BoneChat call #35 - Winning your VAC battles, Q&A with the VAC Whisperer, Mark Copeland

Okay, welcome everybody to BoneChat Discussion 35. As you know, the BoneChat community is, is really here to help startups grow and prosper, and we try to hit the big hurdles for startups, and navigating VAC committees just keeps popping up. And so, um, backed by popular demand, is the Vac Whisperer, Mark Copeland. And no slides, we're just going to hand it over to Mark and do Q&A. You can ask anything you want. Use the little icon to raise your hand if you can. So turning the mic over to Mark, to Cope. Everybody calls him Cope.

Yeah, my friends call me Cope. We're all friends, so call me Cope. It's nice to see some of you guys again, and some of you I've talked to many times between these meetings. So, yeah, I'm, I'm Mark Copeland. I'm the Value Analysis Whisperer. I am a salesperson at heart. That's what I do. That's what I've done. So if you want to talk about FDA approval, I'm not the person to talk to or any of those things, but I've been selling products into everything from disposables to implants to capital into large sophisticated health systems and small mom and pops for decades now, two decades. And, and mostly up and down the East Coast the past 10 years. And what I found is the ground beneath our feet has shifted considerably. I think we all sense that over the last 10 to 12 years. And, uh, it's, it's different. I, I, I think we all think it's more difficult. I, I know it's different. And, um, I, I've, we've been pretty successful getting some, all types of different products approved in all types of different places. So we'll draw on that and I'll teach anybody whatever I know, and I'll take inputs from anybody who's had successes. As well. I know, like, last time we did one of these, Alyssa Huffman had great ideas, and I immediately wrote them down and started telling others about them. So, um, if I— so I wrote down a couple of commonly asked questions, but Tiger, should we open it up? Is there somebody that has a question that they are just burning to get off their chest to start?

Yeah, let's just, let's just open it up. So anybody, if you've ever— are you Yeah, Kyle's up first.

Go. Yeah.

So Mark, the last time I had to deal with products get into a hospital system, it was a, something that would fall into that more novel device category.

Mm-hmm.

Wasn't, you know, we got a volar plate for the wrist and it's the 73rd version of that that I'm trying to get into a hospital. It was more novel than that and it seemed like it was smooth sailing, piece of cake because the doctor could very easily make a case for we simply don't have this, so therefore I need it because it does something. But that's been a couple of years. Is that still the case where— and I think a lot of times with startups, you, you usually have a technology that's got some sort of novelty to it that gives you some bearing to say, yeah, you know, you can do a new procedure or you can't do it this way. Is that still the case or is even that a big problem these days?

It's still the case, just less so. Right. And it's not as easy. It takes longer. It's less successful in less places anymore. It, it, it, some of it needs to be that the iterative changes or improvements need to be more obvious. But I still think 80% of the issue is the decision-making has shifted versus value as much. And if you don't know what matters to these decision-making groups, it's hard to, it's really hard to tell. So we, like, you'll be able to find occasionally champions who can get your product approved through either strength of, you know, whatever they, whatever it is they do, they understand the process or they are still so valuable that what they ask for they get. But that asteroid has struck. It's just not that common. But I will tell you what I'm finding as I work with companies, and I was working with just one this morning, startup, is that they're also leaving a lot of value on the table that they're not aware of because they're looking, Kyle, at the surgeon as their only customer. And I urge everybody, force yourself to think of the, the health system as the customer. Even if it's an ambulatory surgery center, think of them as the customer. Think of your surgeon as the highly sophisticated, highly technically involved, super important end user. And if you change that, that in your head, you start to uncover things that maybe you didn't know about your product. So I can tell you this, if Tiger and I started an orthopedic company today that was implants and we thought we had something that was better for a better spine pedicle screw or a better cervical plate, I mean, it better be astounding because we can't just take it to our KOLs and they're going to get it approved. It's just— that's just not— it will work occasionally. It's not sustainable that way. Just isn't. So I don't want to rain on anybody's parade.

Ted, comment?

Yeah.

Hey, Cope, good afternoon. Hey, T-Bird, how are you?

Ted, doing great, doing great. Um, yeah, you know, uh, with the startup community, and then there's a prevalence of that here on Bone Chat, it's all about strategically, just want to affirm what you're saying here, that you have the data to back up what's going to differentiate your product. And that's where it's at today compared to just get your product champions, you know, on board to support it, to push it through, because that, you know, train has left the station or ship has sailed, whichever, you know, acronym you want to use. But I did want to highlight here and welcome Eric Lang, who's joined. Eric is a longtime engineer, one of the best I've ever worked with in spinal implants, and I told him to check out the Bone Chat. So Eric, thanks for joining. It's not usually, you know, Eric's the guy at the front end doing a lot of the development work, the patent work. He's got as many patents to his name as Dr. Alex Vaccaro has consulting agreements. So, uh, anyway, the, um, the back to the, the two points that I wanted to make is the other, the other issue. And, and we encountered this, Cope, and I introduced you to someone with a, with an orthopedic spine startup. His main frustration was, how do I stay on contract? I'm losing business because I'm getting knocked out by, you know, particularly the big guys that are coming in and doing these backdoor rebate or robot, you know, deals. But, you know, maybe comment about, you know, for an individual here in BoneChat that need to allocate resources to and how you approach that in terms of defense, you know, as opposed to just the offense of the playbook.

