Stuart Simpson, THINK Surgical - Miniature Robotic System for Knee Replacement | LSI USA '24

Stuart Simpson  0:04  
Stuart Simpson, think surgical. We are a surgical robotics company, not an implant company. A very important point of differentiation. We have unlocked the implant from the robot so the physician can choose the technology and the preferred implant independent of each other. And on top of that, we have miniaturized our total knee robot, because to make it easier to use, surgical robots have been around for a long time. 1992 was the first total hip replacement with a product called Robo doc Mako then came in 2006 into the uni compartmental, or partial knee replacement market, and after the acquisition by striker in 2013 they launched their total knee application in 2016 that's where the big opportunity is for surgical robotics. Knee replacement surgery can be significantly improved through this technology, and that's why the other major companies, such as Zimmer, Biomet and Depew followed in 2016 and 2019 and 2021 respectively. Orthopedic robotics is at a tipping point. It's about a $2 billion market. It is forecast to grow to about a $6 billion market over the next six years, and joint replacement is one of the major drivers of that expected growth. And as I've said before, within the category of joint replacement, total knee replacement is where the biggest opportunity lies. When you ask physicians today about their intention to use robots. 80 sorry, 70% of them say that within three years, they'll be using it routinely, if not for all of their procedures. That is very different from where we are today. Why? Because robots can improve accuracy and surgery may improve outcomes for the patient. Patients are asking for the procedures and fellowship programs are teaching the next generation of surgeons that this is how you should do joint replacement surgery, and increasingly, physicians are realizing that using robotic technology reduces the physical burden on them during each procedure, at a time where they are under immense pressure to perform more and more procedures. That is a very important consideration. So why, then, is joint replacement, or total knee replacement, use of robotics only at about 15% Well, there's two major problems. The robots are big and difficult to use, and they're all tied to one brand of implant, or they're each tied to their own brand of implant, and that needs to change. This is a typical operating room set up. You have a anesthetist at the head of the table, and you have a surgeon, a physician assistant and a scrub tech around the patient. That is the way it's been in the operating room for decades. That's how they are trained to operate on a patient for orthopedic surgery. So imagine you bring in a robot which is 900 pounds. To give it some context, I looked up things that are 900 pounds, and this grand piano is almost exactly 900 pounds. Imagine navigating that up to the side of the table and have it participate in the surgery. It completely disrupts the entire workflow and means that those members of this operating team have to reposition themselves. The robots that are on the market today are tied to one implant, so Stryker's Mako is available with a knee implant, which is about 20 years old. There are more modern alternatives on the market today, but you can't use them with that robot only the striker knee. I don't know about you, but when I go to get even sneakers, I'm interested in trying on a range of sneakers to get the one that fits me, even if they are all the same size, I have different expectations than other members of my family. So if I put that much effort into selecting the right sneaker, does it make sense that when I have a knee replacement, I get offered one option only? So that's why think surgical is not an implant company. We are implant agnostic, and because we believe that the big robots are so disruptive in the operating room, we've miniaturized our robot. It gives the physician the freedom to choose the right implant for each patient, and it makes the robot itself so much easier to use. So this is our handheld robot, wireless handheld, seven pounds, not 900 pounds, but seven pounds. Some say that that makes the other 893 pounds redundant. It's optimized for knee surgery. It delivers all the same functional results that the big robots deliver, and it is easily integrates into the standard operating room workflow, and it has an open implant library. It was cleared last year. We were in seven sites. By the end of the year, we had 11 more contracts signed. We're deploying those contracts as we speak, those systems as we speak, and we have a very deep pipeline of new potential opportunities ahead of us. It is so easy to adopt that this workflow that has been the standard for so many years doesn't change at all. Our T mini sits on the same surgical instrument table that all the other instruments sit on. Nothing else changes that makes it particularly pleasing to the OR staff, and it makes it particularly well suited to the ASC market, where many of the procedures are moving. We had four implant companies on our platform last year. We have signed contracts with another five, and we're in the process of doing the development work to submit in the next couple of months. So by the middle of the year, we will have nine implant options covering all the different implant philosophies that a surgeon may be interested in. But the big question everyone asks us is, so when do the big companies come along? Will you ever get one of the big players? And I can say with absolute confidence that by the middle of this year, we will have at least one of the big implant companies on our platform, which will be a tremendous validation and a great springboard for our company. Our company is not dependent on implant revenue. We have sell the robot. We get service revenue, and we get disposable revenue, which both of which are recurring. And as we scale, those recurring elements of revenue become a bigger part of the overall revenue contribution. We're about six. We have a pathway to about 60, 65% gross margin, a lot lower than the 80% gross margin that you get in an implant company. But because we don't have to field our own sales force, we work through the sales channels of the existing implant organizations we're working with, it gives us a very big sales force at relatively low cost, and means that we have a clear pathway to mid 20s operating income margin. We will do over 10 million in revenue this year. If the major company comes on board, you can double or maybe even treble that number for year one revenue and we have a pathway to operating income positive by 28 and cash flow positive by 29 we've brought together a very experienced leadership team. Our executive chairman was the former CEO of Zimmer Biomet. I used to run strikers, joint replacement and robotics business globally and in key commercial R and D and regulatory functions. All of our executives have decades of experience in robotics in orthopedics, so we have the team to deliver on what we're trying to do. We raised 100 million late 22 we've sub since then, got our regulatory clearance in the US, as I said, and we've launched and are doing well commercially. So we've taken a lot of technology, regulatory and commercial risk off the board, and we're now seeking an investment later this year, of $100 million to accelerate our commercialization of this technology and of this company. And if you're investors and interested in robotics or orthopedics or both, I would ask you to just think about it. That's my cell phone. Reach out if you want to have a meeting while here. Okay, I'll leave out there for a minute for you to take a picture, if anybody's interested. Thank you. Applause.