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Despite delays, Medtronic remains bullish on its robot system, Hugo

Burl Gilyard, Star Tribune on

Published in Business News

"We experienced a supply constraint on a sub-component of our Hugo robotic-assisted surgery system, which delayed shipments to customers in Europe," said Megan Rosengarten, president of Medtronic's surgical robotics unit.

The company declined to identify the specific component but said that shipments have resumed.

To maintain interest and momentum while awaiting the component, Medtronic sent their European customers surgeon consoles and simulators so they could begin their robotics training before their Hugo machine arrived, Rosengarten said.

The equipment's full name is the Hugo RAS System. RAS stands for robotic-assisted surgery. The "Hugo" name is trademarked.

Medtronic's robotics system has been in use for less than a year. It was first used on a patient seven months ago, performing a robotic prostatectomy at a clinic in Santiago, Chile. About 50% of all robotic-assisted procedures, including those done by Hugo, are in urology or gynecology — though Hugo can also be used for general surgery.

 

"FY23 will be a big year," said Rosengarten. "Demand is high and we're building a strong list of hospitals that want ... be among the first in the world to use the Hugo system. Surgeons continue to do cases and our order pipeline continues to grow."

Despite analysts' disappointment over Hugo's delayed growth prospects, at least one observer is bullish on the company's overall new product pipeline.

Medtronic "is unfolding the strongest innovation cycle in its history and is at the front-end of major launches that we think are underappreciated given recent setbacks," wrote Shagun Singh, an analyst with RBC Capital Markets, which initiated coverage of Medtronic in December. "These opportunities are potentially transformational and likely to position (Medtronic) to deliver growth above its stated targets."

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