‘How am
I going to sell this thing?’ Here’s the scenario:
Engineer or physician develops an innovative product,
Heads-up for manufacturers at Conference. Let your
manufacturers know that there’s something special
A good match. San Antonio-based VidaCare and Medical Dynamics is newest member. IMDA’s newest member covers the Southwest under the direction of Bill Carmouche. Simplicity, usability key considerations in medical device competition. Winners announced for 10th annual Medical Design Excellence Awards. Angels bless medical device firms in 2006. Angel investors dipped deeply into their pockets to fund new healthcare services and medical devices and equipment. Prospecting for IMDA members. Your manufacturer partners are an excellent source of names of prospective IMDA members. So ask them.
In his travels as a medical products executive and now consultant, Rick Davies has seen the following scenario play out again and again: Engineer or physician develops an innovative product, files for patent and finally obtains FDA 510(k) marketing clearance. Then, with his 510(k) letter in hand, he sighs, “Now, how am I going to sell this thing?” Davies, who along with his son, Chris Davies, manages Vector Resources in Midvale, Utah, has extended a helping hand to such individuals through a series of “commercialization seminars” co-sponsored by the Medical Device Manufacturers Association. The seminars are designed to help manufacturers of innovative technologies consider the options they have in taking those technologies to market, among them specialty representation, licensing, hiring a direct sales force, or selling the entire company to one of the big boys. At the most recent seminar – held in Washington, D.C., on March 22 – Tom Birmingham of Bay State Anesthesia and Rick Pfahl of Bovie Aaron Medical presented the case for specialty sales and marketing organizations. Birmingham spoke from the distributor’s perspective, Pfahl from the perspective of a manufacturer who uses specialty distribution. (IMDA member Dave Campbell participated in the two prior commercialization seminars.) Davies told attendees that even the coolest new technology will fail in the market if it doesn’t meet some “commercialization imperatives.” “The successful commercialization of medical devices begins by understanding and confirming the clinical and commercial viability of the technology or product,” he says. “Then it moves on to the importance of properly matching the product and business objectives with the broad range of proven options, ranging from licensing out the technology, to entering into a strategic partnership with an established market player, to selling the product yourself -- using direct employees, sales reps, specialty distributors or a hybrid strategy. Finally, once a commercialization strategy has been matched to the product and objectives, you have to work to avoid common mistakes in implementing the strategy.” New-technology developers (and marketers) would be wise to maintain a cool head about them when they bring that technology to market, advises Davies. “We asked the attendees, ‘How many of you think that doctors come to work in the morning and say, ‘I just can’t wait to use that wound closure device?’ No. They come to provide patient care with good and improved outcomes at the lowest cost to the healthcare system.” New-technology developers should also understand the double-edged sword that hangs above technologies designed to “revolutionize” healthcare. “You might have to wait for a new generation of doctors and nurses to use it, because you won’t find a field with more inertia or resistance to change [than healthcare],” says Davies. One exception was the technology surrounding laparoscopic cholycystectomy. Warren Grundfest, M.D., professor of bioengineering, electrical engineering and surgery at UCLA, told seminar attendees that lap cholies caught on quickly because they were better for the patient from a clinical perspective, and better for the healthcare system from a cost perspective. Quite simply, doctors who couldn’t offer the minimally invasive procedure lost patients to those who could. In short, the technology for laparoscopic cholycystectomies met the “commercialization imperatives.” But a technology that failed to meet those imperatives and fizzled – at great cost to some hospitals – was the minimally invasive laser. When the hype died down, doctors discovered that electrosurgery worked well, as it had with open gallbladder procedures, says Davies, speaking about Grundfest’s presentation. The seminar drew an eclectic mix of people, including representatives from the Canadian, British and German embassies; as well as from the National Institutes of Health and the National Science Foundation. “These were people primarily involved in technology transfer, who wanted to understand the broader commercialization strategies beyond just licensing,” says Davies. A big draw was David Hood, representing the Acquisitions, Telemedicine & Advanced Technology Research (TATRC) of the U.S. Army Medical Research & Materiel Command. TATRC invests in companies that are developing technologies that can help the Army with combat casualty care; control of military infectious diseases; military operational medicine; and medical, chemical and biological defense. The seminar was held in coordination with the Virginia Biotechnology Association and MdBio, a division of the Tech Council of Maryland, with support from TATRC, which is based in Fort Detrik, Md.
Let your manufacturers know that there’s something special being planned for them at the upcoming Annual Conference. “Working with specialty distributors,” is the name of a manufacturers-only breakout session to be held from 3 to 4 p.m. on Sunday, June 3, immediately before the Welcome Reception. The session is designed to give manufacturers a heads-up about specialty distribution before the Conference begins, says Annual Conference Chairman Tom Birmingham. During the session, manufacturers will get a chance to ask their questions and to hear about specialty distribution from a peer – Rick Pfahl of Bovie Aaron Medical, an IMDA allied member. While “Working with specialty distributors” may have more of an immediate impact on manufacturers who are new to IMDA (such as first-time exhibitors at the Manufacturers Forum), veterans who are eager to learn how to build upon their existing relationships with IMDA member companies will also benefit by attending, says Birmingham. To view a Conference brochure and registration form, click here.