That's a really good way to describe it. And so here's what I would say to so many of us who say, hey, using my implant shortens the case by 10 minutes, right? And so we say that and surgeons are like, cool, I'm down. But there are other people who value that in the health system, but we, generally speaking, have never gone to talk to them about it, have never made an economic case of how valuable it is and gotten it aligned with their strategy. So if I had, if I was on contract and I had a product that had— what is it that you— all my surgeons like? They like this, whatever it is about it. Can I turn around and put an economic package to that? And I'm talking to the VP of perioperative services. I'm talking to supply chain saying, here's why they like it and they love it and they've been using it for 2 years and they couldn't be happier. We're on contract, but here's why you should love it. And if you, if you're thinking of letting somebody else in or you're gonna RFP this, Like, part of your RFP should be how much time you're going to save, because there's a metric associated with that, and I know it's important to you. I would be positioning— it's about, it's about the value, right? It's— and the value is to the people that pay the bills and make the decisions, not just the people that are putting them in. So I would be sitting there thinking, do we potentially lower infection? Do we shorten procedures? Do we use less less x-ray. And who else cares about that other than people in the operating room? Well, actually, there's a lot of people that do, but we don't talk to them. And so we get lumped in, in an RFP, and then people say, well, you got 73 of those plates on the market already. I mean, is yours faster? Well, yeah. Well, how do I know? Nobody's— no surgeon has ever told me it's faster. You have no data to support it. So back to, to Eric, right? Eric was saying about he does a lot of this stuff on the front end. That's why during the studies, I was talking to a company last week about this, and they're pre-commercial, and they were trying to figure out what else should we be thinking about? We know what our end users want. What else should we be thinking about? And they had a pretty compelling case that they were going to be shorter or whatever. Shorter. I'm like, time it. Time it because you may need that in 2 years when you are on the market and you can put an economic case with that saying, yeah, we may be the same price, but we're $50 a minute faster and we're 10 minutes faster. That's $500, right? Like, and if somebody pushes back at the hospital and says, that's not really, that's a soft cost. I always say, first of all, it's a cost, hence the term cost in it. And second of all, It's not coming out of your budget, but it's coming out of somebody's. And I'm gonna find out who that is. So it's, it's the value that you're, bringing in to the other stakeholders. And that's the thing, Kyle, there's so many different stakeholders in this now. Like, it is not the surgeon, in most cases. And it all, it's really come about because of the health systems merging. And acquiring. So the big sexy surgeon at one place is not as big and not as sexy when he is a part of UPMC now. He's just not. Like, it doesn't matter if he does $10 million. Sex appeal has gone down. Um, and that's the issue, right? Like, that's one of the issues. They don't carry the weight, except maybe Vicaro. Maybe he does. Maybe, maybe he does. Yeah. I saw John has a hand up.

Rizzo. Yeah, go ahead, John.

Yeah, so I've got Jack Cardella on the call listening in as well. He's my national accounts guy, but his question was about Lumiere and how do you handle those types of programs? Lumir and Simpler. You know, how do you rise to the top to, to program like that?

Well, so Lumir and Simpler to a certain extent are merely sort of portals. So if anybody was, if anybody was doing this 10 years ago, a surgeon would— this is how it always went. Surgeon like Kopp, I want to get that thing approved. I like that. Get it approved. And then somebody from supply chain would send me their value analysis, new product request, because that's really what this is about, is the new product request, right? Right. And I'd fill it out as the surgeon and then hand it to the surgeon and say, hey, I think this will get it approved. Take a look at it. Don't sign it if you don't agree with any of it, right? But if you agree with all of it, you think it's all valuable, sign it, submit it. But there are times when products you're selling are more complicated. Than the little teeny tiny box they had you write, handwrite it in, right? And who can read my writing anyway? Lumiere does that. It's a, it's a protocol, right? It's a, and it's a portal for you to submit that stuff. But I've actually checked with them, and I can't say, I can't speak to like Simplir's version now, but there's no way under any circumstances I am submitting a new product request to through Simplir, through Lumiere, to the value analysis committee, because that's who gets it without my case being presented my way. And if it's a PDF that I attach, if it's a video I send, if I want, I mean, if I drop it out of a helicopter, if I wind it up, Lumiere may get my backpack that says, here's my EIN number, here's my pricing, here's my,, um, linked to my mod complaints for the FDA. But there is— under no circumstances am I submitting that and going, I hope, hope I got it. No chance.

Yeah, you've got to have a champion on the other end of that.

That's, that's part of that program. Yeah, absolutely. But like, John, do, do you trust your champs?

No, that's why we have to bird dog them. That's, that's what That's what Jack does for me. You know, you really have to stay on top of them and say, did you get this? Did you sign off on it? Did you press the button on your end? And sometimes it's that simple. They'd have to press the button.

Yeah, absolutely. Frankly, the term Value Analysis Whisperer came from me whispering into my champions' ears going, say this, do that. And they would say, are you serious? And I'm like, what do you care? I've checked it. Like, I know this matters to them. You don't care. They do. Do you want this or not? And they're like, very good then. And they would do it, right? That's how I did it for like 12 years. And now it's just more grown up. But like, there's no way I'm submitting anything, including with my champion, that I haven't bird-dogged. I like the term. Unless I think they're more compelling, but they never are because they, because they never think of quality. They never think of the service line. I shouldn't say never. Very rarely think of the service line first or even second. They think of themselves. We all do, right? But I'm— my job is to say this helps them. Let's do an economic— we're going to do a pro forma, and I'm going to show them that this is an investment the health system's making. We may be more expensive. I don't really— I've said to people, I don't care. I'm more expensive. I'm also a lot better of a product. My product is way more valuable, and I'm going to show you that value, and I'm going to describe it. And if I can put a number on it, I'm going to put a number on it. And when you, my champion, are in front of these people, you say what matters to you. But could you read this too? If they— if you don't feel like they've listened, because that's how we're going to get this approved. I mean, that's— yeah, it's just different. We never, we never had to do that years ago, John. Like, you know, when we were selling this stuff, um, we just didn't have to do that 15 years ago. We do now because of these committees. And, um, but you're, you're champions.

Do you ever find out who's on the VAT committee? Do you find out who the players are and, and get in front of them?

