BoneChat call #24 - Mark Copeland - "Mastering the VAC process from the Value Analysis Whisperer"

All right, so we are live with Mark Copeland. Due to popular demand, bone chatters have been asking for help navigating these vac committees. And Mark's your man. Mark's the VP of Sales for 3T Medical Systems, and he's also a practitioner. So with his experience in navigating all the value analysis processes, he's become known as the VAC Whisperer. So I'm h. Handing the mic over to Mark. Welcome.

Good afternoon, everybody. I'll see if I could share my slides here. We have some to sort of talk through, but as I was. As I was telling Tiger, let me see if I did this right.

We got it. We can see it.

Yes, yes. All right. Mission accomplished. My goal is to sort of give everybody here sort of an overview of what this value analysis thing is, this process, who it is, what they look at, and just give you sort of a simple level so that you walk away and say, okay, now I think I. I kind of understand some of the things about. I got some questions answered and maybe I learned a trick or two. So that's really my goal. I want to kind of COVID what it is, the history of it, sort of making your case to value analysis. If you're in that spot, which I think most everybody ends up in that spot at some point. And potentially if we have time and there's interest or whatever strategy for sales or even founders, if you're early or pre revenue, we can do that. Or I can set up something separate with anybody who has more specific things they'd like to look at. But really that's kind of my goal. My. My background, hopefully that works for everybody. My background is been in medical device sales for 20 years now. And before that I was a Pfizer hospital rep selling IV antibiotics and medicines to what was the pharmacy and therapeutics committee at the time, a very sort of precursor for what value analysis is for med device. And I learned a lot then, and I was trained by some excellent people. But much of what I've learned that I'm going to share with you all is through getting. Getting beaten up a little bit over time and learning and talking to experts and figuring it out. And so. But I've never been. Pfizer was the only big company I've ever been with, and I'll never be with another one. So I sort of had been in the shoes of what of many folks here at startups. And the. The most successful startup I was at was Globus Medical. I was there in 05 when they were about. I think, I think 7 or 8 million. They're like, they're like their little first 7 or 8 million and left them in 2013 and have been with startups again the rest of the time. None quite as successful as that group. So I've sold implants, disposables, I've sold capital and so I have this weird unique process and hopefully it helps. But I, I think demystifying it is probably my ultimate goal today. So let me see if I can jump to the, to the next slide. Okay, so yeah, one of the. What is it? Well, here's their goal and this is really simple. And I always laugh like this will sound familiar because it's probably why you joined Costco or Amazon prime or anything. Trying to get the absolute best product that money can buy for the least amount of money possible. That's it. So that's what value analysis teams are doing at their processes are different. The way they make decisions may be committee based or take a longer time, but that's really in essence what they're trying to do. And what med device has always been really good at is clinical and has gotten better financial, but they haven't gotten great at strategic and and frankly I believe this is my own bias. You can disagree with me, we can still be friends. Value analysis process is the customer in my estimation. And the sooner people think about it that way, the faster you'll succeed, I think. So that's just my own personal bias. So when did these start popping up? Around 2010 into 2014. So 15 years ago we started hearing about these committees, these groups. I got to get something approved, cope, I want to buy, I want to use it, but I got to get it through these guys, right, Whoever they were. And it really was caused, it was created or put in place by as health systems began and grew. So it used to be a single hospital. I always joke our lady of no air conditioning Medical center merged with the other hospitals in and around town and went from 1 to 3 to 7 to 10. And when you get that size, the average Size now is a 3 billion annual spend and it might actually be higher. I just saw McKinsey put out, so I haven't even read it yet, but I saw a highlight of it. It might actually be higher than 3 billion. Right. But when you're talking about $3 billion in annual purchasing, you are a sophisticated financial purchasing entity whose product is health care. And I think that's one of the ways I've learned to think about it and it has helped me. So what their Goal is basically they want the best clinical practices they can get applied across their system. This is the Kaiser Permanente model in many cases. And they then want to be able to centralize purchasing because they don't want different sites buying different things as much as best they can. And then that allows them to standardize product usage and it maximizes their buying power, right? So it, I mean, you can come up with a million different analogies. Home Depot, five guys, it doesn't matter. Everybody's, everybody's doing this. As you gain scale, you become more sophisticated, and that's really what we're facing. But when, and I'm sure somebody on here has heard this before, when somebody's like, hey, listen, we, you have a nice product, but we need to go system wide, right? This is why they want to go system wide. They don't want one offs. They don't want zealots asking for something that nobody else cares about. They're just not interested, you know, So I think that's a helpful way to understand why they're here and why they are as they are. And I put this together and if you look at the right, you have the steering committee makeup. But I'm going to tell you, there's a joke that Bob Yokel, who's a value analysis person says if you've seen one value analysis process, you've seen one value analysis process. They're all different, right? Everyone's different. They're changing. It's a moving target, frankly. And it's sort of the primordial ooze of value analysis right now. So it's a moving target. And so these are folks that if you are selling the highest expense or the broadest product, these are the people or departments that might be interacting with your product. And you have to be able to speak to each one of them if you're in my position. So if Tiger Buford creates some product and I'm outselling it, I need to be able to talk to the CEO and the director of quality and the surgeon and the director supply chain and show how my product helps them. It's not just the clinician. So that this is what I. Over the years.

Patrick had an early question here.

It wasn't so much a question. Maybe it's just my screen. I don't know. Mark, that your slides are advancing though.

Really?

Oh, yeah, we're stuck in the first slide. Yeah, now they are.

There we go.

There we go. When we got it, we're on slide five, slide.

