Latest / Vanguards of Healthcare by Bloomberg Intelligence / Distalmotion’s Approach to Spread Surgical Robots to More

Transcript

Distalmotion’s Approach to Spread Surgical Robots to More · Vanguards of Healthcare by Bloomberg Intelligence

0:21
Speaker 1: Welcome to another episode of the Vanguards of Healthcare series.
0:24
Speaker 1: My name is Matt Hendrickson, the medical technology analyst at
0:27
Speaker 1: Bloomberg Intelligence, which is the in house equity research platform
0:30
Speaker 1: at Bloomberg LP. We are pleased to have with us
0:32
Speaker 1: today Greg Roche, CEO of distal Motion, a privately held
0:36
Speaker 1: medical device company that is developing and commercializing the Dexter
0:40
Speaker 1: surgical robotic system. Greg, thank you for joining us today.
0:44
Speaker 2: Thanks for having me Matt, It's good to see you.
0:47
Speaker 1: It's likewise and you know, a lot of exciting things
0:49
Speaker 1: since we met at SAGES. But maybe for the listeners
0:53
Speaker 1: just to get them grounded, what is who is distal
0:57
Speaker 1: Motion and then what was your path to get to
1:00
Speaker 1: that CEO role there.
1:02
Speaker 2: Distal Motion as a Swiss company that was founded in
1:06
Speaker 2: twenty twelve, really founded around designing a mechanical tool to
1:16
Speaker 2: give you know, all the former functionality of risted instrumentation.
1:21
Speaker 2: In twenty sixteen we decided to make a change and
1:26
Speaker 2: actually turned this into a robot. So yeah, we've been
1:31
Speaker 2: in business fourteen years, have about two hundred folks between
1:37
Speaker 2: the US and Europe, and you know, in all functions
1:42
Speaker 2: were fully commercialized in Europe now in the US commercializing
1:46
Speaker 2: a soft tissue robotic platform that's really focused around garnering
1:51
Speaker 2: access or or giving patients, physicians, providers access to self
1:58
Speaker 2: tissue robotics when maybe they haven't been able to do
2:01
Speaker 2: that before. And well, you know, I'm sure over the
2:04
Speaker 2: course of this interview we'll talk about why that is
2:06
Speaker 2: so relative to me in my career. So, I've been
2:12
Speaker 2: in medtech twenty plus years. I started my career with
2:16
Speaker 2: Striker Endoscopy, so this a bit of a coming home
2:19
Speaker 2: from a surgery perspective for me. I spent nine years
2:22
Speaker 2: in orthopedics with Zimmer and Zimmer biomet Most relevant to
2:27
Speaker 2: this role, I ran a global robotics so was part
2:31
Speaker 2: of the team that launched the Rosa robot and had
2:35
Speaker 2: a lot of success with Zimmer in the early days
2:38
Speaker 2: of that launch, and then spent two years running a
2:42
Speaker 2: soft tissue robotic company in Germany and a lot of
2:44
Speaker 2: lessons learned and met the team from Distal Motion and
2:48
Speaker 2: some of the key investors in the summer of twenty
2:51
Speaker 2: three and the rest is history. I really saw a
2:54
Speaker 2: purpose built robot for you know, the outpatient setting for
2:58
Speaker 2: the ac uniquely designed solving different problems than I saw
3:03
Speaker 2: in most other robotic companies, and you know, two years
3:06
Speaker 2: seven two years, seven months later, the rest is a
3:09
Speaker 2: bit of history.
3:09
Speaker 1: Yeah, let's you know, maybe we'll just jump right into
3:12
Speaker 1: you you mentioned, solved a lot of different problems and
3:15
Speaker 1: you know, in you know, we'll dive probably deeper into
3:18
Speaker 1: the competitive landscape. But you know, it's a David and
3:21
Speaker 1: Goliath feel to it, So you need to be able
3:23
Speaker 1: to figure out how to differentiate yourself. So what are
3:26
Speaker 1: those features that distill Motion and Dexter have that you
3:30
Speaker 1: know allows them to kind of go in a different
3:33
Speaker 1: direction than the market leader is currently.
3:36
Speaker 2: Yeah, you know, and maybe the level set just one
3:38
Speaker 2: step back and then I'll answer the question. You know,
3:41
Speaker 2: the market today, our data shows that eighty percent of
3:45
Speaker 2: surgeons coming out of residency and fellowship in general surgery
3:49
Speaker 2: and gynecology are being trained on some form of a robot.
3:52
Speaker 2: So the robot itself, and you can see this in
3:55
Speaker 2: a projected data relative to clinical proceeds and use of robotics.
4:02
Speaker 2: The robot itself is no longer a luxury item, which
4:05
Speaker 2: it once was. It's a tool, a necessary tool. The
4:09
Speaker 2: second piece is the growth in the ASC landscape. There's
4:15
Speaker 2: really a couple other factors that are that are really
4:19
Speaker 2: driving this right now. One is reimbursement, and it is
4:23
Speaker 2: a lower reimbursed site of care. But I think both
4:27
Speaker 2: from a CMS perspective, so Medicare, Medicaid and commercial pay,
4:33
Speaker 2: they're understanding or or pushing for the lower acuity surgeries.
