CHICAGO (Reuters) – Mako Surgical Corp, maker of a robotic system used in knee replacement that went public earlier this year, said it was not feeling the impact of the credit crunch that has choked off sales of some other medical capital equipment.
While tighter credit has adversely affected the ability of U.S. hospitals to raise capital and finance capital equipment, it has not had an impact on hospitals’ willingness to buy Mako Surgical systems, Chief Executive Dr. Maurice Ferre said in a telephone interview.
“We’re not seeing any capital type crunch in the hospitals,” said Ferre, who is also Mako’s president and chairman.
He acknowledged that some medical technology companies say the credit crunch has hurt their sales to hospitals. However, he said the type of hospital spending that tends to come under greater scrutiny in this environment has to do with things like refurbishing rooms or capital equipment priced over $1 million, such as CT scanners.
“We don’t fit into that (over $1 million) category,” Ferre said.
With seven Mako systems already in place, Ferre said he expects to sell an additional 8 to 10 new ones by the end of the year. He said those 15 to 17 systems will perform a total of 500 to 600 partial knee replacements in 2008.
Declining to comment on when the company will become profitable or on Wall Street’s financial forecasts, he said only that the company, which was founded in 2004 and went public in February 2008, is early in its commercialization process and does not have an established trend.
The Mako system, which costs $795, allows surgeons to customize partial knee replacement surgery in advance.
Using a CT scan with Mako’s 3-dimensional visualization guide and Mako’s surgeon-interactive robotic arm, the surgeon can resurface damaged bone with greater precision through a key-hole incision, the company said. This not only minimizes soft-tissue surgical trauma, but provides for a more perfect fit of the implant, according to Mako.
AN UNDERSERVED MARKET
Fort Lauderdale, Florida-based Mako is initially focusing on what Ferre says is an underserved market: The 15 million adults in the United States who suffer from some form of osteoarthritis of the knee.
Mako is specifically targeting those in the early- to mid-stage of the disease. In the past, doctors have advised patients to wait, or get a total knee replacement since outcomes for partial replacements did not have as good a track record, Ferre said.
“Lots of doctors were fearful of partial knee replacements because the results were not reproducible, he said. “What Mako is bringing to the party is the ability of provide reproducible results.”
Intuitive Surgical, manufacturer of the da Vinci robotic-assisted surgery system, has revolutionized the robotics field.
The Mako surgical system will eventually include total knee replacement and can be further expanded to do partial and total hip and shoulder replacements, Ferre said.
Dr. Frederic Moll founded Intuitive and Hansen Medical Inc, a developer of medical robotics for controlling catheters, and is currently CEO of Hansen. He also sits on Mako’s 8-member board.
But some orthopedic surgeons are not convinced of the value of the Mako system.
“How well the parts are put in is important. However, we do not know how precise one needs to be in order to influence results…. A knee typically fails because of more than one cause,” Dr. Mary O’Connor, an orthopedic surgeon at Mayo Clinic in Jacksonville, Florida, said.
Without a prospective, randomized study of patients treated using Mako systems compared with those treated with standard technique, it is difficult to make claims of superiority, she added.
(Reporting by Debra Sherman)