I wish I knew what I just did there? All right. Yeah, we're on slide five. Very good, then. I don't. We must have. There must have been a time warp or something. All right, so thanks for telling me that. All right. It look like a big dope. So here's where the puck is moving. Let me see if this works. Right, so, yes, there used to be just a committee and the clinical champ pitched to them. Now what we're seeing is, I do not assume every place you go sell, talk to is this way, but this is where we think it's moving to what's called a clinically integrated supply chain, which is another term free diagnosis, where the clinical champion brings it to the VP of the service line. So if you have a health system of eight hospitals, there is now a VP of orthopedic Service line or VP of Robotics, usually a nurse, usually, who's been around for some years, right? Might have an mba. And he or she, they're the clinical sort of brain trust that works with the champions and their organ, their clinical team, who has a supply chain facilitator whose job is to make sure if we bring this in, we like this, but does it break any contracts? You know, do they have enough slopes? We have, like the right supply chain that we can handle. Are they on our gpo? Does that matter? So they work together so that it's more driven by clinical. Because we saw it went from clinical everything to a lot of supply chain, feeling their oats and thinking they ran the place. And I think the pendulum is starting to swing back where the clinical team has a very important voice, but we're not there yet. And I'm telling you, like, this is sort of predictive from experts that I'm talking to. This is not where we are yet. Okay, so. And you guys, if you got anybody afterwards wants these slides, I'll send them to you. I don't know data there. There's not like there's. Don't worry about that if that's a big issue. So we talked about who's on it, here's how they think. And it goes back to. I use the example of we've all bought a car, maybe for our family, right? And you say, hey, I'm the champion. I like this car, but does my husband like it? Can my kids fit in it? Can we use it? Does it. Does it do all the things we need it to do? You're like the clinical champion, but you have to go, can we afford it? What it'll be like if we resell it? How many Times do we have to take this back to the dealer to get the tires changed? Right. Is it Safe for my 16 year old who's now driving and he plows into a telephone pole? Are the airbags on it? It's all the same thing. It's very similar. And the reason I say this is if you think this way you will start to think effectively how these committees are buying organisms. Think about your product. It is not just about the driver, just isn't. It's not about the champion. Don't underestimate it. It's very important. But it doesn't carry the same power. And particularly since so many of them have become employed now. 78% of all physicians in the US now are employed. So champions are, can still be champions. They're just not able to carry the day and make all the decisions. So hopefully can you guys see the priorities and headwinds slide? Hopefully you're. Yes, okay.

Yes.

Okay. So you've seen who's on it, how they're thinking, how they assess things, what all those good, all those good pieces of information. Here's some of their priorities and headwinds. And I, I love this, I actually love this slide. I think you could, you could talk about this thing all day. The disruptions from supply chain are basically Covid based but there's like we are still experiencing them. Supply chain people we've talked to, 30% of their time is being spent trying to find backups for things that are in back order replacements. It's really dragging their time. And so they are stressing the importance of getting a vendor's inventory status. So if Patrick has a product that helps nurse practitioners do something right. And has to go value analysis committee, that, that supply chain person that works, whose job it is is to drive this project. If they decide they're going to spend time on Patrick's product, they'll probably say, yeah, but Listen, we have 250 nurse practitioners. If we switch to your product next week, could you even fill orders for us? Could you handle our supply, our, our buy? Right. So that's an issue. They're vetting that upfront much more. And I tell people whether or not you can handle that, be prepared for that question and how are you going to manage it? How are you going to describe it? Those are things to think about that were less of a priority 5, 10 years ago. Standardization versus supply diversity is a really interesting thing. Five guys wants to buy all their french fries from the same place in Idaho. Right. But in Covid, that potato farm, everybody Got sick and nobody could deliver french fries. So they need a backup fry distribution, you know, so that's one way to have diversity is to be able to say, hey, listen, you want a Stryker has this great deal with you, but you might need to carve out a second because we've all seen what happens and they're really hurting from a lot of that stuff they're not so sure is just in time, inventory, the right way to go for patient care. So there's an opportunity there. But supplier diversity also means, you know, small business owned, minority owned, women owned. It can mean many different things, but it's definitely a priority or headwind, depending on how you want to look at it. Commodities versus breakthrough technology is always on this. It will be on this slide forever because it's always, they're always struggling to figure it out. Health equity is one that has become an enormous thing. 88% of health systems have signed that they're going to improve health equity in their system. And 11% of them actually have a plan. Nobody knows what it is. I don't know if you guys are familiar with it, but the definition is that you're, you deserve the same outcome as everybody else, regardless of race, color, age, creed, religion, economic status. So. And I've seen some products and we can talk about them at the end of examples that I think like I, I've seen companies miss on this and I'm like, you don't, I'm not sure. You, you are deprioritizing something you don't even know matters. But this could be a cheat code for you. If you can come in and say, listen, we're just like the other guy, but we can help with this, that's a win.

Right?

So these are priorities for them. And this workflow, my goodness. I don't know how many of you have been in hospitals regularly in the past five years. I've been in them. I've been in them for 20 years. I've never seen anything like we're seeing right now. The amount of burnout and new people training new managers, training new people and the things that are getting missed, that's being pushed back on vendors. We need you to handle this for us now. It's astounding. I, I've never seen anything like it in the 20 years I've been in the business. I hope it's getting better. But if you have a product that's just as good as the other guy, but cuts five steps out, that's important. Yeah. So may not be so Mark So does that make sense?

Elizabeth's got her hand raised.

Yeah, yeah. I was going to ask a question, but just to your point, I just got a new GP and he tells me he has 4,000 patients and that's why I had to wait so long. Yeah, yeah. It's nuts. Could you give an example of the health equity piece maybe someone might bring to you that is insufficient or won't work work or unwise. Yeah, I'll give you two that I think because this is an orthopedic group, I'll give you the more orthopedic one at first. So if I sold pedicle screws, which we all know are pedicle screws, they're same as pedicle screws and like every. Despite everybody saying they're not, then you get them drunk and they say they're all the same and whatever. Right. If mine has better pull out strength. That used to be like hey to the surgeon, hey, cool screw's not going to pull out. Right. The smart reps would say, hey, you know what? It's better in patients with lousy bone. Now you can. I would urge people to say, hey, it's not only. But those people deserve the same fixation as the 48 year old getting it like that's part of health equity today. It doesn't matter what the patient looks like. They deserve the same outcome. Now are you putting. Are you gilding a lily? I don't know. But I can tell you this. I would differentiate my product line every way I possibly could and if it feeds towards that one that I know of was. Was cerebral oximetry. Nitronic had one. It's old technology wasn't great and I could not believe this and I'm trying to think who owns the company now but it was shoot this small, smaller company but of some note which are like, oh, this is our. Our way we measure is better and this and blank and blanket. Eight pages in you go. Oh yeah. And African American patients. It doesn't have the problems theirs does. Identifying their oxygenation in their brain. It was eight pages in. Like that's health equity. That's not right that somebody because of the color of their skin doesn't get the same clinical care. And it's kind of important. Oxygen to the brain seems to me to be pretty important. I would have had that upfront. Those are health equity examples. From an implant or a simple med device standpoint, there are much greater examples of that. Everything to. Do you speak. Does your staff speak Spanish? We have a Spanish Population. Right. And HCAP scores are reflecting that. But I can tell you, if I had a product that showed it worked better in older, younger, different color skin, different economic, I would make sure I'm highlighting that because that's important. And I find companies bury these things because it's still clinical, you know, and interesting. I'm just astounded. So hopefully that. Elizabeth, that gave you a decent example. Yeah, yeah.