4:39
Speaker 2: The higher volume surgeries like a hernia, like a hysterectomy
4:42
Speaker 2: that we're focused on, They're trying to push those into
4:46
Speaker 2: a lower cost setting or side of care, which is
4:50
Speaker 2: in this case an ambulatory surgery center. So you've got
4:54
Speaker 2: all this market momentum that's pushing the surgery, you know,
4:59
Speaker 2: the need of robotics and the prevalence of robotics and
5:03
Speaker 2: and you know, uh and kind of inte in that
5:07
Speaker 2: integration into surgery. But also these external factors, you know,
5:13
Speaker 2: CMS and and and are commercial pairs pushing these surgeries
5:17
Speaker 2: to the appropriate side of care. And you really have
5:20
Speaker 2: some limitters. You know, the current robotic platforms that are available,
5:24
Speaker 2: most of them are very large and and not very mobile.
5:30
Speaker 2: And when you're in an a SC environment where you're
5:33
Speaker 2: servicing multiple services, maybe on a on a daily basis,
5:38
Speaker 2: you need flexibility, so the ability to fit a robot
5:42
Speaker 2: into a room that maybe wasn't designed for complex surgery.
5:47
Speaker 2: The ability to move a robot room to room or
5:51
Speaker 2: accommodate other surgeries other than the ones that are tasked
5:54
Speaker 2: for that robot, you know, so moving the robot out
5:57
Speaker 2: really really important. The other piece is sterility. So this
6:04
Speaker 2: is something that I learned in my endeavors in orthopedics.
6:07
Speaker 2: It's easy to want a robot in an ASC really
6:10
Speaker 2: another thing to support the instrumentation that goes along with
6:13
Speaker 2: the robot and to have sterile processing be you know,
6:17
Speaker 2: up to speed or have the ability to do it.
6:21
Speaker 2: We solved that with the single use instrument platform, so
6:24
Speaker 2: we're really eliminating the need for any infrastructure changes, but
6:28
Speaker 2: also physical infrastructure. You can plug our robot into a
6:32
Speaker 2: standard outlet fitted through a standard door frame. It really
6:36
Speaker 2: integrates into whatever environment that it's presented with instead of
6:41
Speaker 2: trying to build the environment around the robot, you know,
6:44
Speaker 2: which is two different concepts. A couple other things that
6:47
Speaker 2: we have the ability so, you know, one of the
6:51
Speaker 2: other things that ASC struggle with is staffing and just
6:57
Speaker 2: consistent staffing, having the rights staff expert staff. And we
7:03
Speaker 2: have a sterile console. So this is the only robot
7:06
Speaker 2: in the US and our space where the surgeon is
7:08
Speaker 2: actually sterile or can be sterile and integrate it into
7:11
Speaker 2: the field. So what does that do or what does
7:17
Speaker 2: that allow? It allows you to do less or more
7:20
Speaker 2: with less, meaning you can you can work in the
7:26
Speaker 2: sterile environment with the surgeon and perhaps the scrub nurse
7:29
Speaker 2: and not having one, two, three other assistants, so really
7:32
Speaker 2: being agile with who you bring there because the surgeon
7:37
Speaker 2: has the ability to connect with the patient as well.
7:40
Speaker 2: And the final thing is economics, and you know, the
7:44
Speaker 2: robotic platforms that have existed, and that doesn't just mean
7:46
Speaker 2: price of a robot, you know, you still have to
7:50
Speaker 2: deal with all those other things, but you know, having
7:53
Speaker 2: healthy economics so that the ownership groups of these ASCs
7:57
Speaker 2: can actually be profitable even though they're taking into a
8:01
Speaker 2: side of care that's you know, has a lower reimbursement profile.
8:04
Speaker 2: You know, remember revenue is not always the most important thing.
8:08
Speaker 2: Profit is. And and we really feel confident that we
8:11
Speaker 2: can make these surgeries uh you know clinically we can
8:15
Speaker 2: perform them at and and and produce world class outcomes,
8:20
Speaker 2: but also we have an economic profile that allow you know,
8:23
Speaker 2: surgeon ownership groups, I d ns, our AC management companies
8:27
Speaker 2: to generate healthy profits as well. So it's it's really
8:31
Speaker 2: a win win. Yeah.
8:33
Speaker 1: No, that was a pretty comprehensive. Sometimes you can just
8:36
Speaker 1: hit stop. And then that was that. You know, you
8:38
Speaker 1: got the summer, You're right there. We'll go through a
8:40
Speaker 1: lot of these and you know, but what caught my
8:42
Speaker 1: attention was the lux It's not a luxury item, it's
8:44
Speaker 1: a tool. And that the fact that you know a
8:47
Speaker 1: lot of these you know or younger doctors are being
8:51
Speaker 1: trained on robots. Now that's not the first time I've
8:53
Speaker 1: heard that, and I feel like that is going to
8:56
Speaker 1: help the utilization accelerate further as these younger doctors get
9:01
Speaker 1: out into the field and the older doctors, who are
9:04
Speaker 1: you know, the more stubborn ones not wanting to switch
9:08
Speaker 1: to a robot, they retire, and I think we're going
9:11
Speaker 1: to see that next generation really push that increased utilization
9:14
Speaker 1: of both you know, heart, you know, knees and hips
9:17
Speaker 1: as well as the soft tissue which distal motions in.
