Talk about striking while the iron’s hot. ReWalk Robotics (Nasdaq:RWLK), a manufacturer of robotic exoskeletons for paraplegics, went public Friday, Sept. 12, raising $36 million on Nasdaq by selling 3 million shares for $12 each at a company value of $136 million. According to IPO Insider, ReWalk is the best-performing IPO for 2014.
ReWalk, formerly known as Argo Medical Technologies, aimed to raise $58 million for a company value of $250-300 million by selling 4 million shares at $13-14 each. So while that was a disappointment, ReWalk’s share price more than doubled after the IPO, rising 113.33 percent in its first day of trading to $25.60, and was up a further 5.08 percent in after-market trading to $26.90.
Globes, the English version of Israeli business daily, reports that ReWalk may also receive an additional $5.5 million with underwriters including Barclays Capital and Jefferies having an option to buy an additional 450,000 shares.
On Monday, its second day on the Nasdaq, ReWalk stock climbed 45 percent to join an exclusive club, according to Renaissance Capital, which reports ReWalk became the fifth IPO of 2014 “to fly 100 percent or more on its first day of trading, and the only IPO since 2000 to do so after pricing below its estimated range, which was 3.4 million shares at a range of $14-$16 a share.
ReWalk, which has offices in Marlborough, Mass., Germany and Israel, sells two products to help paraplegics: ReWalk Personal, a custom-fit exoskeleton to be worn at home and at work, and ReWalk Rehabilitation, an exoskeleton targeted at clinics and hospitals for rehabilitation therapy.
ReWalk Personal, which costs $69,500, is worn over the legs and part of the upper body to help an individual sit, stand, and walk with assistance from a trained companion. It weighs 46 pounds, supporting its own weight, and has metal braces, a motor, and a 5-pound backpack that houses the computer and battery.
ReWalk, founded in 2001, has marketed earned $1.6 million in revenue in 2013 and a loss of $12.2 million.
ReWalk will ring the NASDAQ Stock Market opening bell on Wednesday, Sept. 17.
ReWalk to Expand Exoskeleton Technology
ReWalk’s exoskeleton technology can and will be expanded beyond its current uses. ?We are going to be using the money raised in the IPO to expand our research and production, almost all of which is done in northern Israel,” says CEO Larry Jasinski.
ReWalk Robotics CEO Larry Jasinski
In Robotics Business Review’s 2014 Healthcare Robotics Research Report, Jasinski says, “while we are starting to provide a system for spinal cord injuries, these technologies can potentially apply to many other medical needs such as stroke, multiple sclerosis, cerebral palsy and advancing age. Fundamental research must occur in these areas in order to develop and expand. Each of these segment are as large as the spinal cord injury segment.”
Jasinski says the driver behind exoskeleton innovation is the potential size of the market. “I think that many of us looked at these technologies as something that enabled walking. The clinical data taught us that they are very much ?more than walking?; the physiologic and personal impact on the individuals and their families that utilize these technologies is enormous. These are technologies that truly offer a better life and a better society for all of us by including more people in all aspects of daily life.”
As Financial Buzz points out, ReWalk’s partnership with Yaskawa Electric Corp, a Japanese company involved in the electrical equipment industry that also has a robotics segment, should also be enticing to investors.
ReWalk needs to continue to innovate as the competition certainly won’t be easy. A recent study from ResearchMoz called “Worldwide Rehabilitation Robots, Active Prostheses, and Exoskeletons Market 2014 Shares, Strategies, and Forecasts 2020,” forecasts the rehabilitation robot market to grow from $43.3 million to $1.8 billion by 2020. And a report from ABI Research has projected the overall market for exoskeletons could reach $292 million by the year 2020.
Exoskeletons are also already being tested for applications outside the healthcare space, including military use and as an aid for industrial customers. RBR50 company Lockheed Martin, which has been developing exoskeletons since 2009, just received its first order from the government to test its Fortis exoskeleton. The U.S. Navy will test the ability of the Fortis exoskeleton to help ship maintenance crews perform tasks that require heavy lifting.
FDA Approval Leads to Insurance Deal
In July 2014, ReWalk became the first and only exoskeleton approved by the Food and Drug Administration (FDA) for personal use. With the approval, Jasinski says the company is working with insurance agency’s to help cover the costs, which will help ReWalk widen its distribution.
ReWalk reached its first insurance deal with the Veteran?s Administration (VA) in the US, outfitting disabled veterans at the James J. Peters VA Medical Center in the Bronx with exoskeletons.
?Because it will save them money in the long run,? Jasinski tells the Times of Israel as to why the insurance deal with reached. ?Our estimates show that the ReWalk costs the same as two years? worth of drugs, rehabilitative personnel, and hospitalization expenses paraplegics require. Our system is guaranteed for five years, so the companies are saving three years? worth of expenses.?
ReWalk says its system has the potential to benefit an estimated 200,000 people in the United States living with a spinal cord injury and an estimated 1.5 million wheelchair users. The vast majority of people who need the system, however, will certainly need help from insurance companies.
Retired U.S. Army sergeant Theresa Hannigan, paralyzed three years ago, became the first patient in the United States to use ReWalk at home, CBS News reports (see video below). The VA is working with ReWalk to cover the entire cost for Hannigan.
Healthcare Robotics 2014 Research Report
Healthcare in the U.S. is approaching $4 trillion annually. To support, enhance, and mitigate the healthcare burdens, our healthcare system is witnessing robotic medical technology entering hospital surgical suites, in-patient rooms, in-home patient care, and uses with emergency services and vehicles.
Robotics Business Review’s special report “Healthcare Robotics 2014” analyzes new developments, trends, challenges and opportunities in the medical robotics sector.
The report profiles leading healthcare robotics companies, features exclusive Q&As with leading executives, discusses the impact of the Affordable Care Act, and examines surgical robotics, robotic replacement for diminished or lost function, exoskeletons, robot-assisted recovery and rehabilitation, and personalized care for the elderly.
There are two ways to access the research report:
2. All research reports are sold individually on the Robotics Business Review Store for $299 each.