TransEnterix, Inc. (NYSE MKT:TRXC) Q3 2018 Earnings Conference Call - Final Transcript
Nov 08, 2018 • 04:30 pm ET
loss of haptic feedback, and higher procedure cost relative to laparoscopy. While robotic procedure growth has been strong, the applications tended to be limited to converting open procedures to robotics because the reduction in hospital stay could offset the high per-procedure cost. This meant that nearly half of the surgical procedures being done worldwide still did not have an attractive robotic alternative.
What excited us about the opportunity for Senhance was the unique design of the system that we believe will help revolutionize the robotics industry. The Senhance was developed to cater to laparoscopic surgeons as there was nothing on the market purpose-built to convert laparoscopic procedures to robotics. It was specifically designed to leverage their laparoscopic familiarity and training and utilizes 5-millimeter reusable instruments similar to laparoscopy, which maintains the minimally invasive nature of laparoscopic procedures. The Senhance also brought new innovations with haptic feedback and eye tracking camera control. Finally, because our instruments are reusable, we can provide surgeons with all of these benefits while maintaining procedure costs that are comparable to laparoscopy. Bringing a product to market with a well-established incumbent has been and continues to be a journey.
Following the Senhance acquisition, with the CE Mark in hand, we initiated the commercialization of the product in EMEA in 2016. We have often stated that the hospital capital sales cycle is four to six quarters and, as a result, when building a pipeline from scratch, it can take a number of years to fully mature. In EMEA, we are just beginning to see the benefits of our maturing pipeline as we have gone from two system sales in 2017 to eight sold this year through the third quarter and we now have 10 commercially sold systems as well as three strategic placements that serve as training sites or to produce clinical data for our global regulatory submissions. In April 2017, we submitted our application for FDA clearance for Senhance. We took a strategic approach to our filing and decided to submit for initial indications for use within gynecologic and colorectal laparoscopic surgery.
We targeted this specific clearance because we had significant clinical data from our sites in Europe that could be used to support our filing. In addition, GYN has significant laparoscopic volumes and colorectal procedures are complex and can benefit from the advantages of a robotic solution. We also decided to file for a three-arm system because our experience in EMEA suggested that the majority of surgeries were done with three arms. In October of 2017, six months after filing, we received 510(k) clearance for the system becoming the first new entrant in the field of abdominal surgical robotics in nearly 20 years. Our initial indications of GYN and colorectal gave us immediate access to over 1.5 million annual procedures in the US.
Obtaining FDA 510(k) clearance is a rigorous process for any device, but the hurdles are particularly high for a surgical robot given that it has hardware, software, vision and instrument components, and the