9:21
Speaker 2: Yeah. My one reaction to that is I would I
9:24
Speaker 2: would say, I don't know if it's a generational thing.
9:27
Speaker 2: It is on the new So those coming in, I
9:30
Speaker 2: think robots will be a part of their practice full stop.
9:34
Speaker 2: For those that maybe haven't used robotics so you know,
9:38
Speaker 2: would be in our space primary laparoscopic approach. The way
9:43
Speaker 2: in which our robots design really lends to a surgeon
9:46
Speaker 2: that wants to do the case fully robotic or also
9:51
Speaker 2: if they want to blend some of the approaches that
9:54
Speaker 2: they're incredibly comfortable with but but get the benefits of robotics.
9:57
Speaker 2: So you know, the minute that you pull you know,
10:01
Speaker 2: a surgeon away from the patient, you know, there is
10:04
Speaker 2: a barrier there, and I you know, I think we
10:07
Speaker 2: kind of meet in the middle. You know. So again
10:11
Speaker 2: for someone that's trained on robotics, you know, I think
10:14
Speaker 2: there's the reality is they're going to be working on
10:18
Speaker 2: a robot in the hospital and we see them working
10:20
Speaker 2: on Dexter in the ASC, and we want that transition
10:24
Speaker 2: to be very seamless. We don't want any mental load
10:26
Speaker 2: when they do those things. And and we we we
10:29
Speaker 2: are getting high marks from surgeons all over the world
10:32
Speaker 2: in that regard who operate on multiple platforms, But we
10:36
Speaker 2: also have a lot of surgeons that were laparoscopic or
10:39
Speaker 2: even open in nature hadn't taken the leap into robotics.
10:43
Speaker 2: And because of the platform, the ease of use, the
10:46
Speaker 2: integration with the team, the shorter learning curve, and the
10:51
Speaker 2: ability that they don't have to jump all the way
10:53
Speaker 2: into the deep end necessarily, they can ease in. We
10:59
Speaker 2: really see nice adoption regardless of the profile of the surgeon.
11:04
Speaker 2: So we feel like, you know, we kind of can
11:08
Speaker 2: serve most surgeons regardless of where they are in their
11:12
Speaker 2: career path. And you know, let's not forget if if
11:16
Speaker 2: you can move these cases into an ASC for a surgeon,
11:19
Speaker 2: quality of life likely gets a bit better. You know,
11:21
Speaker 2: you've got shorter turnover times, you can get in and
11:25
Speaker 2: out quickly. Your patients have a great experience right there.
11:29
Speaker 2: They're not dealing with the you know, maybe the bureaucracy
11:33
Speaker 2: of the larger hospital where you can barely get out
11:37
Speaker 2: of the parking garage at time. So this this experience
11:41
Speaker 2: for everyone, and if we can generate profit, you think
11:43
Speaker 2: about it, the provider, the physician, and the patient all
11:46
Speaker 2: elevate their experience exponentially.
11:50
Speaker 1: Yeah, and it's you know, it's funny you mentioned me
11:52
Speaker 1: in the middle and that blend. So what's the what's
11:55
Speaker 1: the kind of the technology or the secret sauce at
11:59
Speaker 1: distal that's allowing the surgeons to be able to have
12:03
Speaker 1: that capability to kind of, you know, not have to
12:06
Speaker 1: jump into the deep end, like you said, but be
12:08
Speaker 1: able to still access the robotic capabilities for their procedures.
12:12
Speaker 2: Well, the genesis of at least my opinion of why
12:15
Speaker 2: robotics became so prevalent, It makes very complex surgical tasks easy.
12:22
Speaker 2: So having you know, risted instrumentation, the ability to suit
12:26
Speaker 2: your dissect and work in confined space with high dexterity
12:31
Speaker 2: is why robotics took off it. You know, there's ergonomic benefits,
12:37
Speaker 2: you know, there's all kinds of things that are really
12:39
Speaker 2: beneficial to that case. You know, some of the cases
12:42
Speaker 2: that we talk about, especially like a hernia, if you
12:46
Speaker 2: perform at laparoscopically, it's physically very demanding and to do
12:50
Speaker 2: five or six in a day, I mean, I think
12:52
Speaker 2: most surgeons would tell you it's really taxing and over
12:56
Speaker 2: years that can really take a toll. So there's a
12:58
Speaker 2: tremendous amount of a benefit there relative to the uniqueness
13:02
Speaker 2: of distal motion. You know, again, our genesis was really
13:08
Speaker 2: around it, you know, inception around morphine out of laparoscopic surgery.
13:13
Speaker 2: So you don't have to change too much relative to
13:16
Speaker 2: port placement or the things that you use, or again,
13:19
Speaker 2: how you want to approach it, how you how you
13:22
Speaker 2: bleed it into your practice to draw to adopt it.
