Time is our enemy:
Once again, everybody say it. "Its cheaper to buy tech/IP, than to create it, develop it and patent it." It takes large amounts of talent, that's not just walking around looking for a cool new project. All high-tech companies are competing for the top level talent. Net new development takes time, and time for R&D costs A LOT. It also comes with risk of not making it to market to recover the investment. As I've mentioned recently - look at how long it's taken to get the most recent patents approved. Many years. When you buy tech/IP you accelerate the time-line = jump ahead of the competition by 3-5 years? Which will enable you to expand a product line, and create barriers to entry in different market segments from the acquired tech/IP and......shorten the time to market and the adoption/learning curve.
Market share is critical:
From a strategy point of view, if many small, mid and large hospitals adopt SPORT, what % of the market is left? Will there be enough of the pie for the competition to recoup their investment? Will they bleed too much money chasing too few customers? If we get to market quick enough - then we can only hope so.
From my perspective, and I hope from TITAN's - we all get that which we hope for, but more importantly SPORT gets accelerated to market.
Now, to those who love to say "I told you so," no I don't think mgmt was wrong to expand the number of indications from the initial design to what it is today. I'm confident that TITAN took a look around to see what was on the horizon, and took a measured guess as to what the margin of error was prior to embarking on this generation of SPORT. My guess is that the robot will operate the same regardless of the surgical procedure, but the training will be very different. So I think that they will pick 4-6 "high-impact" surgical procedures for phase 1A trials. I completely defer to our professional surgeons on this board for their opinion over my guesses. I'd think then a few more field units will be installed to address phase 1B indications. I don't see all 9, or 11 or however many all at once.
Again time is critical. The sooner ANY indications can be shown in the field, the fear factor of TITAN's success jumps way up. It's as much the fear of the unknown (how fast the market will adopt SPORT) as it is of the known reviews of those field units. And it's easier to sell and support the 1A's immediately.
Keep your Xanax, and anti depressants handy!
GLTA.
Regards,
BK
AI
