. Now it's been an industry leader in just about all performance measures including things like R&D productivity, commercial capabilities. The group continues to deliver strong topline growth while also increasing investment to further develop our incredibly strong pipeline of innovative new medicines. But I'll also tell you we are far from finished and despite the current pressures from biosimilars and generic entrants into the market we are confident the continued growth of our marketed products, the expected launches from the robust pipeline, all these things position us to continue to grow well ahead of the market.
Now we also continue to submit regulatory applications for new molecular entities and we expect to file for the approval of up to eight new compounds by 2021, each with more than $1 billion of peak revenue potential. Our key components for growth include things like growing markets, increased patient penetration, new indications and line extensions including more than 10 each of which represent more than a $0.5 billion of opportunity.
And finally, an exciting new entrant into the pulmonary arterial hypertension market with Actelion. Now we're confident that all these factors pulled together should drive above market growth well into the future. But today, well today we're here to talk about our medical device and consumer businesses. So let me highlight what you can expect from these leaders.
First, with our Consumer segment, it is very important to Johnson & Johnson, in addition to its strong reputational value, it's this business that provides us with the capabilities to gain a deep understanding of consumer and patient insights particularly as these audiences become much more active in their decisions impacting their overall healthcare and treatment regimens.
We see rapid transformations happening all around the world due to demographic, socio-economic and technology shifts and this has resulted in a growing global consumer class that are interested in things like natural health, beauty products and services that more and more incorporate concepts of total health and wellbeing. And look, they want all this and they want it on their own terms, and they want it on a touch of a button or screen, and the rising income in emerging markets, well it’s also fueling the demand for health products.
And this rapidly changing landscape in the consumer market, we believe creates significant opportunity for a company like Johnson & Johnson. And I'm confident in our strategies to move quickly, address new market needs, work with customers from the individual consumer to the large box retailers, as well as the e-commerce channels and everything in-between.
Now in today's presentations, you're going to hear about the strong plans that we have to have sustainable above market growth in 2018 and beyond from many of our dynamic and science based iconic brands and franchises. Now many of which you know and love and I hope that you use every day, you look even better, feel better from Johnson's Baby to Listerine to OGX to Neutrogena, you'll see the right outside, but look when you see what we're doing you will have a much better understanding of how we're leveraging consumer insights, preferences to design, tailor and deliver ultimately superior products.
And you’re going to hear a lot about today is how we're doing that with the revitalization of baby care and our oral care franchises. We're going to be implementing an omnichannel approach to ensure that these products are available whenever and wherever consumers are shopping. And we believe that the top line growth I just referenced will be met with even greater bottom line growth as we continue to improve our productivity and margins.
So let’s now transition to medical devices and we've got powerful opportunities for growth across orthopedics, surgery, interventional solutions and our vision business. And if we reflect on it for just a moment more than a century ago Johnson & Johnson pioneered the concept of sterile surgery and over the decades we've led the way with many significant steps forward.
It's estimated that almost 90% of people living today in developing countries don't have access to safe and affordable surgery and millions of lives have been lost over the last several years from conditions needing surgical care, well that just wasn't available where they live. And I can't emphasize enough the enormity of the opportunity in surgery and medical devices to deliver better outcomes and ultimately help people live healthier lives.
Now we're committed to closing this gap through our solutions and our innovations. In medical devices, we have businesses displaying great strain, businesses such as vision, electrophysiology, bio surgery, endocutters, hips, trauma, but we also fully recognize that our progress has not been uniform across the entire portfolio.
There are areas where we must and we will improve such as our weaknesses in knees and our spine businesses. Now we've taken strategic actions to refine our portfolio through our 20 plus acquisitions, the pending divestitures of certain businesses and a thoughtful deployment of resources, but we've also increased investments in critical capabilities, technologies and solutions frankly that our customers are more and more demanding.
Additionally, we're improving our cadence of innovation with 15 to 20 major product launches planned for 2018. Also our robust pipeline includes a truly differentiated orthopedics robotic solution in Orthotaxy as well as our Verb Surgical platform where we are creating the next generation and frontier of digital surgery. And we're simplifying our operations, developing new commercial models with a focus on execution to meet the needs of customers and patients when, where, and how they want their needs to be met.
Now another important factor is technology is profoundly transforming this space and we are actively assessing, developing and implementing technology and strategies across all of our platforms. We believe these drivers will deliver sustainable above market growth across the entire breadth of our medical device businesses starting today and we are committed to delivering across the portfolio in 2020.
So in closing, first and foremost I want to thank you for being here today and investing your time in Johnson & Johnson. And you know we are certainly proud of our historical performance, but I'll be very clear we have an even stronger sense of urgency and excitement about our future. Your trust and confidence in us is something that we never take for granted and recognize that we need to earn it each and every day through innovation, execution, customer focus and last but never the least, near and long-term performance.
And you've got our absolute commitment that we'll hold ourselves accountable and execute on the strategic plans that you're going to hear about today fulfill all of our credo responsibilities where we always keep the customer and patients at the center of everything we do and ultimately profoundly change the trajectory of Health for Humanity.
So before I turn the stage over, just a couple more logistics. You're going to have a chance to hear from each of our sectors on their own, we're going to do multiple panels where you'll get a chance to engage directly with the leaders responsible for those particular business, so and by the way we've used the survey information that you provided from past meetings to try to improve our performance.
As I told you feedback is a gift along the way and very importantly myself Dominic and Joe will be here throughout the day as you probably remember from previous meetings from time to time we may chime in as we go along, but we will also Dominic and I and Joe will be up here for a panel at the end of the day. So if there are questions that have not been answered that are specific to the particular businesses, but are perhaps more at a corporate level or regarding some of our strategies we'll be here, but also during the breaks in between if there's any questions you have we are here for you and we want to make sure you walk away today as I mentioned earlier with a very clear understanding and excitement for our future.
So with that, it's now my turn to hand it over to the consumer team to walk you through our consumer business in detail. Thank you very much everybody.
Ladies and gentlemen please welcome Executive Vice President, Worldwide Chairman, Johnson & Johnson Consumer, Jorge Mesquita.
So, good morning. It's great to be back here with you to talk about our global consumer business. I hope you saw in the video we just shared with you how proud we are of our long-standing tradition of game changing transformational innovation. Our business has been built by innovation that truly invented new categories or reset the standards for the categories in which we play, and that will always be at the core of our success and something that we're committed to continue to drive as we go forward.
Now the key messages, I want to get across to you today is that we are well positioned to drive above market, sustain top line growth, starting in 2018 and beyond that we'll do so by embracing the new omnichannel where consumers are shopping in, whether it's in brick-and-mortar stores or online and e-commerce which represents a massive opportunity for us. That we did we have a powerful innovation pipeline one of the strongest in our history and we will reinvent in particular the baby care and the oral care categories. And then we are committed to continue to improve our operating margin even as we invest in the business to sustain our top line growth.
Now as way of background, we play in six broad categories. OTC and beauty being the largest of each, baby care and oral care and we also play selectively in wound care and in women's health. OTC and beauty each represent a little over 30% of our turnover, so combined there are more than 60% of our sales. But we have strong leadership positions in baby care and oral care as well.
We have a large global footprint and more than 50% of our turnover is outside of North America and we have very strong operations in Europe, Middle East and Africa and in Asia Pacific. We play in large and attractive categories that are very profitable. Combined that represents over $500 billion in turnover. And these categories are growing faster on average than the broader FMCG industry. And if you look at consumer trends, they're both well to ensure these categories will continue to enjoy above FMCG growth as we go forward.
We see consumers taking a much more educated and proactive stance in caring for their health which bodes well for our OTC business. Consumers want to pursue beauty through health, a beauty that comes from wellbeing and wellness which again paves the way for brands like NEUTROGENA and AVEENO. We're seeing an aging population trend across both the developed and the developing world and with it comes a number of healthcare issues we can address.
Unfortunately we're seeing a sedentary lifestyle trend across the entire world now migrating also to the developing world and with it come a series of obesity and healthcare issues that again we are well positioned to address. And every year 135 million new babies are born and we're here to meet their needs as well. So we're well positioned and we're playing in attractive, profitable, and fast growing categories.
Now about our performance, we had a great run between 2014 and 2016. We grew about 3.5% ahead of the market and we gained market share in that period and we made significant improvement in our profitability. We grew operating profit 20% annually in that timeframe. In fact we doubled our operating income from $1 billion to $2 billion in that timeframe and significantly expanded our before tax margin.
However, last year we hit a speed bump. Our top line growth slowed down and we grew very modestly and this reflected a couple of major factors. One, we saw a temporary slowdown in the categories in which we compete in that timeframe and we also saw inventory reductions across our customers both in developing and developed markets and that led to the slowdown in our top line.
We were able to hold our market share and we improved our margin modestly in 2018. In addition to these results, we're very pleased with the fact that the six acquisitions we made in 2016 collectively we're ahead of plan both in terms of top line and bottom line performance. So we accomplished a lot in 2017 but it clearly wasn't our best year, but it was a very valuable year for us because we learned a great deal.
And what we learned is that the pace of change in the consumer industry is accelerating. In fact we learned that our industry is being disrupted. What we're seeing is that the competitive advantages upon which the FMCG industry has been built are not as relevant today as they once were. So for example, it used to be that large companies like J&J are at a competitive advantage in terms of attracting the best talent. But what we're seeing today is that for students joining the workforce, joining a smaller company a startup enterprise, that is more entrepreneurial has certain appeal to them.
It used to be that building nurturing brands was something expensive that only large companies like ours could do, but the reality is that it's relatively affordable now for you to build the brand online and to create an active community of loyal users very efficiently. It used to be that manufacturing assets, large plants was a moat, a barrier for entry. But again you see today across the world that small companies, new entrants can access excellent contract manufacturing in just about every region. Retailer relationships are very important and we're very proud of them, but if you are a newcomer to this industry you can sell directly to your consumers online efficiently.
Innovation as I said has been and will continue to be an important source of differentiation, but these small entrants that join our industry can do so as well by outsourcing some of those elements of innovation. And then lastly, financial firepower, a great strength of Johnson & Johnson is not an impediment for a new entrant to come to this industry. Given this relatively low interest rate environment, abundant VC Capital even crowd financing. It's relatively easy to raise the money you need to start a new business.
So what we're seeing as a result of all this is that there's a digital disruption that is changing the face of the consumer industry, lowering the barriers for entry and paving the way to do this new class of star entrepreneurial entrants. And at the heart of this digital disruption is a new consumer centric paradigm that is challenging the traditional value of scale as we have defined it and is forcing a disruption in the retail and media landscape.
And what we're seeing is the emergence of a new how do win playbook which is characterized via asset light infrastructure and the creation of highly personalized on demand consumers experiences which is what consumers want today and owning that consumer relationship and its related ecosystem has now become the greatest source of competitive advantage.
So the question is what are the strengths of these new entrants? What is that they do uniquely well? We think we have that figured out because among other things we have the privilege of have acquired a great company a startup in its own right that for many years has been winning against large established players in the hair care space, Vogue the makers of OGX. And what we see in that unit is they are single mindedly focused on breakthrough, game changing innovation by staying externally focused and very close to their consumers, their shoppers, their customers and overall trends.
They focus on building digital first, purpose led brands, very important for young millennial consumers. They capitalize on the rise of emerging markets and emerging channels. They see where the shopper evolution goes, they see changes in consumer shopping behavior and they position themselves to intercept that for their advantage.
They're very lean, they're very cost efficient, hyper efficient and they move very fast. Speed is an important source of competitive advantage. So now as a result of this change we are competing in two worlds, we have to compete against the large multinational companies that have been our traditional peer set for many years, but we also have to compete against these start-ups. So Alex said, we have to become a giant startup.
We have to play to our strengths of skill and science based superiority and differentiation, but we have to become more nimble, we have to become more entrepreneurial. In order to compete in these two worlds, we have a strong strategy that has been guiding us for the last few years. We have 12 mega brands. When I met with you two years ago they represented 60% of our sales, they're now representing 70% of our sales and we're focused on continue to driving disproportionate growth with these mega brands.
We play in these large categories that I described before six broad categories and we have a very clear set of how to win choices around game changing, brand building capabilities, transformational innovation, a systemic approach to driving P&L improvements and productivity, a transformational commercial strategy enroute to market and building a world-class organization.
In addition, we have very clear where to play geographical choices designed to in sum maximize our overall global competitiveness and value creation. But in addition to this, we have identified five principles we need to embrace as we execute those strategies in order to compete against this new landscape.
The first principle is to broaden the scope of our innovation model. It's not enough to have great product and packaging innovation. We have to innovate to create a digital eco system around those products, something these small entrants do very well, an ecosystem that creates loyalty and opportunity iterate and engage with our consumers. And it's not enough to have big game changing global platforms. We have to have locally relevant fast speed innovation as well. We call this two speed innovation.
We have to build our brands to be relevant in these two new worlds. We have to communicate the superiority of our products and our benefits but we have to also communicate what's the purpose of our brands, something that again these small companies do very well. They articulate well what they stand for and we must do the same. And again, even as we drive global campaigns for these 12 mega brands that have the best possible ideas around the world, we have to amplify and execute those campaigns in a way that feels intensely locally relevant.
These small entrants tend to be single country operators and they make their brands feel like they belong to that market and nowhere else. Global multinational brands need to be locally relevant. As I said before, we need to win in the traditional channels, but also in those new emerging markets, in emerging channels particularly e-commerce something where we see disproportionate growth from these new entrants.
We have to go beyond productivity and efficiency and cost reduction. We have to become more flexible and more responsive to meet consumer needs. And lastly, we have to evolve our work processes and we have to evolve our culture, so we can become more entrepreneurial and as I said before be a giant start-up. So what you're going to hear for the rest of this presentation is how we're actually bringing these principles to life.
And to do that, I'd like to invite to the stage two of my colleagues, Alison Lewis is our Chief Marketing Officer, and Josh Ghaim, who is our Chief Technology Officer.
Thank you, Jorge. Good morning, Alison and I are going to take you through the first two principles that Jorge just highlighted. The first, how we're broadening the scope of our innovation model and at the same time how we're building brands to compete in these two-world of small start-ups and large multinational players.
I think it's important as we broaden the scope of our innovation model, we continue to look at both in terms of what we're doing globally, both as big companies and small start-ups, first building breakthrough innovation and at the same time implementing fast cycle, locally relevant innovation. Second, we're continuing to create superior product and packaging, innovations and build the connected digital ecosystem that's needed in order to engage with our consumers much closely. Breakthrough global innovation platforms require deep expertise in science, robust clinical efficacy and strong regulatory knowhow globally, big ideas that step change the categories that we play in.
And now, we're complementing that with fast cycle innovation focused on local insights that continues to enable us to engage with our consumers regardless of where they live. We have a long history of building robust, science based global platforms that transcend geographies. In fact, this year in 2018, we will be launching over 150 new products globally, including some of the breakthrough innovation platforms such as the first mouthwash to prevent sensitivity as a class two medical device so that you can have your coffee in the morning without the pain that you feel in the morning when you have sensitivity.
A new standard in anti-aging, Retinol has been a credible standard for anti-aging, this year we're launching a Retinol and Neo glucosamine combination through our NeoStrata business in order to drive new standard in terms of anti-aging skin care. We're continuing to expand some of our newest platforms such as Hydro Boost Light Therapy to new benefits just to name a few. To demonstrate how we're living into this two principles that Jorge highlighted, Alison and I will dive and give you some examples of how our core brands are living into this.
First, we’ll start with LISTERINE, we’re driving category growth through big global platforms around the world and at the same time continue to bring this fast cycle locally relevant innovation. LISTERINE has a long history of safety and clinical efficacy, 50 years of research and clinical data, over 100 years of safe and effective use, making it the most widely used extensively researched and most effective mouthwash.
What is even more differentiating about LISTERINE is its superiority to all other mouthwashes as demonstrated with American Dental Association Seal of Acceptance for fighting plaque and gingivitis. It is our mission to drive category growth attracting new users was the goal to grow household penetration from 37% to 50% basically bringing the global penetration to make it equal to that of the U.S.
At the same time, we continue to drive more uses of LISTERINE, more daily uses of LISTERINE globally. These two initiatives add up to 350 million new households, $25 billion in incremental sales related to in terms of market potential creating a great opportunity to continue to drive the category growth for mouthwash.
Thanks Josh. So LISTERINE, clearly one of our crown jewels, one of our billion dollar plus brands with strong sales and share growth over the last five years, but also as Josh highlighted, still enormous growth potential when you think about expanding household penetration. So we think about global platform innovation on LISTERINE this year, it starts with a complete brand refresh that's rolling out now.
This includes new packaging graphics which have clear variants segmentation, clear highlighting of the benefits and claims and then also better pricing architectures and structures. This all makes it easier to shop and easier for consumers to get the benefit that they need, all built around the iconic barbell bottle while adding elements that modernize the brand.
This is launching now as I said in over 90 countries and it's amplified with powerful in-store and e-commerce support with science based claims in all communications. Let's take a look at how we're bringing this to life.
So, a great example of commercial innovation which is proven to drive growth in our categories, but we have these big global platforms like the Refresh, but we also need to balance that with fast cycle locally relevant innovation. We've seen significant success in bringing locally relevant flavors combined with plus one benefits.
So examples would be Green Tea for strong teeth in China, salt and lemon for whitening in Indonesia, and Miswak for gum health in the Middle East. We recognize through the success the opportunity for true kitchen logic ingredients, so those ingredients that are very familiar in local markets to deliver against unmet needs. These ingredients have easy to understand benefits and are combined to make something like what we're launching now, our new gum care product with ginger that's launching in Asia and before being rolled out globally.
Few examples of what Johnson’s has done over the past century. This has made Johnson’s by far the number one brand in the world. Superior science, differentiated products, professionally endorsed, gentle, mild and safe. But as many of you are aware, our baby business has been challenged. Consumption and expectations changed. We are making incremental improvements, connectivity with millennial moms was lacking, all of this resulting in share losses.
We're very excited to tell you today that we have a complete end-to-end re-launch and restage of our Johnson's brand globally starting later this year. It is to completely transform our baby business. We have shared it with some babies and I thought I would show you what one baby thought about the whole idea.
This is also true for new moms. We shared the ideas and the products with new moms whether they’re current Johnson’s users or new to Johnson's consistently loved the transformation of our formulations, packaging, digital first communication. We have re-engineered and simplified our supply chain network and our whole operating model, all of this to address the needs of millennial moms, increase our responsiveness to market dynamics, and make Johnson's a true 21st Century brand. We have designed Johnson's with everything a mom wants for 100% gentle new classics.
While our ingredients have always been safe, our new formulations contain no unwanted ingredients. To meet the needs of new moms today more than 90% of the ingredients in our formulations are natural. We have built superior experience with no residue formulas, professional reassurance through dermatologists and pediatrician testing, all with unique claims based on our body of baby skin science.