13:27
Speaker 2: And I think when you reduce some of those barriers,
13:29
Speaker 2: that actually increases efficiency, you know in speed integration into
13:35
Speaker 2: the surgical workflow. And that's real that is really unique
13:39
Speaker 2: to Dexter. You know, it's designed to be simple in
13:44
Speaker 2: a way, even though it's incredibly complex device. You know,
13:49
Speaker 2: we are very proud of the fact that the surgeon
13:52
Speaker 2: has a really quick learning curve. You know, we we've
13:56
Speaker 2: published ten to fifteen cases you know, to get up
14:01
Speaker 2: to really kind of you know, your ability to use
14:06
Speaker 2: it on a day to day and then some surgeons
14:08
Speaker 2: even seven. So there's really a nice easy way to
14:12
Speaker 2: do it. And from a staff training perspective, you're talking
14:15
Speaker 2: about a couple hours, no more, and and so it
14:19
Speaker 2: doesn't take much to bring it into into clinical use.
14:22
Speaker 2: And for us, I think that that was the barrier
14:25
Speaker 2: for a long time. You know, the complexity of actually
14:28
Speaker 2: implementing something into a hospital or an o R that
14:33
Speaker 2: was really complicated and new this to me. You know,
14:36
Speaker 2: the difference is we've made it quite easy.
14:39
Speaker 1: Yeah, man, And now I connected the dots between the
14:42
Speaker 1: dexter name and dexterity, and now I'm connecting further. When
14:46
Speaker 1: I was, you know, doing kind of my brush up
14:49
Speaker 1: before the call, I noticed there was mention of the
14:53
Speaker 1: technology that allows both hand and wrist movement, which seems
14:58
Speaker 1: like a differentiating f and so what what exactly is
15:01
Speaker 1: that technology that allows that? And why you know, we
15:05
Speaker 1: kind of talked about laparoscopic. You know, it's it's it's
15:08
Speaker 1: a tough positioning for the surgeon to do it manually.
15:12
Speaker 1: But how does that differentiate between that and then also
15:14
Speaker 1: kind of the other robots that are in the market currently.
15:18
Speaker 2: Well, I think that's actually table stakes. There are a
15:23
Speaker 2: lot of there are several robotic platforms that have risted instrumentation.
15:28
Speaker 2: I think you have to have it, you know, there
15:31
Speaker 2: are there are other technologies that I would I would
15:35
Speaker 2: call like lap assist or or things that help you
15:38
Speaker 2: do with surgery. But if you're not introducing risted instrumentation,
15:43
Speaker 2: you're really not solving the first and most important piece,
15:48
Speaker 2: which is allowing a surgeon to you know, complete complex
15:52
Speaker 2: surgical tasks much easy, you know, in a much easier fashion,
15:57
Speaker 2: you know, through the use of technology in a much
16:00
Speaker 2: more consistent fashion. So to me, like, you know, that's
16:04
Speaker 2: the piece that really raises the level of care. There
16:07
Speaker 2: are several there are multiple robotic platforms that have risted instrumentation,
16:11
Speaker 2: So I wouldn't say that is unique to Dexter in
16:15
Speaker 2: my you know, kind of in the intro that we
16:17
Speaker 2: talked about all of those other things in combination with
16:21
Speaker 2: risted instrumentation or what make Dexter unique and distal motion, gotcha?
16:25
Speaker 1: Okay, So it's kind of taking the best of what
16:28
Speaker 1: the robotics have and being able to simplify it for
16:30
Speaker 1: the procedure point of view. And so with that procedure,
16:33
Speaker 1: let's walk me through a little bit more about how
16:36
Speaker 1: you know, you talked about a surgeon and a nurse
16:38
Speaker 1: and then you would you wouldn't need to have the
16:40
Speaker 1: extra assistance there. So what what is Dexter doing in
16:45
Speaker 1: the procedure that is taking over the role of those
16:47
Speaker 1: extra you know, doctors or nurses that is no longer needed.
16:52
Speaker 2: Yeah, So it's really the ability now for the surgeon
16:55
Speaker 2: to connect with the patient. So if you think about
16:59
Speaker 2: how traditional robotic platform set up happens, I mean, sometimes
17:04
Speaker 2: you'll have an extra physician in the field, sometimes you'll
17:07
Speaker 2: have a physician assistant, and then you know, we like
17:12
Speaker 2: to say that you know, when you get you know,
17:13
Speaker 2: when you really get through the learning curve, a scrubners
17:17
Speaker 2: is really all you need because the surgeon ultimately has
17:20
Speaker 2: full connectivity. You know, in a lot of cases we
17:23
Speaker 2: have our console almost next to the field because it
17:27
Speaker 2: is sterile in nature, where again and in a lot
17:31
Speaker 2: of other robotic ors that's not the case, and even
17:34
Speaker 2: some are outside the o R. So you know that
17:39
Speaker 2: that connectivity really allows the surgeon to connect, which then
17:43
Speaker 2: they're not fully reliant on additional staff. So there's certainly
17:48
Speaker 2: things that need to need to happen in the sterile field.
17:51
Speaker 2: Although you know, we're kicking around ideas around solo robotic
17:55
Speaker 2: surgery or the ability for a surgeon and you know,
17:58
Speaker 2: theoretically to do a surgery on their own, and we're
18:02
Speaker 2: working on some advancements in the tech to do that,
18:05
Speaker 2: but we really think you can do again more with less,
18:10
Speaker 2: with Dexter because of that connectivity of the surgeon.
18:12
Speaker 1: Yeah, and I think you know, that's the interesting thing.
