Will Intuitive Surgical's Appearance on 'Grey's Anatomy' Boost Sales?

Product placement in movies and TV shows has become commonplace. Usually it's a casual shot that blends into the scenery, sometimes it's a little more obvious - i.e. the Coke (KO) cups on the American Idol judges' desk - and occasionally it hits you in the face. That was the case last night when I was being a couch potato watching the season finale of ABC's (DIS) "Grey's Anatomy" on TiVo last night.

Essentially two commercials for Intiuitive Surgical (ISRG), the company that makes operating-room robots, were embedded in the script for the show. And I can't imagine the actors were happy about having to pretend over-the-top effusiveness and to recite lines that were so blatantly written into the episode because ISRG was paying for the storyline. Although, these days maybe the actors are resigned to the fact that this kind of stuff helps pay their salaries.

It went like this. The chief of surgery, Dr. Webber, is trying to keep one of his top docs, Bailey, from defecting from his staff to pediatrics. So, he tries to woo and wow her by playing Santa Claus and buying the latest state of the art ISRG equipment. "No, you did not," Dr. Bailey said. (Yes, I actually rewound the TiVo and transcribed the dialogue.) "Oh, yes I did," replied Dr. Webber. "The daVinci SiHD Surgical System," he said like a proud papa. "Tell me you didn't wait until I all but left the general surgery program to buy us a daVinci," Dr. Bailey exclaimed. "Care to take it for a spin?" Webber asked. And then Bailey turns to him and with a #@*!-eating grin effuses, "Santa!"

Cut to a later scene when Dr. Bailey takes the daVinci for a spin. By now, she's referring to the thing as "Leo" (uh, Leonardo...as in daVinci) and verbalizing her amazement and wonder about everything it can do. "540-degree wristed movement. You can't do that with a lathroscopic," she says. "Or in open surgery," Webber adds before going on to claim that a doctor at The Cleveland Clinic is using a daVinci to do a "single incision gall bladder removal through the belly button." Oy!

I ran upstairs to my computer to Tweet about what I just saw and then Googled Intuitive Surgical's website where, lo and behold, it was cross-promoting the whole thing. "From Seattle Grace to a Real Hospital Near You," the homepage artwork with a Seattle skyline photo says. If you don't watch Grey's, Seattle Grace is the name of the hospital in the show.

ISRG shares have been on fire lately. They've surged from less than a hundred bucks in early April to more than $150 today. But the company reported flat sales in the first quarter, presumably as cash-strapped hospitals cutback on purchases of big ticket items like the daVinci. I don't know what the company spent for the Grey's thing, but I can't imagine some hospital CEO or CFO sitting at home watching the show and saying, "Wow. We just have to buy one of those, right now!" Or maybe ISRG thinks patients will come into hospitals now and ask if they have one of those fancy things they saw on that TV show. Either way, I can't see it driving sales. But it did get me to write about it.

UPDATE: A spokesperson for The Cleveland Clinic says the doctor the fictional Dr. Webber referred to in last night's "Grey's Anatomy" is a real doctor at the hospital. His name is Sricharan Chalikonda. Neither the hospital nor the doc had any heads up about the shoutout in the show. In fact, Dr. Chalikonda was in surgery last night when the progam aired. And, indeed, the "single incision gall bladder removal through the belly button" is one of the procedures he does with the daVinci. The hospital's checking to see if he has any relationship to ISRG. A Cleveland Clinic spokesperson says Dr. Chalikonda "teaches other surgeons how to use the (ISRG) robot on behalf of the company. He has also spoken at a conference for them. All of his ties have been disclosed per Cleveland Clinic guidelines."

Intuitive Surgical is located on the west coast. So, the folks there weren't at work yet when I called Friday morning seeking comment on what I thought was product placement in last night's "Grey's Anatomy." They all stayed up late to watch the show and then bask in the glow of the kind of advertising some might say money can't buy. And, in this case, apparently it didn't.

ISRG's Director of Marketing, Heather Chemtob, called later in the day to tell me it wasn't product placement at all and that no money changed hands. She said the folks at ABC's Grey's reached out to ISRG less than two months ago and asked to use one of its robots because it likes to keep it real. Of course, ISRG was more than happy to oblige. Chemtob said the company got to proof the script for the two scenes where the daVinci robot was used or talked about and sent a couple of "experts" to the set for the two-day shoot to make sure the device was used "appropriately." ISRG had once arranged a similar loaner to NBC's "ER," Chemtob told me.