Over the past few years, the Johnson’s reinvention has also focused on portfolio simplification and massive reduction of our operational complexity. All of this means simplicity, efficiency and speed to market for better responsiveness, better profitability and accelerated growth, Alison?
Thanks Josh. So ages and stages, this has always been a really important part of our business. We enter with newborn, we retain that baby through six to 18 months and then expand with toddler always addressing baby and mom’s needs.
So our newborn products that are gentle enough for a newborn's skin, sleep time products for six-month plus babies clinically proven to give baby and mom a better night sleep and then hair care for toddler where there was nothing in the market for kids that was comparable to adult products and we brought the mildness and safety of Johnson’s with ingredients like silk proteins and Argan Oil that allow for toddler hair shine and smoothing.
So the restage lays the foundation to accelerate this pioneering ages and stages model. But in addition to the ages and stages, we'll launch a new hero line, a hero line is something that becomes a new line that haloes the entire portfolio of Johnson's brands. So Johnson's cotton touch, cleanser and lotion for newborns to accelerate recruitment. And as I just spoke about the more we recruit the more we move households through the model. It's an ingredient focused product with cotton at the core and as you can imagine, there's nothing softer or more intuitive for a baby's skin to a mother.
It's also a superior product in that it's formulated to not have any residue and no stickiness and it's proven therefore to reduce anxiety and at the product performs perfectly with that skin to skin touch during bath time. So this is a significant part of the re-launch again that haloes the whole line and allows us to stay number one in the world in baby care.
Also accompanying the re-launch is a strong digital first mindset. Moms have always taken their job very seriously. They want the best for their baby, but today's moms have more information than ever. And as many of you know digital is at the heart of how they get their information, how they research brands and how they choose what brands they are going to use for their baby. We have BabyCenter, BabyCenter is the world's largest online parenting community. Seven out of 10 moms around the world sign up for BabyCenter to get information on pregnancy and their baby at five weeks of pregnancy.
BabyCenter exists in 14 countries around the world and those 14 countries actually represent 70% of our Johnson's business. So what we're doing is building a complete ecosystem around BabyCenter with digital assets and using BabyCenter as the engine. We will be able to give parents what they want, when they want and this is something that no one else can do, a huge competitive advantage for us.
And all of this is brought to life at point of purchase with creative in-store theatre and accelerated e-commerce presence, all supported with brilliant claims and brought to life with an idea around the Johnson's brand that reclaims our safe, mild, gentle heritage and point of difference with powerful purpose and promise based communication. I'll share a video in a moment that gives you a taste of how we believe in helping every baby thrive all around the idea that if we limit our conversation only to the amazing things that are in our bottle, we miss the opportunity to share what is in our heart.
Everything we make, everything we do, and everything we stand for at Johnson's is as gentle as we want the world to be. Roll the video please?
So little taste of the powerful global platform innovation we have on Johnson’s that will allow us to retain our number one position and expand that position in the marketplace. But just as important as big global platform innovation is we need fast cycle locally relevant innovation and I’d be remiss in not talking about the premium segment for baby where we continue on our premium platforms to see double-digit growth and premium as a category actually outpaces the mass category by two times and two-thirds of the premium business actually sits in China.
We at Johnson's already actually have the number two baby premium brand in the world with Aveeno Baby and we've seen amazing success as we've rolled that out in China in the last year. In fact China now represents our second largest Aveeno Baby market behind the U.S. But we'll bring new innovation to China, Petite Planet from Johnson's which will be the first extension into premium under the Johnson's name launching in the back half of this year. This is a globally curated baby skincare collection inspired by the wisdom of mother's traditions from all over the world.
Each product in the collection is inspired by unique local ingredient with strong baby care rituals, so Nordic Berry, Japanese Lotus, African [indiscernible] just as a few examples. This will allow us to strengthen our leadership position in premium baby and uniquely deliver against the China needs for continuous premium innovation. Josh?
Thank you. The second area of focus in broadening the scope of our innovation model is all about creating superior product and packaging innovations and adding services where digital ecosystem that can create even more meaningful experiences and engagement with our consumers.
With Neutrogena, let me take you through two examples of how our superior scientific and clinical rigor drives our commitment to addressing the unmet needs and at the same time how we're innovating in the digital and connected world. Skin cancer is growing rapidly, yet one of the most preventable. One in three cancers diagnosed globally is actually skin cancer, a person dies every 57 minutes here in the U.S. Our ambition is to continue to reduce cancer around the world specifically skin cancer around the world, promote sun care compliance by understanding consumer behaviors and the barriers that they face, but more importantly educating our consumers in breakthrough ways that is truly going to cut through the clutter that exists in the market.
Neutrogena is the number one dermatologist recommended sunscreen. Our broad educational initiatives match with products that have strong focus on science, but also equally important on aesthetics of the products, so that we can encourage more compliance. Today I'm excited to share the results of a recent study published in The Journal of the American Academy of Dermatology. Their randomized double-blind study evaluated SPF-100 versus SPF-50 under natural sunlight conditions.
The results were very clear. After one day use SPF-100 protected two times better than SPF-50 regardless of the re-application frequency and regardless of the skin type, demonstrating the importance of sun protection with the right SPF contrary to the belief that SPF-50 is actually enough protection. So, all of you that are planning summer vacations don't forget your SPF-100 Neutrogena product.
We also believe that superior products must be matched with superior packaging, our new proprietary packaging innovation is quick and easy application that allows you to reach the hard to reach spots. You'll get a chance to see it when you visit the Neutrogena booth right outside the hall.
As I mentioned earlier, we're taking our biggest strength of creating superior product and packaging innovation and adding services via digital ecosystem. We're innovating in the digital and connected world out to drive personalization. We unveiled the Neutrogena Skin360 at the Consumer Electronics Show in January. It is the first dermatologists grade at home skin analysis tool for your Smartphone. It provides real time to Neutrogena product recommendations and ability to buy product and track progress you're making over time directly from the app.
This is where our decades of skin research and clinical efficacy data with digital diagnostic tools, bring superior products and better outcomes for our consumers. We have enhanced the Smartphone camera with high accuracy, high magnification lens and controlled LED lighting, custom built mobile app with changing algorithms to detect and quantify skin features such as hydration, lines and wrinkles, pore sizes within the skin. This highlights our vision of internal scientific and clinical rigor complemented with external partnerships to bring innovation faster to the market.
So a great example of taking existing products and combining services through technology and science and I encourage you all to try it outside at the NEUTROGENA booth. So now let's talk about the second principle build our brands to compete in two worlds again there's two ways that we do this. It starts with ensuring that we have global ideas and campaigns against our brands. This allows us to ensure that the brand is the brand is the brand around the world. But we amplify those global campaigns with local insights making sure the brand feels like it was made just for you wherever you live.
So let's talk about ZYRTEC which is a great example of a global campaign in Muddle No More. Muddle No More is based on a universal human insight that allergies create a wedge between the allergy sufferer and the people around them. It makes people feel isolated lonely, they find sub optimal ways to cope and what ZYRTEC does it shows through its advertising that it really understands you as an allergy sufferer, it pokes a little fun at you and ultimately provides ZYRTEC as the solution.
This campaign was launched in the U.S. and has continuously driven share growth we've now rolled out across Canada, Australia, Philippines, Europe and later this year in China and seen similar results. Global scale is really important but for allergies are actually very local and so only Texans know the misery of cedar fever and North Carolinians can appreciate the intensity of pine pollen.
We need to go beyond just the global campaigns and bring local activation and what the team did was created a proprietary sneeze trigger, This sneeze trigger uses local data to predict when allergies will hit, it's highly efficient because we only activate the brand when allergies are in season and that in season differs by market and by country, it's highly effective in that it shows that the brand truly understands you because it understands the problem that you're suffering in that market at that time. It's personalized marketing at its best. Josh?
Thank you. And finally, the second way we're building brands to compete in these two worlds of large multinational players and small start-ups is all around our heritage and our unique differentiator of superior science based benefits with professional endorsement and our core purpose.
Our relentless focus on scientific excellence and clinical efficacy is a true differentiator in our innovation model. Our consumer R&D has published more fundamental and skin clinical research than any other global consumer company. In fact 90% of all baby skin research publications is the result of our research or our collaborations.
Our scientific regulatory and Clinical Excellence has enables us to accelerate our Global Development in markets such as Japan, Russia and China and drive strong professional endorsement across many of our brands.
TYLENOL is a great example of how we bring superior science a long history of clinical efficacy and our purpose together. It started over 60 years ago as a children's product. It was the first product that was safe to use for children versus Aspirin. Today TYLENOL is the most recommended analgesic and offers products across many benefits.
Our launch of rapid release in 2017 shows our R&D brilliance. This gel caps have laser drilled holes in order to release drugs more quickly for faster pain relief. It helped TYLENOL gain 1.6 share since its launch in 2017. This is just the first of many innovations we plan to bring into this category over the next few years.
Thanks, Josh. So science is a fantastic point of difference for us at Johnson & Johnson's, but it's not enough. We must balance that with purpose inspired brands which today is what millennials are looking for. What we believe for TYLENOL is that love and medicine is better than medicine alone. The brand connects on a deeper emotional level with a point of view. So in the U.S. we've done this by celebrating the diversity of families today. And in China, I'm about to share with you a sweet story of a father and son giving back to a mom what she has always given to them. Let's take a look.
Once again here we show that purpose isn't as important as superiority, a real competitive advantage for our brands and what those founder based startup brands do so well. We have just as rich and just as the purpose as far Johnson & Johnson brands so we share them.
Thank you very much Allison and Josh. I hope you saw with these examples that we are really reinventing how we build our brands and how we innovate at Johnson & Johnson in order to meet the needs of current consumers and to compete in this new landscape. The third principle, I'd like to talk about is again how do we win in the existing channelsm, but also in the new emerging ones.
Our business in the brick-and-mortar customers is very sizable and we are focused on winning with great sales fundamentals and joint value creating plans with them. But we're seeing clearly that a new omnichannel is really created. Consumers, even if they shop in brick-and-mortars often are browsing online to decide which brands they're going to select and of course we’re seeing that increasingly more and more of our brands are purchased online. So we have to evolve with that shopper and meet our needs.
We're very proud of the strength and the accelerated growth of our e-commerce business. Last year our e-commerce business grew 50% well ahead of the market which is growing around 30% and we're gaining market share and our aspiration is to increase this business six-fold over a three-year period. Now how are we doing that is by embracing a model we call scanner, which is really all about excellence in online sales fundamentals. It starts with search. When the consumer searches for a benefit or a category or a question, our brand has to be there first, it all begins with that.
And then we need to have excellent content. We have evidence that shows that when we have video rich in-depth depth of sale content, consumers are more likely to purchase your brand. We have to have the right assortment, the right SKUs, the right power SKUs that will drive preference. We have to make navigation easy as a consumer browses online, make it easy for her to both select what she wants and then to purchase our brand and then lastly, ratings and reviews. What other consumers think of your brand and what they say online is more important to a future shopper than any message we can convey to them.
So focus on the sales fundamentals is key for us to continue winning and we know this can be done. China for example, we're gaining market share online significantly. Today 20% of our business in China is online. In fact 30% of our beauty business last year was online and we expect this year 35% of our business will be online in China in the beauty category. And we have a great example with the Vino baby which is also the number one brand online in that market. So we see the future in China and we believe the rest of the world is going to go there as well.
The last principle I'd like to talk to you today is it's not enough to be efficient and to drive productivity and to eliminate cost and waste. We have to be more agile, more responsive, more flexible to meet customer needs much faster. We're very proud of the fact that over the last four years we've taken $1.7 billion out of our system in terms of wasted cost and created value through strategic pricing and that enabled a margin expansion I referred to before. But again, this is not enough. We have to become more responsive, more agile, to meet consumer needs faster just like these start-ups do.
And we're starting to do that. I'll give you an example. Last year we launched a new light therapy line from Neutrogena. Light therapy masks that provide consumers with the benefit that ranges from anti-aging, tone and acne. We believe this platform can disrupt the beauty industry. If you go to a dermatologist's office today, the gold standard of care you can get is about $400 worth of light therapy.
We are democratizing that and the consumer now can get that same treatment for 10 minutes for a few dollars. We're very excited about the opportunity this presents for us to meet consumer needs. But particularly in the acne space what we learned is that consumers liked the benefit that we were offering but they needed something that would help them with more acute lesions for acne. And so in only eight months we designed and launched a new light therapy pen which consumers affectionately called the zit zapper and it's really putting a lot of additional wind in our sales in this category. So it's a great example I think of responsiveness to beat consumer needs.
So in summary, we are already a solid contributor an important contributor to Johnson & Johnson. We have a turnover of $13.6 billion and margins that are now in line with our peer set. Our aspiration as we go forward is to continue to grow consistently ahead of the market year in and year out starting in 2018 and to grow our margin ahead of our sales. And we're confident that we have the right strategies that we are facing the reality of the changing landscape and making the necessary adjustments to compete in this new world.
So in summary we believe that we will start winning again starting in 2018 above the market, we will do so by embracing this omnichannel and drive disproportionate growth online, we will do so by continuing to embrace our commitment to innovation and to leverage our powerful pipeline which include the reinvention of our oral care and baby care businesses and will continue to drive our operating margin even as we invest continue to sustain our growth as we go forward. Thank you.
So what I'd like to do next is just have a dialogue with you to answer any questions you may have and for that I'd like to invite Allison and Josh back on stage along with Joe Wolk, Vice President of Investor Relations.
Hello everyone, good morning. I hope you enjoyed the consumer overview and thanks for your continued interest in Johnson & Johnson here today. So to ask a question of two options; certainly for those here in the room you can raise your hand. We simply ask that you wait for a microphone so that folks that are participating via the webcast can also follow the discussion. We also have the opportunity for you to ask a question through our event app. So with that I'll open the floor up to somebody who may have a question.
David Lewis from Morgan Stanley. Obviously given Alex's introduction I have to give you the first question, the trials and tribulations you took to come here.
Thanks Joe. I did this with Morgan Stanley, I wouldn’t miss it true for the world. A couple of quick questions here, the presentation was very helpful in understanding how you're redeploying and personalization of the products is obviously what was stuck out to me. But the one thing that I want to address is acutely was your big box customers are feeling a lot of acute pricing pressure from large retailers. So what specifically do you do, how does that impact your business? Is it diversifying away from big box distribution channels into e-commerce and how do you take cost out of your system to sort of meet demand as these big box customers are coming under pressure?
Yes, we work strategically with our big customers, whether they are brick-and-mortar retailers or online retailers on what we call joint value creating plans. So think about a three-year horizon plan where we together look at efficient ties in our business including the supply chain and eliminating waste in our integrated operations and then how do we innovate together to meet the needs of their shoppers.
As we do so, and as we innovate, we do customize differently to meet the different needs of shoppers from the different channels. If you go to a Dollar Store consumers are looking for the same benefits, but offered in a different price point in a different format than a person who shops online. So what you'll see as we innovate Dave is we will continue to try to differentiate not only from a pricing standpoint but from a product offering and proposition standpoint focused on understanding the shopper needs which are different from channel to channel.
I'd also just build on that. I think you heard me talk a little bit about premiumisation of baby and I think that's a great way through both innovation, I talked about Petite Planet, but also I talked about a Vino and it's seeing baby and it's seeing strong double digit growth. So these premium brands also help with bringing the pricing up in the category and ensuring that we have a brand that competes against every segment which also helps to manage against any pricing pressure?
Just two quick followup from me, Jorge. The first is you talked about growing above market. Can you just define for us again what specifically, what growth rate is market growth? You've a whole bunch of different brands and a lot of different markets, so what is market growth so you can grow faster than that?
And the second thing is a lot of things that came out in this presentation were, you're competing with local players, smaller players that are doing better or more nimble, more innovative, are you as driven today as you were three years ago that being big in a lot of these categories is an advantage and is there a suggestion that maybe consumer needs to get smaller and more focused, maybe be very dedicated to health, beauty or wellness or something like that? Thank you.
No, I would say starting with your second question, we do believe that we have enormous strength that come with scale and we believe it's very important we continue to embrace that. Our science based superiority, the relationships we have with our customers, our insights in the category are something we can need to continue to leverage. However, as we shared with you across this whole morning, we need to make our brands feel more personable, more intimate, more local and less global in terms of how they come across to consumers. And that impacts everything we do, it impacts how we innovate, impacts how we design our products and so that's the key challenge that we're focused on.
We don't - we believe that every category in which we compete can become one that feels to consumers as being more personal, more intimate, a brand that is more purposeful and more differentiated from an innovation standpoint, just as dynamic and fresh and unexpected as some of these local brands are that's what we need to do. So we do believe that scale is not something that is a hindrance for our success, quite to the contrary, but it needs to be complemented by these more entrepreneurial qualities.
I guess two things to add to that is, one when we talk about small companies without the scale or without the science so we showed you the personalization for example for Neutrogena Skin360, it's a small company that actually came up with the idea and when it first came they said we can magnify skin images by 30X basically. Our first reaction was so what? If you don't have the science, the clinical data that actually match that and make specific recommendations, so I think you'll see us that we're doing a lot more collaboration 50% of our pipeline is actually through those collaborations is with small start-ups and that's a big part of the pipeline that we're building.
And Jorge would like to address the second question that David had regarding market growth and what we assume that they're going forward?
Yes, I mean you know David, as I said before this, the categories in which we play have been very healthy and robust growing about 4% to 5% over the last four years. We saw a slowdown in 2017 to something less than that. We expect the markets will continue to get back to grow around 4% as we go forward here, that's what we've seen in the last few years.
Thank you. Joanne Wuensch from BMO. I’m a med-tech girl, so this is all sort of new to me. I hear you talking about personalization and new branding, but how long does it really take to gain traction? And if you move from we had a tough 2017 to we're going to grow above market growth in 2018, how do we think about that trajectory and then looking forward into 2019 and beyond? Thank you.
Sure, the reality is the pace of change in our industry is accelerating at a rate that is unprecedented. And so we've been of course monitoring all these events and we kind of consolidated our thinking around what needed to be done differently so that we can compete in this new landscape throughout last year. And we put in motion already the interventions that were required for us to restore the kind of growth that we've enjoyed in the past. So as I said before, we're confident that we are getting back to growing ahead of the market starting this year and sustain that kind of above market performance as we go forward.
And then as a follow up are there any brands within your categories that you feel like you don't have or anything after your evaluation of the last year that you sort of think about minimizing in a more significant way?