18:14
Speaker 1: You know, we talked about the ASC setting and then
18:16
Speaker 1: they get the lower reimbursement, but you know, you first
18:19
Speaker 1: initially think about, okay, lower reimbursement the ASC because there's
18:22
Speaker 1: less hospitalization afterwards or less length of stay. That's always
18:27
Speaker 1: going to be a savings for the ASCs over traditional
18:29
Speaker 1: inpatient hospital settings. But it sounds like then this, you know,
18:33
Speaker 1: by having less people per procedure, you're saving on that
18:38
Speaker 1: labor cost or you're making that labor more efficient as
18:40
Speaker 1: they can do other procedures at the same time. Is
18:43
Speaker 1: that the right way to think about that kind of
18:45
Speaker 1: business model as you go into there or are there
18:47
Speaker 1: other features as well about Dexter that allows it for
18:51
Speaker 1: the hospitals with ASCs to be a more profitable procedure.
18:56
Speaker 2: Well, I mean there's very little. So if you if
18:59
Speaker 2: you look at a a robotic setup, tip typically in
19:02
Speaker 2: the trays and things that need to be sterilized. We
19:05
Speaker 2: have one small tray can sit on a bedside table,
19:08
Speaker 2: you know, so we have a single use instrument platform.
19:11
Speaker 2: So as I mentioned, you're not you don't you need
19:17
Speaker 2: to have big, big changes to you know, your sterile processing,
19:22
Speaker 2: and they are required and the other pieces. You don't
19:25
Speaker 2: need to hold hundreds of thousands of dollars of inventory,
19:29
Speaker 2: you know that Again, if you think about it, most
19:32
Speaker 2: platforms are multi use instruments. They have an inherent costs
19:37
Speaker 2: per case. So you're holding each tray is sixty instruments
19:41
Speaker 2: in theory of sixty virtual instruments. Four instruments times fifteen
19:45
Speaker 2: uses you have if you're doing high volume surgery and
19:48
Speaker 2: you need five or six of those, that's a lot
19:52
Speaker 2: to hold for an ASC, you know, so that inventory
19:56
Speaker 2: burden is meaningful. We can reduce that, you know, again,
20:00
Speaker 2: the infrastructure changes I mentioned. One of the things I
20:02
Speaker 2: didn't mention is the platform is open. And what I
20:07
Speaker 2: mean by that is typical robotic platforms have a closed ecosystem.
20:12
Speaker 2: So they're bringing their own visualization, all of their own
20:15
Speaker 2: advanced instruments, own tro cars. You know, they're really controlling,
20:20
Speaker 2: you know, so when you buy the robot, you have
20:22
Speaker 2: to buy all these other things, and a lot of
20:26
Speaker 2: a lot of users don't think, you know about necessarily
20:29
Speaker 2: all of that over the course of time. But if
20:32
Speaker 2: you need, you know, camera systems, and they're I mean
20:35
Speaker 2: it's expensive, it's really expensive. So we actually allow so
20:39
Speaker 2: we're we're integrating a robot, and we have five instruments
20:43
Speaker 2: that are used in all our surgeries, usually three at
20:47
Speaker 2: a time or two at a time, and some you
20:50
Speaker 2: know that. So we provide a world class robot, five instruments.
20:54
Speaker 2: That's it. They can use their own visualization, they can
20:58
Speaker 2: use whatever kind of tracks they've signed for access or trocars,
21:03
Speaker 2: advanced energy stapling. Really we allow the provider to leverage
21:08
Speaker 2: their contracts, the surgeon to choose what the best ecosystem
21:12
Speaker 2: is for that patient at that site of care, for
21:16
Speaker 2: that particular procedure. And that's really important. That flexibility is important.
21:20
Speaker 2: And the reason I say that from an innovation perspective
21:25
Speaker 2: is visualization, for example, which is where I started. The
21:30
Speaker 2: best visualization companies in the world are not necessarily the
21:34
Speaker 2: ones that manufacture a robot. And so if you want
21:38
Speaker 2: to take advantage of something, you know, kind of these
21:41
Speaker 2: next gen technologies, it may not actually be in the
21:44
Speaker 2: ecosystem of the robot you acquired. We allow that that
21:48
Speaker 2: freedom and flexibility that no one else does. So these
21:51
Speaker 2: are some unique things, you know that that give economic
21:55
Speaker 2: and also procedural flexibility, so you can approach the case
22:01
Speaker 2: in any way that you want. And if there's something
22:04
Speaker 2: when you have a robot in the field, if the
22:07
Speaker 2: minute you attach anything to a robot, it drives the
22:09
Speaker 2: cost up. And you know, there are some easy tasks
22:13
Speaker 2: that you can actually go over to the patient and
22:14
Speaker 2: perform and keep the costs of the case low, which
22:18
Speaker 2: is important for the system right for the patient, for
22:22
Speaker 2: the for the surgeon, for the provider, and the system
22:26
Speaker 2: just the healthcare system in general. So these are all things,
22:29
Speaker 2: you know, again beyond just the pure price and economics
22:33
Speaker 2: that are really really customers are finding valuable and partners
22:37
Speaker 2: are finding valuable with us right now.
