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Intuitive Surgical, Inc. (ISRG) Robot Probe Threatens Trend-Setting Surgeries



3/4/2013 8:15:53 AM

The safety of robots made by Intuitive Surgical Inc. (ISRG) is being probed by U.S. regulators, raising questions about the prospects of one of the hottest technologies in health care. The Food and Drug Administration asked surgeons at key hospitals to list the complications they may have seen with the machines, which cost about $1.5 million each and were used last year in almost 500,000 procedures. The doctors were also surveyed on which surgeries the robots might be most and least suited for, and asked to discuss their training, according to copies of the survey obtained by Bloomberg News. The answers may sway debate on whether robotic surgeries promoted as being less invasive are worth the extra cost. The findings may also determine the outlook for Intuitive. The da Vinci surgical system and related products generated most of the Sunnyvale, California-based company’s $2.2 billion revenue in 2012, and helped boost market value 70 percent over three years to about $23 billion, according to data compiled by Bloomberg. The surveys were sent to hospitals that belong to a product safety network overseen by the FDA. What the agency is trying to determine is whether a rise seen in incident reports sent to the agency are “a true reflection of problems” with the robots, or the result of other issues, said Synim Rivers, an agency spokeswoman, in an e-mail. “It is difficult to know why the reports have increased,” she said. Incident reports are sent to the agency by patients, medical professionals and companies. They “can contain incomplete, inaccurate, duplicative and unverified information,” Rivers said. ‘System Redundancy:' Intuitive fell 11 percent yesterday to close at $509.89. The stock recovered today, rising 8.5 percent to close at $553.40 in New York when at least four analysts reiterated their recommendations of the shares. Jeremy Feffer, a Cantor Fitzgerald LP analyst, raised his rating to buy from hold, saying “we see limited risk of this investigation materializing into significant punitive measures against the company.”

Read at Bloomberg


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