Johnson & Johnson executives offer insights into their view for the company's medical device business, which is undergoing a transformation.

Johnson & Johnson's latest medical device transactions pale in size compared to the company's $30 billion deal to pick up Actelion and its 2012 $20 billion acquisition of Synthes. Is there any potential for Johnson & Johnson to go after a large device acquisition?

The healthcare giant has announced a few medical device acquisitions already this year, including its purchase of gastroesophageal reflux disease company Torax Medical and stroke care company Neuravi Limited. Earlier this year, Johnson & Johnson also agreed to sell its Codman Neurosurgery business to Integra LifeSciences for $1.045 billion.

Asked about strategy on Johnson & Johnson's first quarter earnings call this week, a company executive pointed to the historical success of smaller acquisitions in the device business. "Our entire medical device business has largely been grown by these smaller tuck-in bolt-on acquisitions with technologies that advance the standard of care and with our scale in distribution we're able to do much better with that asset in our hands than in the hands of the previous owner," said Dominic Caruso, chief financial officer, according to a Seeking Alpha transcript of the earnings call.

That doesn't mean the company shies away from large device deals as a rule. Caruso added that there is an "agnostic" view on the size of a transaction, with more emphasis on the potential for growth and shareholder return.

Johnson & Johnson has been reworking its device business, trying to shift the portfolio to higher growth products. For instance, Caruso spoke enthusiastically about the Neuravi acquisition on the earnings call, noting the ischemic stroke treatment's potential for faster growth.

On the company's fourth quarter earnings call earlier this year, the management team announced it was considering strategic options for its Diabetes consumer and medical device business. Caruso told analysts on this week's earnings call that the evaluation process is ongoing and that the options might include partnership or divestiture.

Sales of Johnson & Johnson's diabetes care products declined year-over-year in the first quarter, a decrease that analysts expected.Kyle Rose, analyst at Canaccord Genuity, wrote in an April 18 research note, "We believe the decline in J&J's diabetes business has been exacerbated by an interim period of uncertainty following the announcement on the Q4/16 call about evaluating strategic alternatives for its collective diabetes business units."

The company's restructuring efforts in the device business, announced last year, also include job cuts, more centralized operations, and product innovation.

"It takes time to improve a business that's so widespread and diverse as our medical device business, but we're making good progress," Caruso said.

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