Titan Medical Inc (TMDIF)

[diversify]

The math still won't work for quite a while as the robot will come with a minimum of a 12 month warranty (no service contract revenue for a year). You have to sell a decent amount of robots in order to take advantage of the razor/razor blade concept while simultaneously ensuring it is used for a ton of procedures to rack up your disposable sales. Not to mention the toll this is going to take on expenses when you need a sales force and clinical staff to support sites to drive adoption, use, and procedure volume. When I said "200 robots" I was assuming it would take quite a while for Titan to sell that many...as in several years post-FDA-clearance. For clarity and so I don't get skewered, I was referring to 200 robots in the US market. I have no capacity to understand the market opportunity, competitive landscape, etc. OUS.

If Titan could somehow sell 20-30 robots domestically in their first 12 months post FDA it would be really impressive. They are going to have to find the sites that want to get rid of Intuitive to sell the first batch. Another option is to sell to smaller hospitals looking for their first robot where they will be in a blood bath against Intuitive. Disrupting a somewhat-happy ISRG site with more than 1 daVinci is going to be tough because hospitals are not going to want a mixed bag of general surgery robots that each require their own set of surgeon & staff training, maintenance, service, etc. I personally think those sites will be won over in year 2 and beyond.. or Titan will have to essentially donate the robot to the site in order to have some show-sites that have both systems.

All of this assumes we get FDA...