Yes, I think it's a good question. What I would say is, we are blessed with a full portfolio of brands and frankly our presence globally with these brands is not as uniform as it should be and it needs to be. So we still see a lot of runway for us to globalize with brands we do have. That said, as you know we have a very robust M&A process in the company where we are very disciplined about assessing within each one of the categories where we compete and adjacencies around them. Are there opportunities for us to create value and further accelerate our growth opportunities like for example Vogue that we acquired two years ago. So we continue to canvas the market for that and also to continue to look at ways to prune the tail of our portfolio, so that's a ongoing strategic process that we review with Alex and Dominic regularly.
The one thing I would say though, we're not only focused at acquiring and looking at brands themselves, but often there's new capabilities that some of these start-up companies have that could accelerate our ability to compete in this new landscape, so we're looking for that as well in addition to brands themselves.
Thanks. Two questions Jorge, you talked about 2017 being a challenging year. First quarter was also a little challenging, but your competitors are reporting the same challenges and I get it there's the online competition, there's the local competition. But I just want to make sure that there's nothing else out there that we're missing.
So that's question number one and the second question is J&J in a negative way is hitting the headlines with the baby powder. And I'm wondering has that had any negative impact on the brand, have you done any focus groups with consumers to make sure that the brand is still fine in the eyes of consumers? Thanks.
Sure, it's a fair question Glenn. I mean, the reality is what we spent this morning sharing with you is, all the things we believe we need to do different, so that we can strengthen our relevance and get back to winning above the market. And as I've said before, we are confident that throughout this year we will do so. And one of the things that has been holding our performance back has been our baby care business. If you look at our performance in beauty care, in OTC, in oral care, it's been strong over the years.
And of course we've been working hard to reinvent the baby care business and we're confident that that's going to swing from being a drag in our performance to being a driver of growth. So I think the combination of all the changes we described to you today and a healthy and vibrant baby care business is going to get us back to sustainable growth. Sorry, I missed the, remind me of your second question if you would, oh in regard to talc, sorry.
What I can assure you is we've been through this extensively and we are 100% sure that our talc product is safe and we will continue to defend our brand we will continue to defend our product. Talc is only a very small portion of our business, it is like 0.3% of our total sales and it's more relevant in emerging markets of the world where some of the news that have been in the headlines because of these lawsuits have been less relevant. So what I would say in general is we have not seen a significant impact from the talc issues on overall performance of the business.
Hi, Robbie Marcus, J.P, Morgan. I was hoping you could give us some early insights into the change that's taking in the consumer business. So are there any things you could point to early on or that we'll see throughout the first half or the rest of 2018 that really demonstrates the change that's taking hold?
Sure, I think you'll see it in a number of ways, some more visible than others. So, one thing is that our innovation pipeline we're not at liberty to share with you all the things that we're launching this year. You know, in this industry things move very fast and so it's something we have, we're not at liberty to share to you today, but you'll see that in addition to what you heard today there's a lot more transformational innovation coming in the back half of this year that we're very excited about it.
The other thing that we didn't cover here today, but I'd like to share with you just to dimensionalize the transformation that we're driving inside our company is, we are evolving our organizational design to a more agile entrepreneurial model. So for example, in the United States we have a $5 billion business and we have divided that now in 10 working squads of about $0.5 billion in turnover each over each and a squad think about it as a multi-disciplinary end-to-end group of leaders, co-located, empowered to make decisions and to run more entrepreneurially to compete in the market in which they're responsible for.
And then what we envision is that these squads will exist around the world in critical country category combinations all rowing together to execute the global strategy that we have identified for that category. So we're driving real change in how we organize, how we go about our work to become more like a giant start-up that I discussed.
The other thing I'll just mention is, we continue to invest a lot in data and analytics and we get better and better and better at using the data analytics to basically leverage that against our digital marketing to make sure we get better returns from every dollar we invest and drive greater personalization in the messaging which is super important when you think about our categories and the brands that we have, where they're very unique problem solutions and you want to reach that person with precision.
I talked a little bit about that with ZYRTEC and the sneeze trigger, that's a great example of data analytics fueling a more personalized message and a better return which is part of our productivity agenda. It doesn't mean we're cutting marketing dollars, but it means every marketing dollar is working that much harder. So those are the types of things and these are the things those small companies and small startups do, that we're doing very well now and we're really excited about the success we're seeing there.
And you mentioned this in different parts across the presentations, but maybe you could give us some more insight into what changes you're making internally to attract the personnel that could help drive these changes?
Well, I mean, I think what a student that joins the workforce wants today is a dynamic entrepreneurial place, a place where they can make a personal difference and they feel that they kind of own the shops somewhere. That sense of ownership, that sense of being able to make an early impact is what people want more than ever today. By evolving our model to become more agile, more entrepreneurial like that and by innovating in a way that is more discontinues, more relevant to consumers, we can create the kind of atmosphere, the kind of growth opportunity that will make us a very attractive place for a young person joining the workforce.
And I think we're adding positions like data scientists, we're adding positions like Content Manager, we're bringing people in from different companies, different businesses, we're putting people in charge of incubator brands, go figure out how to restage or re-launch this, go figure out how you create a brand through social media data.
Those are the types of things we're doing which are super exciting and because we have the scale and resources that actually is exciting to the people that sit outside, because they look at us and they say, you can do more. I mean we have what those small brands want, the scale and resources, they have the speed and agility. Jorge talked about how we're driving the speed and agility, we're bringing the scale and resources.
Just only - the only thing to add to that is the partnerships that we’re building across around the world with small start-ups with new innovators around the world, that's also another way of the people don't have to be at J&J all the time, I think it's a partnerships, the work that we do with them is also extremely relevant.
Hey Robbie, if I could just maybe add a little bit of corporate overlay to that, that relates to consumer but also more broadly across all of Johnson & Johnson, and I said earlier I probably couldn't resist doing this from time to time. So I hope it's okay with everybody, but as we look at talent across J&J, we actually feel very confident in our ability to continue to attract and retain across all of our different segments.
And look a lot of it we believe and we've actually validated this through some of the research that we've done gets back to this culture and credo. I mean number one, I might go out on a limb here, I think there's a sense here that the millennial today is going to work 85 different jobs change jobs every six months, our surveys don't support that.
Our surveys show that when you provide them a purpose driven place where you're not going to go to a company that maybe has a cool technology zap at name, but basically going to be making click or a headline versus actually making a difference in patients lives that we constantly emphasize in all of our recruiting makes a big difference.
And so if we look at our traction rates from schools, frankly from other industries it's very strong. If we look at Millennial turnover rate, it doesn't differ significantly than any one of our other segments. A lot of that has to do with the fact that we provide for example 17 weeks with a millennial mom, she is going to have a baby and the father that they can have that kind of maternity leave.
Another very interesting fact, when we survey our Millennials the number one reason they say to be J&J number one and number two is purpose, our credo and number two our pension. Who would have thought, again there's a lot of misnomers out there. While pension is not important to me, now I'd say just the opposite if you go back to 2008 and 2009 when a lot of them were getting into workforce, they got burned.
And so, I think doing all those things that we found is actually our intention and finally they can join J&J and they can have a career like many of the executives you see today where you can rotate across region, across sector and you don't have to change company and do that trade-off. So we don't take any of it for granted, we fight for it every day. But what I'd encourage you to do is ask some of the employees outside in the exhibits you can hear from firsthand to maybe reinforce some of those things. Thank you.
Thanks. Joe. Jorge, you alluded to taking $1.7 billion of cost out, I'm respectful of that, I'm also respectful of 20% of margins, but the key question is, is 20% the peak and if not what could be the peak? Thank you.
Sure, it’s a fair question. Well as you point out we do feel good about the fact that we've come a long way and now we are slightly below our peer set average and clearly that's not a place where we need to be. So our goal is to continue to improve our margins, but in a sustainable way which allows us to reinvest to continue to drive topline growth ahead of the market and we think there's still opportunity for us to drive margin. But again, we need to balance that with our desire to invest, to capitalize on all the opportunities you've heard about today.
And Tony maybe just to elaborate, that's just not for consumer business, that's for our pharmaceutical and med device business as well, that idea of growing the bottom line faster than the top line, so even though pharmaceuticals and medical devices operate at higher margins compared to the peer set, we still strive to improve that each and every year.
Thanks, Jayson Bedford from Raymond James. There wasn’t much mention of emerging markets and a couple years ago I think you talked about 60% of the expected growth coming from emerging markets. So I guess the questions are one, have emerging markets lived up to your expectation and two, should we still view it as a key growth driver?
It’s a good question and I do believe that the emerging markets will continue to drive about 60% of our growth going forward. That remains our assumption the plan. I will say last year was a bit of an exception to the rule for very unique reasons. So you take India for example, there's been very disruptive efforts to transform, to modernize the Indian economy which are going to pay huge dividends mid to long-term, but created a real shock in the economy and consumption and liquidity with our customers in the timeframe itself.
Brazil, we still are very bullish on long-term, but you saw that last year the country went through a very cathartic process of ridding itself of corruption which again created a short term impact. Russia suffered a bit from low oil prices and the liquidity issues that came with that. So the exception was really China where we continue to see terrific growth. But whether you look at BRIC or the MINT markets, Mexico, Indonesia, Nigeria, Turkey and parts of Sub-Saharan Africa and Southeast Asia, we still see tremendous growth opportunities as we go forward. And so we remain just as bullish as we were and we see last year as more an exception to the rule for emerging markets.
Great, so that concludes our consumer panel. I want to thank Jorge, Alison and Josh. I know the audience found the presentation and the resulting conversation informative and valuable. So thank you.
I will now take a quick break. I would encourage you to visit our exhibits, they are open and they will be open again at lunch time. It really gives you a great opportunity to hear from additional business leaders in our consumer and medical device units. It really features the exciting products and technology that is discussed in today's presentations. We will return here and begin our program promptly at 10.40. Thank you.
So, good morning. I hope you guys were as excited as I was listening to Jorge, Josh and Alison talk about all the amazing things that we're doing in our consumer business and how they have really lived into understanding and owning the consumer and understanding the changed market environment and then clearly living into the science base of everything that we do.
And I hope you share my conviction that we are making the right choices to be relevant for consumers in the future, the way we have been for over 130 years. We clearly have built on a legacy of deep consumer understanding and science based differentiation in our consumer business. Our team is demonstrating flexibility and creativity in not only responding to the disruption in the marketplace, but more importantly, they're actually capitalizing on it to ensure that we restore above market growth for J&J Consumer.
So both our consumer and medical device businesses are competing in industries that are undergoing profound shifts. As Jorge said, it's just as relevant in medical devices, the old playbooks are being rewritten, new players are entering the market, harnessing data to create new customer centric business models and disrupting traditional value chains.
Two years ago in this setting, I spoke about the shifts taking place at the intersection of science, technology, and health. I remember saying then the business of health and wellbeing was changing at a pace that I've never seen before in my career and let me tell you in the last two years it surely isn't slowing down.
In a few moments you'll hear from some of our key medical device business leaders, some of them you've met before, some of them this will be your first experience seeing them in action. The four markets that make up our medical device portfolio are unique and they have unique attributes and each business is in a very different stage. But like all of our businesses at Johnson & Johnson, they are all focused on delivering sustainable above market growth.
Across medical devices, we are executing robust, holistic, innovation and growth strategies. As Alex said, we are relentlessly focused on execution, driving quality, simplifying operations and delivering new commercial models in response to changing customer needs.
And in each business, we're leveraging science, technology, scale, and expertise to meet the evolving expectations of health systems and people around the world. So let's be clear, healthcare is one of the world's greatest challenges and it also represents a great market with many new opportunities for Johnson & Johnson Medical Devices. Global healthcare spend is growing faster than GDP and as we all know it's just proportionately concentrated in developed markets. The industry landscape is being reshaped, creating new challenges but we see them as new opportunities.
Around the world, the 16 over population is growing faster than all other age groups and in emerging markets, the middle class is growing at an unprecedented rate of speed. Did you know that it's adding five people to the middle class a second, that's a million people a day actually that's like the equivalent of a small city that's going to be created in the middle class in emerging markets as we're sitting here today.
Economic development especially in these emerging markets is increasing healthcare access and demand enormously. But while that's happening, we're also seeing consolidation and globalization among our customers. The increased influence of the consumer as patient and the migration of care outside of the hospital, the advances in science, technology and data analytics create immense opportunities for J&J to provide new types of care that it can extend and improve lives in new places and deliver in very new ways.
We believe that J&J is uniquely positioned to respond to these forces. We are the market leader in surgery, in orthopedics, and in contact lenses. Our products are in nearly every OR in the world and are used in over 75 million procedures a year.
And we have a specific strength in emerging markets where much of the procedural growth will occur. The global medical device market is attractive and it's growing. We estimate by 2022 the markets we compete in will grow to over $120 billion. The total medical device market will top about $490 billion. But the markets we compete in are projected to grow faster than the average of the medical device market and we expect the overall growth rate in emerging markets where we have a particular strength to grow by approximately 7%.
From our earliest days Johnson & Johnson identified unmet needs and created new markets in medical devices, we made surgery safer, we create, we increased access to surgical care and we helped people recover from accidents. We've trained literally hundreds of thousands of surgeons around the world. We became the leader in minimally invasive surgery. We have played a key role in restoring mobility and sight. We also have been at the forefront of controlling surgical bleeding and infection around the world.
But in recent years, our track record has been uneven. At the 2016 Analyst Meeting, we had recently announced a major restructuring and at that meeting we projected above market growth across the sector. We are on track to deliver on our commitment of $800 million to $1 billion in savings by 2020. However, we’ve grown above market in only some of our businesses.
Quite honestly, we had some missteps. Our innovation cadence in some areas was not what it should have been. Many of our resources were still tied up in completing remediation and integration work rather than in innovation. We also fell short in much of our commercial execution which was compounded by the restructuring disruption and sales force attrition.
We’re clearly not satisfied with this performance and we are laser focused on delivering consistent and above market growth going forward. And I hope you will see throughout the rest of the day, the progress that we have made and why we're convinced we will change this trajectory.
Over the past 12 months, we have made significant progress resetting the foundation in medical devices. We're reshaping the portfolio and making major strides in improving quality, growth and execution. We have filled critical portfolio gaps, accelerated our deal pace and divested businesses with lower growth or which were no longer a strategic fit for us. We've built new platforms in stroke and surgical vision.
By the end of the year, we expect to have completed the diabetes divestiture which will improve our overall growth rate by one full point. In 2017 alone, we doubled the number of new product launches and we launched them on time. This year as you've already heard and you'll hear more about through the rest of the day, we will launch between 15 and 20 major new products this year. Last year, we simplified our R&D organization. We shifted investments from incremental programs into programs with much higher potential and transformative impact.
We have increased our pipeline value and expanded our innovation, focused beyond the product. In 2017, we invested over $5 billion with more than 30 acquisitions, investments and partnerships. We will continue to manage our portfolio with discipline aggressively seeking out opportunities to acquire products and solutions that will make a difference to the patients and customers we serve and bring new capabilities to strengthen our ability to compete and grow.
We are improving execution across all dimensions of the business. Number one, we're improving quality and reducing the complexity of operations. Number two, we're enhancing our commercial capabilities and number three we are learning to collaborate with our customers in new ways.
The lifting of the Synthes warning letter on February 1st of this year was a major quality milestone. We have designed strong quality systems and we are focused on innovation and execution in addition to sustaining that strong quality. We have simplified our product portfolio eliminating more than 26,000 SKUs which equates to about 11% of our store count. We continue to focus on optimizing every aspect of our supply chain, work that's improving our gross profit and equally importantly our customer responsiveness.
We are also investing in sales force training increasing both clinical and commercial sales coverage and we are building critical new commercial capabilities in analytics, in pricing and in strategic account management. These investments and this focus is beginning to drive growth and profitability. We are also evolving our go to market models and entering new channels in response to changing customer needs and dynamics. As part of the world's most broadly based healthcare company, we bring unrivaled knowledge, resources and experience to bear for our customers.
We’re actually actively co-creating with health systems around the world to improve outcomes, to increase patient satisfaction but equally important for them to reduce costs.
We are introducing digitally enabled services and tools and these are designed first to optimize surgery and OR efficiently, second to strengthen surgical skill sets and third, to help patients better prepare for surgery and recover more quickly. Last year, we launched 26 global Johnson & Johnson Institute sites, reasserting our leadership in professional education. We are investing in new capabilities and reimagining what surgical training can be.
So bringing this all together with our strengthened foundation, we expect and are committed to accelerating growth sequentially in 2018 and achieving above market growth across our total portfolio by 2020. At Johnson & Johnson, we are focused on four medical device markets, all very attractive with areas of significant unmet need. We are the world's largest orthopedics business. We continue to be the leader in global surgery. We are a strong player in high growth interventional solutions market and we are the number one in the contact lens category.
We have also during this timeframe made significant investments in future areas where we can build new markets and new forms of care. These include surgical robotics, oncology and ablation, neurovascular and orthopedic robotics.
As you will hear from the team for the rest of the day, we believe that we are well positioned in most of the categories in which we compete. Our performance is very strong in wound closure, in biosurgery, in endomechanical, in trauma, in hips, in eye health and electrophysiology. But you'll also hear about the work that we're doing to address the challenges we have in three of our businesses; in energy, in knees, and in spine and why we're confident and I'm hopeful by the end of today you will also be confident that we're going to improve the trajectory of these three businesses.
Two years ago, we told you that the competitive advantage at J&J was our breadth and scale that will increase as the environment, the external environment evolves. Our customers are very diverse and they need very different kinds of support and engagement from us. Our recreation of our commercial model quite honestly took us longer than we expected. But I'm delighted to tell you that it's actually now paying off.
In 2018 alone, we racked up more than 50 cross category multi-year customer wins, that's double the number in the fourth quarter of 2017 and we clearly expect that upper trajectory to continue. It's actually really exciting to see how our business model innovation with our customers and co-creating things that they really need is leading to tangible wins. Let me just give you a couple of examples.
In the U.S. we've deployed Care Advantage programs in 132 health systems in 2017. So Care Advantage is what we call our holistic approach to helping customers improve care and actually increase efficiency and outcomes by bringing a very broad range of capabilities to work with our customers that go beyond the product to help them meet their specific unique needs, 132 in 2017 alone.
Let me give you another example. In the Middle East in response to changes in our customer's needs, in Saudi Arabia we took a very different approach and we evolved our go to market model. We announced a joint venture in Saudi Arabia which allows us to work with healthcare providers and partners to develop solutions that not only reduce costs, but they deliver better outcomes and ensure patient satisfaction across many disease states, including obesity and orthopedics.
We expect to see the impact of these wins and others as the year progresses, not only in 2018, but beyond as this momentum grows and we continue to co-create with our customers and meet them where they need help. We also believe that our refreshed approach to professional education will drive competitive advantage and growth for J&J. As many of you know, Johnson & Johnson has been at the forefront of providing comprehensive disease state and procedural education for healthcare professionals around the world for decades. We are very, very proud of that work.
