Public healthcare systems will be last in line for surgical robotic systems

GlobalData estimates that the Covid-19 pandemic caused the cancellation of 15% to 30% of elective surgeries in 2020 and two years on we continue to see press articles regarding the cancellation of non-urgent surgeries in the UK by their public healthcare system, the National Health Service (NHS).

While the cancellation of surgeries led to lost revenue for surgical robotics vendors in the first three quarters of 2020, by the final three months of 2020, the market began returning to its pre-Covid figures. GlobalData predicts that the number of robotic surgical procedures will reach over 3.1 million in the US by 2030, growing at a CAGR of 10.5% from 2020 to 2030.

Covid-19 has made the need to digitally transform the healthcare industry more pressing. It has proven that automation is key to improving productivity, with surgical robotic systems helping to address staff shortages, providing an additional line of defence in healthcare systems, reducing error, accelerating recovery times and lowering the costs associated with extended hospital stays.

Designed for solving limitations in minimally invasive surgeries (MIS) and improving procedure outcomes, surgical robotics can be divided into three primary sub-segments: general surgery robotics, orthopaedic robotics and neurosurgery robotics. More common robotic surgical procedures across these three sub-segments include hernia repairs, cholecystectomies, prostatectomies, knee reconstructions and minimally invasive fusion procedures.

Designing and modelling surgical robots is relatively expensive, resulting in high costs for healthcare systems looking to install and maintain them. For example, Intuitive Surgical’s latest da Vinci model costs around $2.3m, alongside annual costs for disposable accessories and maintenance.

Given the high cost of equipment and the need for additional staff training, GlobalData expects for-profit entities to act as pioneers of the technology, with the outpatient ambulatory sector likely to see initial adoption. Healthcare systems with larger revenues will be able to procure the technology at an earlier date and begin the extra staff training necessary for such systems.

In line with the need for higher healthcare expenditure, the North American market for surgical robotics has experienced rapid growth in recent years and GlobalData expects this trend to continue. Growth here is driven largely by increased healthcare revenues, growing surgical patient populations, and a rising focus on robotics training for physicians.

Smaller markets for surgical robotics with increasing healthcare expenditure such as the Asia-Pacific and the Middle East and Africa markets will see expanded access to robotic surgical systems. Factors such as improvements in life expectancy, investments in state-of-the-art medical research facilities and increased awareness will also improve access.

While Europe has the second-largest market for surgical robotics, the domination of public healthcare systems in this region and restricted government spending will prevent the quick adoption of more expensive surgical robotics systems.

Covid-19, Brexit and geopolitical impacts such as the economic and trade policies imposed by the Trump administration all had a profound economic effect on European countries. As countries continue to contend with government debt and high levels of unemployment, robotic vendors will also have to contend with the stricter, regulated budgets of public healthcare systems.

Although it is unlikely that this technology will sweep systems (such as the NHS in the UK) anytime soon, GlobalData expects early adopters of surgical robotics systems to cause an explosion of adoption in public-based healthcare systems. The development of more cost-efficient robotic systems, such as CMR Surgical’s Versius, may help in this adoption.