Deal Constructs to Expand Commercialization and/or Mitigate Exposure

Over the years I have been responsible for many types of partnerships in all phase of the agreements and have observed exceptional success.  Pending on the specific business need there are many paths that should be explored.  Reviewing the gaps, challenge or opportunity, there are so many options companies could consider.  SWOT analysis is certainly one tool that can be used for the overall company or program specific reviews.  I have partnered with Business unit leaders to ensure they have a strong development pipeline, commercial product offering and maintain strategic advantages over their competition.  Business unit areas include the Commercial Operations groups, Endovascular groups, Coronary Vascular and Structural Heart.  Additionally, I am now partnered with several Diabetes companies, Wellness companies, Diagnostics, Surgical units and Dialysis companies.  I have enjoyed many years in the medical devise space working in many therapeutic areas with unique technologies.

Please note I coordinated and/or managed teams for Initial Assessments, Due Diligence, Integrations, Ongoing management and terminations.  Below, are a number of partnership types that can be considered as examples with the description and benefit?  I had individual contributor roles, direct reports and many dotted line reporting relationships to ensure we considered all aspects of our business.  General coordination includes – Legal, RA/QA, Sales Operations, R&D/Product & Technology Development, Supply Chain, Production Operations etc.  Additional examples available,  pending again on business need or challenges your trying to mitigate.

Development Agreements – Types, benefits and considerations

• Co-development – Partner with companies with complimentary IP to existing product or technology in the development pipeline. Many possibilities have to consider.  Bottom line, what are your needs and gaps.  Misc examples –
  • Partner with coil manufacturer to braid their technology into your delivery systems for greater push ability possibly for Chronic total occlusion crossing
  • Unique characteristics in a balloon material that could benefit your diagnostic or delivery devise
  • Bundle your technology with a partner to – enable additional fields of use – expanded indications etc
  • Partner with external development groups and/or medical device companies who have demonstrated expertise in areas that benefit your pipeline. Allows you to focus on your core technology and expertise and broadens your product offerings.  I found many times partners can develop faster with better cost structure since it is their core capability.
  • Asset purchase linked to development and regulatory support.
  • University development agreements linked to milestone.
  • Strategic partnership development agreements tied to support and milestone achievements

Distribution Agreements – Types, benefits and considerations

• Co-promotions – Allows for launching into new geographies where you have limited infrastructure or limited experience with the regulatory and governmental navigation
• Could extend IP (patents) if new indication or fields of use are in play.  I.e. using a specific catheter delivery system and or diagnostic capabilities in ophthalmology vs. coronary applications.  Using Hypertension technology for oncology applications adding whole new revenue streams using a partners expertise and infrastructure to expand commercialization into new applications
• Drop ship agreements – Expand your distribution with partners or visa/versa thru distribution agreements.  Lots of reasons and benefits to distribution agreements if thought out properly and realistic mutual expectations are achieved.  Basically reach an agreement to sell your product to a company (or visa/versa) but the deal flows thru the partner stemming from their relationship.  GPO A buys product from Cardinal Health, JnJ, Medtronic, Abbott etc, which then places and order with your organization.  You ship the product directly to the given hospital (s).  Partner does not touch the product so has more limited requirements to engage the RA/QA, Supply Chain Etc.  But expands you bah and or commercialization avenues.
• Country specific distribution agreements – always lots of pros and cons to consider.  Typically these deals are beneficial when you are considering a technology and want to gain more experience with before launching your product in a given geography.  Example, you are developing a structural Heart technology but are still developing your strategy and understanding of the adoption rates and true benefits.  Partner with a company with similar technology (shield both IP’s to ensure your protected from a legal and developmental perspective
• General distribution agreements
  • Evaluate technology even a company prior to an acquisition.  Allows to evaluate organizational fit and technology adoption.  Dip your toe in the water before jumping in.  Could be tied to commercial and or regulatory milestone etc
  • Mitigate legal exposure allowing access to certain technologies to mitigate exposure to other lawsuits where you have concerns.

Distribution agreements allow for evaluating technologies and or new therapy areas without the full M&A or asset purchase.  Allows a company to grow the clinical relationships to allow for swifter adoption to technology in you development pipeline.  Obviously as stated above, gives your commercial organizations more products in their sales bag which truly could have great pull through for your core technologies adoption.

Unique Deal Constructs

• Mitigate your exposure to IDNs, GPO’s or hospital organizations breaking contract or not meeting minimum purchase quantities (MOQ’s).  Medical Device Companies struggle with this as they have little to no recourse unless they have the only technology available.  Companies need to be strategic and creative in creating win win value propositions potentially more that the products at their disposal.  What else can you offer?  What would be deemed valuable to your critical accounts?  Conversations must ensue to determine what is important to these accounts.  Co-promote large capital equipment then linked to long term maintenance contracts?  If they do not meet MOQ?  Service level agreements above normal contracting parameters?

Unique Deal Constructs cont.

• Ship to home patient certain items to track compliance to post operation requirements?  Assist office quarterly with Lean events?  5s etc?  Many items can be considered, again pending on the needs and vulnerability’s you are trying to mitigate.

Distressed and Obsolescence

• New Product Launches – With new product launches companies must review exposure to distressed and or obsolete predicate product.  Many ways to mitigate this exposure.  If worldwide launch, repurpose product to the country’s where approval will be delayed.
• Slow adoptions in certain geography’s and or specific accounts.  Repurpose product to higher movement accounts or geography’s where the adoption of that technology is greater.
• Rebrand product and configure to allow the US Company to commercialize in the private payer space and government reimbursement space for the emerging markets.  May need distributer partnerships to ensure you do not compromise the higher margins generally appreciated from US companies in the private market space?