We got. Mark's got a question. And then John, we'll go. Mark, John.

Two things. One, one, I have a question, but first I have an observation. One of my partners last month called me and said, I think everybody on this call knows what bone marrow aspirate is. He said, I have a bone marrow aspirate product that I'm looking at that does not require centrifugation. Like, for example, Arthrix does. I made two phone calls, got it approved in a month because of immediate workflow improvement. They saved five minutes, not centrifuging. Great example of yours. The other question I have is that how do you weight the push and the pull of the different parts and different people involved, starting with clinical champion, VP of service, supply chain, CEO, administrator. How do you. You have a system to weight that, like in a decision matrix anywhere coming down the PowerPoint or is that still sort of a. Sort of a, you know, swing?

I think it's still. I don't. Although it would be nice to have. I still my sense from talking to people and some of it's my training. Mark, it's a great question. I would still start with a clinician, but I would not expect them to carry the ball for you. I would get multiple clinicians, interest and like, and then figure out my strategy because I was trained. Never go to somebody who can tell you no, who can't tell you yes. And sometimes you go to supply chain and they're like, oh, yeah, whatever, same thing. Beat it, we're not interested. And then technically you're ignoring them if you go back their clinicians. So I. That's my default. I don't know that that's the best. I do think I will tell you there's a little bit later, but I would. You could make a strong case. And it's. What I'm doing these days is I'm going to VPs of that service line if they'll see me. And I'm going. Starting there. Okay. Because they should understand what I'm talking about. And I think that's where many companies are going to end up. But I can't sit Here and tell you I have a long track record of doing it with a deep experience.

The reason I ask is that in every deal I've ever been involved in, there's always a lot of people that can say no, but there's only one person that can say yes. I want to spend 80% of my ammunition on the yes person.

Exactly.

I'm just trying to figure out who. Just trying to figure out who is that these days. That's my big conundrum. Thanks.

Yeah, thanks.

Hey, Cope, when you go to the VPS service, do you demo the product for them? What do you show them?

Yeah, I would. I would treat them like a clinician, but I wouldn't do it before I knew they had the problem. You know, like, that's the thing. If I solve a problem, I'm searching problems. I'm not searching users first and. But yeah, I mean, eventually I'm going to show it to them. And when I do that, like when we've sold a couple of things that I have taken it to them first and told them all about it and then shown it to them and then said, okay, how do you want me to proceed on this? Because they're interested, they'll say, I need you to go show this to this person. This person. And then we go. So, yeah, so I will. They're a nurse, usually.

Yeah, go ahead, John.

Thank you. A quick question and then a quick comment. I'm wondering, these look very, very familiar to me. Are these kind of a coming up and out of what used to be the triple A, and it's now whatever five is the, you know, where, where it used to be clinical economic patient satisfaction. And now they're saying equity, right to get a fair thing. And then also the patient surgeon satisfaction. Is that kind of, Is that, is that the root of this? Maybe, do you think?

Yeah, I think it is, depending on how, like how you end up bunching them. But yes. Okay. They're greater, they're greater factors. And you could say, does health equity fall under, you know, patient satisfaction? It does. When you look at those HCAP scores that people fill out because it's. Do you understand the medications that were giving you, where did they. So it sort of is designed to capture that. But it's a good question. I think on a slide, it would probably. You could either split them apart as 4 and 5 or drop them in. That's a really good question.

Yeah.

And my, my comment or my might be. My example is when we realized that there, the triple aim was growing as we were approaching the strategy for value analysis. We included these and this is for everybody. I think this was a light bulb moment for me. We had developed a product that came as a sterile procedure kit for a fairly unusual fracture. And so we talked a lot about being able to reach outlying communities with this technology that wouldn't normally have access to them. And so it was as simple as the packaging being able to deliver the solution to a rural area that wouldn't have access. And if you, you know, orthopedics, you know, if you have to run trays all over, you know, central Illinois, it's very difficult. So we, we started talking about our product being able to reach more patients. And anyway, I think is that it sounds like that's kind of what you're talking. That's what we're talking about.

That's, that's a perfect example of it. I talked to a company the other day. There's a really cool pill cam and that's exactly what we were talking about. They kept talking about how cool the camera was. And I kept saying, like, you're missing out on, like you have such an advantage. And I'm curious, John, I'd love to talk to you about this or at least here now, if you have a second.

Sure, sure.

Were you, were you afraid you were narrowing down your potential market when you described it that way? Because I get that from a lot of people, like, well, but wait, we can do it in everybody. Like, well, yeah, but maybe this where you get a foothold. How did you handle that?

Yeah, I think that's a good point. Of course, you know, in a startup we were trying to be very focused in population dense areas with KOLs that are in those spots. But I think in a way we separated that in our mind from what was the real value of the product. Knowing that we would be able to deliver a better solution to people in Decatur, Illinois than would a competitive product that's a non sterile would have to be delivered. So in a way, maybe we talked out of both sides of our mouth in terms of our business strategy to be in these very concentrated markets. But we knew that in the general US Market we'd be able to deliver a better solution to more people. Did that answer your question?

Yeah, totally. I just, I wanted to make sure. I hear people get nervous about, you know, you say you got to get a foothold on the beach and they're afraid that then they're going to be only thought of as something. And I'm like, I understand that. Yeah, but you got to get some, got to get some awareness somewhere and win somewhere. So I was just curious because that's, I love these conversations.

