Dive Brief:

• Intuitive Surgical has paid $7.5 million for a nonexclusive license to most of Titan Medical’s intellectual property.
• The deal gives Intuitive access to patents related to the enhancement of robotic-assisted surgery, including ways to enter the body through a single access point. 
• Titan licensed the patents after failing to find a company willing to buy its business. The failure of the search for a buyer led Titan to further reduce its headcount to lower its operating costs.

Dive Insight:

Titan has been struggling for years. In 2019, cash constraints forced it to rethink its timeline for seeking 510(k) clearance for its single-port robotic surgical system. After further delays, the company started to look for strategic alternatives such as the sale of some or all of its business late last year.

Titan contacted “over 55 potential counterparties,” it said in a statement. None of the parties expressed an interest in buying the company.

Lacking a buyer for its business, Titan has concluded its engagement with the bankers who supported the strategic review and entered into a licensing agreement with Intuitive. Per the terms, Intuitive paid $7.5 million upfront to strengthen its patent portfolio.

The only Titan patents excluded from the deal are those “exclusively licensed to another party under a June 2020 license agreement.” Titan granted Medtronic an exclusive license to a portion of its intellectual property in June 2020. Medtronic made a one-time upfront royalty payment of $10 million to license the patents. 

Titan is continuing to evaluate additional licensing opportunities but, with the $7.5 million from Intuitive the only proceeds to date, has decided to further reduce its costs. The company laid off 73% of its staff in February and removed members of its senior leadership team later that month.

Now, the company is making more cuts to its leadership team to further reduce its spending. Cary Vance is stepping down as president and CEO. Paul Cataford, the chair of Titan’s board, will fill Vance’s positions on an interim basis. Titan is also promoting Chien Huang, its vice president of finance, to replace the departing chief financial officer Stephen Lemieux.

Lemieux will continue in a consulting role, as will the departing leaders in the legal, manufacturing and human resources departments. With most of Titan’s previous leadership team departing, the changes suggest the company’s senior group will consist of Cataford and Huang, plus consultants.