22:39
Speaker 1: That's interesting and so that kind of then just turns
22:42
Speaker 1: into the business model itself. And you know, let me
22:45
Speaker 1: just start any kind of it's worthwhile just to kind
22:48
Speaker 1: of you know, ground ourselves is let's start with what
22:51
Speaker 1: are the what is the robot currently indicated for? And
22:55
Speaker 1: then kind of what are kind of the next key
22:57
Speaker 1: indications that are going to be coming out over the
22:59
Speaker 1: next six twelve months.
23:01
Speaker 2: So in Europe we have full vertical indication approval under
23:05
Speaker 2: mdr for urology, gynecology, and general surgery, and we do
23:10
Speaker 2: we do surgery in all three verticals, you know, high
23:14
Speaker 2: and low complexity. In the US, we're very focused on,
23:18
Speaker 2: you know, what we would call lower acuity or lower complexity,
23:20
Speaker 2: high volume surgery. We got our de novo approval in
23:24
Speaker 2: twenty twenty four Q four of twenty four in Gwenohrnia.
23:31
Speaker 2: We received the five ten K approval for col systectomy
23:34
Speaker 2: in May of twenty five, and then received another five
23:39
Speaker 2: to ten K for the the latest version of our
23:41
Speaker 2: robot and hysterectomy, which also includes various other gynecological procedures
23:48
Speaker 2: in that in that umbrella. And then we've submitted we've
23:53
Speaker 2: submitted for sacra colpopexi in February of this here, and
24:00
Speaker 2: we just submitted in April for ventral hernia. Those procedures
24:05
Speaker 2: get us really a very large squatch of what we
24:09
Speaker 2: see as the ambulatory surgery center market, you know, so
24:13
Speaker 2: these procedures that are going to be pushed into the ASC.
24:18
Speaker 2: We're working on a few other clinical studies just to
24:21
Speaker 2: round these out over the course of the next two
24:24
Speaker 2: or three quarters, and then we'll have what we need.
24:28
Speaker 2: The nice thing is we're doing a lot of surgery
24:31
Speaker 2: in Europe. So if there are different surgeries that you
24:34
Speaker 2: know now aren't prevalent in the ASC, but start to move,
24:37
Speaker 2: you know we can quickly react. We do most of
24:39
Speaker 2: those in Europe, and we'll let our customers and partners
24:43
Speaker 2: help us guide. You know what the next approvals are.
24:46
Speaker 2: You know, high priority approvals will be twenty twenty seven
24:49
Speaker 2: and beyond.
24:50
Speaker 1: Let's just true. This is actually I'm curious about this.
24:53
Speaker 1: You mentioned the full vertical for urology, gynecology and general
24:58
Speaker 1: surgery in Europe with this E mark or m d R. Now,
25:02
Speaker 1: how does that work? I mean, is it is that
25:04
Speaker 1: does Europe usually do that? It's the full vertical every
25:06
Speaker 1: time and the US is kind of piecemeal or like,
25:10
Speaker 1: how does that conversation work with the regulatory agencies?
25:15
Speaker 2: Yeah, so we we had we had those approvals under
25:19
Speaker 2: under m d D and now we have them under
25:23
Speaker 2: m d R. The the FDA has a different approach,
25:27
Speaker 2: which is, you know, I wouldn't say it's every procedure,
25:31
Speaker 2: but it's you know, they have targeted procedures in each discipline,
25:36
Speaker 2: and when you get those targeted procedures approved, then you
25:38
Speaker 2: get the discipline you know, or and and so I
25:42
Speaker 2: think there's been a lot of thought from the FDA,
25:43
Speaker 2: but it is definitely a different, different approach. I will
25:46
Speaker 2: say they've been great with us, really been accommodating in
25:54
Speaker 2: the way in which we're a you know, attacking this
25:57
Speaker 2: and and trying to figure this out. And really we've
26:01
Speaker 2: come up with a great strategy we feel comfortable with
26:03
Speaker 2: to get to where we need in a timely fashion.
26:06
Speaker 2: So all is good. I think it's just different markets
26:10
Speaker 2: have you know, different classifications in different ways to get
26:15
Speaker 2: to the various approvals. Gotcha.
26:17
Speaker 1: And it's interesting because the Denovo happened right after you
26:20
Speaker 1: you joined, and it seems like you were able to
26:25
Speaker 1: use your muscle memory from your days at ROSA and
26:28
Speaker 1: then your other robotic company. Just curious to see what
26:33
Speaker 1: of those kind of what you know, what skills and
26:36
Speaker 1: experiences from both of those you know that you know
26:40
Speaker 1: like oh I need to do this, or you know
26:42
Speaker 1: from some of your other experiences like oh let's avoid
26:44
Speaker 1: that path. I'm just curious about which ones that you
26:48
Speaker 1: know you're like, oh I definitely need to do that
26:50
Speaker 1: or not do that.