Sometimes, yes, not always. Um, but yeah, it's always a good thing. I, I, it's funny, I tell reps to do this. I doubt most of them do it. Like, go introduce yourself to the VP of Surgical Services. Go introduce yourself to the VP of, um, the perioperative services. Well, what do I say to them? Hi, my name is Mark. You know, like, I'm here, things are changing. I'm trying to stay like in this system. I'm trying to understand what matters to the system because I've learned it isn't just my surgeon or surgeons that matter. It's the health system. What matters to you guys? And I don't do it with a product in my hand. And it's amazing. They tell you everything because they want good vendors too. Like they want good products. That's the, the common thing I found is Yeah, the bean counters. If it's not cheaper, they don't want it. Absolutely not the case. What I mean, if you submit a shitty value analysis proposal for a new product, what are they going to say back to you? They're like, I don't— this is great for grade 2 spondylolisthesis. I don't even know what that is. Right? And you have your clinical champion talks about it. And what's she do? She goes up and goes, yeah, it's awesome for grade 2 spondylolisthesis with my patients with bilateral auriculopathy. And people are like, I have no idea what she's talking about. I have no clue what she means. They literally talk Latin. It is literally Latin. So I take, like you said, I bird dog it. I take control, but I try to know what everybody on the committee wants and gets a win. Sometimes I know who they are. Sometimes I don't. But generally speaking, it's all this. They're all coming from the same place. Finance is finance. Quality is quality., does, do you know, does your product help? Does your product help them with their strategies? Let's say, we're trying to, like, here's a perfect example. I just told this group this morning, do you realize, like, if the, you should be telling the health system, if you approve this product, it'll help you retain some of your spine surgeons. Now they're like, is that important? I'm like, the spine surgeons don't feel like it is. But I'm telling you, the health system values it. They care. So if I'm a talking in my surgeon's ear, I'm like, hey dude, tell them this helps retain spine surgeons and maybe attracts more. And they're like, really? Like, yes, because that's part of their strategy. And you may actually be able to do it if you're innovative enough. You know, it all depends on what your sales pitch is. The whole goal is to know what value analysis and What's— and it's the same thing most of the CEOs on here want for their company. You invest in software, you invest in people, you invest in research. You say, what am I getting out of this? It's gonna cost me $50,000. What am I getting out of it? What's my return on my investment? Sometimes it's qualitative, sometimes it's quantitative, sometimes it's required. Same thing with value analysis. Everybody bought EMR because they were required to. They just, they had no choice, right? So those are things to put in your head and think about. And it depends on each product. So sorry, I got a little revved up there.

It's all right.

Thank you.

Yeah, we'll come back. I'm sure Colleen's got a hand up and Tom.

Hey, uh, Cope, it's Colleen Gray. I'm in the San Francisco Bay Area. Uh, we haven't met, but, uh, nice to speak with you. I am, um, helping a company raise money that has a unique product, um, that meets the cost less, can do, can do the procedure faster. They have an opportunity to get on, um, a distribution agreement in place with one of the big four. Ortho companies, and, um, they believe that it will kind of open the doors to getting on contract at hospitals all over the country. Do you see that as a, um, benefit, one of the benefits of getting on a contract with one of the big four?

If yes, if, if you know what to expect, and I, I don't know specifically which ones or what you're talking about or how easy it'll be. The term line extension always helps to be able to say this is a— hey, we all learned that about 10 years ago. Say line extension and revision, right? It was like an easy pass. And you had to kind of be truthful when you said that.

Right.

So yeah, it can be. But I would say If it doesn't show up under— I'm making a name up— Smith and Nephews, right? If it doesn't say Smith and Nephews blank, um, and you're relying on them to get it approved for you, I would— I'd ask to see their historical data on getting new products approved because I've talked to a lot of their people and they struggle too. Tiger and I were laughing. Alyssa Huffman said to me last week when I said, how many— what's the percentage of companies that you think struggle? She's 100%. She interrupted me. She's like, 100% struggle with value analysis right now. Not 95, 100. Stryker does. Zimmer Biomet does. Smith Nephew does. They're all struggling with this. The smaller companies are quicker to respond and react, but I would want to know like, is— are they a sales channel, or are they in a new product request approval pathway? Because I would say they're— they might struggle in the latter. I would— I would be skeptical, I will tell you that.

Colleen, how new is the— is the thing? How— without telling us what it is, it's—

it's new. Um, it's, you know, it's a solution for, um, tendon repair in the hand and forearm that is not sutures. So it's definitely different. And, you know, I don't know how you argue it's a line extension because it is really different. And I know that depending on the big companies' reps to get you approved or just their whole process, you can just get, you know, lost in their, you know, It's, you know, a lower ASP than, you know, some of the other products they might have. So who knows? I don't know. I think they— I think, I think the company's being a little optimistic personally on how quickly they can ramp based on, you know, inking an agreement with one of the big boys. But, you know, that's my advice to them. They need to, you know, kind of make it their job to get it approved as well and have all the analysis that we've all been talking about.

Yeah, yeah. I think you're gonna have to arm them and push the button for them. And to use somebody's smart term on this, bird dog hard, hard. More like, I would actually say, as I've said to a couple of my clients over there, customers, I'm, I'm going to be your big offensive lineman. I'm going to leave you your lead blocker because I'm not letting you— I'm not pushing you in front of me. I'm going to steamroll a lot of this stuff and work for you. And then I'll come back and tell you how I think we should approach getting this approved. Because I— nothing against them. I got a lot of friends at those big companies. Several of us have worked at those big companies at points, but I don't think they're very good unless at this. I just don't. And I would be— I would— I'm going to use a 4-letter word here. I'd think about a GPO. Which is not technically a 4-letter word, but it feels like it. Every time I say GPO, I see people like, what did he say? I mean, I, I was never in love with GPOs, but they do have some new product pathways that they claim help accelerate the process if it's innovative. And if yours is innovative, I would at least look at it, you know.

Um, trying to think—

good advice. Yeah, good advice.

Yeah, it's not bad. Like, I don't know, but I'm just skeptical of that pathway just from what I've seen and heard now. So sorry, wish I had more better news for you, Colleen.

Thank you.

Thomas's hand up. Yeah.

Hey guys, I have 3 comments and 1 question here. Colleen, What I did is I was about to do a deal with a big strategic and they were telling me they could get product on and so forth. And I asked them to prove that to me. And one of the ways they proved it to me was they had some prime vendor agreements, which meant that they— that was the easiest one for them to get in. And so that's something you can ask for. And that way you can, you know, your client can maybe better forecast. Other comment on these VAC submissions. We ran into something with Banner Health where we had submitted everything. You know, you gotta show your FDA clearance, you gotta show all that stuff. And somebody on the VAC committee looked at our predicate and part of the, one of our predicates for our implant was a headless screw. So they're going like, wait a second. I mean, we're nothing like a headless screw, but bottom line is, is they compared us to that. They're going, I don't need another headless screw, especially at your price. So that was, that was another comment on that. Um, Visient is a, is, um, we entered into Visient, you know, the four-letter word that Mark just talked about. The way we got in is they have an innovative, uh, competition, innovative product competition. They invite you to this conference if you get selected. Um, and that's really been good. I mean, it would just smooth that whole thing out, you know, again, Is it leverageable? You know, a lot of, they got 5,000 hospitals, you know, the, I think the, the academic institutions are probably the strongest with them. They, they commit to a much higher, uh, compliance level. Um, so that was that. So, so now question, do these guys look at, does the hospitals, the ASCs, do they look at patient satisfaction? At the facility level?

