Intuitive Surgical’s (ISRG) Da Vinci X received early FDA (US Food and Drug Administration) approval in May 2017 and was given a CE Mark in Europe in April 2017. The company has initiated an early launch of the system, which is a low-cost version of Da Vinci Xi, its flagship product. Thus, high demand is expected in cost-conscious markets and emerging nations, and the product is expected to expand the company’s presence in such low-cost markets.
Intuitive Surgical launched its Da Vinci X systems in 2Q17, but the full launch isn’t expected until the end of fiscal 2017. The limited launch of the system has already generated significant sales.
ISRG’s expansion strategy for Da Vinci X
In 3Q17, Intuitive Surgical’s Da Vinci X system placements totaled 16, five of which were placed in the US, while 11 systems were placed outside the US. In 2Q17, a total of 11 Da Vinci X systems were placed.
In 3Q17, ~10% of new placements were contributed by the sale of Da Vinci X systems. Intuitive Surgical also launched the product in nine additional countries and expects to launch the system in four more countries in 4Q17.
According to Intuitive Surgical, the Da Vinci X system’s utilization was reported as strong in 3Q17. The system was used mainly in general surgery in the US for urology and gynecology procedures.
Notably, Intuitive Surgical stock makes up ~1.3% of the total holdings of the Health Care Select Sector SPDR Fund (XLV). XLV also holds ~3.4%, ~1.5%, and ~1.5% in peer medical device peer companies Medtronic (MDT), Becton, Dickinson, and Company (BDX), and Stryker (SYK), respectively.