One little comment that I'll have with that is I probably had more skepticism from board members who weren't orthopedic or really versed in medicine that didn't, didn't get, that didn't understand it didn't, it didn't match with our business strategy perfectly. But it really made sense on our, know our economic model for hospital. So, so, so if there was push back, it was from kind of the, the board members that weren't fully understanding what, what we needed to do.

That's such a, that's such a great point. I mean, thank you for that. Such a great point. So I will talk a little bit about sales strategy. Then we'll stop and we'll see where you guys, what we want to talk about what everybody else wants to weigh in. Now, I stole this from Jim Sur. Some of you probably know him, but I love it. And it goes to a little bit to what John, you were just talking about, right. Is I have seen so much clinical that companies are brilliant at clinical. Some have gotten good at the clinical. And the financial, and the financial would be as simple as what are the codes? What do we get paid? What do we get reimbursed? How can we walk through this process? And less are becoming. Or we're getting there. But to your point, strategic. Now I talk about like, this is not your strategy, this is your strategy to help their strategy. Right? So if you're putting your product together and you're saying, we know this helps this patient, we know the surgeons, they'll love it or the doctor or the nurse practitioner. But. And we know the economics and we can walk them through that. You have to know that. You have to. So was that, who was it that was talking about the five minutes on the centrifuge? Was that, was that Mark? Yeah. What we're finding now today is you also have to say and that five minutes is worth this amount of money. But that five minutes has the opportunity cost of sending the nurse who was, instead of running the centrifuge, now she can go see two more patients down the hall. Right. Like you're having to show that downrange effect and you should be able to. If you can't, you're, you're stopping early. But that's, that's sort of the, the strategic is, does your, like we're, can you help them with their diversity? Can you help them with health equity? Can you help them retain surgeons, can you help them with their workflow? And you know, it's a priority because you've talked to them and learned these things. Right? And that's what not enough companies I think are doing, which we will talk about on this next slide. And then I'll stop. So this is the filter that I like, I put everything I do through this and, and we'll, I'll show you how here on this. So here's the strategy I would suggest most people, here's, here's why I get involved because I get a call this way, like I hope you seem to know about value analysis. You're the, you're a little noisy for a whisperer, but you're the whisperer, right? And, and they'll say, hey, I just had it yesterday. Hey, what happens when I have a champion who loves our breakthrough product because it's just so great, because it's a breakthrough? And we mentioned it's a breakthrough. But our competitors on contract for the next three years, right? I get this three times a week. I'm like, well, first of all, if you're such a breakthrough, it should be so obvious that they can get out of that contract because you're an advancement or you're not describing your breakthrough very well. But that's a different discussion. But if you can't tell your champion, your clinical champion, by the way, you know the clinical benefit, you've told me how much you love it and why. But also know this. Here's the five year cost, here's the five year cost of ownership of this product for the health system. Here are two very important KPIs that the health system is trying to accomplish, that our product helps you get towards that. So when you present our product to the value analysis team, Mr. Dr. Or Ms. Whoever it is, clinical champion, you need to present that as well. And they're, they're most. Because if you don't, your, your batting average will plummet. If you do, your batting average will go up. But if you can't do that, I'm going to guarantee you this, your clinical champions cannot. And that's why I learned this 18 years ago and I've never forgotten it. I talk business to clinical people and I talk clinical to business people because, and if you think about it, your board members, you had to talk clinical to them to understand they can talk business. But if you didn't explain to them, hold on, hold on. There's this whole population that has these rare fractures that we can't, we can Handle we can own that market because here's why. But you had to explain that to them. When I talk to surgeons or operator room managers and they're like, wow, I love this thing. This would be so awesome. And. And you should see them. When I say this to them, I'm like, stop, stop. Right there you are. I do not want you to request this because we're not ready. And you should see them. They're like, oh my gosh, thank you. Because I was afraid I was gonna have to carry the water on this whole thing. And I don't even know how to do it. And you say, nope, I'm going to get you this information. And what we're going to do is we're going to stop, we're going to, going to look around, we're going to say, hey, that they claim we. They have a contract, we can't get in. But how come Medtronic has that contract yet there's seven other companies in that space in this place. And how they figured it out, There's a way to do it here, but what is it? And you go talk and you find out and you ask supply chain and you ask other clinicians and when you start to say, we're not requesting this yet, we're doing our due diligence, we know a couple people want it, we think it's better for the patients, but we need to understand where we stand strategically. Our strategy. Once you have enough people telling you, well, listen, there's this thing, it's an 80, 20. You go, we. You can play in the 20%. It's not an exclusive agreement. Medtronic makes all the clinicians think it is, but it isn't right. When you find that out now you can map out your route. Now you can figure out your strategy. We're going to focus in Decatur, Illinois on. Right. On the more rural people. And we know we're going to win there because it makes sense to everyone. Clinicians, economics, strategic. Interesting. And now you have your talking points, so I'll give you an example.

Jump in. Yeah, jump in real quick.

I just want to emphasize, I think this is a really important point that you're talking about, Mark, that most of the people on this call are probably really well versed at, like how to sell a widget to a surgeon and then how to get a surgeon excited about such widget. But oftentimes the same, these same people, like in these discussions, we're not in the room where the surgeon then has to sort of take that information and then Go on and sort of sell that to a room of people with sort of very, you know, sort of similar but disconnected sort of, you know, levels of knowledge. And if you just let a surgeon go in there and say this is the greatest device because of such and such, they're going to talk like they're at a journal club with seven other surgeons and they're going to, they're going to speak to like some sort of really nuanced clinical benefit. And, and it's not going to resonate as well as it's supposed to with audiences that are non clinician that you need to like, get the surgeon to understand the, the vocabulary and the sort of language that these people are speaking and, and get a point, get points across that they, that they want rather than just getting in there and talking about it like it's double Eos or something like that.