She thought most of the stuff would end up on the proverbial cutting room floor, but the company was "amazed" by how much they actually put into the show.

So was I. As far as the cross-promotion ISRG is doing on its website, Chemtob said the company was careful not to use any images, clips or quotes from the show. They just wanted to capture any inquisitive viewers - I guess, like me maybe - who might have wanted to check out what the deal was with the thingamajig. "For us, it's just about patient education," Chemtob said.

But Miller Tabak healthcare analyst Les Funtleyder says there's more to it than that. He sent me an email after reading my earlier blog about all this to point out that Intuitive Surgical has "been encouraging DTC (direct to consumer) advertising for prostate and hysterectomies. Perhaps this is an extension of that. They want people to go into the doctor and specifically ask for 'the robot'."

Now they might be asking for 'the robot' they saw on "Grey's."

Comments

[DONE_SONZ:]

I dont know,but I sure wish I held on to the stock when it was $6 years ago around the time they bought out RBOT.I need to find more gems like that.

May 17 07:45 AM

[speculari:]

To Mike & DONE_SONZ,
Mike - why not state at the outset that it was not a "paid" spot on the part of ISRG, instead of almost losing that particular near the end of your article.
DONE_SONZ - it was Computer Motion that ISRG acquired & their "ZEUS" system around 2003. The stock hit a llow around 2002 of about $7.
Spend a little bit more time on their website, you can watch a range of informative videos ( please go beyond the one with a "cutesy" Diane Sawyer gushing almost moronically about the daVinci ) - from the most detailed of surgical procedures to more general stuff by Sanjay Gupta. I agree with you on one point Mike, it probably won't have any direct impact on sales. It has got a lot more to do with educating the public. You may also want to spend a bit more time acquainting yourself with their financials - a recent $300 million stock buyback, zero debt, more than 930 machines or "thingamajigs" (as you so brilliantly put it) in place, and much more; - then, perhaps you too can write a little bit more intelligently about this powerful device.
I've had a long position in ISRG since 2004.

May 17 08:32 PM

[speculari:]

Mike,
I went back to look at your blog - I notice that you did not bother to set the record straight there, regarding the fact that ISRG DID NOT PAY for the spot.
When the small coterie of neurosurgeons operating out of Transylvania tries the daVinci to transplant real human brains into stock analysts - may we add your name to the list? (as a recipient, of course)

May 17 09:32 PM

[Anthony B:]

Wow, a great product markets itself. Can't believe that kind of product placement is free! Imagine 24 blatantly using the Sprint network for free.

I'm going to try and sell some OTM puts on an ISRG pullback. Pullback will happen when people realize unit sales to continue their decline in the short-term. Thankfully, they're on the razor and blades model and the blades aren't cheap either!

May 17 09:43 PM

[speculari:]

Sorry about that last post Mike! You did make a correction - I'll switch your name over to the "donor" list.

May 18 08:51 AM

[wallcrwaler78:]

Interesting article and comments. Personally, I would suggest that you rewrite the structure of your blog post to include the new found information you became privy to after the fact. You start out so negative, and then gain some enlightenment after the fact. People may not bother to read to the bottom, where you actually acquired some facts and stopped lashing out. But that's just my opinion...

On a side note. I think Intuitive makes a pretty cool product. Anything that can help reduce the amount of collateral damage in a surgery (broken bones, large scars, etc) is something worth watching.

Has anyone seen the movie "Hackers"? Yeah that wasn't even remotely realistic. I will take a product plug over fake high technolgy any day.

May 21 02:10 PM

[JW Bennett:]

Please see webiste above,

link: www.authorizedmovers.c...

and profile at linkedin: linkedin.com/pub/j-w-b...

I would like to discuss more of this issue with you and its impact on "Edu-tainment" and the history and medical shows and TV/ movies and why its such a powerful medium.

If interested please contact via email: drjwbennett@medi-media...
or 888-814-2550

Thanks

J Bennett, M.D.

Nov 16 02:26 PM