Investor Presentation Q4 2013

Transcription

1 Investor Presentation Q4 2013

2 Forward Looking Statement These slides and any accompanying oral presentation by Intuitive Surgical, Inc. contain estimates and forward-looking statements. Actual results may differ materially from those expressed or implied as a result of certain risks and uncertainties. These risks and uncertainties are described in detail in the Company s Securities and Exchange Commission filings.

3 Corporate Overview Founded in 1995, IPO 2000 Financial Results 2012: Revenue - $2.18B, up 24% from 2011; Operating Profit $878M, up 26% from 2011, 40.3% of sales Q3YTD 2013: Revenue - $1.69B, up 8% from Q3YTD 2012 Approximately 450,000 da Vinci procedures performed in 2012, up 25% from 2011 Q3YTD 2013 Procedures up approximately 18% from Q3YTD ,871 da Vinci System installed base as of 9/30/13 2,042 United States, 455 Europe, 374 Rest of World FDA Clearances Laparoscopic, Thoracoscopic, Prostatectomy, Cardiotomy, Revascularization, Urology, Gynecology, Pediatric, Transoral Otolaryngology, Single-Site Cholecystectomy, Single-Site Hysterectomy Feb 2013 Primary Markets - Urology, Gynecology, General Surgery, Cardiothoracic

4 Recurring Revenue Model Instruments & Accessories $1,300-$2,200 per procedure 2012 Rev $903M da Vinci Surgical System $1.0M - $2.3M 2012 Rev = $933M Annual Service Agreement $100K - $170K/Year 2012 Rev = $343M

5 Adoption of da Vinci Surgery is Driven by Patient Value Patient Value = Efficacy Invasiveness

6 Annual Worldwide Procedures 600, ,000 United States International 2013 Fcst 16-17% Growth 400, , , ,

7 da Vinci System Installed Base 3,000 2,500 United States International 2,000 1,500 1, Q313

8 1 Weerakoon M, et al. Predictors of positive surgical margins at open and robot-assisted laparoscopic radical prostatectomy: a single surgeon series. J Robotic Surg (2011) DOI /s Coronato EE, et al. A multi-institutional comparison of radical retropubic prostatectomy, radical perineal prostatectomy, and robot-assisted laparoscopic prostatectomy for treatment of localized prostate cancer. J Robotic Surg (2009) 3: Health Information and Quality Authority (HIQA), reporting to the Minister of Health-Ireland. Health technology assessment of robot-assisted surgery in selected surgical procedures, 21 September Rocco B, et al. Robotic vs open prostatectomy in a laparoscopically naive centre: a matched-pair analysis. BJU Int Oct;104(7): Epub 2009 May 5. 5 Ficarra V, et al. A prospective, non-randomized trial comparing robot-assisted laparoscopic and retropubic radical prostatectomy in one European institution. BJU Int Aug;104(4): Epub 2009 Mar 5. 6 Ho C, et al. Robot-Assisted Surgery Compared with Open Surgery and Laparoscopic Surgery: Clinical Effectiveness and Economic Analyses [Internet]. Ottawa: Canadian Agency for Drugs and Technologies in Health (CADTH); 2011 (Technology report no. 137).7 Hohwu L, et al. Open retropubic prostatectomy versus robot-assisted laparoscopic prostatectomy: A comparison of length of sick leave. Scand. J. Urol. Nephrol. Apr : Menon M, et al. Prospective comparison of radical retropubic prostatectomy and robot-assisted anatomic prostatectomy: the Vattikuti Urology Institute experience. Urology Nov;60(5): Miller J, et al. Prospective evaluation of short-term impact and recovery of health related quality of life in men undergoing robotic assisted laparoscopic radical prostatectomy versus open radical prostatectomy. J Urol Sep;178(3 Pt 1):854-8; discussion 859. Epub 2007 Jul Carlsson S, et al. Surgery-related complications in 1253 robot-assisted and 485 open retropubic radical prostatectomies at the Karolinska University Hospital, Sweden. Urology May;75(5): da Vinci Prostatectomy Clinical Benefits of da Vinci Prostatectomy v. Open Surgery Cancer Control: Studies show, compared to open surgery, experienced da Vinci surgeons achieve improved cancer control - lower positive margin rates. 1,2,3 Return of Erectile Function: Studies show patients who are potent prior to surgery experience a faster return of erectile function than patients who have open surgery. 4,5 Return of Urinary Continence: Recent studies show more patients have full return of urinary continence within 6 months as compared to patients having open surgery. 3,4,5 Shorter hospital stay 3,4,5,6,7 Less blood loss 3,4,5,6,8,9,10 Less need for a blood transfusion 3,5,6,8,10 Lower risk of complications 3,6,10 Lower risk of wound infection 10 Fewer days with catheter 4 Less pain 8 Faster recovery 9 and return to normal activities 7

