BREAKING: Is the next move for Intuitive "Handheld?"

Made up image of a possible hand held Stapler

Okay - so this is all just wild speculation with a click bait title... but now you're here stick with me it will all make sense...

What an absolutely gorgeous lap tower Intuitive have created with their romper stomping Da Vinci 5 soft tissue surgical robot. I've been screaming pretty loud that their central "power tower" is a super capable full on laparoscopic tower with the ability to be used with full NIR - Near Infra Red (ICG) - a massively capable energy chain, a world class insufflation chain and loaded to the gils with next gen compute power. WHY?

Well besides utterly dominating the robotics space by making their DV5 the undisputed king of the big format robots - it does open up the trojan horse of getting to all of those juicy lap procedures.

"Here have a few towers" - and they will all be used on the laparoscopic procedures - scooping up all that lovely image data - energy use data - insufflation data. Linking to the EHRs and getting a more complete picture of the ORs lap and robotic workflow, timings, outcomes... and real case load.

And all that lovely data gets fed back to the hopsital - which might just say... "These procedures would be better done with a DV5... let's wheel another boom in for ya and give you that nice comfy console."

Why leave money on the table?

So this is where I get speculative for sure - but stick with me. All of those hand held lap cases will require access - imaging - insufflation - basic energy. But a lot of those hand held lap cases will also require hand help stapling and advanced energy. A rollicking good business with some great margins - just saying.

Now JNJ and Medtronic are fairly and squarely encroaching onto Intuitive's turf by bringing out a robot. And in some ways Intutive is now getting (someway) into their turf with a lap tower. (Stryker /Storz / Olympus are just collateral damage IMHO.) But why would I allow (me now being Intutive) JNJ or MDT to come in and take the juicy stapler and energy business in my lap tower case? - and have their reps in the OR saying "have you tried Hugo?" "Have you tried Ottava?" - and side selling in their robots and prepping the "Wait 'til you use our stapler on our robot... wow!" etc etc

And those two companies take that $1000 of cash out of the procedure by selling staplers and energy. And they run off with some pretty valuable data... And all that goes back to fuel the robotics program that hurts Intuitive.

So here I go...

I'm going to make a very heavy bet that Intuitive are going to launch a range of hand held Sureform staplers and a range of hand held Advanced energy devices in 2025. (Damn I'm pushing that date, but let's see.)

It makes utter sense to me to have a hand held connected stapler that uses the same cartridges that are already being produced. (Volume crashes costs.) And a handheld set of Synchroseal / Vessel sealers (damn the energy generator is right there.) I might even think they would add a 5mm straight vessel sealer (stretch I know but hey.)

They could easily create a handle mechanism that allows intelligent wristing (just look at Artisential by Livsmed - they do it really well.)

I am sure that they are working on it within the R&D team as it is a multi billion dollar extension opportunity that will be just too tempting to ignore. (They need to keep their aggressive growth train for the next decade to keep Wall Street happy.)

Pros and Cons

But surely Intuitive are the "Robot company" right?

They were, but they are now the "Get patients better company in a minimally invasive way."

And well let's face it - not every case is ever going to come across to the robot - so why would they not offer their optionality of tools to their customers to do it lap or robotic?

The pro is a massive cash upside - and an immediate user base that for those lap cases they do off robot - it would be a single supplier - and they can lock all their case data together - improve supplier and inventory management for the hospital - etc etc.

It also gives them a Trojan horse into "on the fence" lap users that they give a "lower barrier" on ramp to... to get them to enter the Intuitive ecosystem. An ecosystem that includes towers, smart insufflation, staplers, energy, data, data, data and case insights. And those insights may show - "Doc these cases would have better outcomes with a DV5... just saying - and well you know how to use the stapler, you trust the tower, you like the energy -- how about trying that all on a robot?"

One big pro for Intuitive is that the entry to ASCs will have a way way easier time. -And that is where the puck is moving for case loads. I feel strongly this would be an ASC aimed play - to start to get a serious tower and tool footprint in that vast ASC and growing market. It is the thin end of the wedge for the robot.

So what's the downside? I imagine that in the board room there is a pretty serious back and forwards debate. (I speculate!)

I imagine they will be debating if the user experience will be "good enough" and if the hand held will be too unstable, if the accuracy drops. If the UX is clunky. If it hurts their brand.

They might be saying "But does it remove our robotic advantage? Would some people say - well actually with these tools, this data, this tower - I can do more robotic cases lap and please the administration." Could they actually lose some robotic cases?

So the financial debate could be "Do we win more hand held or lose more robotic opportunity?"

And I think that debate will be way more focused on the ever expanding OUS market where they perhaps do risk to lose some dominance in the future to MDT and JNJ (if those companies get a foothold and do smart combined robotic and hand held products.)

And make no mistake - JNJ and MDT are making connected handhelds to their architecture - so the robot and or hand helds will communicate and run data. And they will be offering up more and more bundled deals that will be hard for Intutive to combat without hand helds. It is one of the strong cards they will play - so will Intuitive beat them to it?!?!

I am speculating that there is a lot of back and forth scenario planning going on with some pro camps and some con camps.

For me - I would go full steam with handheld. I see nothing but upside. It will open up a billion $ market and cement the Intuitive brand as the king of the OR. It will give them a spectrum of options to bring surgeons and hospitals into their ecosystem and lock them in.

I think it ultimately drives more robot usage and makes a deeper and wider moat around their business.

I also think it takes the power our of the coming JNJ / MDT bundling approach they will use.

Plus I am convinced it will grease the skids for a faster adoption into the ASCs.

It will lower the barrier to "come to Intuitive" OUS in emerging and developing markets.

It will give them access to another 30% or 40% of cases that are hard to get to today on a robot. And in fact, may never come across as systems like Moon Surgical arrive.

They will suck more Oxygen out of the room

If you want to take someone down - take out their legs.

The threat of Ottava and HUGO should be taken seriously. And I imagine in the most respectful way - because that is how they roll - Intuitive are thinking about that threat. JNJ and MDT are not some back water startup. They are serious machines. And they have the best bundling power.

BUT - a large part of their fuel that pays for the development of their robots is derived from Staplers and Energy devices.

And a huge part of their impetus for doing robotics is to defend that empire by attacking the robotic market... which is attacking that empire.

If Intuitive launches hand held - and takes (quickly) a good proportion of handheld stapling and energy devices - it further sucks the oxygen out of the room for JNJ and MDT. A loss of just 25% market share for either of them will be financially catestrophic and, I suspect, will put their entire robotics program in jeaporady. Why?

Well first it will starve R&D $$ and the dollars needed to develop those robotic teams and markets.

It will force those companies to retreat into a "all hands to defend hand held!" (you see what I did there...)

But a 25% loss of market share will have the senior management of the "multi sector companies including growing cardiac," asking. "Is it even still worth to defend this dying market? Why the hell are we still even pumping all this money into the black hole of the robot?"

** Remember they will both now be placing robots on lease and that is a cash sucker for a decade **

I think that a 25% loss of the stapler and energy market (on top of what they lose daily anyway) could be the straw to break the camel's back, and cause a stop on the robotics and a divestiture of the endo mechanical businesses.

That is why I'm betting that Intuitive will eventually make the bold decision to go handheld.

And when that happens... boy watch this ride in the market! Interesting times ahead

These are just wild and crazy speculations of the author for educational purposes only. They are designed to stimulate debate and conjecture and none of this is based on fact or knowledge.