Dive Brief:

• TransEnterix told investors Wednesday its Senhance robotic surgery system has failed to consistently live up to high expectations of physicians using Intuitive Surgical's devices. 

• The would-be rival to Intuitive again sold one Senhance system in the quarter, this time to a German hospital, extending its stretch without a sale in the U.S. out to six months.

• TransEnterix had expected to sell two to four units in the quarter but delayed negotiations in Europe and customer satisfaction problems in the U.S. led it to miss that target.

Dive Insight:

TransEnterix sold 15 Senhance robotic systems in 2018, its first full year on the U.S. market. Five of those sales came in the fourth quarter. Since then, TransEnterix has sold one system in Taiwan and another in Germany.

Todd Pope, the CEO of TransEnterix, thinks the lack of U.S. sales this year stems in part from the experiences of the first surgeons to buy or try Senhance.

"The U.S. robotics market is mature with the well-established competitor, so potential customers have high expectations. Early Senhance system experience did not consistently delight prospects and customers, which impacted early system evaluations and clinical use," TransEnterix CEO Todd Pope said on a second quarter results conference call with investors. 

Pope said TransEnterix worked quickly to resolve these issues, noting that making the surgical system compatible with imaging products from companies such as Stryker has resulted in a "higher quality, more consistent surgeon experience." Even so, the early struggles negatively affected TransEnterix's "pipeline activities and early customer satisfaction feedback," according to Pope.

TransEnterix is still trying to get back on track in the U.S., including by hiring people with experience of the capital selling process. Pope expects to make "meaningful commercial progress" in the second half of the year as a result of improved performance in Europe, Asia and the U.S.

Investors expected the company to make meaningful progress in the second quarter but the forecast sales failed to materialize. Pope said the sales TransEnterix hoped to make in the second quarter "have continued to slip, not necessarily go away."

TransEnterix's efforts to turn things around in the second half could benefit from the reimbursement coverage it recently gained in Japan. Pope said the breadth of the coverage exceeded expectations and emboldened the company to defer plans to appoint a distributor. TransEnterix is now rethinking its go-to-market strategy in Japan. Pope predicted TransEnterix will "get some initial traction in the market this year."