9 da Vinci Prostatectomy Procedures 120, ,000 United States International 80,000 60,000 40,000 20, US da Vinci Prostatectomy procedures were approximately 15% lower than We believe the US prostatectomy decline was driven by a combination of the US Preventive Service Task force recommendation against PSA testing and a change in treatment recommendations for low risk prostate cancer away from definitive treatment. Intuitive proprietary data

10 da Vinci Prostatectomy Market Potential* US Prostate Cancer: Estimated at 200,000 cases annually Europe Prostate Cancer: Estimated at 250,000 cases annually Active Surveillance IMRT EBRT Brachy Other dvp** Open IMRT EBRT Brachy HIFU Laparoscopic Active Surveillance dvp dvp** Open Other Total Worldwide dvp Target Market: 200,000 *2012 US da Vinci Prostatectomy procedures were approximately 15% lower than We believe the US prostatectomy decline was driven by a combination of the US Preventive Service Task force recommendation against PSA testing and a change in treatment recommendations for low risk prostate cancer away from definitive treatment.

11 da Vinci Hysterectomy - Cancer Reported Clinical Benefits of da Vinci Hysterectomy Procedures for Cancer Versus Open Surgery: Better chance of living cancer-free at 2 year follow-up 1 Fewer complications 1,2,3,4,5,6,7 Less blood loss 1,2,3,4,5,6,7,8 Less pain 7,8 Shorter hospital stay (one day in many cases) 1,2,3,4,5,7,8 Quicker recovery and return to normal activities 6 Smaller incisions for minimal scarring 1 Lau S, et al. From McGill University: At two-year post-op follow-up. Outcomes and cost comparisons after introducing a robotics program for endometrial cancer surgery. Obstet Gynecol Apr;119(4): Paley PJ, et al. Surgical outcomes in gynecologic oncology in the era of robotics: analysis of first 1000 cases. Am J Obstet Gynecol Jun;204(6):551.e1-9. Epub 2011 Mar Estape R, et al. Robotic-assisted total laparoscopic hysterectomy and staging for the treatment of endometrial cancer: a comparison with conventional laparoscopy and abdominal approaches. J Robotic Surg 2009 DOI /s DeNardis SA, et al. Robotically assisted laparoscopic hysterectomy versus total abdominal hysterectomy and lymphadenectomy for endometrial cancer. Gynecologic Oncology 2008;111: Boggess JF, et al. A comparative study of 3 surgical methods for hysterectomy with staging for endometrial cancer. Am J Obstet Gynecol (For port placement, see figure 3) 6 Bell MC, et al. Comparison of outcomes and cost for endometrial cancer staging via traditional laparotomy, standard laparoscopy, and robotic techniques. Gynecologic Oncology III 2008: Halliday D, et al. Robotic radical hysterectomy: comparison of outcomes and cost. J Robotic Surg (2010) 4: DOI /s z. 8 Magrina JF, et al. Robotic surgery for endometrial cancer: comparison of perioperative outcomes and recurrence with laparoscopy, vaginal/laparoscopy and laparotomy. Eur J Gynaecol Oncol. 2011;32(5): H 1/13

12 da Vinci Hysterectomy - Benign Reported Clinical Benefits of da Vinci Hysterectomy Procedures for Benign Conditions Versus Open Surgery: Less blood loss 1 Fewer complications 1 Shorter hospital stay 1 Reduced scarring 2 1. Landeen L, et al. A Comparative Study of Four Surgical Approaches for Hysterectomy at a Single Institution: Outcomes and Costs of Robot-Assisted, Laparoscopic, Vaginal, and Abdominal Procedures. Pending publication June 2011, South Dakota Medical Review. 2 Data on file with Intuitive Surgical, Inc.

