A Big Week in MedTech

A big week in medtech.

RIF’s, robots, resets, and realizations.

Lives have been disrupted.
Liabilities have been exposed.
Opportunities have been created.

In no specific order of importance.
All are potentially interconnected introducing a saltation event in the medtech community.

–      The immediate solution of the Silicon Valley Bank situation allowed for a once-in-a-generation catastrophic event in the startup world to be side-stepped. It will however add levels of complexity, internal controls, and additional costs to startups and a greater oversight of managing risks at a micro-level that we have not previously experienced.

–      The substantial reduction in work force by Johnson & Johnson in their digital soft tissue surgical robotic programs as well as shuffling of executive level personnel in those programs. Billions of dollars had been invested and a pause button tapped on internal development.

–      Medtronic will likely be following with a large reduction in workforce in the next 30 days as well as an internal shuffling of the executive team in their surgical robotics program in addition to others. The Medtronic cuts may be larger than JNJ’s.

–      I would not sleep on the appointment of Supratim Bose as the newly appointed CEO of CMR Surgical. This is not likely an isolated appointment. The U.S. activity of CMR in with the FDA, the alignment with JNJ in some OUS activities, the pause button being hit by MDT and JNJ on internal development on their soft tissue robotics and once an additional soft tissue robotic platform comes to the US, not sure there is room for more than three players in that space. Intuitive, Asensus Surgical and CMR. Does that put a $18B+ purchase price out of reach for CMR in order to have that likely last seat saved in the soft tissue robotics race? I think not.

–      The headcount reductions, divestitures of businesses, recent acquisitions by JNJ and MDT supports a heightened interest in returning to their roots. Analog medical devices. The strategics perhaps will focus on what they have as an enormous competitive advantage…access to the patient. Adding digital intelligence to the existing specific verticals that they already own can stand on the shoulders of the industry equity and access that has been built upon the previous decades of great work.

–      An accelerated level of activity from the corporate venture groups. There is a competitive advantage over classic 10-year closed venture funds as long as the larger strategics can exert an aggressive patience and offsite development activities as independent as possible from the corporate parent.

What’s not to love?

Thanks to Tom Salemi and DeviceTalks for the discussion last week.