FDA approves Insightec-Siemens neurology surgery platform

MRI - Photo: Shutterstock

The product, which is adopted for use in combination with Siemens's imaging devices, is already used with GE.

Elbit Medical Technologies (Nasdaq: EMITF; TASE: EMITF) has announced that Insightec, a company that develops systems for surgery, in which it holds a 22% stake, has obtained FDA marketing approval for its brain surgery product developed jointly with Siemens; this product has been adopted for use with Siemens's imaging devices. Up until now, Insightec has marketed systems adopted to GE's imaging devices, but the exclusive agreement between Insightec and GE was opened in 2016, while a joint development agreement with Siemens was signed at the same time. Simultaneous cooperation with the two companies provides Insightec with great access to the market.

Insightec has developed and markets systems based on ultrasound from several directions focused on specific tissue. MRI is used in this treatment in order to provide the doctor with guidance about exactly where to focus the ultrasound radiation, so compatibility with MRI devices is very important for the company. This cooperation also has marketing significance, because Siemens is likely to encourage its doctor customers to buy Insightec's device and to use it in order to facilitate greater use of its Siemens's MRI devices.

Insightec's neurology surgery system is currently designed mainly for treatment of tremors not caused by Parkinson's Disease. Insightec posted $32 million in revenue in 2017, and CEO Dr. Maurice Ferre said that revenue is projected to grow in 2018 with the launch of Siemens's product. Insightec's revenue grew 12% in the first half of 2018, compared with the first half of 2017, before the launching of the joint product with Siemens. The predictions of faster growth can now probably be put off until 2019. The company hopes to later expand its business by attaining medical insurance reimbursement for users of its product in additional states in the US and in other countries, and by extending the capabilities of the device to tremors from Parkinson's Disease and improved delivery of drugs to the brain.

The announcement did not affect the share price of Elbit Medical, whose current market is NIS 230 million. Elbit Medical also owns an 18% share of cancer treatment company Gamida Cell, which recently filed a confidential prospectus for a Nasdaq offering. It is believed that the company will attempt to raise $50-75 million at a company value of $300 million, but it is still unclear whether it will try to conduct the offering before the year-end holidays or wait until early 2019.

Published by Globes [online], Israel business news - www.globes-online.com - on September 27, 2018

© Copyright of Globes Publisher Itonut (1983) Ltd. 2018

MRI - Photo: Shutterstock
MRI - Photo: Shutterstock
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