Google Inc.’s share price up, to cooperate with Alcom unit of Novartis AG to develop smart contact lenses

Google Inc. is going to work in collaboration with the Swiss drug manufacturer Novartis AG to develop smart contact lenses that are to feature embedded electronics to correct vision and monitor health by tracking blood sugar levels for example.

Mr. Joe Jimenez, who is the Chief Executive Officer of Novartis AG, commented on the decision of partnership between the two companies in a an interview that was cited by the Wall Street Journal: “This will be a very important growth area in the future.” He also added that the technology of the smart lenses may become a “large revenue stream” for the company.

According to a statement, made by Novartis AG, the Swiss drug makers Alcon unit is to work in alliance with the Google X unit on smart contact lenses featuring non-invasive sensors and microchips. The companies did not reveal any of the financial terms of the deal. Novartis AG expects to get the first prototypes of the new product by early 2015. As explained by the companys CEO, Mr. Joe Jimenez, the company may start producing the lenses in five years time.

A prototype of the contact lenses was unveiled by Google Inc. in January, with the perspective of becoming helpful for monitoring diabetes. The product analyses the level of glucose in the tear fluid of its wearer and sends the information to a mobile device.

According to analysts, the cooperation between the two companies was a sensible decision, especially taking into account the massive presence of Novartis AG in the eyecare market primarily through its Alcon division, which is considered the second-biggest unit of the company.

Novartis Chief Executive Officer Mr. Jimenez also said in the companys statement, which was cited by the Financial Times: “We are looking forward to working with Google to bring together their advanced technology and our extensive knowledge of biology to meet unmet medical needs.”

Google Inc. was 0.12% up to trade at 595.00 dollars per share by 14:30 BST, marking a one-year change of +28.57%. According to the information published on the CNN Money, the 41 analysts offering 12-month price forecasts for Google Inc. have a median target of 665.00, with a high estimate of 750.00 and a low estimate of 525.00. The median estimate represents a +11.90% increase from the last price of 594.26.