Mad Money

Johnson & Johnson CEO on Apple Watch collaboration: 'Ultimately, we're going to save lives'

Key Points
  • Johnson & Johnson Chairman and CEO Alex Gorsky speaks to his company's partnership with Apple, deal to buy Auris Health and more in an interview with CNBC's Jim Cramer.
  • The pharmaceutical company is collaborating with Apple to build out the health-care capabilities of its Watch.
  • Gorsky also briefly addresses the company's scandal surrounding its baby powder product.
JNJ CEO on Apple collaboration: 'Ultimately, we're going to save lives'
JNJ CEO on Apple collaboration: 'Ultimately, we're going to save lives'

Johnson & Johnson's collaboration with Apple on the Apple Watch will be a pivotal step in detecting heart irregularities that could lead to much more serious conditions, Johnson & Johnson chief Alex Gorsky told CNBC on Friday.

"One of the most exciting parts of my job right now is to see the technology that's usually equated with California and the West Coast, whether it's AI, machine learning [or] robotics, ... more and more being integrated into health care," Gorsky, the chairman and CEO, told CNBC's Jim Cramer in a "Mad Money" interview.

That's certainly the case with Johnson & Johnson and Apple's new partnership. The two giants are using the Watch in a cardiovascular health study to see how it impacts early detection of atrial fibrillation, or heart flutters, which can lead to stroke and other debilitating conditions. AFib, as it's known colloquially, affects some 33 million people worldwide.

Apple already introduced an electrocardiogram feature for the Watch in December, marking the first release of a mass-market product with an ECG. But there has been some debate around its accuracy, which this tie-up could help improve.

"We're talking about algorithms that are built into the Watch that are monitoring it [in] real time, and it can detect these anomalies far before something really manifests itself," Gorsky said of the study's ideal next steps. "If we can detect [AFib] earlier, we can get them the right medication [and] we can help them be compliant on these medications over a longer period of time. Ultimately, we're going to save lives. And I think it really shows how some of this new technology is coming to health care in new, innovative, unique ways that, frankly, we couldn't have even imagined just a few years ago."

The CEO also touted his company's $3.4 billion deal to buy Auris Health, a robotic surgery firm. Not only will the deal help Johnson & Johnson capitalize on the future of robotic surgery, but it could also eliminate mistakes and cut costs significantly, he said.

Gorsky broke down a few of the ways surgeons could use Auris' Monarch platform, which makes endoscopy, a nonsurgical procedure that is used to inspect the digestive tract, look a bit like a high-stakes video game. The platform can also be used for bronchoscopy, a similar procedure that inspects the airways and lungs.

In future iterations, the Monarch platform could be used to not only see, but even treat or remove lung lesions or tumors, the CEO said.

"We can run this wire down through the system, [...] and, once we get there, we can do a biopsy," he said. "We could use imaging, in the future, to actually determine what kind of a cancer it is, or we could deliver a therapeutic, perhaps a new kind of immuno-oncology agent, to that specific lesion, or we could go ahead and cut it out. Those are the kind[s] of things that are being made possible by this new technology at a company like Auris."

Gorsky also briefly addressed the scandal that shaved $40 billion off Johnson & Johnson's market cap in December: a Reuters report that accused the company of knowing for decades that there were traces of asbestos in its baby powder product. Gorsky previously denied the report on "Mad Money."

"We put safety and quality first in all of our products, and we believe in the more than 100 years of experience with that product, and we'll defend it appropriately through the courts," he told Cramer on Friday. "What we think is most important is the people get the facts and we continue to educate. And, look, we think this will play out in an appropriate way."

Shares of Johnson & Johnson closed up 1.54 percent on Friday, at $136.38 a share. The stock is up 5.68 percent year to date, and has been on an uptrend since the company's late January earnings report beat consensus estimates.

Watch Alex Gorsky's full interview here:

Johnson & Johnson CEO on Apple Watch collaboration: 'Ultimately, we're going to save lives'
Johnson & Johnson CEO on Apple Watch collaboration: 'Ultimately, we're going to save lives'

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