That's a good question. Yes. From what I've— when I've asked them that, but it's usually— there's two ways that I've heard them using. The formal one is the HCAHPS, which is patient satisfaction, but it's not— you know, it's funny, Tom, it's like it's not how well did your ankle feel after surgery? It's did you— did they explain your medications and your instructions? And so like, it's not what we think of as patient satisfaction, but they do. And I actually had an ASC and an orthopedic surgeon who everybody here probably knows, but they track their Google star ratings from patients.

Yeah.

And it's obvious we're going to see more of this right there. There's no question we're going to see more of this. So if you were early on, I would say that might inform some of the studies you do, right? Yeah. To say that because hospitals are, although I, I should say health systems are, but I don't know if it's down to the hospital. So I have a big whiteboard next to me. I'm gonna, I'm capturing like these good questions and the predicate device, cuz I have a story about that too. And I'm gonna find out cuz I'll report back to everybody cuz it's a good question. They are, but I don't think it's really super formalized, and it probably varies place by place, month by month. But it is coming, you know. So that's actually a good question. I'll get, I'll get us some answers on this.

Yeah, because I would lead them down that path. You know, the surgeons all know, right? You know, patient satisfaction, at least while they're capturing KUHS and Lysholm and Tegner, we ask them to do a satisfaction because, you know, it's, you know, The surgeon's trying to, to manage expectations. They're trying to live up to whatever that patient's expectations are. But my argument with the, the health system would be, okay, this patient had surgery there. What are they saying in this, in the social realm, right? They're not going to say, oh yeah, they gave me great prescription, this great, whatever that is, right? It's like, okay, my leg felt, my knee felt better, my ankle felt better, and, and that's, you know, I, I, it reached my my goal, right?

Yeah, yeah. I, I— it's funny, Thomas, so I'm in sales, right? So don't everybody look to me for like some statistical analysis, and because that's— I'll fall asleep in front of everybody if we do that. But what I would say is, as I'm putting this— if I'm putting together an executive business summary, I call it the home run summary because we add third and fourth base, or third, third base and home plate, which is Um, sort of the strategic goals the health system's trying to accomplish that we may help, as well as, um, some of the quality measures that a health system may be trying to do. And that's sort of— some of it's on the ground, but like, if I don't have a study that shows I improve patient satisfaction, but I'm selling a percutaneous pedicle screw system versus an open, because I like— if it's 10 years ago and I'm selling MIS and it costs more and the hospital's complaining, hey, our reimbursement doesn't any higher, but you're charging us is twice as much, right? Which is what we all heard. I would be talking to my clinicians, my nurses, the staff, whoever, and saying, hey, do you think like, do patients feel better after this? And like, oh my gosh, they get up, they're out of the hospital a day sooner. By the way, $1,500 you just took off the bottom line. Like, they love it. They're up, they're showing. Like, I would say, hey, listen, when we make this submission, this request for this, We're gonna put on there, anticipate increased patient satisfaction because we're all anticipating it.

Right.

And nobody's gonna argue with it because they're all gonna look like, oh my gosh, yeah, look at the small incision. Mm-hmm. Is that valuable? And I will tell you it's more valuable now than it was 5 years ago. Mm-hmm. And it's getting more and more valuable. Right, right. So I'm not gonna say I can prove it, but my clinical champion that requests it is gonna say, we anticipate this. And if somebody says, well, how much? I would say, I don't know, let's, we can measure it after we get started. So are we approved? Right? Like, but you know it's going to, you know they're going to, like, why do we, sometimes we don't have proof, but if they're telling me it's going to happen, well, I'm going to put it on my request. It's, I mean, that's, that's where your salespeople have to be. Asking the right questions, right? If you know something helps but you don't have proof of it, well, if my— everyone, all 5 orthopedic surgeons tell me, yeah, we need the Hana table, the anterior, like, whatever, right? I don't even know. I kind of know what a Hana table is. I'll be like, well, is patient satisfaction— they're gonna be happy? Oh my gosh, they're up for that, whatever. Okay, well, we're gonna, we're gonna put that on our request because it does matter. You know, I still am waiting for companies to really go hit insurance companies hard other than SI Bone, because I think there's something there. I mean, I really do, but that's a whole different topic and smarter people on that than I. But yeah, thanks. I thought it was a good question.

Yeah, thank you, Mark.

Thank you.

Yeah, Eric's got a comment or a question.

Yeah.

Hi, everybody. Thanks for letting me in. Nice to see y'all. I wanted to expand on something that Cope had said earlier in talking about, you know, your value propositions. I just want to say, and I guess also building on how Ted introduced me being the upfront guy, you really need to think about your value proposition at the very beginning, right when you're designing the product. Later on, you know, after it's all done, it's hard, you know, to do something change it to, to add that, but a lot easier up front in the design process. And the other place to start looking at this is, is when you're designing your, your study, say that's a Class 3 device, you could do all these, these measurements that'll get you your, your FDA approval, but you didn't build in your, your data for, for, you know, this, this, this value proposition. You know, you measure OR time, hospital stay, you know, revisions, those are all, you know, super expensive numbers that if you take that data early on and it's in a well-run study, you're going to do a whole lot better. But then also say Class I devices, you may just not think about it because it's so, you know, you're not doing a study. I developed a discectomy tool. At one point, you know, big, big deal, you know, how, how, how are you going to sell that? And there was, was no good way to do it other than collecting this data. So up front, we, we did a lot of studies to where we measured, you know, every discectomy tool is going to, going to do well, but it's how long it took to get, you know, 80% of the disc out, how many passes it took. So building this data up early on, thinking about how it is that you're going to capture this data is really important such that you have it to sell later on.