13 da Vinci Hysterectomy Procedures 175, , ,000 United States International 100,000 75,000 50,000 25, Intuitive proprietary data

14 US da Vinci Hysterectomy Market Potential* 500, ,000 Estimated Annual US Hysterectomies Laparoscopic and Vaginal Procedures dvh** dvh** Open Procedures - Remaining DVH Multiport Target Market Total US Target Market: 350,000 *Based on Company estimates **Based on approximate 2012 procedures

15 da Vinci Target Procedures Urology da Vinci Prostatectomy dvp dv Partial Nephrectomy dv Cystectomy dv Pyeloplasty Gynecology da Vinci Hysterectomy dvh dv Sacrocolpopexy dv Myomectomy dv Endometriosis Resection General Surgery Cardiac dv Colorectal Procedures Single-Site Cholecystectomy dv Mitral Valve Repair dv Revascularization Thoracic dv Lobectomy Head and Neck Surgery dv Transoral Procedures

16 da Vinci Surgery Long Term Revenue Potential for Current Target Procedures US Target Procedures: Urology 150,000 Gynecology 500,000 General 475,000 Cardiac 75,000 Thoracic 75,000 Head and Neck 25,000 Subtotal US 1,300,000 International Target Procedures 1,300,000 Total Worldwide 2,600,000 Annual I&A Revenue Annual System Revenue Annual Service Revenue $4.1 Billion+ $1.9 Billion+ $1.3 Billion+

17 Share of ISRG Target Market US Procedure Adoption Q % Procedures dvp dvh - Cancer dvh - Benign Cholecystectomy Sacrocolpopexy Nephrectomy (Prtl & Full) Colorectal Myomectomy Lobectomy TORS Mitral Valve Repair 200K Annual Procedures 0% Time Conceptual depiction of procedure adoption, scaling is approximate.

18 Share of ISRG Target Market US Procedure Adoption Q % Procedures dvp dvh - Cancer dvh - Benign Cholecystectomy Sacrocolpopexy Nephrectomy (Prtl & Full) Colorectal Myomectomy Lobectomy TORS Mitral Valve Repair 200K Annual Procedures 0% Time Conceptual depiction of procedure adoption, scaling is approximate.

19 Share of ISRG Target Market US Procedure Adoption Q % Procedures dvp dvh - Cancer dvh - Benign Cholecystectomy Sacrocolpopexy Nephrectomy (Prtl & Full) Colorectal Myomectomy Lobectomy TORS Mitral Valve Repair 200K Annual Procedures 0% Time Conceptual depiction of procedure adoption, scaling is approximate. Full Year 2012 prostatectomy procedures were 15% below We believe the US prostatectomy decline was driven by a combination of the US Preventive Service Task force recommendation against PSA testing and a change in treatment recommendations for low risk prostate cancer away from definitive treatment. The addressable market is estimated to be 15% lower on the Q312 and Q313 slides.

20 Share of ISRG Target Market US Procedure Adoption Q % Procedures dvp dvh - Cancer dvh - Benign Cholecystectomy Sacrocolpopexy Nephrectomy (Prtl & Full) Colorectal Myomectomy Lobectomy TORS Mitral Valve Repair 200K Annual Procedures 0% Time Conceptual depiction of procedure adoption, scaling is approximate. Full Year 2012 prostatectomy procedures were 15% below We believe the US prostatectomy decline was driven by a combination of the US Preventive Service Task force recommendation against PSA testing and a change in treatment recommendations for low risk prostate cancer away from definitive treatment. The addressable market is estimated to be 15% lower on the Q312 and Q313 slides.

21 Annual Worldwide Procedures 500, , ,000 Urology Gynecology General Surgery Other 200, ,

22 Advancing Surgical Ideals - New Technology Enter the body less invasively Single-Site Released Q111 EU / Q411 US (Cholecystectomy) / Q113 US (Benign Hysterectomy) Single port instrument set See anatomy more clearly Firefly Integrated Fluorescence Imaging Released Q111 Real-time contrast imaging Interact with tissue more precisely EndoWrist Vessel Sealer FDA cleared Q411 Articulating vessel sealing and ligation EndoWrist One Stapler 45 FDA cleared Q412 Precise and fully articulating control of linear stapler Build advanced skills da Vinci Skills Simulator Released Q111 Software based skills training and practice tool

23 da Vinci Single-Site Robotic-Assisted Surgery through a single umbilical port US FDA Cholecystectomy Clearance Dec 2011 Benign hysterectomy / Salpingo Oophorectomy 510K Clearance Feb US hospitals have purchased Single-Site products through Q313

