Intuitive Surgical Shares Plummet after da Vinci Sales Disappoint
Shares for Intuitive Surgical Inc. (ISRG.O) dropped by an alarming 11 percent after the medical device manufacturer published a diminished sales forecast for 2013 based on increasingly lower demand for the company’s da Vinci surgical robots, Reuters reports. The company also admitted to receiving a warning letter from the FDA after regulators inspected its facilities last month.
Only three months after the company published predictions of revenue growth of 16 to 19 percent, representatives from Intuitive Surgical now expect no more than a 7 percent increase in revenue, if they see any increase at all, according to Reuters.
These numbers are even lower than the poor totals expected by some investors, and they also fall well below previous Wall Street forecasts.
While the company predicted a 20 to 23 percent growth in sales of the da Vinci surgical robot in April, it commented in a conference call late last week that they now only expect a growth of 15 to 18 percent.
The da Vinci surgical robot is a complex medical device which surgeons operate via hand and foot controls to conduct minimally invasive surgery. The robots have been used most commonly in hysterectomies and prostate removal procedures, but now the company is showing a sharp decline in hysterectomy procedures where the robot is employed.
According to Intuitive Surgical representatives, the decrease in the use of the da Vinci robot for hysterectomies is a result of high insurance deductibles and the reluctance of many insurance companies to reimburse for robotic surgical procedures.
Intuitive Surgical also stated that increasingly negative press surrounding their product has also contributed significantly to their decrease in profits. In recent months, the da Vinci robot has been the subject of a number of media reports which call the device’s cost effectiveness into question.
The company also made reference to a recent warning letter issued by the FDA after the regulatory agency conducted an inspection of its facilities last month. In this letter, the FDA asked for more information about how the company issues recalls as well as further insight into design elements of a product which Intuitive Surgical declined to identify by name.
In addition to being the subject of increasing scrutiny by the media, Intuitive Surgical is also the defendant in a number of personal injury lawsuits brought by individuals who claim to have suffered severe injury or the wrongful death of a loved one resulting from surgeries where the da Vinci robot was employed. For more information on plaintiffs’ rights in da Vinci surgical robot lawsuits, contact an experienced personal injury attorney with Berkowitz and Hanna LLC.