Yeah.

Yep.

I couldn't agree more. And it's, I feel bad sometimes because you're saying like, hey, Eric, when you're designing that today, could you look at what it's going to be like in 2029? And you're like, what? Right? So we're trying to play where the puck is going. But what I still see is, and you're absolutely right, and the predicate comment is, is it was fabulous because that's— I saw that with OneTray. If you guys have ever seen that product, OneTray, the predicate device was flash sterilization. They're not flash, but it says it in their 510 letter and it says it in their IFU, and it's what got them in all kinds of trouble. And like, it has really crippled them from a growth standpoint that I don't know if they're ever going to be able to dig out of it. And it was all a decision made in 2004, right? Like, so it's literally 20 years ago. Um, so it's hard to predict the future, but I do think you can at least look a couple years out if possible. And if you know what matters today and assume it's either going up or down, You can at least try to project. And good salespeople should be able to take certain benefits that come out of these and turn them into bigger benefits. Like, for instance, if my case is 20 minutes faster, I see— here's how I see most reps present it. Oh, it's— we're faster, less blood loss. Well, how much? Does it improve block utilization? Does it improve on time starts?

Oh yeah.

And then I'll, they'll say, oh yeah, yeah, we can get another case in a day. I'm like, really? How many? Like one? Is it one a week? What's that worth? Because they don't, they won't look up the DRG. I'm like, well, here's what I know. If we do one more knee a week, $650,000 top line revenue minimum because of CMS, because I know the reimbursement. And somebody in finance goes, what was that again? Say that again. Right? Because I know what they, what they need to hear. Right? So, I mean, these things have downrange. And I used to wonder, I used to think, am I gilding the lily? We're not. I've talked to these value analysts. I've interviewed at least 50 of them. Formally interviewed them. And they'll say, no, that's what we want to know. Oh, our utilization is one of our major priorities. Like, if you can help us, that helps. I need you to show it to me, right? That's up to us to show it. But me, that's the value we're talking about downstream. It doesn't just matter to the surgeon. Like, I know some surgeons I saw, I saw an orthopedic surgeon in Rhode Island said, I measure it by B time, butt time, how much I'm on my butt.

Okay.

All right.

All right.

Hey, Dr. David Kaye's got his hand raised. For people who don't know him, he's a successful startup founder and a clinician and a hospital owner. So I can't wait to hear David's comments.

Yeah, thanks for taking my question. This is going to be pretty specific. So we're in the final submission and awaiting approval. From the FDA for, I'm not sure what that's supposed to be, for new tissue adhesive. And we're first going after skin adhesives. Now, one of the tactics that I want to take with the VAC is there's a significant hidden cost in the way that we close skin, and that's the aftercare. It's all well documented how much time is saved in the OR and how that translates into cost. And, and that won't be differentiated. But we, our formulation is actually quite different from what's currently out. It really is the next generation of, of adhesives. But let me give you a, for example, so if I'm an individual practicing surgeon versus a healthcare system, and we can extrapolate the, the numbers based upon where you live. So if I'm an individual surgeon, I'm getting paid less every year for my surgeries, which cover the suture removal side. Now, when we look at what suture removal costs me, I have to pay an MA to remove the sutures. I have to take up a room for a non-paying patient and as well as dispose, and it's red bag disposal of the suture. That's compounded, made a lot worse because we have to use these garbage disposal suture removal kits that don't really hold the suture. I had a partner complaining about yesterday, he's getting a lot of problems with retained sutures because we can't get 'em out. So he has to go take his time to go pull 'em out. And we're looking at the cost of that visit for us around $150 to $200. Now there is not a single patient on the planet, let alone family members who like that visit. It's a horrible patient experience. It's compounded drastically in children. But there's also another cost. That's the person who drives them to the office to take time off work. To bring 'em in for the suture removal. So where I want to get to is to leverage that to a telemedicine visit. And we really don't have to do anything different than current, current telemedicine software, and they can be coached on removal from home. So that means I'm not taking up a room and they're just coached to peel it off typically 2 to 3 weeks afterwards with no pain. And then we can document it with a photograph. How do you think that's gonna go with the value-added committees? Because it's a patient experience issue, but it's also a direct cost. Now, I said, you know, let's look at this from an individual surgeon who's in private practice, which is only 30%, but 70% of healthcare systems. If you multiply that out by the number of surgeries that are done, and that's all a bundled plan at that, let's say $200 per visit in the bundle, that really adds up to a place that's doing tens of thousands of surgeries.

Yeah, totally.

So what's, what's your impression of that tactic?

Yeah, I would, you're spot on. Like, that's the value, right? And, and how do you describe it and how do you put a number on it? And I will tell you, I would put a number on it. You just did, $200 per. And I wouldn't dive a ton deeper until, if you have to get it approved through a value analysis committee, I would say, look, You do 10,000 of these patients, we're gonna save $200 on, on that episode of care. It's not in the account, it's post-operative, right? And I would say we've estimated it this way, in your executive business summary that will capture their attention. Now they may say, well, where, where'd you come up with that number? You just rattled those numbers, some of those numbers off, right? And You are now— here's— you're making a business case for them to invest in this. And sometimes it doesn't even have to have a reimbursement with it. Like, everybody buys stuff and doesn't have a reimbursement for it. They buy it because it's valuable. And so I would be describing like, look, this, this will save money this much. I've estimated over this many patients in your facility, if you went system-wide, we'd be talking about whatever the X times 200 is, right? And then I'll be saying we anticipated major increase in patient satisfaction, surgeon satisfaction, and we're going to take the time that we have estimated to be X amount of time an MA does and our staff, and we're going to redeploy them on things that they're already working on. Because when you start talking about FTEs, Then people start going, whoa, I don't want to cut people. I don't have enough people to begin with. You're saying, yeah, we've estimated it as a full FTE or whatever it is, 66% of an FTE, but it's actually 22 hours a week. We're going to redeploy that 22 hours on— and what am I putting my MA on? Patient care, seeing more patients, whatever it is. That's the opportunity cost on the other end. But let me ask you this, Dr. K. Would you buy your product knowing what you know?