But the demand is increasing especially in emerging markets where there is an insufficient number of qualified surgeons, training more surgeons creates access for patients and increases procedural volume while it also improves patient experience and measured outcomes.
To meet these challenges, we've rethought how we do this and we've built an omnichannel education system designed to support surgical innovation and improve surgeon and care team skills. Our training, our technologies can help deliver better patient outcomes, improve our efficiency, and to transform the way care is delivered.
My simple analogy is it's like the way pilots and athletes are trained today. By combining the best features of virtual and lab training, we can drive the best outcome for patients, physicians and health systems. I hope at one of the breaks you will get a chance to see some of that work in action, it's really exciting and it's having a huge impact in training surgeons around the world.
So at J&J, we are innovating at the forefront of science and technology. We are developing connected products and solutions across the entire patient journey not just in the OR. We’re leveraging data and insights to lower costs, increase access and improve outcomes and not surprisingly, we're doing all of this with an incredible focus on disciplined commercial execution.
I am convinced that after hearing from our team today, you will get the essence of the intensity of our commitment, and actually equally importantly, the enthusiasm we have for the future and what we can do to help patients around the globe. We are increasing our innovation cadence. We are optimizing our portfolio making sure that we're targeting high growth categories and unmet needs while exiting slower growth businesses. We are relentlessly focused on execution in all of its dimension across our whole business, and we will accelerate growth sequentially in 2018 and are absolutely committed to achieving above market growth across all of our businesses in 2020 and beyond.
So now it's really my pleasure to introduce to you the talented committed people who lead our medical device businesses. You'll hear from our leaders in interventional, orthopedics, surgery, and eye health. Together this may surprise you, but they actually represent about a century worth of experience and knowledge and expertise in this business. And I must tell you I’m very pleased, honored and privileged to have the opportunity to work with this team every single day. They're wonderful people who are doing amazing things to help people live better, healthier lives.
So Shlomi Nachman, Ciro Römer and Michael del Prado will next take you through the work we are doing to grow and shape the industry in interventional solutions, in orthopedics and in surgery. Peter Shen and Euan Thomson will then share with you an exciting update about our pipeline of innovation and our approach to transforming digital surgery and robotics.
And finally, Ashley McEvoy and Xiao-Yu Song will share their compelling story of vision care and the transformation that we have made in this business, our contact lens business, as well as creating a comprehensive eye health business over the last few years.
Now it's my pleasure to turn the discussion over to Shlomi Nachman who will lead the Interventional and Specially Solutions business. Shlomi?
Thank you, Sandy. Good morning everybody. Good morning everybody. Thank you. I'm very happy to be here today to share our strategy to sell to millions of patients around the world who can benefit from our solutions to treating both atrial fibrillation and stroke. Let me start with introducing the platforms and the market. Interventional solution is a $2.3 billion portfolio in medical devices, it includes Biosense Webster focusing on electrophysiology and Cerenovus focus on neurovascular.
Both markets are very attractive going double-digits. The EP market is about $4.4 billion market with a very strong CAGR of estimated at around 11%. Biosense Webster is the undisputed market leader and across all regions with over 46% share and about $2 billion in revenue. We are very, very proud in our performance delivering strong double-digit growth over the last nine plus years and taking share every year, each and every year.
On the neurovascular side, the worldwide market is about $2 billion with a CAGR of roughly 10%. Currently, we are number four in the market with revenues of about $200 million. As you know, we made a series of portfolio decisions last year, when we divested Codman Neurosurgery we elected to focus on neurovascular.
We acquired Neuravi and Pulsar Vascular, we formed Cerenovus and we have started a new chapter in neuro-intervention, a new exciting chapter in neuro-intervention. I will go into details first on atrial fibrillation and Biosense Webster and then I will cover stroke and Cerenovus.
So what is AFib? AFib is a rapid irregular heart rate that causes poor blood flow. Patient's symptoms typically include heart palpitations, shortness of breath and fatigue, some patients describe it like being hit by a truck.
Patient quality of life is significantly improved, not to mention the five times higher risk of stroke associated with atrial fibrillation. Atrial fibrillation is truly becoming one of the world’s more significantly public health issues. It is estimated that about 33 million individuals around the world are living with atrial fibrillation with five million patients diagnosed each year placing a critical, critical burden on the healthcare system. In fact based on statistics, probably one out of six of us in this room will experience AFib in their lifetime.
So what are the treatment options for patients with atrial fibrillation? One option is medication namely blood thinners such as Xarelto and of course antiarrhythmic drugs. These primarily are the symptoms and we know that about half of the patients don't respond well to antiarrhythmic drugs. The only potential curative option is interventional procedure known as ablation.
However, while ablation is becoming more common procedure, penetration is still less than 10%. This represents incredible opportunity for both Biosense Webster and of course Johnson & Johnson. With this in mind, let me talk about our innovation strategy. We all know hospital systems are under pressure to increase productivity while managing cost and improving patient care. This challenge is further compounded due to the AFib population expected to double between now and 2030.
This means our customers need to increase lab efficiency with safe and effective procedure for both paroxysmal and persistent atrial fibrillation. To address our customers unmet needs, our innovation strategy is focused on three areas. First, locate where to ablate with high density mapping solutions, second deliver better relation with high power short duration procedure and third simplify the procedure with single show device.
With those innovations, we know physicians can now increase their success rates from about 60% to 70% to about 90%, they reduce their fluoroscopy from about one hour in the past to less than five minutes today and they’re reducing their procedure time from roughly four to six hours to less than two hours today. Personally I'm very excited with our strong innovation pipeline. Biosense Webster is clearly, clearly leading the way.
Now let me share with you some other steps that we are taking to continue fueling our growth momentum. First, we're expanding our unique commercial model. Our clinical account specialist support customers at every case. In the U.S. for example, we have more than 90% of the navigation cases covered, meaning we are there providing support to our customers and gaining valuable insights.
Second, we are taking steps to expand our indication to include persistent atrial fibrillation and establishing ablation as a first line therapy. We have made significant progress in our clinical pipeline. We just recently finished our enrolment in our present study for persistent AF indication. And as you might know, we are one of the key sponsor for CABANA designed to establish AF as a first line therapy.
Third, we continue to invest in adjacent interventional solution beyond ablation. I mentioned earlier the highest stroke rates associated with atrial fibrillation, our acquisition of Coherex and the commercialization of their WaveCrest left atrial appendage device expand our capabilities to address this focus.
Let me switch now from the heart to the brain. I'm sure you're familiar with the devastating nature of stroke. Stroke is one of the most feared diseases robbing millions of their independence and their quality of life. It is truly a worldwide public health issue. Strokes claimed a life every six seconds and has far reaching implications in terms of disability and of course an extraordinary high burden on the healthcare system.
Let's understand better what is stroke? Stroke is basically a brain attack and it can happen to anyone at any time at any age. There are two types of stroke, ischemic caused by a clot accounts for roughly 90% of the world wide stroke cases and hemorrhagic which is caused by rupturing the vessel accounts for the remaining 10%. Treatment for hemorrhagic stroke is primarily preventative, with the use of stents and coils to prevent rupture. Treatment for ischemic stroke is acute with either mechanical thrombectomy or aspiration device.
With the strong clinical evidence established over the last few years, the ischemic stroke market is booming and presents a very exciting opportunity to make a difference. You know they say time is brain, every second matter in stroke treatment. Therefore our innovation strategy is designed to address unmet needs in restoring oxygen to the brain.
We are doubling down in ischemic stroke with the introduction of Ambrotype our stent label device and focusing investment on solution design to remove the clot quickly. On the hemorrhagic side, we just introduced the G3 called mini device as well as the [indiscernible], the only device on the market to treat bifurcated aneurysm.
To accelerate our growth, we're excited about entering two new segments that are significantly in the field of new intervention. First and as I just mentioned, we enter the ischemic stroke market, with Ambrotype, the next generation stent people. The technology is currently in Europe showing great momentum and I'm excited to share with you that just last week we received FDA clearance and we are gearing up for commercialization next month. I hope that you will take the time to see this great technology and our innovation display.
Second in the [indiscernible] market we will be entering the flow diverter segments by launching our Verb device in Europe later this year. In order to drive overall adoption and clinical differentiation, we are investing heavily in EBITDA generation and we're expanding our field presence all over the world. I'm very excited about progress in neurovascular space. I believe that we are very well positioned to take share and be a strong contender in this space.
In summary, I'm really excited, extremely excited about the future of intervention solution and I'm confident we will continue delivering strong double digit growth fueled by innovation and commercial execution. Our sense of urgency is stronger than ever before literally millions of patients are waiting for us and we are committed to addressing their needs.
Thank you for your time today and I look forward to your questions later. Now let me introduce my colleague and friend Ciro Römer who leads orthopedics. Thank you.
Good morning. Thank you, Shlomi. Good morning again. My name is Ciro Römer and it's a pleasure to be here with you today to first of all share the orthopedics market's perspective, update you on our progress, but more importantly, present how we are positioned to win in this dynamic but very exciting environment. Now movement is a fundamental aspect of our lives, yet for millions of people, movement is compromised. Approximately, 110 million people suffer from symptomatic hip and knee osteoarthritis and 250 million people suffer from osteoporosis worldwide.
Now, this needs to approximately 1.6 million hip replacements, 2.2 million knee replacements and 6.4 million all perfectly free treated fractures every year. Additionally, only 40% of certain spine surgeries are successful using today’s available technologies. Now as the largest and most comprehensive orthopedics business in the world Johnson & Johnson has a critical role to play in tackling this challenge.
Now let's talk about the position that we have in the market. DePuy Synthes is the world's largest and most comprehensive business and US$45 billion market. We're operating from a position of strength. We are established broadly across orthopedics with significant market share across all platforms were either a number one or number two in three out of five platforms. Growth is forecasted to be around 3% worldwide CAGR through 2022. Now as Sandy mentioned we're experiencing good performance with our trauma, hips, and spot platforms.
We expect that with our different shaded portfolio and pipeline we will lead to above market growth this year and beyond for those platforms. Now we still have work to do in our spine and knees business and I will address this as we deep dive in our platforms. We're however, very confident that as we com wherever are very confident that that's we complete our portfolio and address the spine sales force attrition, we will stabilize our performance in spine and knees this year and anticipate to grow above market by 2020. Now we are very proud of the substantial progress we have made since the last time we were in front of you.
We are very confident that this will fuel our future growth. We have significantly reinvested in innovation and as we are increasing our launch cadence expect to gain market momentum. We launched eight major products in 2017 and planned another seven to 10 in 2018. We have also filled key portfolio gaps through external innovation with 11 deals in 2017 alone. We've also been increasing our presence in the important digitally enabled solutions area. You will hear more about that later in my presentation, but also from our R&D leader Euan Thomson. As Sandy mentioned, we have also completed critical quality and regulatory mediation and we have successfully passed 21 FDA inspections.
Early this year the FDA lifted the warning letter issued to Synthes in 2012 prior to the company's acquisition. And last but not least, we have stabilized our commercial organization and evolved our go-to-market model which I'll get to later. Now orthopedics is important for Johnson & Johnson and we're building the orthopedics company of the future. Starting from a leadership position, our business strategy is to transform procedures to personalization, automation and providing complete solutions for surgeons and their patients throughout the entire continuum of care.
Over the last decades, we have mainly improved outcomes focusing on better materials, better implant designs and better operating techniques all of that combined with professional education. Moving forward, we plan to not only deliver differentiated implants, but drive better clinical outcomes and increase patient satisfaction. So now, let's take a deep dive in our platforms starting with knees. Now I've read some of your reports where you mentioned or tibial loosening specifically in relation to the ATTUNE system. Let me address this.
Tibia loosening is and industry challenge. It's the number one cost of knee revision two years after the primary knee replacement. The ATTUNE performance is consistent with the total knee arthroplasty class for survivorship based on four independent registries, namely the National Joint registry in the U.K., the Australian and New Zealand Joint Registries and finally the Michigan registry data. Now U.K. national joint data provides reasons for revision and it shows ATTUNE performing within class tibia loosening. You may have access to these data and the app but also printouts are available at our demo for your disposal.
By the way, these results are also consistent with our own internal data for more than half a million patients who have benefited from the ATTUNE in 43 counties. Important is also that compared to leading total knee aArthroplasty products, one year patients reported the outcomes measure favorably for the ATTUNE across a broad range of outcomes. I thought that was important to address this first to now go through our plan to return knees, our knee business to growth.
We're number three player globally and then number two player outside the U.S. with a portfolio position to win as the market evolves. The ATTUNE system is the foundation of this portfolio and we're building upon it. It's a comprehensive knee system that is designed to work in harmony with the patient's anatomy and deliver for what they want for that procedure and that is stability emotion during daily activities.
Patients with ATTUNE showed statistically significant improvement in knee physical function at six months and were discharged sooner from the hospital than those with competitive implants, according to a study data presented at the Second World Arthroscopy Congress. We are very excited to have launched also the ATTUNE revision knee system. We anticipate that this launch will extend our leadership in the revision segment and help also convert primary total knee customers.
In the fastest growing sub-segment of knees, namely that some mentalist total knee with approximately 10% growth we anticipate full launch of the ATTUNE system in 2019 giving us entry in this very attractive segment. And finally, as you probably have heard, we have recently acquired Orthotaxy which will allow us to tackle the next frontier in orthopedics. The potential of digitally enabled technologies is significant, but we believe that existing solutions are not optimal especially in the area of robotics.
Now current robotics a large and complicated, they slow the procedure down without improving accuracy. They require very often dedicated support, intensive training and cannot easily be shared between ORs and surgeons. We have waited to engage until we found the right technology. With Orthotaxy we will have a portable, low cost system that is designed to be easy to use and improve accuracy. Very importantly, it maintains the surgeon’s involvement, requires minimal training and technical support and can easily be shared between ORs and surgeons.
Now we're working very hard and plan to launch it in 2020. Today you will have the opportunity to learn more about agility R&D presentation and experience the prototype in the demo space and I really hope that you get us excited that's the surgeon who has seen it. We're entering a new era with the acquisition of Orthotaxy. It's another example how we as a company are moving beyond the implant to focus on the complete software enabled solution with the single goal to move from better implants to better outcomes. We're very confident that we will enhance our competitiveness and the stellar growth in our knee platform. So now let's move to spine.
In spine, while we have made progress with the cadence of launches, alliances, and acquisitions to help fill some of our portfolio gaps, we're not satisfied with our current performance of the business. Besides a slowdown of the spine market especially in the U.S., the main reasons for our mix performance are first, remaining product portfolio gaps that we are now closing and second sales force attrition which we have stabilized. But let's not forget spine is a large and attractive market. We continue to maintain a number two position globally and the number one position in key markets such as China and EMEA. There are also still many opportunities to address unmet needs. Bottom line is that technologies are not delivering satisfactory results today.
Our plan is to focus our investments both internally and externally on segments where we see the most growth, mainly the minimally invasive solutions, deformity, complex cervical pathology and the aging spine. We're very excited about the progress we have made specifically in the minimal invasive space with the recent launch of the Unleashed platform which supports every step of the procedure combining the Concorde lift expandable cage, the VIPER PRIME pedicle screw system and the Concorde clear MIS Discectomy device.
This complete solution is designed to reduce surgical steps, enhance efficiency, and simplify spinal fusion surgery. Besides these product launches in the U.S. we have just announced an agreement with Prosidyan to promote their line of synthetic bone materials. They signed for ease of use and have been engineered for optimal absorption in clinical use during spine fusion surgery.
In the interbody segment which is growing at more than double the rate for the overall spinal fusion procedures, we have just launched the PROTI 360 family off interbody devices to help broaden our portfolio and better meet the needs of customers performing spinal surgery. Later this year, we will also plan to launch Sentio, the only software enabled solution used for the nerve localization available in the marketplace. As I mentioned before, we're very committed to stabilizing our performance in spine this year and anticipate returning to above market growth in 2020 and beyond.
Now let's move to hips. In hips we have grown above the market for the last five years and have gained almost three points of share since 2011. We attribute this in part by developing, promoting and educating the complete solution for the anterior approach. Seven out of 10 surgeons entering hip surgery will use the anterior approach and we are clearly well positioned to win in this attractive segment. The ACTIS Total Hip System was designed to be optimized with the anterior approach technique. The system is gaining a lot of traction with surgeons given its benefits, including initial implement stability and the potential for reduced pain and improved mobility.
We've also been commercializing two enabling technologies. The first one being the ME Impactor and the second one is JointPoint. Earlier this week we announced agreement to acquire assets of Medical Enterprises, the developer of the ME Impactor which is designed to automate bone preparation, implant assembly and positioning.
Following the close of this new deal, our plan is to build on the earlier exclusive agreement by further providing this technology to surgeons. In the near future we plan to develop and broaden the surgical impact of technology for a range of orthopedic surgery procedures including the knee. We also have the ME Impactor available for you to experience in our demo space.
Now JointPoint provides a noninvasive computer navigation, pre-surgical, digital templating and feedback for surgeons doing hip surgery. Now with the implants, the automation, digital solutions and instruments, we provide a complete solution to surgeons which is key for better outcomes and at the center of our strategy to continue to gain market share in hips.
Moving forward we're going to continue to expand our anterior approach leadership. We're going to drive CORAIL and PINNACLE. We will enter the dual mobility market in 2018 to the recently announced agreement with Serve [ph] and last but not least, globally lunched JointPoint and the ME Impactor.
So let's move to sports shoulders and early intervention. The total market, the market totals approximately $8 billion with growth rates more than 1.5 points higher than the overall orthopedics market. Our strategy is to gain momentum by rounding out our portfolio. In shoulder reconstruction we are seeing solid growth for the global icon, our anatomic stemless both in Europe, but also in Canada.
This year we plan to expand our Global Unite platform with the launch of a shoulder reverse system designed specifically for the treatment of complex fractures in the upper arm. Within Surgical Sports Medicine we increased our launch cadence over the last year introducing five new knee products in 2017 that drove faster market growth in knees for the first time in several years.
We also launched PUREVUE, a high definition and 4K imaging platform for the minimally invasive and endoscopic surgery. Additionally, we're substantially refreshing our capital equipment portfolio with the goal of bringing more comprehensive arthroscopy solutions to the market by the end of 2018.
In sports medicine where rotator cuff surgical interventions come with a more than 20% failure rate, we anticipate launching DYNACORD in the third quarter of this year. This is a new innovative suture designed specifically to secure the knot tension to improve outcomes in the rotator cuff repair. We're additionally also launching our TRUMATCH shoulder preoperative planning. In early intervention, DePuy Synthes is growing the market with Monovisc and Orthovisc and has become market leader in the U.S. in the first quarter of 2018.
