Todd Pope, CEO of TransEnterix (NYSE MKT:TRXC), the medical device company making a robotic surgical system, says that when he founded the company six years ago, one of the biggest challenges he faced was skepticism that it could make it big in the Research Triangle.
The company, which moved from the OTC Bulletin Board to the New York Stock Exchange April 15, is developing the SurgiBot System, a minimally invasive surgical robotic system that allows the surgeon to be patient-side, and flexible surgical instruments compatible with it.
Last year it merged with SafeStich Medical in a deal that included a $30.2 million private placement.
Following its move to the NYSE MKT accompanied by offering12.5 million shares of its common stock at a public offering price of $4 per share for total gross proceeds of $50 million, TransEnterix is now seeking FDA approval of its advanced SurgiBot System.
Advanced Energy Is Directed Heat
It also launched what Pope calls “The world’s first fully flexible advanced energy surgical device.”
That would be the Flex Ligating Shears, which has received 510(k) clearance from the U.S. Food and Drug Administration. It is designed to deliver full flexibility to the surgeon while offering ligation and division with direct thermal energy in various laparoscopic surgical procedures.
That “advanced energy” is simply direct heat carefully controlled by a computer algorithm,” not a laser, Pope explains, saying, “it does it uniquely.”
One of the key advantages is that the heat fuses the wound so there is no bleeding.
Although this device works with the company’s current SPIDER Surgical System, it and similarly flexible instruments will be offered with the SurgiBot System in 2015.
Now up to 90 employees, the company is hiring and prepared to take on a market that racked up $6 billion in sales for Intuitive Surgical’s (Nasdaq: ISRG) da Vinci surgical devices the last three years. While some business writers have characterized TransEnterix as a David taking on Goliath, but Pope says the two firms are really looking at different segments of the market.
Flexibility Means More Procedures
Sketching differences between the two systems, Pope notes that the SurgiBot System is not a single-use device. It can move between operating rooms on a rolling stand, and allows the surgeon to be where he is most comfortable, at the patient’s side, not in another room.
The SurgiBot System is also going to considerably less expensive than the da Vinci devices, at $500,000 rather than the $1.2 million to $2 million for da Vinci’s.
That means, Pope explains, that the SurgiBot System can be marketed to mid-sized hospitals where 80 percent don’t currently have a robotic system, as well as the nation’s 5,000 surgery centers, where less than one percent have a robot.
Pope says the SurgiBot’s flexible instruments also allow the surgeon to do more procedures because “Many require you to move around within the abdomen.”
When asked what his greatest challenges were in building TransEnterix, however, Pope goes back to the beginning in 2007.
“We had a lot of people who insisted before they invested that this would only work in Silicon Valley or Boston, one of those big hubs,” says Pope, who is from Raleigh and graduated from the University of North Carolina at Chapel Hill.
“I was confident we could not only survive, but we could thrive. I thought we could separate ourselves being in this Research Triangle area. If you’re in Silicon Valley, you’re one of hundreds and hundreds of start-ups in the Med Tech arena. If you’re here, you can stand apart.”
The result, he says, “Has been rewarding. It’s great to have the talent base here from the pharmaceutical and biotech world’s and it’s great to recruit people here because it appeals to people who want to raise a family.”