On October 4th, the University of Michigan Medical School is hosting a day-long seminar on robotic surgery. The seminar is being sponsored by Intuitive Surgical, manufacturer of the daVinci robotic surgical system. Seminars and subsequent adoption of robotic techniques for surgical procedures such as prostatectomy, cardiotomy and gynecology are on the rise, yet the target market of hospitals for these expensive systems has barely been tapped.
Intuitive is a leader in robotic systems for surgery wih over 600 robots in the field. At $1.5M per robot, they offer a premium priced product into this growing marketplace.
Intuitive Surgical Fast Facts: 
Founded in 1995, IPO 2000
2006 revenue $373M, up 64% from 2005
2007 Q2 results:
- Revenue $140M, up 61% from 2006
- Operating profit $45M, up 84% from 2006
656 da Vinci® System base as of 06/30/07
- 504 North America
- 108 Europe
- 44 rest of world
FDA Clearances – Laparoscopic, Thoracoscopic, Prostatectomy, Cardiotomy, Revascularization, Urology, Gynecology, Pediatric
At $221 per share, the market rewards ISGR with an $8.3 billion market cap. Intuitive estimates a global world wide demand for 6000 robots, and also projects annual reoccurring revenue (instruments, accessories and service agreements) of up to $3.4 billion. At a lofty P/E of 90, the stock is definitely trading at a premium to the market.
Much like IRBTs recent stock decline because of a major loss to Robotic FX in the military sector, ISRG needs to be wary of commoditization of their marketplace – especially in markets outside of the US where FDA type approvals are not as “invasive”.
Here is a fascinating video of a da Vinci robot in action performing a hysterectomy.
Robot Central is looking for doctors and technicians who have first hand experience with the da Vinci. If you have exposure to this robot platform and would like to participate in our ongoing research, please contact jonas@robotcentral.com.