Patrick, that is, you should come ride with me because that's exactly what happens, right? Like that's, we all laugh about it. Like, you put me in front of a spine surgeon, I'll win most of the time. But if he or she can't get it approved, like all. And you know what I also do? I upset them. And now they're the point where they're like, hey, listen, I'm not going to do this because unless your thing costs less, I'm not even going to run it up the flagpole. That's where we are today for a lot of people. And I'll bet there's a lot of people out there nodding their heads going, yeah, I just had somebody say that to me the other day. So that's why I say, I think we still start with clinical people. It depends on what you're selling. And I'm not sure if it's VP of the surgical service or the, or VP of orthopedics or the big orthopedics. And I think every place probably a little bit different. I don't think either is wrong and I'm not sure either one's better than other, but I do think there's both. I would not, I would not ignore both. I wouldn't ignore either. But I am amazed at how many people don't sit down and strategically look within a health system. And, and the funny thing is what you find is when you talk to all these different health systems, we sold a product for 10 years up and down the East Coast. Now we talked to all these health systems. They all say the same thing, there's variation, but you can, you can apply what you Learn in one or two and know that it has application in most places. Your batting average will vary, but it will go up and you will be closer to winning in more places, which is all we're really looking for, you know. And so does it have scalability? I'm finding I have. It does. You're just going to, it just depends on how good you are, how good your product is and how good you are at presenting it and where they are in the process. Like, are they are. You know, we're used to that. So I, I, I will tell you. Like, if you guys hang up and say, that guy is a star raving lunatic in Hershey, Pennsylvania, take one thing away. I might be, by the way, take one thing away. Take talk clinical to business and business to clinical, you will be shocked at how fast you advance with these people. If you can help them and if, if it's okay, I'll actually show you how I present. Or I get a champion to present after having done all this work. And it's executive business summary and I write it. Yeah, this is my last, I think this is my last one. So if I have a spine surgeon requesting kens or I don't know what a robot, whatever, I know why they like it. They've told me all about it. We can go deep. I've gained. Others are interested too, same reasons, but they need to be able to present it. Your champion needs to be able to present this to the value analysis team this way. And if they can do it, which they all can, your batting average skyrockets. But when you, when you have them present this, you have to explain, like Patrick to that surgeon. It's perfect example. You're measured. You're telling them, listen, as cool as you are, when you, when you say this to them, they're not going to say, my God, we've got to do this right now. But what you are going to try to do is you're trying to get their attention so that they put you on the agenda and they give you time and manpower to assess this. Because right now, if you walk in and just say, I need this, it's better for patients. They just backhand you. You're never, you'll. And now you've, you look like a little bit of a fool. So I've written these for people because it's easier for them, but I need to gather a lot of information from them. And it's the clinical situation. So, you know, we need, we need navigation because it shows it's safer for patients long Term, blah, blah, blah, all the clinical stuff. I actually am less interested in that than ever.

Yeah, we all know this committee, they're not saying, they're not sitting around a table saying, if we could just improve our COUP scores by one standard deviation, you know, we would be in better shape as a health institution. But, you know, so they need to be able to translate the sort of clinical speak into the, the economic speak.

Yep. So you talk about the clinical. Here's the problem. Here's the problem. Or the goal we're trying to hit. Right. And I'll show you an example. You got to hit them with the economics. And you're doing this. And by the way, five to six sentences in about 45 to 60 seconds. And it's easily done because you're just trying to capture attention economics, cost and financial improvements. If there are some available, those KPIs that we talked about, and this is where you have to know what theirs are like. Remember when I said stop and look, look at their websites, the health systems websites, look at their annual reports. It will tell you things that they're targeting that are strategic, that you're like, oh my gosh, we might actually be able to help them with that. And I didn't even know about it. Right. And I tell. When I sit and talk with doctors, I don't talk to them about, hey, how do you approach the hip, lateral or anti. I could not care less, I'll be honest. What I want to know is, hey, what are the strategic goals of your practice? What's the department trying to do? What's your service line trying to. What's the health system telling you? You guys need to do what matters to them. And they tell me all this stuff. I'm like, oh man, now I know how to. Now I know how to talk. Here, this is where you'll find. This is where you plug a lot of those that aren't economic. Right. You plug it right in behind it. I mean, this is how C suites talk. I always laugh like, I don't hang out. I didn't ever hung out. A lot of C Suites, this is how they present to each other. Then you do your cost benefit analysis and a return on investment. And I have stuff in there that can show people how to do those. But that's, that's not. The purpose of this is if you do it. And here's an example. I, I made this one up. So this is a fake Fetzer valve. We're selling a Fetzer valve. Whatever, Right? Currently our length to stay is four days for fetzer valve type patients. Right. Annually we see 300 patients in a clinical pathway. Our goal is three day length of stay. A $100,000 investment in those Fetzer valves from Patrick allows our clinical team to maintain our high clinical standards while shortening our length of stay by one day, saving our health system $450,000 annually. Do I have everyone's attention? I probably do. Right. Our length of stay KPI is estimated to decrease by from 4 to 3 days. Our goal is morbidity mortality estimated decrease, sepsis documentation estimated to increase. And I know these are important because I've done my homework and I've talked to them and I know we can do them. And I've got some proof source staff time because I've embedded with their staff and understand their current process will be cut by two hours per episode of care and redeployed towards a more cute patients in the department. That's your opportunity cost. That's where you're deploying those steps that the centrifuge a limit. You don't have that. Can you deploy those people elsewhere? Because nurses will say dumb things like, oh, what would you got to be an extraterrestrials? I'd go have a smoke break. I'm tired. I'm like, let's not say that this week. Can we not say that? Right. We estimate a 4.5 time return on investment at one year and a payoff of that investment at 2.5 months. Okay, so when you write that on an index card and the doctor or nurse reads it, your batting average goes up. Right? You can't make it up. The work is underneath the water. This is the tip of the iceberg. But if you can do the work to deliver this, you've done the work and this gets their attention. And then there's. They slow down and say, all right, explain this to me, what's the big deal? And now you spend all the time showing how the centrifuge does this because you've earned their time and attention. It's still going to take a couple of months because they're still going to check your ein number. They're still going to make sure your mod doesn't show horrible outcomes that you didn't tell them about. There's a due diligence process you're going to go through. But if you can do this, you're batting ever. You will be Rod Carew or Tony Gwynn for baseball fans. You will hit a lot. You get a lot of hits and you're now in the slipstream and your clinician respects you more because your clinician's like, I had no idea. Thank you. And now they get it. So it's all over the place. But you have to be able to do this stuff. So. Questions. We can stop here. I can hang up. Hang these slides up.

No, there's. There's burning questions.

I'm sorry. Should I shut the slides off?

Yeah, yeah. Go back to faces. Mark Maloney's first question.

