“Wealth Care — The Next da Vinci”

By Travis Johnson, Stock Gumshoe, August 8, 2007

This one comes in promising to find us the “next Intuitive Surgical” — and as an ISRG shareholder sitting on 100%+ gains, that really strikes a chord with me. Sounds like it’s worth a sleuthing moment or two.

Intuitive Surgical, for those who don’t know, is the company that makes and sells the da Vinci, the surgical robot that’s taking over prostatectomies and is gradually expanding into other minimally invasive surgeries. Over the last few years it has climbed from $30-40 or so up to the current price that has spiked a bit over $200 on some great recent earnings and guidance numbers.

So yeah, let’s get us another one of them, shall we?

The newsletter doing the teasing here is Quantum Confidential from Brian Hicks — which is normally $600 bucks a year, though it s a bit less than $500 with a sale price now. Still, a little steep for a wee investor like me … unless this really is the next Intuitive Surgical we’re talking about here.

Then again, if it really is, then that $500 invested in this company would turn into about $2,000 in a couple years … so maybe that’s a better investment at the moment. Let’s investigate.

The leadup is a fairly typical one for your finer health care teasers — lots of talk about the baby boomers, how they’re getting old and will be spending millions on health care, and how they’re entering the prime cancer years (sorry, didn’t mean to put that so bluntly … but that’s essentially the “sell” here).

Brian Hicks calls this “Wealth Care” investing, which as I understand it is the need to be wealthy when you retire so you can afford all this expensive medical care.

And this particular teased company is a cancer fighting technology of some sort. They couch this in terms of the “Doctor’s Retirement Plan”, the idea of which we’ve seen teased before — basically, that doctors who invest get rich because they understand the new drugs and technology well before us laypeople do.

The guy he talks about, Dr. Mark W., who may or may not be fictional, made a bunch of money in ISRG and kept holding on even after stupendous gains that would have tempted many investors to sell, because he really understood how important the da Vinci was going to be.

So we learn all about Dr. Mark W. and his investing prowess, and how much money he made in Intuitive Surgical. Yay! And according to Brian Hicks, the inside knowledge gained from subscribing to his newsletter will enable you to hold on to your investments, like ISRG, well past the 50%, 100%, and 200% gains (fighting those profit-taking temptations) to enable real wealth building.

I have no idea what Quantum’s record is overall — so far, I’ve seen teasers from Brian Hicks for DIVX and FRPT … DIVX (which is the only other Quantum Confidential pick I’ve uncovered here) is down about 30%, FRPT (teased for a different one of his newsletters) up about 40%, for whatever that’s worth (not much, I’m guessing). He does document in the ad several big winners that he’s had in the service … doesn’t mention any losers, surprisingly enough.

But moving on … what specific clues do we eventually get about this company?

“In just three and a half years, this tumor-tracking cancer killer has treated over 30,000 cancer patients suffering from nearly every type of cancer known … more than 2,000 lung cancer patients in just over three and a half years.”

This is some kind of radiation treatment device — but it allows pinpointing of cancer for better impact. Since breathing and moving make it hard to focus beams of radiation at a tiny tumor, this uses robotics to do the job (thus the allusion to ISRG).

“The new technology takes the slightest involuntary movement into account, adjusts for it, and homes in on the cancer.”

Then Brian tells us the success stories of several cancer patients who had this treatment and saw great results, or who are on waiting lists to get it.

Apparently, this device is the first radiation treatment that lets radiation be used on cancers outside of the brain (that’s news to me, I thought radiation treatment was pretty common for all kinds of cancers — but I’m definitely no expert on that). It’s apparently particularly great for treating lung cancer, which is still one of the more common and deadly ones.

Brian says the market should be pretty remarkably big — “three years from now, nearly one million cancer cases. Just about all of them treatable with the new miracle tumor tracker.”

The machine costs about $5 million clams &#