Let's move to trauma, in trauma as you know, we're the clear market leader with the broadest and most comprehensive portfolio in the world. Every 12 seconds a patient gets DePuy Synthes implant around the world. In 2017 we launched the first and only cement augmented nailing system in the U.S. to enhance implant fixation and we have seen double digit growth with this product portfolio. It has also benefited the health care system, the combination of the TFNA and the Geriatric Fracture Program has reduced clinical complications decreasing the hospital length of stay for elderly hip fracture patients.
In the hip and femur fracture space, we provide the broadest portfolio of what we believe are best in class products and services, unparalleled expertise and the broadest resources in the industry. This year we plan to add the Femoral Neck System and the Femoral Recon Nail System to this comprehensive portfolio building on our history of leadership.
We've also launched MAXFRAME, the first significant advancement in 20 years in the orthopedic external circular fixation. It gradually corrects bone or soft tissue deformities in the upper and lower extremities in patients with limb deformities. Its unique 3D planning software helps improve accuracy of the deformity correction plan through product enhancements and digital tools.
Finally, we have broadened the portfolio with token deals such as Biomedical Enterprises and distribution deals like Lifenet Health and Tyber Medical to increase our portfolio and presence in the fast growing extremity market.
Now let's have a look on how we have evolved our go-to-market model. As Sandy mentioned, across the world we have launched CareAdvantage with the goal of helping healthcare systems deliver value based care by reducing costs, improving outcomes and advancing patient satisfaction. In the U.K. we have announced the 15-year strategic partnership with the Guy's and St. Thomas to deliver improved standard of care for patients through state-of-the-art facilities, supply chain streamlining, patient pathway redesign and introduction of innovative new technology.
In quarter one in Germany we signed a five-year exclusive agreement with the Asklepios Hospital Group for the delivery of hip and knee replacements. This is by the way the largest commercial deal in the history of the DePuy Synthes.
Now these are only some of the many initiatives we have implemented around the world which we believe will help us drive market share and growth. Now we have moved through a lot of information today. I think importantly, is that we believe that we have a robust plan in place to realize above market growth across orthopedics in 2020.
We first of all have and very importantly a strong cadence of product launches, laser focus commercial and supply chain execution, new go-to-market models that will improve sustainability of healthcare system and last but not least, digitally enabled solutions that will evolve and disrupt the market.
I want to thank you very much for your time and I really invite you to go and see the innovations we're bringing to the market in our demos. I think you will be impressed by the cadence of launches.
And with that, I would now like to invite my colleague Michael del Prado to the stage to talk about our surgical business. Michael?
Well, good morning. My name is Michael del Prado. I’m responsible for Ethicon, the surgery business of the Johnson & Johnson Medical Device Group. I'm pleased to be here today to share with you how we continue to shape the future of surgery and its impact on our customers and the patients we're privileged to serve. To set the scene, significant unmet need still exists around the world in surgery. 32% of the global deceased burden could be attributed to surgically treatable conditions.
There are 5 billion patients globally who are unable to access good surgical care. And there are about 10 million new surgically relevant patients every single year. As a leader in surgery, it is our responsibility to ensure that our patients globally have access to safe and effective surgery to the best of our ability and to focus on diseases with the highest unmet needs. We are committed to addressing the increasing clinical and economic burden across surgical specialties globally, with a specific focus on general surgery, on obesity and cancers.
Unnecessary complications in surgery including bleeding, leaks, surgical site infections, lead to significant additional healthcare costs and this is tremendous burden to the system. There are about 211 million obese adults globally who are eligible for surgery, but fewer than 1% actually get surgery. Cancer surgery continues to be aggravated by very high complication rates leading to high morbidity and high mortality.
Colorectal cancer for example, is associated with high readmission rates after surgery. Lung cancer is a leading cause of cancer deaths worldwide with China contributing the largest proportion of these cases. With our leading innovation and unmatched global reach we are very well positioned to make a meaningful impact in all of these areas to dramatically improve patient outcomes, reduce unnecessary healthcare costs and deliver significant returns.
We are the global leader in surgery. We're number one in endocutters, we're number one in biosurgery, we're number one in wound closure and number two in energy with ambitious plans to endure leadership in the very near future.
This market is large at $23 billion globally and is expected to grow at a CAGR of about 6%. Growth is driven by acceleration or robotics and you'll hear more about that later and continued adoption of minimally invasive procedures over the next five years. We also anticipate that expansion in emerging markets will continue to drive double-digit growth. We expect more than 70% of our growth to be driven from the international markets over this very same time. In fact, this year we anticipate Ethicon sales in China will exceed $1 billion.
As you will see we have very clear plans to sustain our leadership across our key segments and entered new attractive and high-growth categories. Let me tell you the main areas that we are accelerating our growth today. We are delivering consistent sales growth improvements. Through discipline and focus we are sequentially adding about a point of growth every year over the past three years.
We grew more than 4% in 2017 with strong sales growth and share gains in all of our key platforms. Other parts of our business are core surgery business which is less than 20% of our business such as general endoscopic and mechanical platforms have been growing slower and I will show you how we plan to accelerate the growth in these areas.
We've launched 80 new products and line extensions over the past three years, six of these key products delivered beautiful innovation and growth including ENSEAL X1 Large Jaw which set the new standard for sealing performance, for advanced energy in open procedures, powered ECHELON FLEX with Gripping Surface Technology, delivered exceptional stapling performance and clinical evidence.
SURGICEL powder allowing us to enter the broad surface bleeding category and then expansion of our STRATAFIX Knotless, Tissue Control Devices continuing our long tradition of leading the evolution in wound closure technology. Our strategic acquisitions contributed about a point of growth in 2017 and our disciplined approach to portfolio optimization allowed us to double down on digital surgery, build a leading advanced surgery portfolio with a very best evidence, refresh our open surgery portfolio while at the same time rationalizing our slower growth businesses and building on Sandy's discussion earlier this morning are focused on shaping the future of healthcare and specifically surgery will drive our growth into the future.
We are achieving this in four ways. We are already winning in open laparoscopic surgery. This is very relevant as I shared with you statistics on people who deal surgery and couldn't get it. We're improving our broad-based access to safe and efficient surgery, especially in emerging markets and building an advanced surgery portfolio with the strongest evidence particularly in cancer and obesity.
We are entering the high-growth area of digital surgery with a differentiated and compelling offering. At the same time, we are creating the next frontier of surgery, including new less invasive modalities that are designed to produce better clinical and economic outcomes. And lastly we're delivering solutions designed to maximize customer value that leverage our global scale and capabilities, drive flawless execution and increase customer satisfaction.
Let's start with open surgery, that's where it all started about 130 years ago. Despite advances in minimally invasive surgery, most complex surgery still is being performed open. We continue to be the leaders in this very important space. We provide surgeons the most advanced tools to improve procedural efficiency and enhance outcomes. Here are a few examples. First, to address the slower growing core surgery space we have begun refreshing our open stapling portfolio by applying the advanced stapling technologies that have transformed minimally invasive surgery to open procedures. This year we expect to launch the very first product as part of this refresh. Echelon Circular Powered Stapler which has been shown to reduce leaks at the staple line by 61% in bench testing as compared to the competition.
Second, we are driving the first systematic approach to bleeding management to improve the use of adjunctive hemostats in the operating room and optimize surgical outcomes and reduce costs. We are the only medical device company that can provide both primary and adjunctive hemostats that will help surgeons stop bleeding. We are expanding our category leadership in biosurgery with our unparalleled mix of category insights evidence the innovation that were bringing including the newest addition to our biosurgery portfolio SURGICEL powder.
And third, we are setting the standard of care in wound closure which we believe only Ethicon can truly provide. As you know, we have unrivaled leadership in wound closure. Seven out of 10 surgeons globally use Ethicon sutures every single day. At our Ethicon antibacterial sutures are the only triclosan coated sutures available worldwide. With triclosan coated sutures now being recommended by the WHO, the CDC for the prevention of surgical site infections. We are uniquely positioned to ensure surgeons have the right tools to improve outcomes.
By combining the comprehensive portfolio of antibacterial sutures and our DERMABOND PRINEO technology we are reducing surgical site infections, very important in areas like total knee procedures let's now turn to minimally invasive surgery where our innovation is truly addressing a lot of unmet needs. With the acquisition of mega dying last year and our recent energy launches, including Harmonic HD 1000 I and our sustainable reprocess solutions, the Ethicon energy platform has returned to global share growth and delivering best in class products across all energy modalities.
Secondly, are advanced stapling technology and exceptional power devices are associated with delivering quantifiable better outcomes, very, very important in this cost constrain environment, including reducing hemostasis complications and significantly reducing total surgical cost and bariatric and thoracic surgeries.
These unique technologies and evidence have secured our leadership position in laparoscopic stapling. And third, growth is also coming from our new technologies such as LINX a novel minimally invasive solution designed to controlled gastroesophageal reflux disease or better known as GERD. So maybe in this room out of the 150 or so, or about 30 to 35 were suffering from GERD, a very important disease.
Contingent growth from clinical evidence and the extending reimbursement coverage and global expansion is key to making LINX the new standard of care in GERD procedures. Let's now talk about robotics and I'm pretty sure all of you are excited to hear about our robotics program. While open and laparoscopic surgery have evolved we see robotic surgery within the early stage or the bigger S-curve as shown on the screen.
That intersection point that's shown, we are committed to addressing the current limitations to robotic surgery, such as access and reach, footprint and cost, workflow and advanced instrumentation. I'm pretty sure all of you who cover the robotic space have heard those limitations. And we're not stopping there. We intend to transform robotic surgery into the digital surgery.
We are architecting to pave the way for the exciting future of digital surgery. If I only have one analogy for you, I would say it's like going from the mainframe computer to mobile digital devices. So we're going to from simply enabling surgical jobs to building an intelligent connected operating room environment.
We are poised to disrupt the fast-growing robotics market. The Verb platform represents a true quantum leap in surgery and we have approach robotics in a very different and novel way. Capitalizing on the unique strengths of Johnson & Johnson of Alphabet and Verb we are designing a best in class differentiated launch and we are on track to be in market by 2020.
We have received resounding validation of our value proposition from many surgeons and non-clinical stakeholders all over the world. You will hear some of the feedback as Peter delivers his talk. And you will hear just how excited these surgeons are with the testimonials that will be presented later on. We are absolutely pleased with our progress and have begun engaging J&J commercial, professional education, supply chain, information technology and digital capabilities that Sandy just talked about to deliver a best in class M2M and experience at launch.
We have 130-year-legacy of shaping the future of surgery. As we've done in open and minimally invasive surgery, we intend to prevail as the market leader in digital surgery and accelerate our growth in 2020. We are eager to give you a glimpse of what we're working on and in just a few minutes Peter and Euan will share more about exciting work that we're doing in digital surgery.
Now let's look at creating the next frontier of surgery. By this we mean emerging technologies that are meant or in some places replace and create new markets and segments. Thermal ablation is an important emerging technology. Our recent acquisition of NEUWAVE which has proprietary precision controlled ablation probes that produce larger and more predictable and more consistent ablations, new ways ablation confirmation software which we just launched recently helps physicians identify ablation targets and for the very first time allows real-time confirmation of the probe placement and procedural tactical success including margin measurement.
In addition the NEUWAVE flexible microwave ablation system is the only FDA cleared flexible microwave ablation probe. Throughout the next five years we expect NEUWAVE to grow two to three times faster than the market.
We also have access to new and exciting technology through our collaborations and our investments. You may just have heard yesterday fresh out of the wires that Auris Health announced a co-development and commercialization agreement with Ethicon and our NEUWAVE team especially our NEUWAVE flexible ablation system. This is an exciting collaboration with the goal of enabling robotic, bronchoscopic ablation of lesions in the lung.
Bronchoscopes as many of you know provide real-time visualization of airways of the lung for the purpose of diagnosing and treating lung disease. We will work with Auris to integrate our NEUWAVE flexible ablation system with our Monarch platform, the first FDA cleared robotic platform for diagnostic and therapeutic bronchoscopic procedures. Together, we are well-positioned to design innovation to diagnose and treat hard-to-reach lung lesions with more precision than ever before.
We also made an investment in RefleXion Medical which combines the power of biologic imaging and radiotherapy to treat both primary and metastatic cancer. And we also are developing advanced imaging modalities designed to provide sensory augmentation to allow surgeons to identify critical structures and fully viewed extent of the disease. We believe this will facilitate better surgical planning and execution and eventually improved surgical outcomes. These are all exciting opportunities that truly demonstrate the next frontier in surgery where we intend to lead and drive growth.
And lastly, we are focused on delivering solutions that maximize customer value and ultimately benefit the patient. Let me share with you a few examples. By utilizing the supply change optimization solution offered through CareAdvantage Intermountain Healthcare which is one of the largest health systems in the U.S. experience superior supply chain improvements.
As a result and we're very proud of this, Johnson & Johnson Medical Devices was presented with the Intermountain Health 2017 supply chain excellence award. Because of this great work we are seen as an important strategic partner and we've been able to grow our business with this major health system. This is one of many examples of how we are engaging customers in very different ways to drive growth and ultimately realize better patient care. Next, evidence and you'll be seeing a lot of that in our booth.
As an organization, we are committed to using clinical and real world evidence to demonstrate that our devices our innovation do in fact make a difference in clinical and economic outcomes. We have some of the strongest in Advanced Stapling and in wound closure.
And finally, I'll briefly echo Sandy's commentary around training with the creation of the omnichannel very similar to what consumers doing, apply the training and education where we are meeting our customers wherever they are. The combination of live in digital training conducted through the J&J Institute enabled Ethicon to educate about 158,000 healthcare professionals globally in 2017.
The recent acquisition of C-SATS allows us to deepen our engagement with customers and healthcare systems through our leadership in professional education. We are the undisputed leader in open surgery and also minimally invasive surgery. I expect nothing less as we aim to disrupt the robotic space with our novel digital surgery approach and as we enter new modalities and create the new frontier of surgery.
I want to underscore my confidence in our ability to execute on our initiatives and to capitalize on the significant market opportunity and drive sustainable value. In short, we are accelerating sequential growth. We are increasing our global reach and important to touch those patients without access to good surgical care and continue our legacy of shaping the future of surgery.
I know you will all agree that this is an exciting time to be in Ethicon and Johnson & Johnson medical devices. Thank you so much and is now my pleasure to our welcome on stage our partners in R&D, Peter Shen, and Euan Thomson who will talk more about our innovation. Thank you.
Good morning, good morning, and let's talk about innovations. Thank you, Michael. I'm Peter Shen and together with my colleagues Euan Thomson sitting there and who will co-lead on research and development for Johnson & Johnson medical devices.
While I lead the R&D team, for the surgery and interventional solutions business, Euan leads R&D for our orthopedics and digital technology for the in-time medical devices. We and more than 3500 talented R&D associates know that gross depends on our ability to bring innovative product and solutions to surgeons and their patients and today we were provided an overview of our innovation pipeline and also highlight our work in the development of the state-of-the- art digital surgery technologists. And we believe we are a reinvent medical devices industry. And then also fundamentally change of the healthcare as we noted today. This is our pipeline for interventional solutions, our surgery, orthopedics and our health.
I hope that you see it as a pretty amazing innovation pipeline and we are confident we're going to transform patient care through innovation into the future. As Sandy mentioned, we had a stronger innovation year in 2017 with a renewed focus on launch excellence. We expect to continue this strong launch cadence into the future.
We’re on track to launch 15 to 20 new products this year, 20 to 25 in 2019, next year and in our pipeline we have 40 to 50 planned launches for 2020 and beyond excluding acquisitions. So in our interventional solutions pipeline, our team is going to continue to advance the science and technology in our electrophysiology platform and invest aggressively in our neurovascular innovation for stroke treatments.
In our surgery pipeline, our team continued to innovate the next generation haemostats for challenging bleeding management and also making our surgical devices smart, advance our development in digital surgery. In orthopedics pipeline, our team is transforming the orthopedics industry through technologies such as 3D printing, sensors and the digital technologies. And in our eye health pipeline which I spent last five years in that business, our team expanding our market leading innovation in contact lens, now broadening into broad eye health innovation, we’re truly excited.
As you can see we have a robust pipeline of meaningful innovation that we believe will improve clinical outcomes for increase the patient, customer and the consumer satisfaction. Johnson & Johnson Medical Devices innovation pipeline from 2018 and beyond excluding acquisitions is expected to drive close to $7 billion in new product sales in 2022.
This is a reflection of more than 20% increase in R&D productivity. So this you can see that would take hours to cover all the products, so today you and I were going to provide just some examples for you. I think one of the Johnson & Johnson’s most distinctive features and one of our greatest advantage is that we are truly agnostic to the source of great innovation.
We see to the best ideas and technologies wherever they are. In addition to our internal innovation efforts, we look at external innovation ecosystem to enrich our portfolio, add new capabilities and again early access to cutting edge innovation.
As Sandy mentioned, last year we invested more than $5 billion in acquisition and a strategic partnership with over 30 transactions in 2017 alone. And also last year, we opened the Center for Device Innovation at Texas Medical Center in Houston creating a brand new way to develop a breakthrough medical devices for close collaboration with early stage innovators and the physicians.
As Michael shared, how we intend to disrupt the robotics market with our Verb Surgical platform in partnership with Verily. We believe this is possible because of our deep understanding of the market needs and we’re bringing new benefits to customers across the globe, as the largest surgery business in the world and with our unique smaller footprint, more flexible design than system on the markets we aim to drive greater global access to hospital operating rooms.
We are also working to transform the learning process using virtual reality, personalized the training based on the individual user experiences and integrated the best practice by design. Our platform is designed to deliver a better user experience with a unique console and the connection through an open design principle to allow the surgeon to work with entire operating room team.
We treat a patient access and the workflow optimization is significant unmet needs. Our team is working to optimize the technology through holistic solution to really raise the bar. Besides that, our system is being designed to provide multi-quadrant access to enable broader range of surgical procedures beyond the prostate surgery to colon, gastric, thoracic surgeries.
Finally, with our proven capability in advanced instruments in combination with 3D HD visualization, our system is being designed with aim of increasing surgical efficiency and the confidence across surgical procedures. We believe this is going to be a highly differentiated platform with the design that is intended to create a new category of digital surgery.
Here is a little bit more information on elements of our platform, we have in development and surgeons who have used the latest prototype are saying. Please load the video.
You can see our surgeon customers are truly excited, I hope you are too. So the question then where are we? So what do you see is just a small glimpse of the overwhelming positive response that we have been receiving from surgeons. Our team is very busy achieving project milestones and we have made built multiple working prototypes.
