MetroWest495 Biz

"Their enthusiasm for the product was almost indescribably high," he said. "This is life-changing for people that haven't been able to walk for years and years. They can walk their daugh- ter down the aisle." Of course, they can only do that if they can get one of the exoskeletons, and they're not cheap. Each device costs around $70,000. And, while some po- tential customers have that kind of cash lying around — or the ability to raise the money privately — large-scale sales depend on winning insurance coverage. There's been good news for ReWalk on that front as well in recent months. In June, the James J. Peters VA Medi- cal Center in the Bronx, N.Y., which also handles insurance payments for veterans, became the first U.S. insurer to reimburse a patient for the device; and this January, private Midwestern insurer Workers' Compensation did the same. Four groups in Germany have also agreed to cover the exoskeletons. Taylor said he expects more insur- ers to get on board with ReWalk, but they'll want more data from clinical studies than what they've seen so far. "It's a big expense," he said. "I mean, it's $70K. So you have to show that you're going to save $70K on the back end." That could mean avoiding expensive surgery thanks to the exoskeleton's positive effects on a user's health compared to wheelchairs, Taylor said. Or it could mean simply improved quality of life, translated into financial terms. The company is now evaluat- ing possible health benefits, including increased bone density and reduced body fat, better heart and lung health, improvements in bowel and bladder function and less pain. It also says users find the ability to stand for much of the day makes it easier to engage in conversation, give hugs, cook and do other everyday activities. ReWalk is expecting more insurance deals soon. In an email interview, CEO Larry Jasinski wrote that the company has multiple claims pending with private insurers throughout the U.S. and it's working with several other federal Veter - ans Affairs centers on potential coverage. Jasinski wrote that in 2015, "we be- lieve we will see multiple reimbursement cases in the U.S. and Europe; we expect several additional regulatory clearances; we expect to see a high level of growth in terms of home use year over year." In the third quarter of 2014, which ended Sept. 30, ReWalk reported 26 sales, compared with 25 of the devices in all of 2013. The sales are to individu- al users as well as rehabilitation centers. One center using the devices is Boston-based Spaulding Rehabilitation Network. Spokesman Tim Sullivan said patients can be fitted with the exoskel - etons, work with them in the therapy setting and then bring them home. The network is "kind of a hub for communi- ties with disabilities," he said, and it works to bring patients, technology and funding sources, including foundations and government organizations, together. "For us it kind of fits with our mission and mode of always trying to advance the technology, and also giving access," Sullivan said. "I think we've seen the robotics and exoskeleton technology keep advancing, and certainly we all hope that one day it's commonplace to see somebody in Starbucks walking up [and using one of the units]." Sullivan cautioned that the ReWalk devices aren't appropriate for everyone using a wheelchair. So far, the FDA has only approved them for people with spinal cord injuries that have caused lower-body paralysis. The company is now developing a new design for patients with quadriplegia who are unable to hold crutches. That would be a particularly significant milestone for the company since its founder, Amit Goffer, is a quad - riplegic whose own life experiences led him to invent the ReWalk device. The company is also planning to seek regulatory approval for use by people with other diagnoses such as multiple sclerosis, stroke and cerebral palsy. Taylor said that even without official approval, rehab centers can use the devices for those other conditions. "A lot of the rehab centers we've talked to have said they want to use it for an array of things," he said. "They'll use it how they see fit. They don't have to follow the label." The New York City firm Ark Invest- ment Management estimates there's a potential market of 2.6 million Ameri- cans who might be able to use a robotic exoskeleton — with more outside the U.S. — signaling a huge opportunity for ReWalk to grow. The question is whether the company can stay ahead of the competition. Taylor said ReWalk has distin- guished itself by getting the first FDA approval, which is likely to lead to more adoption in the short term. Another advantage for the company is its patented "tilt sensor" technology, which lets users guide the machines with natural body movements rather than with a joystick, as some competing products require. "It is sort of a more natural way to do it," Taylor said. He said users are likely to prefer the experience with the ReWalk device, and there may also be health benefits associated with the more natural walk- ing style the product allows. David Conway, a robotics analyst with ARK Investment Management, said it's hard to predict the future for companies like ReWalk because the market for exoskeletons is so new, and bound to change in coming years. As insurers begin to cover the products, he said, more will be produced, driving the prices down. ARK projects that the per-unit cost of the devices will drop from $70,000 to $40,000 by 2020, then to $10,000 — comparable to the current price of a high-end wheelchair — by 2030. By then, the firm suggests, about 1.3 million medical exoskeletons could be sold, representing half the market. There's no certainty that ReWalk will be the company to provide the best and most cost-effective product in the long term, Conway said. ReWalk noted in its IPO prospectus that it has a number of competitors, including Ekso Bionics, Rex Bionics, Cyberdyne and Parker Hannifin, and Conway said more players will undoubtedly enter the market as it heats up. "The potential market is huge, but cur- rently it's very, very small," he said. "In five years, who knows what we'll see." For the MetroWest area, though, there's good reason to be excited about ReWalk, at least for the moment, and perhaps many years to come. The com - pany has 10 employees at its Marlbor- ough office, a second-floor suite at 33 Locke St., and about 60 more in Israel and Germany. It's now adding positions in fields that include administration and finance in Marlborough, and Taylor said he expects the growth to continue. "Certainly they're going to hire a lot more people before they fire anybody," he said. "I would be really excited if they chose my town as their headquar - ters, because they're really cutting-edge. They're really moving quickly." n MetroWest495 Biz | February 2015 13 Y O U R R E G I O N A L R E S O U R C E F O R B U Y I N G O R S E L L I N G A B U S I N E S S Your resource for buying or selling a business BUSINESS OF THE MONTH The following is our selection for the business of the month that is for sale. For confidential reasons the name of the business and its exact location is omitted. • UPSCALE SALON/SPA • This business is a turnkey business that has an extensive clientele following serving the local area for over 20 years. The ambiance of the salon/spa is upscale with all new furniture and equipment. Its annual revenue exceeds $1,000,000 and the cash flow is substantial. Currently there are 18 hair stylist and 4 massage therapist. The business is located in a high end retail shopping mall in a suburban town in the Metro West area. Significant opportunity to expand and grow the business in a well defined market segment. Asking Price is $625,000 including the inventory as well as furniture and fixtures. Some owner financing is available. Owner is retiring. All inquiries should be directed to the EXCHANGE Email: smunyon@wbjournal.com or call Susan Munyon at 508-755-8004 x258. Inquirer should provide name, phone number and email address as well as the specific Business of the Month. For additional businesses for sale go to www.wbjournal.com and click on the EXCHANGE Price projections for robotic exoskeletons Cumulative sales projections for medical robot exoskeletons Source: ARK Investment Management 0 $10 $20 $30 $40 $50 $60 $70 $80 2014 2020 2025 2030 PRICE PROJECTIONS (In thousands of dollars) $70,000 $40,000 $20,000 $10,000 0 $300,000 $600,000 $900,000 $1,200,000 $1,500,000 $30,000 $360,000 $1,300,000 SALES PROJECTIONS 2025 2030 2020

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