Stryker Snaps Up Mako

Robotic Knee Resurfacing the Mako way

Mako Surgical Corp. is one of today’s bigger fish in robotic surgery, although it’s had to overcome some choppy waters to get here. Now Stryker has got its teeth into the Florida based robot-assisted knee joint resurfacing outfit, to the tune of a $1.65Bn takeover.

Background

Mako Surgical pioneered robotic-assisted surgery in orthopedics and the term “makoplasty”. Its system comprises the Rio Robotic Arm, which enables surgeons to precisely and consistently cut through bone. The incisions are designed for the company’s Restoris implants, including partial knee resurfacing in people with early or mid-stage osteoarthritis.

Stryker obviously really wanted to add a robotic surgical option to its portfolio, the purchase price representing an 86 percent premium over Mako’s most recent closing price.

Analyst comments

“The take-out price seems high, but strategically it makes a lot of sense,” said Joanne Wuensch, an analyst at BMO Capital Markets in New York, in a note to investors today. “For Stryker, the company takes a step forward into robotic surgery, consolidates its orthopedic silo, and continues its M&A strategy that it has been on for several years.”

Company comments

Stryker CEO Kevin Lobo said the addition of Mako’s technology to his company’s established position in operating rooms, joint reconstruction and surgical instruments will spur the growth of robotic assisted surgery.

“Mako has established a compelling technology platform in robotic assisted surgery which we believe has considerable long-term potential in joint reconstruction,” he said in a statement. “Our combined expertise offers the potential to simplify joint reconstruction procedures, reduce variability and enhance the surgeon and patient experience.”

Source: Bloomberg