I'm still here.

So, Mark, great presentation, great subject. Would you consider. I have two questions. Would you consider product approval to be a marketing function or a sales function, or is it an evolution of a hybrid of a new function within a company? That's one question. The second question is, should a startup company leave product approval in the hands of their distributors and agents, or should they take it over?

I think the first answer is, nobody's ever asked me that, Mark. So I'm sort of. I think it's sales, marketing and product development. I mean, it has to be.

I think it's a hybrid.

Yeah, it has to be. Your marketing has to reflect what your sales team is learning, and your sales team has to be presenting what your marketing team is. Is helping them with. So that's. It's a really good question. And then number two, you were asking about, should distributors do it? Well, it depends on how well you train your distributors. Distributors right now are so irritated that I think if you could come in and say, look, you get the champions. You're great at getting champions approved. When you do that, stop, and we'll fast rope in and we'll help get all these answers. We'll get all these things, and we'll start to put this stuff together for you. And we can either present it with you or you can do it. Depends on your relationship with them. Right. But I can tell you, if I were a small company, based on what I've seen in the field and the lack of training on these types of things, which is why I do these. Yeah, I wouldn't trust anybody except my.

I think I. I think dealers are looking for this. And I think if you look, if you compare this business to, like, baseball, if I go see a doctor and pitch a product as a swing and a miss, that's one game. That's one out of 80 games. But if I go up against the Value now committee, that's a playoff game, and I'm out.

Yep. And, Mark, to that point, Pfizer taught us when we put IV drugs up in front of the P and T committee at a. What at the time were much less sophisticated health systems, but they were committees. Do not ask for your product to be approved. Do not put it in front of the PNT committee unless you already know they're going to approve it.

Bingo.

Right? That was hard, but they were right.

Great advice, Ted. Ted. And then Patrick again.

Oh, Ted might be on mute. Ted.

There we go.

Can you hear me, Mark?

Great presentation. No, we talked before, you know, about this community and in my experience, just to answer Mark's most recent question here is getting distributors anymore, you know, independent agents to get involved in contract value analysis committee is near impossible because, you know, it's gotten so difficult. And so my opinion is it's a real differentiator, especially for a smaller company to do this work, to do the kind of process that. That Mark is talking about that. That Jim Shurik has published on Get Strategic, understand the landscape, put that together. Otherwise. Can I share a slide? Mark, real quick, One slide.

Oh, yeah, yeah. Remember we talked screen sharing. Mike's still screen sharing.

I'm sorry.

I thought I should.

Yeah, shut it off. Bring it over to Ted.

Let me share a slide. We talked about, you know, how painful it is these days. I still.

Here we go.

How painful this is for.

For.

Especially if you. If you just have. Even if you have a differentiated product, like you mentioned. But yeah, I just want to share. We talked about what life is like without having someone like Mark Copeland involved. And it's like this. That's. That's life in the value analysis committee lane without having a strategy. And, you know, this is the Wipeout game. And it's like. It's kind of like being a startup founder trying to raise capital, too. But I thought I would just share that.

I found that.

Found that. You got to put that in your deck, Mark.

Yes, I think you're right. And I will footnote you like I footnote, sir, as I steal it from you. Yeah. I just think, you know, we're not selling to mom and pops anymore.

Yeah.

We're selling to sophisticated entities, and we fancy ourselves sophisticated entities. But I will tell you, these sales forces are salespeople.

They're.

They're bad at this stuff. That's not what they do. So if you can make it easy for them and give them a. A platform and walk before you run, your chances go up. And. And I would say that's what I try to come up with. Simple formulas so you can say, hey, grab this thing. And at least if you can do this for Them you'd be different. You differentiate yourself from a lot of other bigger companies because they're not doing it and it's driving their people crazy.

Yeah, yeah, this is where it's at today. It's very valuable. Thank you.

Thank you all. Thank you all. Anything else? Anybody else? Anybody have any questions? And I think my, you can send them my email obviously. Like if I can, anybody let me know.

Yeah, I'll share everything with everybody. Cope.

I love this.

I want to echo what you guys, Mark and Ted just said and both, both Marks, I think one, everyone, if they're not being asked this already. If you're dealing with independent distributors, you should be prepared for that question to come up at the contract negotiation standpoint. If I was an independent distributor myself, I would ask 100 of the manufacturing companies that I worked with, how does this look, how does the contracts process sort of look like to Mark's point that sales reps and distributors aren't that good at this. They're going to only get worse in my mind over time as most of these independent distributors today of today were sort of like sales reps at big companies 10, 15, 20 years ago when they were still doing a lot of this stuff. But the distributors of the future sort of, you know, the distributor from 10, 10 years out in the future, they're like a rep at a big company today and they have none of this muscle memory built up of like how to interact with these, these systems. That's all just been totally offloaded to corporate. So it's probably only going to get in terms of like the salesforce's ability to handle it. It's probably going to only get worse in, in my mind over time. What I've started to do with distributors which has been helpful is at the contract negotiation point, tell them sort of I use a three tier type of thing of like, listen, if it's just like going and talking to, to, to Mike, the purchasing manager that you've worked with for 20 years, you go do that yourself. Of course, if it's like a little bit more involved, maybe sort of close to the executive summary type of thing that Mark was describing, like, I'll get involved and I'll help you and then if it's much more sophisticated, we'll get outside help and kind of like as long as they know that the company has like a plan and approach and, and will be with them on it. Because too many companies over, over time have just sort of said nope, that's on you. That's what the commission's for have at it. You know, call me when you need. When you need an order. And I understand the urge to do that, of course, because, like, they're getting more commission than the big companies would pay them anyways. You feel like it should be, you know, they should be doing some. Something for it. But I think this is a. An area of the business that as manufacturers of smaller companies, we're going to have to just swallow this and get better at it. I don't think we're going to be able to, like, we're going to have to take this. This on over time.

Yeah.