Yeah. I mean, I'm using a lot of, a fair number of PA traumatic closure systems. The patient satisfaction is dramatic. And I'll throw another really interesting thing out. And that's, I see a dermatologist and I was talking to her about it and she said 20% of their visits to a dermatology office are to remove sutures from skin biopsies. That's a day a week. That's a day a week.

I didn't know that. Yeah.

20% are coming in to get a couple sutures out. Yeah. And I mean, you, that's a huge expense for them.

Yeah. Who, you know who else doesn't know that? Value analysis, the health system.

Yeah.

Hey, hey, Dr. K, can I, can I be devil's advocate? I'm just sure in your, in your case, I think the, the key question is who does that MA work for? Who pays them? Is it the physician? Uh, and so does the hospital care, I guess is my question. Does it come out of their bucket?

So remember, 70% are gonna be employed, and if they're not employed, they're probably doing that in their ASC. Um, the way my situation is, those MAs are actually hospital employees. Uh, but we own 'em. And, and as it was brought up, and I think everybody knows this, The single biggest problem is just employees, getting employees in which we have to pay employees. I mean, right now our sterile processing people are making, making what PAs make. Wow. I mean, yeah, it's, it's insane what we have to pay people and we're not even talking travelers anymore. So if we can redeploy them and to do things, because sometimes a suture removal can be a couple of minutes and sometimes they'll be in there for half an hour digging out sutures and patients are screaming and hollering. You know, which is in good for business.

Can they do injections?

DMAs?

No.

PAs?

Yes.

Yeah.

Okay. MAs?

No.

If you can, if you can document that you can move those, that, that effort to somewhere that is actually makes money versus just a, a cost, that's even a, a better story to tell.

It's, it's even better to John's point. Although I would say it's not required. No.

Right.

But it is better. It's definitely better if they can do something like that, but look, to your— nobody has enough people. Can we get them to do more productive things, even if it's not something they can bill for? That's valuable. And if you ran a business, you'd probably pay for those because you see the benefit. Can you get the value analysis team to do it? And I'll tell you something, I have not done this yet. But I'm going to do it on my next one. I would videotape those patients who go, oh my gosh, it was awesome. Like, it was great. I'd videotape 4 or 5 of them and I'd submit that to the value analysis team. Here's what patients are saying. That does matter because I've talked to the people. The chief nursing officer will care. The chief medical officer will care. The CEO will care. And you're saying we're delivering better healthcare. At a lower price. It's just our acquisition price may be higher, but we all buy things that have higher acquisition prices but that bring in way more value. It just depends on how you define it, and you have to own that. Like, if we submit something and people are like, Supply Chain goes, hey, I'm paying the same thing for your predicate device, why are you charging me 20% more? Now you're playing defense, right? It's what you buying. What do you buy?

Yeah. And, and part of this challenge is this is a cost that people don't even think about. Yep. When I've talked it over with friends of mine, they're like, oh God, you're right. That's how much this has cost me. I never thought about that before. Well, the VACs aren't thinking about it because what we're doing is changing the process and that it eliminates a bunch of steps, but because it's not the normal process of sutures, you know, we're, we gotta display something that's 20,000 years old. And, you know, that's a bit of a challenge. And that, so it's really coming up with a best-case scenario. I mean, there's other big differentiators that I can't go into details on until we get our FDA approval. But one of the problems with current skin adhesives is skin irritation. And our formulation, we should have significantly less skin irritation issues. We don't put out the noxious nonsense that they do. So big difference.

Yeah. I like noxious stuff sometimes. No, joking. Yeah. No, he's not on your side. I've been described as noxious. If you think about it this way, though, when you're talking to a value analysis, non-clinician decision maker, finance, C-suite, right? Or a CMO or CNO who don't do what you're talking about. Right? Like, they don't, because they're nurses or doctors, but they don't do what you do. They, they, they haven't stood in those shoes. I, I think you want to be saying, hey, there's plenty of ways that to have for, like, to close wounds. The problem we're running into is we're spending, we have derms that are spending a day a week just removing stitches, right? We have people coming in and clogging up our already busy offices to have stitches removed. You know what that doesn't let me do? It doesn't let me see the operative patient next week. I gotta see him in 3 weeks, right? And now maybe they're going to the competitor across town because they can't get in sooner. Like, this stuff all has downrange effects. So to John Rizzo's point, if you can prove that it increases revenue, great. I— but on the same token, I guarantee it's pulling down revenue. To, right? So my skin closure device actually unclogs some of my offices a little bit. That's big. That's a value analysis strategic goal. They're trying to get more patients in. You just helped them by buying that. I honestly, like, people look at me like I'm selling this story. Yes, I am. That's the story. It's not just what the surgeon thinks, although the surgeon matters, right?

So, uh, kind of, uh, but, but there's also, you know, getting back, back to what you're talking about, kind of, uh, and that's a whole nother issue too with surgical training and, and technical skills to close up incisions really well. Because we know we're gonna leave less scarring than with standard sutures and definitely with staples. Uh, there's just not enough people in the OR who have the technical skills to close up incisions real well. And that's another reason why we want to address this. Our applicator is completely different than the current applicators. It's much finer, much tighter control on it. I mean, I'm not gonna go into all the details on it. I could do that at a later time if Tiger wants me to. But just again, just curious because this is something, it's a cost that is just assumed to be a cost of doing business. Without really thinking it through and saying, how can we change that? And that, that's why I wanted to ask the question. Yep. Yeah. Yeah. It's, it's different. It's something they're not even considering. It's a little bit like sterilization costs. You know, there, there's real costs with that and it's mundane, but it has to be done. And if you come in with a better way to address sterilization costs, keeping things out of the sterile processing unit, then you know what, you're, you're adding value, but it's just, it's different and they're not thinking about it. So that, that's, that's, I think part of the challenge is something new.

Yep.

Yep.

Yep.

Well, thank you. Magrito was great. I look forward to seeing that product. Excellent.

All right, Mike, Fabian's been patiently waiting. Oh, can't hear you.

Hey, Coop, Fabe's here, your old buddy.

Yeah.

