Titan Medical has abandoned plans to seek FDA clearance to sell its robotic surgical system before 2021, the company said Tuesday.
Management scrapped the filing target and opted against setting a new timeline in response to financial constraints and the effects they have had on relationships with suppliers.
- Titan is in the process of trying to raise up to $25 million but, even if successful, will need to add around $70 million more if it is to make a 510(k) filing in 2021.
Titan's initial aim is to market a single-port robotic surgical system with gynecologic surgery indications for use, an area Intuitive Surgical's da Vinci covers.
But Titan’s statements about its filing plans have become progressively less confident throughout 2019. In May, Titan told investors it was on track to file to sell its robotic surgical system in the U.S. by the end of the year. By July, Titan was managing expectations, noting that the timeline was "very tight" and "not completely within [its] control." One month later, Titan pushed back its filing target to the first half of 2020.
Now, Titan has scrapped almost all its development milestone targets, the exception being a single near-term goal. The scheduled completion date and anticipated cost of all the milestones between Titan and commercialization of its product are now listed as "to be determined."
The withdrawal of all the forecasts follows the deterioration of Titan’s finances and relations with a supplier and service provider. Titan has faced cash burn concerns throughout 2019 but in May said it expected to be able to raise $35 million to see it through to the first quarter of 2020. Under the old development schedule, the robotic surgical system would be nearing the market by the time the cash ran out.
Titan filed to raise up to $22 million last month, setting an expected Oct. 8 closing date for the offering. Management subsequently revised the plan but has yet to raise the money. Another revised plan was submitted Tuesday.
The company needs to raise money to keep going. Titan ended last month with $1.2 million in cash and $2.3 million in cash deposits with suppliers. Accounts payable and accrued liabilities stood at $12.1 million.
Titan’s financial situation is a source of concern for its suppliers. On Oct. 3, Titan’s primary product development supplier decided to limit its work for the company, leading it to sever ties with a "significant number" of people engaged on the project.
"This will significantly impact the timing and costs associated with the completion of the Company’s future milestones as additional time and cost will be incurred to rehire employees and resume product development," Titan wrote in a regulatory filing.
Titan also disclosed that its relationship with another service provider developing devices for the robotic surgical system has deteriorated. The service provider has concerns about Titan’s "inability to fully pay invoices." For its part, Titan "has expressed dissatisfaction with the quality of the work performed by the service provider."
The service provider has demanded $2.9 million from Titan, which responded with a letter declining the terms of the request. Titan has asked the service provider to stop work on its projects.