Intuitive Surgical Down $6 Billion on Robot Surgery Concerns

July 19, 2013 — Intuitive Surgical Inc., the manufacturer of the Da Vinci Surgical Robot, is having a bad year. The company has lost about $6 billion in market value over the last five months, according to Bloomberg.

The decline is mostly due to concern about robot surgery injuries, recalls, FDA warnings, costs, and insurance companies refusing to pay for certain procedures.

Sales of the robot have also declined amid a growing number of robot surgery lawsuits from plaintiffs who were injured. Intuitive recently recalled 30 robots that were inadequately tested. They have also warned about a problem with electrocutions and burns caused by electrical arcs from the scissors (“Hot Shears”) used to cut and cauterize tissues. Furthermore, surgeons and hospitals have faced lawsuits alleging that doctors were not adequately trained before operating on patients.

Hospitals have also been cutting back on spending, and they have been taking a closer look at procedures that are more expensive with a robot. Each robot costs about $1.5 million and has annual maintenance costs of $125,000. Single-use instruments add thousands of dollars to the cost of each surgery.

Some of the most popular robotic surgeries are more expensive, but offer no better outcome than traditional surgery. This was shown in a study published in February 2013 in the Journal of the American Medical Association, which showed that robotic hysterectomies were $2,200 more expensive, but offered little benefit. In 2010, 9.5% of all hysterectomies were performed with a robot — up from 0.5% in 2007. However, some experts predict that the need for robots will decline as the number of benign hysterectomies declines.