Well, can I give two. One tip off and one tip. One bit of advice to people when you're talking to sales organizations. Here's the advice. If they sit on the other side of the table and say, you're like, hey, how are you with contracting? Or whatever, and they say, oh, you know, the bean counters. Bean counters is a word that immediately tells you they don't know how to do it. Right. Because they don't. And I hear everybody say it. I'm like, they have no. They're. The asteroid is struck and they are a stegosaurus. Right. It doesn't matter because they don't want to learn. So that's one tip off. And I would say, you know, how many. Like, think about how many times when you bring in your sales force and you have a kol coming in, the surgeon. Surgeon tells them about how great is. Consider having somebody come in who's a VP of service line, like of the orthopedic service line. Let him or her come in and let them talk to you about what they look like. You might be shocked at what they tell you, but if you don't, you're flying blind as well, you know, because they are. They understand the economics of business. The C suite, what strategy. That's what those folks do. So I urge you guys to.

Great, great advice.

Yeah.

Okay.

Yeah.

Dr. Matthias Churoth.

Thank you so much. Hey, Mark. Great presentation. I have a question. Thank you. About potentially linking the reimbursement department with the purchasing department. I've seen oftentimes, you know, there's strict walls between those departments and they don't necessarily. Intact. How do you go about that, you know, leveraging one group with another and, you know, make them understand the potential benefits. That's where you. That's where I would. In those situations I've been in, I armed the champion with that. Because the champion isn't like, listen, this is a question. They're going to come up with, you know, if you like, you need to know what we have available. I don't know if you're going to be able to take advantage of it, but know that we know we have people who can help. And that would be a great question for a service line coordinator, a VP of that. Right. But they're all telling, I will tell you, I've had multiple supply chain people telling me, I can't believe these companies don't give us the codes. They don't give us the reimbursement code. How are we supposed to know what to do? And you're like, well, half the time we were told not to do that. Right. So I believe they want it. I would ask them. And if you have a legal oversight that tells you not to do it, I'm a salesperson. I figure it out. That's what I do for a living. But you gotta, like, I mean, you gotta get it, though. If they need it, you got to figure out a way to get it to them. I know that's very ambiguous, but we are taping this. I don't know. I, I, you got to get it to them. And they want it. They've actually asked for it. Supply chain. Yeah. Got it.

All right, List is up next.

Yes, I'm sorry, it's raining pretty bad here, but the clinical nurse specialist or the educator of the departments are always my first go to when visiting a new facility. They're the ones that understand the innovation and they will push it through and be your advocate in the beginning and the long term. And they also know the process far more than any physician knows. And so when I go into them, I ask them the process, I ask them who might be an advocate, and then I collect the names of the surgeons and patients in upcoming cases. And when I'm ready to submit my value analysis package with reimbursement codes, I also have a list of the surgeons who want it along with the case, upcoming cases or the date, not necessarily the patient information. What are your thoughts on that?

I love it. I do the same thing. I'm so glad to hear somebody else say it. Yeah, you, you, those, those educators are great touchstones. They have ears everywhere. They tell you everything. They're very influential. They don't, they typically can't. Sometimes they can champion things, sometimes they can't. But if you sit with them, you learn all sorts of things. And that's the, that's what your sales team should be doing is knowing the political lay of the land, and you find it from People like that. And then you, you talk about a powerful. So you give that executive business and then you follow up with that. Here's the list of everybody who said they want it. And I have a whole course coming out on that that's free for people if they want to see how I do it, because I've been doing it that way for years. But yes, I would absolutely do that. Alyssa, that is absolute. And your salespeople need to do that.

And I like to have the signature, the actual signature of the doctor. That is the, that is the one thing that I think that tips over the scale from people saying yes or no and giving it consideration.

How about, how about video documentation of them saying, My name is Dr. Huffman and I want this for my patients, for this, this, this, this, and this reason. Come on, like, let's wake up. Let's wake up. This stuff works like, it works. We can be creative. Listen, you're. You and I should talk because I love your way you do this.

You're one of my little pre revenue.

But.

But maybe later. Not for Asher's. Up next.

Hey, Mark, great presentation. And I apologize. I'm at an airport, so there may be background noise. Oftentimes when I've done value analysis committee presentations, our goal is just to essentially match pricing and get access, not even get a premium for that product. But if you've got a unique situation where you can actually increase reimbursement and you want to leverage that to potentially secure a higher premium price product, what are some strategies that you would do in that situation where you are not only trying to get access, you're trying to convince them that they need to spend more money because of the value that your product brings.

Yeah, because it's more valuable, by the way. And because if you don't believe it, who will? Right? You're just. Your burden of proof is higher. But they don't know what you know, so how are you going to show them what you know, Ash? Right, So I would be saying in my executive business summary, I'm not telling them all this. I'm just saying an investment in blank gets you this. And then we're like, whoa, that sounds pretty cool. And I'm saying, yeah, we actually cost more. But, but you're. Look at the. They're smart people. Like, we, we keep thinking these people are big dumb cavemen. They're brilliant people, but they don't have time to digest all this stuff. So you get their attention and then you take the time to explain to them, yes, an extra 50 bucks per procedure. Yes, it's extra 50 bucks. But here's the backside. We cut out five steps. It took eight minutes off the centrifuge. That's worth this. Now you get this. Your HCAP scores go up and they're finishing your sentence for you because you've done the work right. I, I just, I hate this matching prices. I hate the one reps. Oh, I just got cheaper. I can't do it. But you're lousy at your job then, frankly. And so you got to sell the value. I keep saying, like, if everybody only bought cars that were inexpensive, Mercedes wouldn't be in business yet. I see a lot of them on them because people see value in them. So you got to sell the value, right? And if you can't document it, then they're never going to pay for it. So it's up to you, Right? One of the things, one of the.

Things I've heard anecdotally is that a lot of value analysis committees will try to limit the total cost of implants and disposables in a surgery to 35% of the total DRG value. So if you can show an increase in DRG value of 10%, do you feel like logically the you can argue for up to a 10% cost of increase, or is that sort of math that doesn't translate always?

No, I think I would ask for 30% more. No, I mean, we're all paid on commission. Like, I'm not taking pay cuts. Yeah, I would be selling what you think. This is a great way to finish this and ask yourself, would I pay for this? What I'm pitching, what I buy this. If the answer is yes, then you're fine. If you're not sure, better tighten it up or lower your price. But, yeah, absolutely, you just. What you don't get is the time to explain it. And so if you don't explain it, they never know it because they're not going to spend the time to do the deep dive you've done. And you got to get your champion to do some of that, too. Right? You have to hand it to them on a silver platter and let them explain it. So I want to be. I see we're up against the clock. I don't want to go any later.

