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Technology

Robot wars: Knee surgery marks new battleground for companies

The world’s top medical technology companies are turning to robots to help with complex knee surgery, promising quicker procedures and better results in operations that often leave patients dissatisfied.

Demand for artificial replacement joints is growing fast, as baby boomers’ knees and hips wear out, but for the past 15 years rival firms have failed to deliver a technological advance to gain them significant market share.

Now U.S.-based Stryker and Britain’s Smith & Nephew believe that is about to change, as robots give them an edge.

Robots should mean less trauma to patients and faster recovery, although they still need to prove themselves in definitive clinical studies, which will not report results for a couple of years.

Fares Haddad, a consultant surgeon at University College London Hospitals, is one of the first in Britain to use the new robots and has been impressed. However, he agrees healthcare providers need decisive data to prove they are worth an investment that can be as much as $1 million for each robot.

“The main reason for using a robotic system is to improve precision and to be able to hit very accurately a target that varies from patient to patient,” he said. “It is particularly useful in knees because they are more problematic (than hips) and there are a chunk of patients that aren’t as satisfied as we would like with their knee replacement.”

Satisfaction rates are only around 65 percent for knee operations, against 95 percent for hips, according to industry surveys.

The rival types of robots vary in cost and sophistication, assisting surgeons with precision image guidance for bone cutting and the insertion of artificial joints.

Orthopaedic companies hope to emulate the success of Intuitive Surgical, an early pioneer of robots in hospitals, which now has more than 4,000 of its da Vinci machines installed around the world for procedures including prostate removal, hernia repair and hysterectomies.

In addition to selling into big Western markets, they also want to expand robot use in India, China and other emerging markets, where owning a prestigious high-tech system can be a marketing advantage for private hospitals.

Stryker is leading the charge with its MAKO robotic arm, a platform it acquired for $1.65 billion in 2013 and which has pioneered robot-assisted whole-knee operations by determining optimal positioning and then helping with bone cutting.

But it has competition from smaller rival Smith & Nephew, which last week launched a cheaper product called Navio for total knee replacements in the United States. The British group bought the company behind Navio for $275 million in 2016.

That has kicked off the battle in earnest, since both companies are now able to do total knee replacements, which represent the vast majority of knee procedures.

MAKO, which uses only Stryker’s joints and implants, costs around $1 million to install, while Navio, which does not have as many features and is not tied exclusively to Smith & Nephew’s products, is less than half the price.

Both companies believe their robots will help them capture a bigger share of an orthopaedic market that has been split between four big players for more than a decade.

Indeed, Smith & Nephew Chief Executive Olivier Bohuon said it was his company’s most important strategic investment for a decade.

“We are now basically head to head with Stryker,” he said in an interview. “I do believe we are going to gain market share due to the fact we have robots, whether it’s Stryker or us.”

Stryker, meanwhile, expects its MAKO system to start delivering market share gains from the end of 2017.

“As we exit this year, we expect to start to see evidence in our knee market shares,” Katherine Owen, head of strategy at Stryker, told an investment conference in June. “Our goal with MAKO on knees is to capture hundreds of basis points of market share. What that time frame looks like, we haven’t been specific about.”

Zimmer Biomet and Johnson & Johnson, the two other big players in orthopaedics, are lagging in the robotics race but both have plans to enter the area in different ways.

J&J is working on surgical robotics with Verily, the life sciences arm of Google parent Alphabet, while Zimmer last year bought a majority stake in France’s Medtech, a specialist in neurosurgery.

Analysts at Morgan Stanley believe robots have the potential to disrupt a market in artificial joints that has arguably become commoditised, with no knee or hip implant emerging as supreme in recent years.

That chimes with the view of Smith & Nephew’s Bohuon, who argues that robots give his company a chance to punch above its weight, despite ranking No. 4 in reconstructive surgery.

He reckons robotics could account for 20 to 40 percent of knee operations.

Much will depend, however, on how the rival systems stack up.

Jefferies analysts said the semi-automated bone resection offered by MAKO might well win out in the long term, but Navio offers a far cheaper option and is still well ahead of anything the other two major manufacturers have today.

Orthopaedic surgeon Haddad, who has experimented with both, said the machines were very different and healthcare systems would need to assess their cost-effectiveness in the light of clinical trial results.

“I think the clinical benefit will be pretty obvious but whether that justifies the upfront outlay is a big question.”

Source: Tech CNBC
Robot wars: Knee surgery marks new battleground for companies

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