Hey, hey, I got a question about— and then I got a little tip too that kind of helps things. But my question is about the nuances that you may encounter in, you know, your wheelhouse, if you will, in the difference between value analysis at the ASC versus at the hospital. Now I'm gonna read ahead a little bit and just wonder if it's probably the structure of that ASC that's making the difference— surgeon-owned, hospital-owned, da da da. But I'll let you elaborate on that. The tip that I was gonna give is pre-value analysis. I had come up with a request for technology, and this could transcend a lot of different specialties. You know, I'm kind of a tech guy, but this would fit a lot of different products. Where I did the due diligence to lead up to this, my surgeon champion voice was being heard too often. And so, you know how ears then go deaf to that tone? I needed to rally though that surgeon stable. And I was able to earmark the other champions that weren't quite as vocal. And then came up with a request for technology. And within that, it was a very carefully formulated questionnaire so that, oddly enough, my product came to the forefront and where they were able to elaborate on some of their requests. Then those quiet members were a little bit more heard then. So that's just my little tip on that, but I'd love to hear you elaborate on nuances of value analysis, ASC versus hospital.

Yeah, that, by the way, it's highly sophisticated selling what you did, Mike, because you're, you're counting votes, you're lobbying, and you're figuring out who your best is to do it. So I applaud you for that because that's exactly how you have to do it. Pre-VAC, like before submitting something, most of the ills can be solved. And I, I'll answer your question about the ASC in a second. I wrote it down here, but if I have a champion, if Dr. Ted Byrd says, I am loving this thing, get this baby approved. I'm like, hang on for a second. I gotta get Buford, Swoboda, Lang, and these guys are all important and I gotta get 'em at least to be neutral if we get it approved. And I'm gonna try to get 'em to see if they want to approve it. And here's what Buford says. I would, I guess if Byrd wants it, sure. Right. And Lang's like, I'm never doing it. Byrd's just not somebody I care. Right. And I got to get Lang to neutral. But like, I am going to rally troops and then I'm going to figure out who's the best to submit. And I'm going to go, hey, Dr. Byrd, you're going to love it. We're going to get it approved and you don't have to burn any capital. Buford's going to do it. Just when they call you and say, hey, do you really want this thing? You answer them honestly, right? So that's what you— some of what you did, Mike, and I applaud you. That's not— that's enterprise selling. We don't see much of that in med device right now. It's coming. I urge everybody to consider it. To the ASC, it's less sophisticated, but they still want value. It's just less difficult for the time being. Right? So you're going to get a quicker no, you're going to get a quicker yes, and it's way less complex. But the day is coming when, you know, these ASCs are going to be owned by one, one of four big groups or hospitals, and it's already happening. So it's coming. It's just not as big of an issue. But I tell everybody who's like, oh, listen, value analysis, that must suck for those people still in the hospital. But the ASCs, I'm fine. I'm like, all right, good luck. It's coming. And you, you better be prepared because they're going to RFP you. They just are. Whatever you are. So yeah, that's, I just think it's coming. And if you're good in the hospital, you'd be great in ASCs. If you're good in ASCs, you might actually be good in hospitals as well. So yeah, it's a good point. So. Sharpen the sword. You're gonna need it everywhere. What else? Any other questions out there?

Yeah, John and Jack, do you wanna talk about, I mean, John and Jack work for a company that's got a better ACL fixation. I mean, it's hands down better. And, you know, and you, and they're just starting to sell in the US.

Yeah, we just started commercializing. Thanks, Tiger. We've started commercializing in March. So we're, we're at the very beginning. Jack and I have have done this before. We were— Jack worked with me at Embodi. We sold that business last year to Zimmer. Good one. And I had a previous company we sold to Zimmer, Knee Creations. So we're— but starting from scratch, it's all the same. You know, you're nobody to no one and you need a surgeon champion at every location and you need to You need to find a way to get in the door with the value analysis committees. You know, Jack and I struggle with it. Jack does the bird-dogging. So, you know, he manages that. And Jack's a— by the way, if anybody cares, Jack's an independent contractor. He can do this for any company if you want to work with him. But so I don't fill his time 100%. But the challenge is, you know, well, we already have something that does that, you know, and, and yours is more expensive. So, you know, in some cases we can be less expensive, but in reality, value analysis committees don't really care that, you know, the revision rate of ACL tibial fixation is somewhere between 15% and 30% according to the literature. Because it doesn't cost that facility anymore to come in, uh, 6 months or a year later. As long as it doesn't happen within 30 days, it doesn't cost them more. So, uh, you know, that's, that's not something to hang your hat on, uh, but the surgeon has to demand it.

Have they told you that? Have they told you they don't care?

Uh, yeah, in, in no uncertain terms. Um, right, Jack? Yep, absolutely. Um, you know, it's kind of— and I think it's not that they don't care, it's that they don't— they just don't believe it, right? They, they— it's that they don't believe. Same thing when you say, oh, we could save you 15 minutes of OR time and that cost you, you know, $80 per hour. So they— I, I've had OR managers say, I just don't believe that's true. Uh, so, you know, okay, I, I failed. I failed to, to properly sell you. I didn't give you enough information.

Here's my argument when I've had people say that to me too, like, oh no, it's 50 bucks. It's 50 bucks a minute. Oh yeah, it's 50 bucks a minute. Yeah. So when we save 10, save us 5. No, no. And I would say, here's my response in my head. Okay. They're either negotiating with me to try to get me to lower my price. They're the wrong person to talk to, which is invariably what it is, or they're stupid. It's their choice. I'll be honest with you. Like, I didn't say this on this webinar I did yesterday, but I'm going to say it in the Bone Check group because it costs a 10-OR hospital $60 million to turn the lights on the year. That's their nut that they got to go sell through. And anybody— what do you think that $60 million is? It's turning the lights on, hiring people, running it.

Turnover time.

