FDA clears new version of Intuitive's da Vinci surgical robot

April 1 Tue Apr 1, 2014 11:54am EDT

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April 1 (Reuters) - Intuitive Surgical Inc said the U.S. Food and Drug Administration approved for marketing an upgraded version of its flagship robotic surgical system, sending the company's shares up as much as 15 percent.

The company said it launched the device, da Vinci Xi Surgical System, in the United States on Tuesday.

The device enables surgeons to perform complex procedures using a minimally invasive approach.

"The new system came a bit earlier than we expected, is a very good improvement on the open surgery part of the ledger -particularly for colorectal surgery," Suntrust Robinson Humphrey analyst Amit Hasan wrote in a note.

Hasan said it also opens up further technology upgrades that were not possible on the older system.

Intuitive Surgical launched its last major upgrade of the da Vinci system in 2009.

The company, which experienced strong revenue growth on steadily rising sales of da Vinci systems in past years, saw demand slow last year amid concerns regarding cost effectiveness of the device and insurer resistance to reimburse some procedures.

The da Vinci system witnessed a steep 23 percent decline in sales to $205 million in the fourth quarter of 2013.

"... if history is any guide, the new system might as well trigger increased demand and a product upgrade cycle, despite ongoing hospital budget constraints," Stifel Nicolaus analysts said in a note.

The Sunnyvale, California-based company's stock was up about 8 percent at $473.82 in late morning trade on the Nasdaq.

(Reporting by Natalie Grover in Bangalore; Editing by Sriraj Kalluvila)

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