And our team is conducting procedure development in preclinical settings and also have had a multiple pre-submission meetings with the Global Regulatory Agencies. As Michael mentioned, we’re scaling our capabilities in commercial, service, supply chain and education to support our global launch. Our plan is to commercialize the Verb platform in 2020. We believe the Verb platform will redefine how surgery is performed the same way we redefined laparoscopic surgery more than 20 years ago. Our Verb Surgical platform is the part of a much bigger vision for digital surgery.
I'd like to hand this over to Euan to update you on our orthopedics robotics strategy and also share our broad digital surgery vision. Thank you.
Thank you, Peter. And I think I'm the first one to say good afternoon. I'd like to start by bringing in an external perspective. Here is Dr. Charles DeCook an orthopedic surgeon sharing some of his thoughts on the real needs of surgeons.
So as you heard from Dr. DeCook, surgeons are craving automation in orthopedics, they need tools that are going to make them faster, more precise and more efficient. Healthcare providers and surgeons are shifting from volume to value based healthcare. They need technologies and solutions tailored to each patient and improve outcomes, enhance patient satisfaction, minimize variability in patient care and reduce costs and that's exactly what we've been working on.
So I’ll start by describing the Orthotaxy system, as Ciro mentioned orthopedic and robotic surgery is a huge area of opportunity to standardize and amplify surgeons abilities, improve clinical outcomes and drive overall patient satisfaction. With the existing orthopedics robots present challenges, they're large disruptive to workflow and really complicated for the surgeon to use.
The training requirement is considerable, they often require dedicated technical support in the operating room for every procedure and they generally slow procedures down without significantly improving accuracy.
As I hope you've had the chance to see in the demo area, the Orthotaxy system is designed to be radically different, so it’s just a different kind of technology, it's so compact that it could be picked up and held by the surgeon but once it's located in the operating field it becomes a self guiding autonomous system that aims to deliver the same optimized results regardless of surgeon's skill set or experience and it's extremely easy to use.
The autonomous nature of the guidance system removes a lot of the complexity associated with other robotic systems. The robot literally guides a surgeon and helps him to achieve the best possible result. And the small size and convenience of the system means that the interruption to work flow is minimal and the time of a procedure is reduced rather than increased as with other robotic systems.
So we see great potential in the Orthotaxy technology. We have an aggressive schedule for development of the system and we're targeting commercialization in 2020. We believe it will be an orthopedic robotic solution that delivers improved patient outcomes in knees, spine and hips while adding value by standardizing procedures and reducing OR times.
But the Orthotaxy system is not the only way we're driving efficiency in surgery. We're going beyond robotics. For example, with the help of SPI’s surgical procedure manager that we recently acquired, best in class surgical standards can be provided across the whole surgical team. This is achieved through use of digital checklists that guide every team member through a procedure. This not only leads to better operating room efficiency, but also to a more consistent outcome and a better patient experience.
And as Ciro mentioned, we've acquired Medical Enterprises the developer of the ME Impactor System. This is designed to replace the conventional handheld mallet used to drive implants into bone, it's a handheld battery powered device that automates bone preparation implant assembly and positioning.
The impactor also speeds up the implant process. If you've not already had an opportunity you can stop by to see the ME Impactor in action. So as an example of what we can achieve when we combine SPI’s automation software, the Orthotaxy robotic solution with the impact of technology, we estimate that we can reduce the 90-minute knee procedure by approximately 30% clearly better for the patient while providing the potential for huge value to our customers and a strong reason to select our implants.
System based automation and standardization are the heart of our entire medical devices digital surgery strategy. The way we're embracing digital solutions will have significant impact on outcomes. We're leveraging our knowledge experience and breadth to disrupt and improve patient and physician experiences. We're developing intelligent personalized products and solutions that guide the physician to improve best medical practice and the patient to optimal recovery redefining success following surgery.
We're building a digital ecosystem where technologies that enhance surgical performance and help guide patients through to full recovery are connected pre-intra and post operatively. We expect this connected environment to enable us to gather insights about key drivers of outcomes.
It guides us in new ways to engage with customers through services and solutions that bring value to patients, providers and payers. To bring that to life, I'm going to use another orthopedics example, but the strategy I’ll describe is targeted at all of the surgical procedures that we support. Our approach is to use a string of technologies to engage across the continuum of care.
These technologies are designed to directly engage with patients using apps and wearables to assess and prepare patients for surgery and guide them through rehabilitation after surgery, they engage with the surgeon in the operating room and aim to ensure best practice.
In this example, our commercially available health partner system is used as the patient engagement platform. Our also commercially available TRUMATCH software planning system is used to prepare a personalized surgical plan. We plan for this information to be automatically transferred to the Orthotaxy robotic system. They will be designed to seamlessly move to the correct cutting angles for that patient.
Meanwhile SPI guides the surgeon and the surgical team through the recommended implant procedure and when ME Impactor is available for knee procedures, we'll be adding further automation and time reduction to this process.
recently acquired digital education system. And the health partner in the platform then engages again with the patient to foster adherence to the prescribed rehabilitation service. It is this strategy to engage beyond robotics that defines digital surgery. We're building an ecosystem of connected digital solutions that guide the surgeon, their team, and the patient toward efficient practice and optimized outcomes.
So today, you've heard about the progress we've made with our innovation agenda in the past 24 months, you've had visibility of our pipeline and learned about our vision for digital surgery. But before you go, I'd like to highlight three main takeaway points.
First, we have increased our launch cadence and aim to continue that path moving forward fueling our growth and revenue across all our businesses. Then the innovation we've brought and will bring to market is expected to drive meaningful clinical and patient value. Also our vision of digital surgery goes beyond robotics to the entire continuum of care and has the potential to change healthcare as we know it.
Finally, we are confident in our plans to Johnson & Johnson Medical Devices to continue to lead the way in innovation that improves patient outcomes, fuels our growth, creates new markets and reduces healthcare costs through comprehensive and transformative innovation.
Thank you, Euan and thank you Peter, very exciting stuff and I hope you take the next couple of minutes as we break for lunch to get a chance and look at some of the digital solutions that we have in surgery as well as other products that have been referenced here throughout the course of the day. We will return at 1’o clock and there will be review of our eye health business. Thank you.
So, good afternoon. Two years ago I was here talking a bit about our ACUVUE brand and some of our growth strategies to grow the contact lens category. And as you can see in the video, I'm very pleased to share that we are evolving into an Eye Health company with a broad array of solutions really to meet a patient’s life time of Eye Health needs. So you see we had vision and think sight is precious. It's our most precious sight and it matters 80% of what we learn we learn through our eyes and actually set sight is the sense that people fear losing most.
They fear losing it more than losing their memory, losing a limb and even HIV. Now the good news is that 80% of serious vision loss is treatable if discovered early. So there's oodles of unmet need in Eye Health and this is what drives us every day. Let me reacquaint you with the Eye Health category. It's large and it's growing. You'll see that it's about an $80 billion category comprised of medical devices, pharmaceuticals and consumer goods it's growing north of 5%, yet it still has woefully low penetration rates. These are the four areas in which we compete. I'll refresh our memory on cataract, so on a $5 billion category growing 4%.
Cataract surgery is the most commonly performed surgery done around the world and it's the number one cause of preventable blindness. I’ll then indirect your attention to contact lens an area that we command market leadership, $8 billion category growing 5%, but once again very low penetration rates, under 10% globally.
Another treatment for refractive is refractive surgery, Lasik surgery we actually enjoy market leadership it's around a $700 million business growing in low single digits very strong outcomes. And then a growing segment is in dry eye, it's around a $4 billion segment growing 6% around 350 million people around the world experience dry eye. And for those if you're one of them it feels like you have sand in your eyes on a 24/7 basis. So it's predominantly treated with pharmaceuticals, but some of the newer technologies and Med Tech are on their way.
So let me share with you our grounding in this market this $80 billion market of Eye Health. We enjoy a very strong foundation in contact lens where we have earned market leadership over 30 years, really fueled by the iconic nature of ACUVUE. We acquired three different companies in 2017. The first and the largest was, what was commonly referred to as Abbott Medical Optics and that gave us a very strong foundation in surgical ophthalmology. We are the number two player in cataract surgery and we're number one in Lasik surgery.
We then acquired a small startup company called TearScience and they are the first FDA cleared imaging and treatment for meibomian gland dysfunction which is actually the leading cause of dry eye. And then we bolstered our very strong ever changing ACUVUE experience platform which has connected commerce with the acquisition of Sightbox which is a startup company in Portland, Oregon. You could probably call it an Eye Health concierge service that really helps people with their eye care needs on their terms. And collectively we are now Johnson & Johnson Vision backed by the strong capabilities, the enterprise capabilities of J&J.
I'm very pleased to share that in our first year together as Johnson & Johnson Vision we have delivered. We delivered in 2017 above market performance a 6.5% revenue growth surpassing $4.3 billion, very nice balance growth between our contact lens portfolio which achieved its 11th consecutive quarter of above market performance through balanced growth in developed markets like the U.S. and Germany as well as strong double digit growth in emerging markets in our contact lens.
And I am pleased to share in our first year of surgical vision, we achieved 10% growth year-over-year and our cataract business achieved a very important milestone. Alex shared that chart around the billion dollar platforms what cataract is now a member of the billion dollar club surpassing a billion dollars grew 13% in 2017.
So let me give you a little bit of a peek behind the curtain. Many great companies get humbled and you saw us last several years stand before you around contact lens and how we had lost our way, so how did we turn that around. And really, I’ll start to share with this starts with the brand, ACUVUE is endorsed by doctors, trusted by doctors and be loved by consumers over 50 million consumers rely on content on ACUVUE every year.
I mentioned two years ago around having a balanced portfolio on the core business on our sphere usable and our sphere dearly disposables while at the same time writing some of those fast growing adjacencies. Those adjacencies are areas like presbyopia or areas like a astigmatism where your eyeball is like a football in the shape of a football versus a basket ball or areas like beauty where people are looking for refractive but also a little bit of cosmetic.
We'll those businesses, those adjacencies have been delivering double digit growth for our portfolio and now represent more than 30% of our revenue. And clearly innovation has had a say. We've had seven new product launches since 2015, you'll hear we'll have two in the next five years and all of these launches have had very strong market acceptance both by doctors as well as with patients.
So one of our largest additions last year was the Abbott Medical Optics acquisition and as I mentioned it gave us a very strong footprint in surgical ophthalmology. We gained very strong material science and optical engineering capability. We gained a world-class intraocular lens platform really powered through the brand of TECNIS Symfony for extended depth of focus.
TECNIS Symfony was the fastest growing premium intraocular lens in the category last year. It really helped us gotten number one positions in market share whether it be in Canada or the U.K. or Germany or Korea. Importantly, we welcomed 5,000 colleagues to our franchise in 37 different countries and I can tell you it was large, it was super complicated but with 14 months into this and we've had very minimal customer disruption.
And our value capture efforts are tracking well above our deal model expectations. So one of the newest additions is this company TearScience for dry eye you may have experienced it in the booth, and as I mentioned they were the first FDA cleared for imaging and treatment of meibomian gland dysfunction which is the leading cause of dry eye.
So the thing is, all of us are born with a 120 different meibomian glands. We have 30 on each eyelid. Now, the primary job of your meibomian gland is to really secrete oil to keep your eyes well lubricated and when it's working it feels pretty darn good, but when those things get clogged up and can actually atrophy they actually lose functionality and that's when you start to feel sometimes that you have seen in your eye.
I actually partaked in this procedure about six months ago. It's a minimally invasive procedure it's about 12 minutes where we apply heat and pressure to unclog the glands. It takes a couple weeks. Evidently meibomian glands have muscle memory, but after it kicks in, I'm six months and you land on a plane after eight o'clock at night, you feel pretty good.
The neat thing about this is both ophthalmologists as well as optometrists are using this novel technology to treat patients and as this is a core customer base for us. Interestingly it shows the synergistic effect because half of all cataracts create patients manifest show up with dry eye and it allows folks who are in contact lenses many of you here today to actually wear your lenses for four hours more.
Two years ago I spoke about the importance really of evolving our business model and moving with the market to really deliver a very modern customer experience. A modern Eye Health experience and we heard a lot about today about the seismic shifts in technology whether they be an AI or the plethora of data that's available and how affordable it is a storage and the power of computing right now and the billions of folks who are now connected.
We harnessed a lot of those technological advancements and are now using this in our first use use case in contact lenses to really modernize this Eye Health experience, you'll see examples of here of JNJ Vision Pro which is really a one stop shopping for patient education, for modern Michael del Prado shared modern digital training as well as one stop shopping for the doctor.
We also had a pilot case in Korea as an example to start to have a subscription business for ACUVUE through the launch of CRM program called MyACUVUE. We have over 3 million members enrolled in MyACUVUE. In fact it was the fastest growing app, it was the number one most downloaded health and fitness app more than 90 in Korea and again we're just getting started. As I mentioned 50 million people already. Clearly as what Jorge mentioned earlier is that e-commerce is how people want to shop, so we will service doctors wherever they practice care and we will service consumers wherever they prefer to shop, clearly e-commerce is a growth engine for us, it's been growing double digit, it grew 15%. I expect that trend to continue into 2018 and beyond.
So we have a very bold ambition to be a world leader in Eye Health. Now to do that, we have to continue to outperform in the market. So, the four key strategies that we're going to continue to pay attention to, the first is having a differentiated portfolio and making sure we have the right balance on our core as we perform some of those faster going adjacencies.
The second as you heard from Peter in unit it really is about accessing the world's best labs and venture companies actually they're significant investment in ophthalmology in the venture community and making sure we continue that very strong cadence of innovation going forward. It's about moving with the market and evolving our model to deliver a better customer experience. Obviously, we had have to have commercial execution and supply chain execution and having a blend of a keen focus on execution today as we really build for the future.
And of course we can do anything without people and it's about making sure that we have access to the top seasoned world class, highly diverse leaders who represent our diverse patient population and who are really united into this noble cause of protecting and enhancing sight. So I am pleased to introduce a colleague of mine, she does have some big shoes to fill we heard a little bit about Peter and that is Dr. Xiao-Yu Song, Dr. Xiao-Yu is a Ph D. and an M.D. Xiao-Yu will be taking the reins of the Vision care R&D. Team.
Xiao-Yu spent her background, her early career in immunology some time with the NIH. She actually joined Johnson & Johnson through our center core franchise in immunology and then spent time in our surgical business that Michael del Prado was sharing earlier really working in some of our drug device combinations, so stay tuned on that. Let me welcome Xiao-Yu to the stage.
Thank you, Ashley. I'm very pleased to be here today to share with you our approach to innovation. As you may remember what Peter shared two years ago that we believe innovation is a company sport, creating, developing and commercializing new novel innovation product is mine and our team's passion.
It is the lifeblood of our business and it will continue to be a key driver of growth for us. We aim to serve our patients all along their care continuing, whether it be slowing down the progression of High myopia which is a really big problem in Asia right now or to beauty needs to vision correction needs to dry eye to Presbyopia to refractive cataract surgery.
I eventually took all coma and age related macular degeneration. To do all of that, we have created a unique repeatable innovation model. The draws on deep customer insight understanding of unmet patients needs, strong internal and external R&D capabilities and technologies and the power of our iconic brands such as ACUVUE and Tecnis.
Let’s turn our attention to surgical business. We have five keeper one's driving acceleration. As Ashley mentioned earlier our cataract business grew significantly in 2017 with strong momentum driven by our IOL portfolio. We have a good track record innovating in all three segments, Monofocal, TORIC, and Presbyopic correcting IOLs. And we are well positioned to continue this trend with innovation programs in all these spaces.
On their developed share in facoemulsificacion is an obvious opportunity and we have innovation programs in this space. We're collaborating strongly with our [indiscernible] energy colleagues and others to leapfrog computation with new equipment. We're also focused on dry eye and they spend in our portfolio because that category is growing especially in today's always on mock [indiscernible] life. Our use of additional devices, for example I watch iPhone, iPad and a laptop computer all working at the same time, it is terrible for our eyes. Do you know that humans blink about 18 times a minute. Guess, what that reduces to when you're looking at the digital device stream for without the natural clean emotion cross the ocular surface, we get into trouble.
So our team is on the quest to look for ways to help solve the issue in order to help people all around the world who suffer from ocular surface diseases. Now let's look at contact lenses where we have committed to launch two new products each year, every year through 2022. Our pipeline fills based business with new family members and it also includes some innovation that will redefine the category beyond vision correction.
In fact we just filed regulatory application in Japan for very first combination contact lenses with medicine. It is a drug alluding contact lens to help patients with itchy eyes due to ocular allergies and it gives me Goosebumps when I say very first combination contact lenses with medicine, not only because it is that's a feel good to be the first but more importantly it's just awesome to feel the power when you bring the different expertise and skill sets exist in different parts of Johnson & Johnson together and innovating on first of its kind new product.
To serve our Presbyopia patients we are developing a self powered smart lens that will dynamically change focus for people with Presbyopia, so they don't need to their arms all the way in order to read a small font size under iPhone. We have overcome many technical hurdles including on board battery technologies, we have more 150 patterns granted in the space and additional 120 patent applications.
We are working very closely with the FDA on the regulatory possibly for this novel inhalation and you may have heard or seen or try and solve the problem out there, we’re meeting the needs of our patients with light sensitivity with our very first light emitting contact lens. This contact lens contains photo chromic that darkens when they dispose of bright light. The product is FDA cleared and we're planning to launch in first half 2019.
Let me show you a brief video to tell you a bit more about our ACUVUE OASYS with transitions like intelligent technology. Please roll the video. Thank you.
So pretty cool, you can check it out we have it in our both, it’s coming soon, early 2019 in the U.S. So J&J clearly is a key source of competitive advantage for us for J&J Vision and let me just share a little bit of it about our supply chain as one example. We have a fully integrated, fully automated manufacturing process which produces over 5 billion lenses per year.
Now clearly this enables us to have superior cost of goods, but what it also enables us is to be able to scale innovation fast and an example of that is within 2.5 years we were able to launch our first in time, now it's the fastest growing OASYS one day with its partner for Astigmatism around the world in less than 2.5 years and it's garnered over $250 million in revenue.
It's also about accessing some of Johnson & Johnson's signature capabilities. You heard Sandy earlier talking about professional education at our core, it's part of our legacy, but we're really working to modernize that experience as well using digital. Well imagine how we can tap into that to really train the next generation of cataract surgeons around the world or what Jorge was mentioning around digital at its core and all of the new tools that help us engage consumers and a very fresh and modern and differentiate way like the use of scanner.
As I mentioned ACUVUE is Johnson & Johnson's largest consumer facing brand. So we take full advantage of that capability or it's what Peter Shen was mentioning around energy and the use of ultrasound we were some one of the godfathers of ultrasound.