San Antonio-based VidaCare and specialty distributors are a match made – if not in heaven, then in Park City, Utah. In fact, it was at the Manufacturers Forum during the 2003 IMDA Annual Conference in Park City that VidaCare exhibited its innovative intraosseous drug-delivery system, EZ-IO®. The company forged relationships with several IMDA members, and this year, presented awards to two of them -- Med Alliance Group and CVC Inc. – for outstanding sales. Med Alliance, located in Carol Stream, Ill., received the top overall award for 2006, based on total dollars, total dollar increase, and total percent-to-quota. Meanwhile, Arlington, Texas-based CVC received the award for total dollar volume. Formed around technology developed at the University of Texas in San Antonio, EZ-IO provides for the rapid, secure and safe delivery of intraosseous drugs and fluids. “Intraosseous” means “inside the bone,” and it is employed when existing methods of vascular access (intravenous, or “inside the vein” delivery) are challenging or even impossible -- which is often the case with trauma patients, whose veins may have collapsed. When considering his options for taking EZ-IO to market, VidaCare Executive Vice President and co-founder Jim Thomsen considered his options. “I could have formed a strategic alliance with a large manufacturer, but I didn’t want to do that, because you give up the store,” he says. Nor did he want to raise the cash to field a direct sales force. So he turned to specialty distribution. And given his history, that’s not surprising. Thomsen had worked with specialty distributors before, and had even founded two specialty distributor organizations in the past, “They can create markets where there are none, through pure sales efforts,” he says. “Specialty sales companies are my sales organization,” says Thomsen. “They have a major impact on our company.” Meanwhile, CVC honored VidaCare with a plaque of its own – the CVC Manufacturers Award. “The manufacturer has to provide the most substantial new dollars to CVC,” says CVC President Richard Manley, explaining the criteria upon which the company gave the award. “Second, we must believe that the vendor is committed to us for the long term and understands the value we bring to the partnership. Primarily, it shows our appreciation and recognition of their contribution to CVC.” CVC has been carrying VidaCare’s products since the manufacturer came to market three years ago. Editor’s note: The VidaCare story will be posted on the IMDA website soon, so that manufacturers visiting the site can see for themselves the power of specialty sales and marketing.
IMDA’s newest member – Medical Dynamics Inc., Rocklin, Calif. – was founded in 1997 by Bill Carmouche, who had worked for ATI Medical and Mediq PRN prior to starting his own company. Medical Dynamics focuses on critical care products with an emphasis on respiratory therapy in hospitals, long-term acute-care hospitals, subacute-care hospitals, EMS, sleep and home care. Medical Dynamics calls on accounts in California, Arizona, Nevada and Utah with six outside sales reps and two inside reps. Welcome Bill Carmouche to IMDA by calling him at (866) 624-3952 x111, or by e-mailing him at bcarmouch@thinkMDI.net.
Usability was a key consideration by judges in this year’s Medical Design Excellence Awards, the winners of which were announced in the April issue of Medical Device & Diagnostic Industry Magazine, a Canon Communications publication. Winners for the tenth annual awards were selected based on product innovation, design and engineering achievement, end-user benefit, and cost-effectiveness in manufacturing and healthcare delivery. Following are some of the winners in this year’s competition. Critical care and emergency medicine
General hospital devices and therapeutic devices
Surgical equipment, instruments and supplies
For a list and description of all 35 winners, click here.
Innovative medical technology has angels on its side. Last year, angel investors – that is, rich people with money to invest in business start-ups – dipped deeply into their pockets to fund new healthcare services and medical devices and equipment. As in 2005, healthcare services, and medical devices and equipment accounted for the largest share of angel investments, with 21 percent of total angel investments in 2006, followed by software (18 percent) and biotech (18 percent). The remaining investments were approximately equally weighted across high-tech sectors. The figures were compiled by the Center for Venture Research at the University of New Hampshire. The director’s center, Jeffrey Sohl, was unable to provide data as to exactly what types of medical devices and equipment attracted the most dollars. Angels were busy in all segments last year, according to the report. A total of 51,000 entrepreneurial ventures received angel funding in 2006, a 3 percent increase from 2005. The number of active investors in 2005 was 234,000 individuals. The sharp increase in total investment dollars was matched by a more modest increase in total deals, resulting in an increase in the average deal size of 7.5 percent, compared to 2005. This continued rise in total investments points to a healthy angel market, according to Sohl.
Growth is good for our businesses, industry and trade association. The bigger IMDA is, the better the educational programs it can offer, and the more attractive the association is to manufacturers seeking specialty representation. Here’s one way members can help IMDA grow. Your manufacturer partners are an excellent source of names of prospective IMDA members. After all, they work with specialty distributors and reps all the time. So why not ask them to share those names with you, so you can pass them on to IMDA headquarters for follow-up? Should your manufacturers be reluctant to share that information, shift your selling skills into high gear. After all, just as you sell innovative technologies, so too can you sell innovative ideas. Following are four features and benefits to share with your manufacturers.
Still meeting some resistance? Well, as every IMDA member knows, selling begins with “no.” Here are two objections you might face, with suggested responses: Objection No. 1: “I have spent a lot of time,
money and energy training and motivating my independent
sales reps. If they join IMDA, they will pick up more
lines, with which I will then have to compete.” Objection No. 2: “By networking with other specialty sales and marketing organizations and obtaining legal assistance, my independent sales reps will make more demands of me in their contracts. I can’t afford to make any more concessions.” Response: “IMDA members understand how to craft mutually beneficial agreements, which minimize misunderstandings and conflict. Solid, equitable and fair relationships advance the goal of manufacturer and sales organization – more sales.” Encourage your manufacturers to share their specialty distributors’ and reps’ names with you, so you can forward them to IMDA headquarters. We’ll take it from there. Any questions, call headquarters at (866) IMDA-YES (866-463-2937).
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