Yeah, here, Alyssa.

I'll hang here. Whatever.

Now List has got another comment. We can go long if. We can go as long as we want.

Guys, I don't. I just don't know how to lower my hand on my phone.

I'm Sorry. I.

Lower it. All right, I'll lower it.

No problem. Anybody have a. I need to know you. This is. You're already killing me. You're already making me laugh.

Anybody have an example of where they ran into a VAC committee and, you know, a real story that was a disaster and what happened?

I got one.

Mark.

Mark Maloney.

I got one from about five years ago. One of my partners, we were. We've been selling stirrups on the orthotic side. Allen Medical. And he did a value analysis with no clinical champion, because the nurses wanted to our stirrups. And it got all the way through. Everything was fine. And then it had to have a doctor at the end. The doctor that. That was assigned didn't give a crap about stirrups. He was an orthopedic guy, and he said no. And we never had recourse. And it was months of work down the drain, and it was in the green light system. That's why I call the red light system. I hate that system.

Yeah.

You lost the playoff game.

Yeah, we lost the playoffs. Yeah, we. We had a great season and got knocked out in the first playoff game.

Boom.

And we're done.

Wow. I hope those nurses make that surgeon's life miserable. I would. Yeah. I'll give you an example of one I heard yesterday. That was a win. Now, I had nothing to do with it. Hemostasis agents and trauma and this. This nurse who runs the whole trauma service line for this hospital in California, they're all the same. They all work great. But we. A couple of neurosurgeons came to me and wanted it to be able to roll this way and do this thing, something a little bit different. And she said, I went out and looked, and you always see the vendors. And I looked, and there was one that you could do this on. You could roll it up, stick it in. And she said, cost a little bit more. But we show. We were looking at this whole process of the time it saved us in these. It might have been durotomy patients. I can't remember what it was. And she said, and it was this length, and it was this capabilities. And I asked her afterwards. I'm like, hey, Melinda, did. Did the hemostasis agent work any better? She's like, no, it was just the different formulation was better. Right. And so I can tell you this. My sales pitch with that product would be, we're the same as everybody else. But in this case, it works well. And I got to go find people who are struggling with that problem. And I wouldn't even talk about the mechanism of action and all that that everybody pumps on their website and puts in 3 dimensional 360 and smoke behind. Doesn't matter if you can't get it approved and if your foothold is Decatur, Illinois rural or because somebody can roll it up and stick it in a wound. That's what you should be pitching, that's what you should be talking about. And that's where your marketing and sales teams are working together on that value analysis. Because they're hearing what and the people that tell you that are the customers that you sit down, shut up and listen to and ask them what matters. And that's where if you're pre revenue now's a good time to start doing that like right now because they'll tell you how to get it.

So I'll just say indicator Illinois has not got this much press since 1987.

It's unbelievable. Now I got to look it up on a map.

Let's find it. All right, Asher's up next.

I had a general question and this is based on a real life scenario where I've actually presented to a Valley analysis committee that consisted of spine surgeons who were not the spine surgeon champion that I had secured. And unfortunately those spine surgeons had financial conflicts with companies that were on contract. And we were essentially told by those surgeons that there was this product was essentially redundant and the current on contract vendors had a product that was close enough. How do you handle something like that where there's a pretty clear cut conflict of interest but you also have to play politics.

That, that's a, that's a heck of one. Did you know they were had conflict of interest before you walked in there?

Yeah.

I wouldn't have walked in there until I knew how I was going to handle that. I just wouldn't have, I mean I, I and I could tell you there would have been people who needed to know because I mean unless this is an ambulatory surgery center that they're the owners of, I mean that just might be a battle you end up not winning. Right. But if you walk in there and you don't know that that tells me the work here. Before you needed more, you needed more work, you needed to know what you were walking into. And we do a charting thing at every health system request where we put across the top against doesn't don't care like that surgeon and four and we put every decision maker down the left hand side and we say where are they? And then we spend as part of Our mapping and talking points, trying to get every one of those people on there to move one column to the right. And what you find is you go talk to those people and you're talking to them before you stand in front of them if you can, and you snip those things out and we would not question until we talk to those people. Yeah, it stinks. You got to do it, Martini.

So my regulatory compliance company has a software that will take a list of any list, one doctor, 100 doctors, 500 doctors, and will tell you what their open payment status is, what they're getting paid by which company, what percentage, how much, and how much in research. And I'll give you a real life example. On Monday, I had a medical appointment. I went to see the guy who's. He was chief of service. And as we're sitting here talking, he said, well, if we, if we do anything in the future, you know, blah, blah, blah. And I said, well, I assume you'll use this because you're a consultant and you got $847,000 last year in research payments from them. And he, he said back and he said, how do you know that? I said, I run a company that does open payments reports on doctors for hospitals and so forth. He said, you're the first patient that has ever said that or known that. And he said, would that affect your decision to see me as a doctor? I said, no, it's just information. Your chief of service, I said, if you weren't getting $1 million a year from some companies, I would worry about, to be honest. And so, but I'm just saying that if anybody on this call wants that report for any of their people for value analysis, I'll run it for free.

Wow. Take. I would take, take Mark up on that.

And in fact, I'll send, I'll send an example of one of these reports, looks like. And it just kind of tells you who's paying who. And you have to know that.

Oh, I'm sorry, I didn't interrupt you. Does that help you target KOLs? Like, does that help? You know, hell yeah, it will, right?

It tells you who either to target or who not to target.

Right? Yeah. Yeah.

I feel right here in Atlanta, for example, Charles to Cook, who is well known doctor, total joint doctor. Okay. Millions and millions of. Of of dollars in 2022 from Depew. So if I were the biomed guy, I don't think I'd waste a lot of time on Dr. De Cook.

I went down and watched him operate. It's unbelievable.

He's good.

Yeah, yeah, yeah. Hopefully you guys got something. And if you. If you need my help, this is. Let me know.

This has been. This has been great. I'll. So we have a Slack channel. Mark Copeland and I'll put all your information in the Slack channel, including your slides. And yeah, we may. You may come back for an encore one day. Thanks. Great stuff.