26:52
Speaker 2: Yeah, well, certainly my experience at zimmer you know, there's
26:56
Speaker 2: some direct correlation with SIDI care. You know, I never
27:01
Speaker 2: thought ten years ago that most total needs would be
27:05
Speaker 2: happening in an AC and they are. And so you know,
27:09
Speaker 2: in that in that experience, I learned a lot about
27:12
Speaker 2: this side of care and and how to move surgery there,
27:17
Speaker 2: which is really important. And I think what we learn is,
27:20
Speaker 2: you know, one of the things that we've seen now
27:22
Speaker 2: from the Denovo on is we really know who our
27:25
Speaker 2: customers or our potential partners are, you know, so we
27:30
Speaker 2: we have you know, really two kind of ideas, you know,
27:33
Speaker 2: places where we can drive incremental surgery. So we're building
27:38
Speaker 2: service lines. And again these are these are places that
27:41
Speaker 2: traditionally could not access robotics. So if they you know,
27:45
Speaker 2: that the surgeons were going to do the surgery where
27:49
Speaker 2: the robots existed, that that that doesn't necessarily mean that's
27:54
Speaker 2: what they preferred to do. That's just where they live.
27:56
Speaker 2: Because of all the things that we talked about earlier.
27:59
Speaker 2: Now we're we're freeing that up and opening that up,
28:02
Speaker 2: and we we we have a very data centric approach
28:05
Speaker 2: to identify kind of where you know, where these places
28:10
Speaker 2: or sites are and and and you know, trying to
28:13
Speaker 2: introduce that. The other the other opportunity we have is this,
28:17
Speaker 2: you know, as commercial payers and and cms you know,
28:21
Speaker 2: really try to figure out how to move these surgeries
28:25
Speaker 2: into a lower cost site of care. There is going
28:27
Speaker 2: to be a need to decant hospitals to to take
28:31
Speaker 2: some of the lower complexity surgery out of the hospital.
28:34
Speaker 2: And we, you know, we feel like we're also a
28:38
Speaker 2: really good answer for those you know, problem statements. So
28:42
Speaker 2: there's been you know, I think some things that have
28:46
Speaker 2: just changed over that two year period that have really
28:49
Speaker 2: put us in a leadership position, we feel, you know,
28:54
Speaker 2: but I think the learnings that I had, plus the
28:57
Speaker 2: learnings that we've we've gotten you know, our limited launch
29:00
Speaker 2: and now into full full market release, we needed those things.
29:05
Speaker 2: I mean, we needed the robot we got approved in October.
29:08
Speaker 2: We needed to build a team, which we've done over
29:10
Speaker 2: the last year and a half, and quite frankly, we
29:13
Speaker 2: needed relevant you know, more than one indication, which we
29:15
Speaker 2: now have multiple, and we can build you know, solid
29:19
Speaker 2: financial profiles or performance for our customers. And that's important,
29:24
Speaker 2: that's really important. So and obviously we're we're not stopping.
29:28
Speaker 2: We're going to continue to you know, to work on
29:31
Speaker 2: the regulatory front to expand those indications, you know, in
29:35
Speaker 2: the near term.
29:37
Speaker 1: Yeah, and you know, it's interesting you were talking about
29:39
Speaker 1: the ProForma and the financials and everything for the hospitals,
29:41
Speaker 1: But it makes me think how much of that is
29:45
Speaker 1: just teaching the hospitals and then they pick it up,
29:47
Speaker 1: or is part of your sales model working with them
29:52
Speaker 1: having to kind of hold their hands at least the
29:54
Speaker 1: first few times, just to explain to them how that
29:57
Speaker 1: business model can work, especially because you know, you think
30:00
Speaker 1: about robotics and there's expensive proposition upfront costs, are you
30:05
Speaker 1: you do have to kind of help them with the
30:07
Speaker 1: financing side of it or how to build out their
30:09
Speaker 1: business model on their side as part of in addition
30:12
Speaker 1: to just selling the robot and the tools that come
30:14
Speaker 1: with it.
30:15
Speaker 2: Yeah, I mean, I think that's a big part of
30:17
Speaker 2: the partnership is really having a mutual agreement on what
30:23
Speaker 2: a pro forma looks like. You know, what surgeons are engaged,
30:30
Speaker 2: you know, how how both entities are going to win
30:34
Speaker 2: or and sometimes it may be more than two. So yeah,
30:38
Speaker 2: that that's a big part of what we do is
30:43
Speaker 2: you know, in some cases, we're identifying the you know,
30:46
Speaker 2: the opportunities in the markets for our customers, which is
30:49
Speaker 2: also a great thing when we can do that, you know,
30:52
Speaker 2: with them. But you really have to have alignment both
30:56
Speaker 2: on the clinical component, you know, the ability for them
30:59
Speaker 2: to accommodate new surgery and to do these things you
31:04
Speaker 2: know where we're targeting them, you know, to do them.
31:06
Speaker 2: But the other thing is is you have to have
31:08
Speaker 2: radical alignment on the financials and you know, and and
31:11
Speaker 2: make sure that you know, not only you know, distal motion,
31:17
Speaker 2: but really they are comfortable with the model that's presented
31:21
Speaker 2: in the commitments that that we're both making.
31:24
Speaker 1: Yeah, I mean that's it seems like if you can
31:25
Speaker 1: get that to the ground running, being able to show
31:28
Speaker 1: them that it's a profitable proposition for them, they're going
31:30
Speaker 1: to be you know, utilizing it more and more.
31:33
Speaker 2: So.
