TEL AVIV, June 10 (Reuters) – Mazor Surgical Technologies (MZOR.TA), an Israel-based medical device maker said it expected a major sales boost in 2010 when it enters the U.S. hospital market but does not expect to be profitable until 2012.
“We expect (sales) to be much higher in 2010 as we enter the U.S. We expect sales to much more than double,” Chief Financial Officer Sharon Levita told Reuters.
The company had sales of $1.4 million in 2009.
However, it does not expect to be profitable for another two years due to increased sales and marketing costs associated with the U.S. market launch, but says it has raised enough capital to support its activity until it becomes cash flow positive.
Its main product is SpineAssist, a robotic guidance system that enables surgeons to accurately place implants with reduced radiation exposure during spinal surgery.
“This can be done with open surgeries which require cutting through muscle and means increased blood loss and pain or it can be performed in a minimally invasive technique but accuracy is a problem. It’s hard to insert the implants with precision, it’s like threading a needle blindfolded,” said Doron Dinstein, vice president of marketing.
In over 1,300 surgeries using the robot there have been no cases of permanent nerve damage, he said.
In the United States, more than one million spinal procedures are performed every year, almost 60 percent of which are spinal fusions. The global market is estimated at between $6.7 billion and $8.9 billion a year.
There are 30 Mazor robots in operation, mostly in Germany, the world’s third largest healthcare market. The robots are also in use in Switzerland, Austria, Russia and Israel.
Now Mazor is focusing on the United States, where it has three clinical devices installed, including a sale announced this week to Texas Health Presbyterian Hospital. It also has a system in a national training centre at Texas Back Institute.
The company went public in 2007 and has raised $49 million to date. It has $3.5 million in debt.
Its biggest investor is Migdal Insurance (MGDL.TA), one of Israel’s largest insurers which is controlled by Italy’s Generali (GASI.MI).
“It’s possible we will go public on Nasdaq in the future though we don’t have concrete plans right now,” Levita said.
Dinstein said there are about a dozen companies in the rapidly growing medical robotics field, though none compete with Mazor in spinal surgery.
The robotics market leader is Intuitive Surgical (ISRG.O) with a market capitalisation of $12.6 billion, compared with $51.2 million for Mazor or $423 million for Mako Surgical Corp (MAKO.O). (Editing by Mike Nesbit)