We have our teams collaborating with our energy team to bring that into the OR suite and cataract really for next generation facoemulsificacion, so these are just a few examples around how I think really Johnson & Johnson brings differentiated capability. We have machine learning folks in R&D and in quality who've been able to use machine learning and actually take our development for prototyping a beauty contact lens and reduce it by 34 weeks and what used to take three days to quality control as a test method our beauty contact lens is now done in less than one hour.
I don't know about that, but that's when Sandy talks about the science and the technology coming together, that's really what we're aiming to achieve. So let me be clear, we have a very bold ambition to be a world leader in Eye Health and I expect us to continue to outperform the market again eleven quarters in contact lens a good year underneath our belt in surgery and many more years to come. I expect us to continue to evolve our business model really to bring consumer and patient to light, to bring a very differentiated customer experience. I expect us to bring an innovation along the lifetime of patients Eye Health needs. And absolutely we intend fully to take advantage of the very best that J&J has available.
So why don't I summarize a couple key themes that we talked about today we clearly discussed the differentiation in Johnson & Johnson and we spoke about the strategic choice to be broad based in Eye Health and in healthcare, and we talked about the differential capabilities that J&J has. I mentioned Vision accessed a lot of those differentiated capabilities to turn around a large multibillion dollar platform.
So clearly you saw that we enjoy market leadership in many platforms but there are a few platforms that we have been underperforming and clearly we're dissatisfied. I think you heard from many folks were on it, but I can tell you know I've been with J&J for 22 years and I know what J&J looks like on our very best day and it looks like when we are absolutely relentlessly focused on our customer and we are obsessed with innovation and we are constantly evolving our business model ahead of the curve.
And most importantly, we are maniacal on execution. And you know why we do all of this, why all of the folks that you heard today why we do all this is because we know patients are waiting. We know countless millions and millions of patients are counting on us and this is what drives us and this is our purpose, so thank you for your time on Eye Health.
At this time, I’m going to welcome Joe Wolk and my colleagues from the MD to have a little bit of a Q&A panel. Thank you.
Great, so as we did with this morning’s panel you will have two options to ask a question, simply raise your hand and we ask that you wait for a microphone, so the folks on the webcast can follow along and then you can also submit a question through our event app.
Thank you. Larry Biegelsen, Well Fargo. One for Ashley, one for Ciro, Ashley you said you expect to be a world leader in eye health, but you have a few gaps in your Vision Care portfolio such as glaucoma devices and back of the eye devices. So my question is, how attractive are those spaces to you?
Yes, thanks for the quarter Larry. I mean we look for areas obviously with unmet need. We look for areas that we can scale and we look for areas that we can really improve the patient outcome. So as I mentioned we want to really take care of the eye health needs throughout their lifetime. Glaucoma is clearly an attractive space, back of the eyes clearly an attractive space. We're going to look for areas that we can have a differentiated capability. I mentioned as an example, our access into our pharmaceutical company and how we tapped into that collaboration to be launching soon within the next 24 months the first drug eluting contract lens is one example.
Thanks and Ciro, you expect to be above market growth in spine and knees in 2020, but both businesses take a little bit of a step back in the first quarter in terms of the growth rate. So can you talk about the pathway to that above market growth. Should we expect a meaningful improvement in 2018 in both businesses? Thanks.
Yes, thanks Larry. I think what is important is, you know, while we have really worked very hard though is to increase the cadence of lounges by really talking to customers and finding out what the clinical needs are that we need to solve. And as we increased the cadence of lounges but also stabilize our go to market models, we feel very confident that we will stabilize the business in 2018 and 2019 and start growing above market in 2020.
Thank you, Joanne Wuensch from BMO Capital Markets. For clarification, your Verb and Orthotaxy platforms, I mean you put up there 2020 for market introduction. Is that us, worldwide? And the second half of that question is do we think of that as the robotic launch or is there a stage presence ahead of that?
Yes, thanks for asking those questions around. Yes 2020 yes we're going to be in the major market globally. So as Peter shared we're now in conversations with both the FDA and the noted volume bodies of Europe and we're also engaging the regulatory authorities of the major markets in Asia. So we now understand what it will take from a clinical perspective and regulatory perspective, to get there and we will be in one of those markets by 2020. And probably Ciro you can address what is the Orthotaxy.
Yes so the Orthotaxy we expect to be in the market by 2020 and we will focus on launching the products in the major markets but we will focus on the U.S. where we feel there is the biggest need at the moment.
And the second half of that question is there a "big" or you know robotic launch or how do we think about staging between now and then?
What we're building as I said we're building complete robotic systems for both orthopedics and us. However, we're also building a digital ecosystem as Sandy spoke about, that would help connect our different digital systems and make it easier and make the customer experience more consistent and that's what we're playing for and we will leverage those capabilities not only in orthotaxy or Verb, but the other digital offerings are changing.
Yes Joanne and let me add a little bit to that which is many of the things that you had mentioned, there are pieces of this puzzle and Michael and Ciro also talked about those are actually already commercialized products that are in the market. So as we think about the launch of the robotic solutions in both orthopedics and in surgery, many of these other things that will connect to those robotic solutions already are in the market and we're launching and scaling them and connecting them. So once the robots are launched, our goal and plan is that this whole thing will connect together.
And then just as a – my final question, big picture I think investors are worried that Johnson & Johnson is minimizing medical technology looking for you to do some form of more dramatic M&A. How would you respond to that?
So I would hope that by the end of the day today it will be very clear to all of you that we are absolutely not minimizing medical devices or the importance of this part of our business in J&J but also for healthcare systems around the world. As you remember, I talked about we did 30 transactions last year with $5 billion.
We're actually on pace to have a very similar cadence in 2018. We've done a handful already both acquisitions and investments and we will continue to always - as we always do across all of the J&J businesses look at what's the right thing to do, whether it's a small, medium or large transaction, it's got to make sense for us to do it.
It's got to be accretive to the business. It has to make sense for us to own that business, but clearly it's got to actually drive shareholder value. So we're sort of agnostic about size, but we've clearly demonstrated in this business that doing a lot of smaller tuck in complementary acquisitions has been very valuable to this business and we'll keep doing that and look at small, medium and large things Joanne.
Thanks Joe, Geoff Meacham from Barclays. So I get the focus on connectivity and surgery and both ortho and in Vision. Just in terms of new products and innovation, but how do you guys think you could further implement technology in other segments across the portfolio to drive differentiation and how would you rate your internal capabilities and tech versus looking externally?
So I'll start and then I'll let my colleagues talk about that. So I think the way we think about it it's relevant all of our businesses, not just consumer and orthopedics. I think Michael talked about the importance of using technology to enable better surgical procedures, better conductivity and the management inside the OR.
We don’t talk about it that much, but if you think about our interventional portfolios, there's an intense amount of technology through navigation in imaging systems that happens for us to actually do the procedures that we do or support the procedures that are being done. So we - technology sort of permeates all of our businesses and it's a combination of our deep scientific expertise with the technology.
As it relates to your second question, maybe I'm a little bit biased here, but I would say that we believe that we have world-class technologists inside J&J and we are able to recruit world-class technologists in the company and that's something that we've been on a journey to do for the last five years, but we don't - just like every other aspect of innovation at J&J we don’t do this alone. We have partnerships with all of the big tech guys.
We have partnerships and small equity investments with lots of the smaller technology companies. So we're sort of agnostic of where it comes from and we figure out what we need to own and what makes sense for us to do and other things that we should do in partnership with other tech companies. I mean, a very small example, 3D printing, we have 50 strategic partnerships with 3D printing companies as an example because we believe we should do it with others to make it much more successful going forward.
So we feel like we're in a really good place as a healthcare company and probably a little bit ahead most of our peers as it relates to our knowledge of technology, but the breadth of our partnerships is what gives us that strength.
And just a followup and thanks for that Sandy, just when you look at the last segment in the eye and the innovation side, can you give a little bit more context for your drug combos with lenses? It seems like a pretty broad platform beyond just allergy?
Yes, so excellent, yes sure. Now I mentioned how you use background, but I think, but we look at kind of the unmet needs and I hope we do see a lot of combinations coming to solve some of those jobs to get done. And because of the poor compliance in medicines alone the combination of a drug delivery device can actually get better compliance and potentially better outcomes.
So one example is an allergy whereby versus just allergy drops or systemic, this is a locally applied antihistamine on your eye for eight hours and itch relief during the season when you need it, a daily disposable, a key reason why people fall out. But we clearly see application for that in areas like dry eye as an example, or other areas potentially even in glaucoma.
Good afternoon, Danielle Antalffy, Leerink Partners. This is another robot question, so both Michael and Ciro, I guess you talked about improving outcomes and reducing costs. And I was wondering what sort of evidence base you're going to build prior to commercialization to prove that.
Yes, so and that's why there's a big difference between robotics and digital surgery right? So robotics was really an extension of your human arm to be able to perform tasks that you could not do because of limited spaces. However, digital is all about capturing the information that goes on in the operating room take advantage of the preoperative information to be able to guide the procedure more precisely and be able to analyze information after the procedure and feed it back to make surgeons better who are they under best and within healthcare systems also improve that.
So obviously a launch there'll be limited clinical information; however, because of this digital ecosystem that we're building, our ability to capture information be able to analyze that the real world evidence immediately will be harnesses and will move very rapidly.
Yes, I think what I would like to add is when we talk to our customers they told us a couple of things in regards to robotics. First, of all they told us, listen we're going to have to do more procedures so the robotic system is going to have to be faster than current technology. The other thing they told me is, it has to be at the – we need to have better outcomes.
And last, but not least, we need to have a sense of benefit to cost. Now we believe that with Orthotaxy we can address those three key demands from our customers and we're starting to build you know technology but also evidence around our value proposition that we will share with you during our journey.
And just one quick followup to both of you, as far as initial indications go, is it - are you targeting one specific indication initially at 2020? Thanks.
Hi, thanks for taking the questions. So one, on the cardio side you guys have talked in the past a lot about structural heart as an area of growth, just your view on that market now in terms of the strategic opportunities and when could we see J&J entering that market?
And then I think as orthopedics really mentioned sales force attrition have been a challenge in the past, maybe just looking back what sort of drilled that attrition and what have you done to stabilize the situation?
So well, I will take the cardiovascular side there and definitely we are very interested in structural heart, we talked about it two years ago, last year, this year. We continue making investments in that area. We just participated in another round of REVIVE. The market is very attractive I think the [indiscernible] is definitely is going to come and will generate another episode of importance in that market so we stay very committed to that market.
Yes and in regards to sales force attrition which I mentioned specifically for spine, I would say two things. The first of all, every time we do a transformational restructuring the risks you know there is some turbulence. But I think more importantly you know if you have good cadence of innovation that will certainly first of all help with sales force attrition, but more importantly, entice all the good sales consultants to have a wish to come in and work for you as a company.
We feel very confident for example in spine where we have recently launched 10 new products in the last six months, that we have now filled the critical gaps in the portfolio and already seeing very much excitement around the sales force with the new innovation that we're bringing into the critical gaps that we have closes, so we feel very confident that moving forward we have the sales force attrition under control.
So, let me just add one last point to Ciro's comment. I think one of the greater early indicators of whether the market and the sales folks that work for competitors or ourselves how they're feeling about our portfolio and our future, we look at what we sort of call net trade meaning you now are we losing or winning more from our competition and that has flipped.
So we are now, more people are joining J&J from our competitors than we are losing to our competitors and medical devices and in particular on our sales forces and I think that's a really good early indicator about their confidence in our portfolio and our business going forward.
David Lewis, Morgan Stanley. Sandy, just first for you and then one followup for Shlomi. One of the themes we've seen in the last several years has been pruning medical device assets to get much more focused in MD business. Is it safe to say the pruning phase is over or could be taken from some of the big businesses you have or medium-size businesses that were not a focus today they are still candidates for further pruning to get focused?
So, what I would say to your question is, like all of our businesses and I think there was a question earlier to Jorge about that, we always look at what's the best optimization of our portfolio. There were certain businesses we didn't have enough time quite honestly today to share with you how those businesses are doing and we really wanted to focus on the four largest markets where we're making significant investments. So we will always look at our portfolio and what we want to do with it to make the right optimal choices, but as you know, the largest divestures of our portfolio have already occurred.
Then Shlomi, if you in the AF market growth rate I think you gave was a five-year projection of 11%, that market has actually accelerated here in last 18 to 24 months, so your guidance sort of implies that market kind of slows in the out years to kind of upper single digit. So I think about your pipeline Cabana and the impact of IORs [ph] and patch monitor having on your business it surprises me to think about this decelerating within three years kind of help me understand that 11% number in context to these drivers? Thank you.
Okay, first I don’t think it will decelerate. We'll see how the things will go over the world. We do see much more pressure at recent pricing in reimbursement in different regions around the world. I do believe that price pressure has continued to accelerate. And you are reaching an area in which you have some kind of ceiling in terms of capacity, so people - there is not enough EP physicians coming to the market in timely manner. This is why we are focusing so much about improving the efficiency of the procedure, so going from four hours to two hours from two hours potentially to one hour.
We do believe that once we're going to come with the new innovation into the market starting by the end of next year. The procedure that today takes roughly two hours, potentially will go down for sure one and a half potentially going down to in one hour, which means that you can double your capacity, which we as 46% of the share of the market definitely will improve the market, so my boss always tells me to under commit or over deliver, so we'll continue doing that.
Thanks. Two questions, one for the group and then one on robotics, so when you're sitting in the audience and you see 40 to 50 new products, the number is impressive, but then when you hear the word cementless and 3D printing and MIS and robotics, the competition has all that already and it seems like maybe you're just catching up.
So can you help us understand like what's in the portfolio that's really leapfrogging the competition because leapfrogging the competition that's what gets the surgeons excited, that's what gets your sales force excited and that's what allows you to grow faster than the market, so just point to us as to what's really game changing in that pipeline?
And then the quick one on robotics, can you confirm to us that the robot is - that the general surgery robot is bed mounted? Thanks.
So I'll try to give you some sense of it and then I'll let my colleagues answer this a little bit. So when we talk about robotics, I guess our view of it and maybe we haven't convinced you yet is it is a game changing definition of robotics in both orthopedics and in surgery. It's not a me too, and so I think that is what's going to make a significant difference and in many of our product categories in areas as we readily admitted there were portfolio gaps.
We had to fill those, we did a lot of that last year through acquisitions and product launches and now we are much more focused on bigger transformational innovation, some of which you heard actually from all of the folks sitting on this panel which they are really different and game changing things like ablation, like some of the work we're doing in Vision. The work we're doing in EP and even in our in orthopedics there's some new very different things that nobody else has in the marketplace. So…
Yes, maybe I will add a few things in our portfolio both in Biosense and in CERENOVUS, we'll start with Bioscience. First, we are the only company that can claim, claim is an understatement, the fluoroscopy use, utilizing our product is substantially less than anyone else. I mentioned five minutes, there are physicians today that using zero flow [ph], meaning they have no lead on themselves zero. It's important for them for a longevity of their life, obviously cancer and so, critically important for a patient, so we the only one and we continue moving in that direction. We're just going to launch Visigo as sheet that is visualized by the cardio [ph] system, again no need for flow at all.
Second we are coming with, hopefully you saw it in the booth over there, the Qdot, the Qdot Micro, emitting ablation high-power show duration. We are talking about 90 watts per second, so nobody is even close to that by MI. So talking about CERENOVUS, we're coming with them but first time [indiscernible] substantially better by 20% to 25% than any of our competition, all of that then more are leapfrogging in our mind, sort of what we're going to have and we're getting extremely good feedback from our customers. I can tell you customers are lining up to be the first to get these products and which is a great place to be.
Yes, I would just add, I think it was like two years ago, Peter Shen was talking about Vision and I think he shared with you all four transformational programs. Again, in addition to those I'll call them steady lifecycle management substantial two per year which we've been doing and three of those are progressing. So we are going to be launching the first light adapter contact lens within the next 12 months, within the next 24 months the first drug-eluting allergy lens, we have a patent state of 150 patents on our smart contact lens, another 100 patents are pending, so it is our intent absolutely start to lead and create some of these new categories.
Yes, I think for in regards to orthopedics, what I'm most excited about is first of all completing the portfolio which I don't think we need to underestimate how important that is, but I think I would journey from moving from the best influence into the industry to really focusing on better outcomes together with surgeons, together with institutions and combining all the technology and the knowledge we have, not only in orthopedics, but across medical devices in Johnson & Johnson, that's the part that excites me, and quite frankly when we talk to our surgeons, that gets the most excitement.
For example in hips, we're going to automate the last part of hip surgery. As you know, hip surgery has been done since 1940, the two critical steps that have been automated was the cutting of the femur head and the reaming of the acetabulum. Now we're going automate with the ME Impactor the last part of the surgery a tremendous excitement among orthopedic surgeons. So getting the best influence [ph] working with the surgeon community in the hospitals to getting now the best outcomes which is going to help everybody is really what excites me.
Yes, I'll respond to the first question first before responding to your specific question on robotics. Firstly, we need to do both right? So there's a lot of unmet needs that we need to continue to address within our current portfolio and sometimes the adoption of advanced technologies hinder, are hampered by the lack of evidence.
And by demonstrating that what we're producing, what we're delivering is really superior, just what you've seen in the booth with 40%, 60% reduction in various serious complications, it's important in terms of driving the adoptions of technology and hence focusing on evidence generation, filling our gaps is important.
You've also heard and many of you have seen our partnership now with Auris, very important partnership, some of you described it as a marriage made in heaven because they do have the leading robotically enabled bronchoscopic system and we do have the only therapeutic intervention tool that could be applied with their system.
So you could imagine that many of us avoid taking a scan of our lungs because if a lesion is discovered what do you do? Watchful waiting is the standard of care today. And this partnership really opens up this new segment which is not there today and we're very excited about that more to come.
On your second question, as you know for competitive reasons we will not discuss the specific embodiment of our system. We are filing more of the IP that you published in your report a lot of that is coming because we're at that stage of development that we're now publishing what we have we've got multiple embodiments and you'll see more to come.
But importantly, are we able to address the unmet needs that continue to persist in the current robotic system? Firstly, reach and access, very important multi quadrant reach being able to have the capability of reaching every part of the anatomy. We're going to deliver that. Footprint is a major impediment today because it's pretty large, right? And all operating rooms are largely what 300 square feet, and so we're going to address that.
Workflow, there's still a lot of clashing, there's a lot of positioning of members of the team because of the clashing and the movement of their arms. And lastly, advanced instrumentation because the magic moment is when an endocutter is fired or an energy device is fired and you've heard from customers that they're making compromises today because of the lack of availability of advanced instrumentation, we're going to deliver those as well.
Great, well I'd like to thank not only these leaders here on the panel, but the other three R&D leaders, which are you, Euan and Peter, for your presentations this morning as well as into this afternoon. I know it was informative for the group. I had a chance to speak with many during the break and they certainly appreciate your candor and your insights about our business moving forward, so thank you very much.
