Intuitive Surgical Inc., makers of one of the nation's most popular robotic surgery platforms, has been having a difficult year. Following the release of data showing an increase in injuries during use of the devices, a recall, and a recent warning from the FDA, Intuitive has lost about $6 billion in value in the last five months.
With demand in decline, and some analysts saying that the tech is more expensive than its worth, are Intuitive's troubles a sign that robotic surgery isn't ready for the big time yet?
The company initially projected growth of 16 to 19 percent this year following years of increasing adoption of its da Vinci surgical system. But following a Bloomberg report in February that the FDA was surveying surgeons regarding an increase in "adverse events" while using the robots, the company's previously meteoric growth started to slow. It now projects growth will be flat to 7 percent this year.
To be fair, the increase of injuries while using the robots may be attributable to an increase in its use, and overall the percentage of problems was low. Still, reported injuries during use of the robots doubled in the first six months of 2013, as compared to 2012. Following inspections of the company's facilities, the FDA has issued a regulatory warning to Intuitive, saying that it hasn't adequately disclosed issues.
Intuitive has been facing blowback over surgery errors for some time now. In fact, a cottage industry of SEO-friendly lawyers suing over robotic surgery has already popped up. Errors happen in surgery, and malpractice lawsuits are obviously a huge issue in medicine. But there's something about a robot performing surgery that makes people seem more likely to blame the bots for errors. Also interesting, as Gary Schwitzer notes, is that Intuitive partially blames bad press for its decline, even though it enjoyed plenty of glowing press in its early stages.
FDA concerns are certainly a big worry for the company (and patients), but there are more structural concerns. More than 1,300 hospitals currently use the robots, which cost $1.5 million a piece. They were used for more than 367,000 surgeries last year, most commonly for hysterectomies, cancer surgery, and gall bladder removal.
In recent years, robotic use in benign hysterectomies has increased immensely, but total procedures have declined in the US, which analysts have said is a drag on its future growth. Regardless, the simple matter is that procedures with Intuitive's robots are more costly; a JAMA report published in February found that robotic hysterectomies cost upwards of $2,000 more than human surgeries on average.
So even without its FDA troubles—which the company says should be sorted out fairly easily—the simple economics of robotic surgery may be cooling the market. “They enjoyed some easier, boom years when doctors and patients were awed by the thought of surgical robotics turning surgeons into super-surgeons,” business professor Erik Gordon told Bloomberg. “Now, the people who pay for the surgery are stepping in and questioning whether the robots are worth the extra cost.”
High-tech surgery, whether via telepresence, the ESA's virtual reality system for space, or robotics, have been making their way into the market for years now. And for good reason: they offer huge potential. I'll also say that, based on the Henny Penny nature of the markets, Intuitive isn't likely headed for disaster any time soon. But it doesn't appear human surgeons have to worry about their jobs just yet.