31:33
Speaker 1: You know, you talked about the full launch. You know,
31:36
Speaker 1: we're in you know, halfway through twenty twenty six. How
31:39
Speaker 1: how are you seeing the rest of the year going
31:42
Speaker 1: and then you know, thoughts going you know beyond twenty
31:45
Speaker 1: twenty six, you know, the strategy to be able to
31:48
Speaker 1: continue to expand are you still in that phase where
31:51
Speaker 1: you're looking at you you know, you're focusing on those
31:53
Speaker 1: those initial targeted A S S or are you starting
31:56
Speaker 1: to branch out to other regions and or just you
31:58
Speaker 1: know fit just that kind of breadth versus depth type
32:02
Speaker 1: of strategy.
32:04
Speaker 2: Yeah, we're really focused. I think we know what we're
32:08
Speaker 2: really good at. We know where we have the best
32:11
Speaker 2: opportunity to help others win, and you know, we're so
32:19
Speaker 2: you know, I would tell you over the next three
32:20
Speaker 2: to five years, we're going to be laser focused on
32:22
Speaker 2: the A S C. That does that mean? I mean,
32:25
Speaker 2: we have hospital partners today, We you know, we need
32:28
Speaker 2: academic work, we need all kinds of other things that
32:33
Speaker 2: most tech you know, medical technology companies need. So that
32:36
Speaker 2: doesn't mean well, we'll never have a robot in a
32:40
Speaker 2: hospital or another side of care. But we know where
32:45
Speaker 2: we have a great chance to succeed, and that is
32:48
Speaker 2: in the ASC market in the US, and we're you know,
32:51
Speaker 2: over the next three to five years, you know, our
32:53
Speaker 2: goal is to really make an impact in that market. Yeah.
32:56
Speaker 1: And then you know, as we kind of close out
32:58
Speaker 1: this episode, I'm curious, you know, I always ask about
33:00
Speaker 1: the five to ten year horizon. It kind of fits
33:04
Speaker 1: in well with what we were talking about. As the
33:06
Speaker 1: newer students who are training on the robots, they're going
33:08
Speaker 1: to be you know, graduating into these robots and day
33:12
Speaker 1: one of their careers. So we have that kind of
33:16
Speaker 1: tailwind in the robotics market. But how do you what
33:21
Speaker 1: else is the unmet needs that you're seeing out there
33:24
Speaker 1: that you know can be in the next generation dexter
33:27
Speaker 1: to kind of continue to improve on, you know, the
33:30
Speaker 1: robotic capabilities that are currently out there.
33:34
Speaker 2: Yeah. I mean for us, the things that we look
33:37
Speaker 2: at are surgical workflow efficiency, you know, again concepts like
33:45
Speaker 2: solo surgery. We have another one called flip you know,
33:50
Speaker 2: that we call flip room robotics, or the ability to
33:54
Speaker 2: you know, shift a robot room to room, you know,
33:57
Speaker 2: so that you can accommodate more patients, you know, but
34:00
Speaker 2: that requires speed to set up, ease a setup, you know,
34:05
Speaker 2: great integration with the staff. You know. So we're right now,
34:10
Speaker 2: we're doubling down on the things we think are important
34:15
Speaker 2: you know, to our potential partners, and we're you know,
34:19
Speaker 2: and we're again trying to keep it incredibly simple. But
34:22
Speaker 2: there are things I think we'll add to the robot
34:24
Speaker 2: over time to and enhance clinical workflow, you know, for
34:28
Speaker 2: dexter to expand use cases, et cetera. But I think
34:33
Speaker 2: we have a five eight year run where we could
34:36
Speaker 2: just do what I'm talking about. I mean, you know,
34:39
Speaker 2: you're looking at four million plus procedures in the US
34:42
Speaker 2: and the spaces that we're thinking of, and and like
34:45
Speaker 2: I mentioned before, more surgeons every day coming out really
34:51
Speaker 2: wanting a robot and you know, in their day to
34:53
Speaker 2: day use, and then all these procedures for all the
34:56
Speaker 2: macro reasons I talked about going into the ASC, you know,
35:00
Speaker 2: we think we can have a healthy business without any changes,
35:05
Speaker 2: although as you can probably guess from a technology company,
35:09
Speaker 2: and we're going to continue to innovate, challenge and make
35:12
Speaker 2: the product as good as we can, knowing that it
35:15
Speaker 2: will never be perfect.
35:16
Speaker 1: Yeah, and I think that's why this is such an
35:18
Speaker 1: exciting field within medtech. And so Greg, thank you so
35:22
Speaker 1: much for joining us. I'm going to be looking forward
35:24
Speaker 1: to following this story over those next five to eight
35:26
Speaker 1: years as you've talked about.
35:27
Speaker 2: Yeah, thanks, Matt, I appreciate you having me again. It's
35:30
Speaker 2: always good to talk to you, and look forward to
35:32
Speaker 2: talking to me again soon.
35:33
Speaker 1: Absolutely, and thank you to our producers Adidia so Amani
35:37
Speaker 1: and Mariam Tha Waile for all the behind the scenes work.
35:40
Speaker 1: And thank you to our listeners for tuning in today.
35:43
Speaker 1: We hope you join us for future episodes, and if
35:45
Speaker 1: you'd like to stay up to date, you can click
35:46
Speaker 1: the subscribe button on Spotify or your favorite streaming platform.
35:49
Speaker 1: Take Care passages, US bases