So as we set the stage and have Alex and Dominic make their way up here for our final panel of the day, I would just like to provide you with a reminder to complete the event survey. As Alex mentioned in his opening, we certainly value your feedback, not only to make events like this a little bit more meaningful for you, but also to assess our business and challenge ourselves as to how we're going forward.
Alex, Dominick, welcome. I'll open the floor to any questions that you may have? I'm sorry, I can't see in the back, but I see a hand up, I need the transition lenses actually.
I may need those as well. Anthony Petrone from Jefferies, maybe just a question on the acquisition strategy in 2018 and beyond now that we have a new U.S. tax structure and Euro-U.S. cash has been somewhat freed up here, so how do those two factors play into the aperture of your lens for M&A? Thanks.
Yes, thank you for your question why don't I start off Dominic and then you can dive in. Yes look, first what I'd like to do is acknowledge the work that Dominic and his team did in working with a lot of legislators and other decision makers in Washington to help bring about what we feel was very important tax reform. I mean the fact that we were able to lower the rate to a much more competitive rate versus the rest of the world, the fact that we were able to go to a territorial structure, the fact that we're doing the one-time repatriation.
You now we think the combination of those things frankly gets our country back on a much more competitive level and very importantly, it will help limit if not completely remove some of the other inversions and other things that were taking place were - that frankly weren't always in the best strategic interests, but were being done because of a tax or an antiquated tax structure that was in place.
For us we think the major benefit of that tax reform is the fact that frankly it just gives us more flexibility not to have that entrapped cash outside the U.S. and I commend also our financial team who over the years I think have done a pretty remarkable job of giving us access to some of that cash in an appropriate way and in an tax sufficient manner, but now I think we're able to do that to an even greater degree.
Fundamentally, we still need to make sure that it's the right strategy; fundamentally we still need to make sure that its value creating over the long term. Next it needs to be actionable, something that we can you know confidently do and bring in, but we think it creates a better overall environment for us to be competitive globally in M&A and I think continue a pattern that we set where we’re going look internally, we're going to look aggressively externally to continue very solid growth rate and frankly to access new technologies and therapeutics.
I would just add that the benefit of not having to repatriate cash and pay a tax rate, high tax rate on that is obviously as Alex said give us more flexibility. But the most important thing about doing an acquisition in addition to the strategic fit and what we can do with it in our hands at the previous owner can't do is whether we're generating enough return on that investment commensurate with the risk, so that we can compensate our shareholders appropriately for using that capital.
Tax is one element of that calculation, so it'll be easier to achieve that level of return, but the most important part of that calculation has to do with market growth, market penetration, technology adoption, regulatory challenges et cetera, those still exist and we'll still use those as the primary filters to determine whether or not an acquisition is value creating.
Robbie Marcus, J.P. Morgan. When you think about investing in the different businesses Pharma has seen an outsized proportion of the investments from J&J, but going forward do you think medical devices and consumer are going to see an outsized portion to help drive growth in those divisions or how should we be thinking about the investment going forward?
As you heard me say in the earlier comments we are excited about all three of our sectors and we think that and hopefully a message that you've taken away here today is our excitement, our enthusiasm, and I think our renewed confidence in our consumer and medical device spaces and the opportunities that we have ahead. As has been articulated in different ways today, we're always looking at a number of different factors on where we're going to invest across the portfolio and frankly part of that calculus is making sure that we've got healthy businesses where we're making that investment.
Because what you find is regardless of your best projections, regardless of your best intentions, mid size in particular large size they are always more complicated than you usually predict. And so, if you're doing that in businesses that are already currently going through transformation that can be a bit more challenging. I think what we hopefully demonstrated to all of you today, that if you look at the fundamentals of both these businesses, if you look at the improvement that we have in our innovation pipeline, our plans for execution, I think they're very well situated. And I would say is, we remain very interested in adding on to those organically and inorganically with the caveat being value creating, a good strategic fit and is something where we're going to minimize disruption and actually synergistically create growth going forward.
I think that over long periods of time about 50% of our growth has been enabled by an acquisition strategy and that applies across all three business sectors and I think it will still apply across all three business sectors going forward and about 50% of our growth has and will come, no matter where it is and consumer med device for pharma from strategic M&A activity.
Just staying with the M&A theme, do you think there is an ability to go large on pharma for its a smaller medical devices and consumer, do you think the hurdle or complication factor is higher or lower in one division versus the other and is there one size that you're targeting for each of those businesses in M&A going forward?
No, look what I would say as it relates to pharma, we in our study of the majority of deals that have been done in that space, the large deals have rarely been value creating over the long run. It was usual in many cases it was done when companies were experiencing particular stress in one way or another and at J&J we would much rather invest in growth and an opportunity to move the businesses forward. So look, ideally we would love to find the next DARZALEX, the next IMBRUVICA in our pharmaceutical portfolio identified early and then rapidly ramp up to be able to reach millions of patients and create billion dollar platforms.
If we look at medical devices and consumer, in some ways and I was having a conversation at lunch and sometimes we're in Pharma because of the nature of the technology that you're purchasing early on, you can have more of a binary result i.e. does the product work or does it not work. Wherein consumer and medical devices, you’re buying technology, but you're also buying capabilities, you're buying relationships that exist, a wide range of other factors, so that your results in some ways could be more predictable. So we think of all those factors as we consider it, but and would we go after large pharma, I think it would be a very high hurdle. Where do we go after midsize to larger medical device? It depends if the opportunity is right and we feel that we can ultimately create value, yes we would just as we would in consumer.
Please, definitely. How your thinking has evolved since you became the CEO towards the medical device space in general? And second you've opened these innovation centers in places like Boston and Houston, I believe you've hired some extremely bright and talented people that didn't come up today, but I'm just curious, what's their mandate? Thanks.
Yes, great questions. If you allow me Larry, maybe I'll take it above medical devices though because I think as the CEO, I’ve learned lot of lessons across the field adage I wish I knew than what I know now. And I'm sure I still have a lot more learning going forward, I hope I never stop because that's one of the best parts of the job is the opportunity to learn new technologies, businesses and situations.
I think there's a few things that if I reflect on candidly or you might say lessons learned, I think one thing is just the remarkable transformation that we're seeing with technology. I mean frankly it would have been hard to predict especially somebody who had spent so much of my career in pharma where we were frequently criticized for incremental or me too innovation and if you look at the explosion in cell based therapies, gene based therapies we're actually moving from chemotherapy to cures.
It was almost hard to realize even seven, 10 years ago or if you did it was a significant bet that you were taking. And by the way I only see that accelerating. In medical device, I think it was a little different story, I think actually if I go back six or seven years ago, we hit a bit of a low point technology wise. I mean there were some pockets. There were things in TAVR, there were things in energy, there were things in EP, but as you well know if you saw what was happening in the venture community at the time, we actually saw a decrease in investment and there was concern about the amount that would be need to be invested in clinical development, reimbursement for those things.
And frankly what I've seen over the last several years now is a recognition that technology can make a significant, I mean and I think where robotics was seven years ago to where we think they could be today. In some of the other transformations that you know we're seeing across all of our businesses where technology can make a difference, technology can be rewarded.
So I think that, I think the second issue is around business models. And I think if we look back honestly five or six years ago, we are probably a bit over our skis in some of our transformation in medical devices of decision making and where to influence decision makers perhaps leaving the surgeon too soon into other decision makers, hospital administrators. And what we found in many cases frankly is hospital administrators are struggling within their own departments around some of that decision making. And the criticality of not walking away from the surgeon of having the right support systems there for them as well, I think is something that we see in and so that's why you heard a lot today, let's get that right balance of investment.
Now what we would say is, we're starting to see some of that shift, but it's probably taken a bit longer. The counter to that in consumer where seven or 10 years ago e-commerce was very low and now in some markets like China you can see it being 20% or 40%, and it's still below 5% in the United States, higher in some categories for example like beauty, so I think that’s another factor.
And I would say the third or a third lesson because there is more, but the third one from me is emerging markets. You know if I think back six or seven years ago, we had been on almost a 10 year run in emerging market growth doing this and that was Brazil, Russia, India, China and even others in the last few years we've seen a get little choppier in many of those markets.
Now I still believe that that curve has a positive slope over the long term, but we shouldn't think that it's just going to be linear, that it could have a bit more volatility that we're seeing now. So in our messaging there was a comment earlier, do you hear as much about emerging markets, we still remain very enthusiastic about emerging markets and it’s about 25% of our business, works about little over half of that, we're still seeing growth rates greater, but we've seen them a little bit more choppiness through that, but that doesn't take away from the secular trend that we're really excited about it.
Innovation centers, so it's a great question. We just sat down actually a couple of months ago and did a deeper dive, is as many of you know, we made the decision about six years ago starting at first in our pharma group to actually reduce some of the in-house you might say scientists in bricks and mortar to more of an external focus putting the innovation centers in places like Boston, San Francisco, San Diego, London. Since then we opened in Texas, Canada. We do a lot in Israel as well where we have teams of not only scientists, but business development people, in some cases IP groups and their whole job is to work within the venture ecosystem.
And that can be with academic centers, the venture community, early start-ups. We have a few different derivatives while that's our innovation center we also had J Labs in several of those where it started out because we actually had some extra real estate space back in 2009, 2010 out in La Jolla, that in midst of the depression or recession some might say depression, we couldn't get a very good return on, so we said well what if we rent it out at a very reasonable price.
We had mass spectrometers that we weren’t using, we had other equipment, let's put it to use how does it work and what we found is that there were a lot of customers, there were a lot of startups that were willing to do that. And we've learned a lot of lessons as we've gone along the way. I think what we would see now as we probably have about 300 to 400 active deals taking place that we've been able to run through them. I think our throughput is getting better, we're learning more and more what works, what doesn't work.
And then I think also from a reputational standpoint on the innovation side, it's a position that's much, much better as a partner, especially for a company our size and scale that you'd actually be willing to take that kind of risk with the new company and create that kind of environment. So we are now starting what I'd call Phase 2 or 2B where we're tracking throughput on those in a much more systematic way and I think overall what we're finding is I think we brought about 12 projects in-house now.
And I would say two thirds of those in pharma, but several now in medical devices and we're starting to see a more consistent cadence. Our teams now I think are working better together between our franchises, business development in the innovation centers they're seen more as a natural extension of what we do in R&D. So we're very pleased and encouraged by what we're seeing. We still have more work to do, but I think going forward to take a different approach where you're just more internally focused versus having this balance wouldn't be the right move for J&J.
So a couple kind of related questions. Just been a lot of questions about this in the session, but I want to put a final point on it, lot of investors certainly came to know J&J as sort of a three legged stool in the old days it was about you can add a fourth leg to that stool. So that three legged stool has always been relatively balanced with the expansion of pharma, the contraction devices the stool is a little less balanced today than it was maybe seven years ago. But it doesn't sound like listening to your commentary today in isolation that's an urgent need that has to be addressed. You think about the balance of the stool and does that need to be addressed?
Yes, we'll look we're always looking at our business and what I would say is the imbalance of the stool over the last few years frankly has been done to a remarkable success, which I wouldn’t apologize for of our pharma group. It's not because there's not belief, but I think what you've heard today is an actual increased belief and level of confidence in our other sectors. And so, yes we are actively on an ongoing basis involved in looking for those right opportunities and these two sectors are clearly a priority for that over the next several years.
Can I just add to that, so we don’t really think that there is an appropriate balance. If you look at the pie we don't really think that it's even appropriate for us to say it should be balanced in this manner, because each and every decision we make David, is based on its own merit, so each investment decision we make is thoroughly evaluated regardless of which sector it’s in and the shape of the each piece of the pie therefore is an outcome of making the best decision in front of us at any particular time.
Okay and just related question, thank you Dominic. Maybe question Alex is, if I think of the last 10 years I can't think of a time when the three independent businesses had different structural things going on, in pharmaceuticals it is about price to value and broad net and gross pricing, medical device…
Absolutely, there is a lot going on in pharma I said versus simply, you mentioned medical devices from seven years ago to today the innovation cycle starting to turn. The consumer I think Jorge did an excellent job talking about some of the brand fragmentation and Millennial risk and Amazon risk going on in that segment. So the question very simply is, are you as committed today as you were when you began to become CEO of J&J that these three businesses you belong together meaning these issues can be attacked more efficiently as a collective than they can be independently?
Absolutely, in fact I feel much more confident sitting here today than I would have six years ago. And it's for all the reasons you heard today. I think in the end it comes down to the items that we talked about having the right innovation portfolio, about having the right execution plan, having the right leaders in place to bring all that together and I think it's a very exciting time for us going forward.
Great, so Alex, Dominic I'd like to give you the opportunity to share any closing remarks with the audience.
Okay, well Joe yes, and first of all I just want to say a big thank you to all of you for hanging in here all day. But before we sign off, I also think it's important to acknowledge this guy sitting next to me. As you all know, Dominic is going to be retiring in just a few months and while we all knew it will happen sooner or later because there is this thing called age, I was always hoping it would be, I was always hoping it would be a little bit later than sooner, nothing against you Joe, you had a great choice there.
But as the saying goes that there is a time for us and that time has come for Dominic and I think it's pretty remarkable. He made that decision. It's pretty remarkable that Dom has served longer than any other CFO in Johnson & Johnson history for almost 12 years, and during that time, I can say on both a professional, but also a personal level I couldn't think of a better partner to have.
He epitomizes really what a credo based leader is about. His financial stewardship, if you look at the performance across so many other challenges and opportunities, economic highs and lows, he's just - he's been instrumental in every way of helping me, helping us, helping the company just deliver pretty remarkable returns over a long period of time.
And I also hope you'll agree that he's somebody that you could always trust, that Dominic's credibility being able to depend on what he said, was in fact correct and that having that kind of integrity and knowing his commitment around the promises that he's going to make is so important in a CFO let alone to the company and look Dominic, first and foremost I just want to thank you for everything that you've done for us, for Johnson & Johnson.
You’ve touched so much of our business, so many of our people. You've been an inspiration and a great role model and just a fantastic business partner. You're going to be missed tremendously and so thank you for your leadership, thank you for being Dominic for who you are and for really being a great CFO for Johnson & Johnson.
Thank you. Well I didn't know where you were going there with the age, probably wrong, I know, I knew what you meant.
Exactly, I’m probably young, so I really appreciate those kind words Alex and well wishes and support. Yes this is probably going to be my last public appearance as the CFO of Johnson & Johnson, so I want to do a couple of things, take this opportunity to express sincere thanks to you Alex for your great leadership of Johnson & Johnson, for your support of me throughout my career and quite frankly for the valued friendship that we've developed over all these years, I’ll always cherish that.
I want to thank my colleagues at J&J, you saw many of them today. I've had the privilege of leading the finance organization at J&J for nearly 12 years. I can tell you they are the best in the business. I can really say that having talked to all my peers in different industries that I think all the business leaders here will attest to that have come from different companies, we really do have an outstanding finance organization and so thank you for supporting me and my career, the finance organization has been tremendous. Let me congratulate Joe.
So Joe will become CFO of our great company July 1st, at July 1st Joe you'll be sitting in this chair, oh not this chair, the chair across the street in my office. Joe is a strong collaborative creative based leader, long track record of success. Joe and I go back many, many years. I know Johnson & Johnson will be in great hands. And when I think about my own tenure as CFO of Johnson & Johnson, it’s just remarkable, I mean to be associated with a company who's at the center of health and improving Health for Humanity is really just a privilege quite frankly.
And professionally I've got a chance to do a lot of great things. One of things I've had a chance to do is interact with all of you and represent our great company to you on some 46 quarterly conference calls is an example, and I'm really grateful for the relationship we've built over time, I think it's a relationship built on trust, candor, transparency and respect. And I know I’ve full confidence that Joe will continue that kind of relationship with you.
So my time here has been humbling and amazing. I often tell everyone that I've had the best CFO job on the planet and people say well of course you are you're a AAA rated company, $50 billion market cap, 56 years of consecutively increasing the dividend, the financial stewardship, you're at the pinnacle of your career, when you are the CFO of Johnson & Johnson. But what I will really remember for the most about my career is the honor of working alongside people who every day, every day want to positively impact the world. So I'll be watching with admiration and quite frankly enormous confidence in our future. Thank you, Alex.
Well, thank you, Dominic. Well Dominic thank you again and look the other person that I’d be remiss if I didn't thank is Debbie, his wife. They were actually great school sweethearts and to go through that and when you look at their children, their grandchildren, the father, the family and mother they have it's pretty special, especially in today's world to have that kind of a family at home and let alone your Johnson & Johnson family is pretty darn special and so thanks again.
So look, as we wrap up today, I’d also be remiss if I didn’t thank a few other people and that is all the J&J leaders in this room. While Dominic and I get to sit up here and conclude and kind of bring this as a wrap up, I think what I said earlier today was I think what makes J&J such a special place besides our credo is the quality of our leaders and in fact the people who are running the business, who are responsible for our people each and every day, there's no way that we could do our jobs without them and I would just like to publicly acknowledge them and ask you guys to stand for second and join me in giving them a big round of applause. Thank you.
So look, as we wrap up today, I hope you got a lot of good information. I hope you found it informative, interesting, and have a much better understanding how across all of Johnson & Johnson, but in particular these two business segments, our medical device and our consumer segment, that we are poised for future success and growth.
And if you think about what we have in our consumer business in addition is great iconic brands, when you think about what we're doing around an omnichannel customer centric approach, and brands that are scientifically differentiated, what we're going to be doing in baby and oral care, how we're financially managing the business the top line as well as our margins, above market growth as we head through the rest of 2018 and beyond.
When you think about our medical device businesses enhancing our current leadership positions that's critical that's critical to start there, some areas we've got great performance. VisionCare is a great example of that. Electrophysiology is a great example of that. What we're going to be doing in stroke that you heard from Shlomi and clearly our commitment to taking on areas like spine and knees and the plans that we have in place to get those in the right place.
You know the cadence of innovation, the string of launches, meaningful launches, yes in some cases are going to better, so we have, but in other cases I would strongly argue that it is going to fulfill unmet need and then allow us to reach more patients and differentiate ourselves further. And we clearly will be accelerating growth across this segment to above market growth by 2020. We think that's a realistic goal, aggressive, but one that we are absolutely committed to.
So we couldn’t be more confident in the J&J of today, we couldn’t be more confident that in the future that we have ahead and we just want to thank you very much for joining us today and hope you enjoyed it. We look forward to seeing you again next year. Yes, Joe?
Thank you, Alex. Thank you Dominic and Dominic once again congratulations on truly a distinguished career. So that concludes today's event. Thanks to those who made the trip into New Brunswick and those who viewed us on the webcast. We look forward to engaging with all of you again in the near future, specifically July 17, for our second quarter earnings call. Thank you.
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