Yeah, it's all of that, right? And so people say, well, you know, they're here 5, 10 minutes, isn't that important? We didn't get to put another case in. I'm like, oh, okay. So I approach them differently and I say, is that a big deal? And they all say, oh my gosh, yeah, we can, we don't have to call people in. We don't have overtime. We don't like, even if you don't get an extra case in, it's valuable. Oh my gosh. Yeah. Yeah. Well then why are you arguing with my 20 minutes not being valuable? But I don't have that argument when I was younger. Skinny or Cope used to have that argument with them. I'm just like, I'm done talking to this person. They said it'll be faster. Cool. I'm going upstairs because this knucklehead isn't paid to think about time. And right, ask a restaurant, you turn your lights on. Does that cost you any money or is it, or you just wait till people start coming in? Like, no, the, the dial is on. Like, yes, we need more diners in this restaurant. We need to turn tables. It's the same thing. So my rule of thumb as I've gotten older and cantankerous is if I talk to somebody who says that's not valuable, I'm talking to the wrong person. I just— you have to be. You're not paid to actually think like a business person. You're paid to whatever it is.

I'll be honest with you, Coach. Our challenge is, is getting the right people to listen because when you have to go through a Lumiere or a Simpler, It's a computer program, and you get to, you know, you get to press buttons, yes or no. You get to download a few documents. There's no guarantee anyone's going to see them. You can download a video. There's no guarantee anybody will watch them. So the challenge is, you know, they don't let us get in front of the value analysis committees like you used to be able to.

You're absolutely right.

Yeah, yeah.

You know, and I agree with that. Everything you're saying, Cope. And, you know, the thing is, the rep doesn't want to go over that person's head because they could, they could shoot themselves in the foot. So guess, guess who does it? I'm the bad cop. You remember this? The good cop, bad cop routine, right?

Yeah.

So I'm the guy who's gonna go above their head and say, okay, is this valuable to you? And if it is, you know, we need, we need to, we need to, you know, proceed down this path.

Yeah.

And if it goes bad, we just deny and say, Jack doesn't work for us.

Exactly.

Now you can say that. Oh, the bad cop came in. Oh, that guy. Yeah.

I've had people say, don't bring him back again. You're welcome here. But that guy, that Gardella guy, don't bring him back. But, you know, I think it's a matter, too, of understanding what's in it for every individual that's on that, on that value analysis committee. And that's where the reps kind of need to step it up a little bit. And they need to at least let us know who's on the committee. If anything else, we can try to find out what's important to them and make sure that we're including that in our submission. To me, that's very, very important. I think it was Dr. K that said that's— it's the pre-work. That's what we have to do up front.

It's—

yeah, we, we have to make sure before we submit if we know what we're up against.

Jack, your point's really well made. And so if I ran a sales organization, which I don't, if I did, I would make every one of my senior reps go make an appointment with the VP of the service line for the health systems in which they are. No product, make an appointment and get in front of them. And if you can't get in front of them, I really wonder if you're a good salesperson. But get in front of them and then say, hey, we see these types of products all the time. They do these things, but I'm not sure 15 minutes is that important. And then just listen to them. They're going to tell you how important it is. And then when you're back in that hospital, that's part of that health system and some knucklehead says it's not important. I'm like, yeah, it doesn't matter. I've already cleared it. The VP of Surgical Services wants to hear about this because they told me how important this is. Because I'm not going to listen to somebody who can tell me no, who can't tell me yes. And those people have no— it's like asking the first shift manager of a restaurant, hey, you know, like, hey, everybody asking for dessert? You know, I mean, like, it's a— it's a— you're— it's just— this is selling at the highest of level in sophisticated buying organizations. They just happen to deliver healthcare as opposed to home improvement, you know, like, or it's the same thing. But we keep insisting on letting the first shift manager at Rite Aid tell me I can't put my product on the shelf. Well, what do we call— what are we talking about? I'm at headquarters. I'm at the regional office. And that's what we need to do more of. And I tell every orthopedic or med device company, bring some of those. Instead of bringing surgeons in to tell your reps how awesome your product is, bring somebody from surgical services or, or coordinators of the service line for health system and sit them down and ask them what matters and run stuff past them. You'll be shocked at what they tell you because they're business people and nurses. And that's what you need to be having in front of your people right now. Because then you'll get approved. So then you say to your surgeon, hey, listen, when you request this, that we're not waiting for the Vatican white smoke to come up. I've already pre-sold it. They're going to approve it because I did all this pre-work. And they're like, really? I'm like, yes. Lumiere is putting your resume in and hoping you get a job at Zimmer. Come on, who does it, right?

Nobody.

It won't work. Work. So there's no way we're doing it. I mean, we'll submit it when I, when they're like, hey man, you killed it at that interview. We're going to need your resume. Are you in Lumiere? Yeah, yeah, yeah, yeah. Let me send it over to you. Sure. Here you go. That's it. Right? I mean, this is, you can see why I can't work for big companies, by the way, John. That's why I like you and Jack already. Cause I'm like, oh yeah, those guys. I get those guys. I mean, you gotta be kidding me. So yeah, I, and I, I always tell everybody on this, I will help anybody I can. You got my, my website in there. You can ping me, you can get me on LinkedIn, you get my email. Like, for instance, Dr. K, I'd love to write an executive business summary for you to, to see what you think to submit to places because we need to do that when we submit to VA analysis. We need to get their attention. I will help do that because it drives me crazy that there's all this cool technology out there. God knows I might need them. Freaking plate. I might need my skin sealed, and I'm like, I gotta call this knucklehead back in 2 weeks to get my sutures removed? Are you kidding me, right? Like, I get irritated about it. I'll help anybody I can. If it takes a lot of time, I end up having to charge you, but I try to help everybody because so many people help me, right? So yeah, I got a whole process that'll help. So, um, thanks, Tiger Buford. I'll hang here for a while. This is— I get all fired up.

We could go for a long time, but, uh, any more questions or we want to just cut it off? We can keep going. There's no limits. I'd love to hear— oh, go ahead, John.

I've got to get going as well. I just wanted to say thank you very much for allowing us to, uh, to join today.

Yeah. Yeah. Good luck with, uh, I mean, um, the washer cap is a huge improvement over ACL fixation. I had just learned about it in depth this morning. Good luck to you guys.

Uh, thank you. Thanks, thanks, Jack. It's great meeting the other bad guy, bad cop.

All right, the bird dog.

Thank you very much, guys.

Thanks, guys.

Good one. Have a good week.