Transcript 12-MRA-008 Event_102312

MRA – Member Companies
Argenta Advisors, LLC
Lighthouse Media, LLC
The Bailey Group
Medpace
Baker Tilly Virchow Krause, LLP
Oppenheimer Wolff & Donnelly LLP
Boulder Creek Consulting/Green Gas
QAD Inc.
Canopy Medical, LLC
Regulatory Strategies and Solutions, Inc.
Creekridge Capital, LLC
RJF, a Marsh & McLennan Agency LLC Co.
DeviceAdvisors, LLP
Silicon Valley Bank
Devicix, LLC
Square Feat, LLC
DuVal & Associates, P.A.
Swenson Gilliand & Associates
Dymedex Consulting, LLC
Talencio, LLC
Healthcare Academy
Technomics Research, LLC
HGA Architects and Engineers
ThreeWire, Inc.
Introworks
VTL Search
KJ International Resources
European Commercialization:
Achieving Success as a Growing
Medical Device Company
J. Greg Davis
Founder & CEO, MedCelerate, LLC
My Device Background
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©2012 MedCelerate LLC, All Rights Reserved.
Chasing Conflicting Commercialization
Objectives
Iterate Product
Design Based on
Clinical Experience
Revenue and Reaching
Cash Flow Positive
Demonstrate Deep
Penetration in Select
Accounts
Substantiate Market
Potential
What is Most
Important to
Achieve?
Conduct
Randomized Trial to
Fine Tune U.S. Trial
Parameters
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Capture Competitive
Market Share
Create Buzz with
KOLs & Potential
Acquirers
Collect Clinical Data
& Experience
©2012 MedCelerate LLC, All Rights Reserved.
Chasing Conflicting Objectives
- Case Study
Commercial Objectives
• Exit Year 1 with revenues >$1M/month
• Maintain premium pricing
• Focus on deep penetration in accounts
• “Go Big or Go Home!”
Lessons Learned
Implementation
• Hired direct sales reps in UK & GER
• Signed 18 distribution agreements
• Engaged three GER sales agents
Results
• Maintained premium pricing
• Objectives incompatible
• Understand sales levers before
expanding geographically
• Strong adoption by some KOLs
• KOL support only part of story
• Focused on large accounts
• Created strong buzz and awareness
• Driving adoption best done directly
• Launched in 22 countries in 7 months
• Exited year at 25% of revenue plan
• Adoption impacted by price, limited
• Set premium price with strict controls
• Product positioning: Easy-to-Use
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clinical data and ease-of-use
©2012 MedCelerate LLC, All Rights Reserved.
Blessing and Curse of CE Mark
Approval
EU Regulatory Class
# of Patients
Trial Region
Cardiovascular
III
30
Europe
Peripheral Artery
IIb
11
South America
GERD
III
24
South America
Venous Disease
IIb
11
Caribbean
Cardiovascular
III
25
Europe
- Limited clinical experience, with small number of KOLs, does not
guarantee product viability
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©2012 MedCelerate LLC, All Rights Reserved.
Building Clinical Data Set Post-CE Mark
- Case Study
• CE Mark enrollment
(30 patients)
• One Employee
• Adverse events
• IDE enrollment
• Product recalls
• Redesign required
• Registry initiated
• Product line extensions
• Registry data published (800)
2007
2008
2009
2010
2011
2012
(30)*
(85)
(500)
(800)
(3,500)
(>5,000)
* Cumulative # of implants
• CE Mark approval
• Contract manufacturer change
• “Minor” design change
• Limited product launch
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• Contract manufacturer change
• CE Mark approval, launch
• IDE approval
• Registry data published (253)
• IDE enrollment complete
• Registry data published
(+1,000)
©2012 MedCelerate LLC, All Rights Reserved.
Deciding Approach to Customer: Distributors
versus Direct Employees?
Product Profile
Commercial Objectives
• Changing clinical practice?
• Alignment with objectives?
• Physician learning curve?
• Revenue ramp?
• Market development?
• Investor patience/dry powder?
• Gross margin?
• U.S. market strategy?
• Niche product?
Market Dynamics
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Distributor Capabilities
• Reimbursement?
• Customer relationships?
• Local tenders?
• Technical expertise?
• Hospital payment terms?
• Financial stability?
• Number of accounts?
• Product portfolio?
• Geographical spread?
• Interest/desire?
©2012 MedCelerate LLC, All Rights Reserved.
Distributor as Commercial Partner
- Case Study
Strategy
• Involved early in commercial planning
• Open and frequent communication to build trust
• Collaboration on programs aimed at our commercial objectives
• Open about company’s progress towards major milestones
• Offered equity investment opportunity
• Joint visibility with KOLs
Results
• Remained with us during 10-month redesign effort
• Consistently achieved/exceeded quarterly sales targets
• Produced strong product adoption in key accounts
• Award for outstanding sales & clinical support performance, 2011
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©2012 MedCelerate LLC, All Rights Reserved.
Delivering Robust Product Supply Requires
Time & Teamwork
In-house vs. Contract
Mfg., New Packaging
Design & Materials
Evaluate Vendors,
Technology Transfer,
Vendor Management
Product Branding, Multilanguage, International
Symbols, Reg. Review
Final
Assembly
/Pack
Component
Suppliers
Financial
Support
Labeling,
IFU
Validations, Biological
Indicators, Vendor
Management
Sterilization
First
Commercial
Shipment!
Logistics
Bank Accounts, VAT,
A/R & A/P, Inventory
Reporting
Order Entry &
Fulfillment, Invoicing,
Returns, Multi-lingual
Support
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Customer
Service
Authorized
Rep
Inbound/Outbound
Transport, Warehousing,
Traceability, Customs
Appoint Safety Officer,
Customer Complaints &
Inquires
©2012 MedCelerate LLC, All Rights Reserved.
Building Capable Supply Chain
- Case Study
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Pre-CE Mark (Q1 2011)
Post-CE Mark (Today)
Manufacturing
• U.S. component mfgrs
• Adhesive, kitting & pack in CA
• Sterilization in CA
• Product made in Ireland
• Adhesive production in NC
• Sterilization in Belgium
• EU Operations Director (Irish)
Labeling/IFU
• English only
• Generic labeling
• 8 languages
• New branding, Venaseal®
Logistics
• Non-existent
• NL distribution center
(outsourced)
Authorized
Rep
• Non-existent
• Emergo - NL
Customer
Service
• Non-existent
• Multi-language call center - NL
Financial
Support
• U.S. bank account
• 3 EU bank accounts
• In-depth VAT analysis
©2012 MedCelerate LLC, All Rights Reserved.
Product Transformation
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©2012 MedCelerate LLC, All Rights Reserved.
Key Takeaways
• Align commercial objectives, focus on few
• CE Mark does not mean you have product
• Validate sales levers before expanding
“It’s all about what happens at the account level”
• Product profile important for determining approach
• Don’t underestimate supply chain complexities
• How does technology save HC system money?
Good Luck!
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©2012 MedCelerate LLC, All Rights Reserved.
Panel Discussion
Moderator
Randy Ban
Inspire Medical Systems
Senior Vice President of External Operations
Panelist
J. Greg Davis
MedCelerate, LLC
Founder & CEO
Panelist
Ross Meisner
Dymedex Consulting
Managing Partner
Thank You.