24 Installs by Country and Region Canada 22 Europe 455 USA 2,042 Direct France 69 Germany 61 UK 36 Belgium 31 Switzerland 21 Netherlands 19 Sweden 19 Denmark 15 Norway 10 Czech Republic 8 Finland 5 Austria 5 Ireland 3 Luxembourg 1 Slovakia 1 Monaco 1 Distribution Italy 64 Spain 26 Turkey 21 Russia 20 Greece 8 Romania 6 Bulgaria 2 Portugal 1 Poland 1 Slovenia 1 Brazil 10 Mexico 5 Argentina 4 Chile 4 Venezuela 4 Colombia 2 Panama 1 Uruguay 1 Latin America 31 Middle East Saudi Arabia Israel 6 Qatar 4 Lebanon 2 Pakistan 2 Egypt 1 Kuwait 1 South Africa 1 Asia 261 Japan 138 South Korea 39 China 24 India 23 Taiwan 18 Singapore 8 Thailand 6 Malaysia 3 Indonesia 1 Philippines 1 Australia/New Zealand 32 Intuitive sells directly to customers in the US, Korea, and the European countries indicated above. Sales are through distributor partners in all other areas of the world including, Canada, Latin America, the Middle East, Asia and Australia.

25 Corporate Objectives Educating the surgical community about da Vinci surgery safety, efficacy and cost-effectiveness facts Building da Vinci capability and supporting its use in General Surgery Extending the benefits of minimally invasive surgery using da Vinci in gynecology and urology worldwide Disciplined execution in expanding our stapling and Single Site adoption

26 Revenue Trend ($M) $2,500 $2,000 $1.69B Q3YTD13, up 8% vs Q3YTD12 $1,500 $1,000 $500 $ Q313YTD

27 Operating Income Trend ($M)* $1,000 $800 $771M Q3YTD13, up 4% vs Q3YTD12 $600 $400 $200 $ Q3YTD13 *Excludes the impacts of non-cash stock compensation

28 Net Income and Cash Flow ($M)* $900 $750 Net Income Cash Flow $600 $450 $300 $150 $ Q3YTD13 * Operating cash flow plus excess tax benefit from stock compensation.

29 Cash and Investments ($M) $3,000 $2,500 $2,000 $1,500 $1,000 $500 $ * 2010* 2011* 2012* Q313* *$150M, $199M, $332M, $238M, and $1,109M respectively, was used in 2009, 2010, 2011, 2012, and Q3YTD13 to repurchase company stock.

30 Income Statement Trend ($M) Q3YTD13 Sales $601 $875 $1,052 $1,413 $1,757 $2,179 $1,689 Gross Profit % 69.0% 71.0% 71.4% 72.9% 72.5% 72.1% 70.8% Operating Income $207 $311 $377 $555 $695 $878 $644 Operating Margin % 34.4% 35.5% 35.9% 39.3% 39.5% 40.3% 38.1% Net Income $145 $204 $233 $382 $495 $657 $505 % of Revenue 24.1% 23.4% 22.1% 27.0% 28.2% 30.1% 29.9% EPS $3.70 $5.12 $5.93 $9.47 $12.32 $15.98 $12.46

31 Corporate Assets Extraordinary people 1,000+ field-based sales and service team 2,871 da Vinci System installed base FDA Clearances Laparoscopic, Thoracoscopic, Prostatectomy, Cardiotomy, Revascularization, Urology, Gynecology, Pediatric, Transoral Otolaryngology, Single-Site Cholecystectomy, Single- Site Hysterectomy Extensive instrument and accessory product line da Vinci Training centers worldwide Ownership of or exclusive rights to over 1,330 U.S. and foreign patents and more than 1,290 US and foreign patent applications da Vinci patient awareness $2.5 billion in cash & investments

32 Thank You While clinical studies support the effectiveness of the da Vinci Surgical System when used in minimally invasive surgery, individual results may vary. There are no guarantees of outcome. All surgeries involve the risk of major complications. Before deciding on surgery, patients should discuss al available treatment options with their doctors, as well as their risks and benefits. Surgery with the da Vinci Surgical System may not be appropriate for every individual; it may not be applicable to the condition. All people depicted unless otherwise noted are models Intuitive Surgical. All rights reserved. Intuitive, Intuitive Surgical, da Vinci, da Vinci S, da Vinci Si, Single-Site, InSite, Firefly, EndoWrist One, EndoWrist Stapler and EndoWrist are trademarks or registered trademarks of Intuitive Surgical. All other product names are trademarks or registered trademarks of their respective holders. PN Rev. E 11/11