TransEnterix Acquires MST Medical to Boost Senhance Capabilities
Posted on September 26, 2018 by Medtech[y] Staff
Earlier this week, TransEnterix ($TRXC), announced that they acquired the assets of MST Medical Surgery Technologies Ltd., an Israel medical technology company, in a cash and stock transaction with a total consideration.
MST is a leader in the field of surgical technology, having developed a software-based image analytics platform powered by advanced visualization, scene recognition, artificial intelligence, machine learning and data analytics.
“We are very excited to be partnering with TransEnterix, one of the leaders in surgical robotics who is pioneering the industry with their Senhance platform,” said Motti Frimer, CEO of MST. “The Senhance is a fantastic product with incredible potential, and we have a shared vision with TransEnterix of providing digital laparoscopy to better equip surgeons with innovative technologies that enhance their abilities, providing better quality, more consistent outcomes.”
The transaction will be financed with a combination of cash and stock, delivered in two separate tranches. At the closing of the transaction, MST will receive approximately $5.8 million in cash and 3,150,000 shares of TransEnterix common stock. The second tranche of $6.6 million, payable in cash or stock, is to be paid within one year of closing. The timing and form of payment of the second tranche is at TransEnterix’s sole discretion.
What does this mean for TransEnterix?
Software development will drive the future of robotic surgery and this acquisition will help TransEnterix achieve one of their strategic intents, which is to digitize the interface between the surgeon and patient in laparascopic surgery.
This acquisition helps move their strategic needle, as MST's existing technology, IP portfolio, and R&D team accelerates TransEnterix's vision of delivering digital laparoscopy, eventually allowing increased control of the surgical environment and making surgery safer with the Senhance technology.
MST brings a lot to the table:
- Innovative Surgical Technology Portfolio: MST’s technology and software engine will help accelerate Senhance platform innovation to meaningfully advance the benefits of digital laparoscopy to patients, surgeons and operating rooms globally. Key components of MST’s technology include advanced visualization, scene recognition, artificial intelligence, machine learning and data analytics.
- Established R&D Center: Provides immediate access to an established R&D center in Israel, with a core team of experienced engineers. In addition, the R&D center allows the Company to tap into talent from one of the world’s top technology hubs.
Making Senhance More Than A Robot
Integrating MST's technology and developing additional technology into Senhance is the goal and TransEnterix gave a glimpse of what's to come in their acquisition presentation.
The below picture is an example of machine learning software integrated into Senhance, which can help surgeons identify anatomical structures during surgery. A simplistic way of looking at this is having navigation built-in to the Senhance system. Yes, surgeons know anatomy but there are always those stressful cases with a less than desirable field of view. Having deep learning software at a surgeon's finger tip is helpful to the surgeon and safer for the patients.
Aside from the clinical benefits, the technology acquired from MST also helps protect TransEnterix from bigger and more well funded competition.
Look at the Johnson & Johnson partnership with Google, forming Verb Surgical. While a robotic system hasn't been launched out of the partnership, J&J realized they need software developers and the brightest minds in high technology to help be a leader in robotic surgery. They couldn't just launch a "dumb" robot because they realized the future is in machine learning and AI.
Additionally, companies like Medtronic and Johnson & Johnson are increasingly fighting for top software developers as silicon valley and the medical device industry start to intersect.
“Adding innovative, novel technological capabilities to Senhance is a critical part of our long-term strategy as we work towards digitizing the interface between the surgeon and the patient,” said Todd M. Pope, President and CEO of TransEnterix. “The addition of the MST technology to our Senhance platform will increase the effectiveness of surgeons, making procedures quicker and less error-prone, leading to better outcomes for the patient.”
TransEnterix made a great strategic acquisition here and CEO Todd Pope continues to make moves that will keep TransEnterix in the conversation for today and in the future.