5 Critical Considerations For Your Medtech Go-To-Market Strategy
LET’S CATCH UP …
Several weeks ago, Excelerant released a blog entitled Building Bridges in Today’s Healthcare Environment in which we discussed two major factors that need to be considered along the pathway to commercialization of your MedTech innovation. They are:
Hospital Consolidation – Basically, in an era of healthcare industry consolidation, “the biggies” are buying up “the smallies” and this means fewer hospital professionals are available to assess healthcare innovations for efficacy, ease of adoption, cost versus value, and supply chain reliability.
GPO Dominance – This hospital-system consolidation has led to a greater role for Group Purchasing Organizations [GPO] which are now more involved than ever in the decision-making process and more likely be entrenched for the long-term. As such, you must have expertise and understanding of how each individual GPO works.
Now it’s time to look more closely at specific considerations critical to building a targeted, go-to-market strategy …
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5 CRITICAL CONSIDERATIONS FOR YOUR MEDTECH GO-TO-MARKET STRATEGY
By MICHAEL THATCHER & JOHN DONOHUE
Partners, Excelerant Consulting
[June 30, 2022] – So you’ve accepted the reality of today’s healthcare industry landscape: Hospital systems nationwide have gone through a tremendous consolidation in recent years and, as a result, Group Purchasing Organizations [GPO] have become more and more critical in the process of vetting and adopting the latest and greatest MedTech products and services.
Good for you.
Change is seldom easy but it’s best to embrace the reality that exists in 2022. Which means you’re ready to put together a strategically targeted, go-to-market plan. But where do you begin?
Like any entry to market, there are myriad factors to first consider. Let’s take a look at key things to explore as you move further along in your journey to commercialization …
CAPITAL INVESTMENT – Talk about a “biggie”. Without adequate funding, you’re “dead in the water” as a sailor would say. Reality is the process of commercialization isn’t cheap and you’ve got to be sure the financial pipeline is flowing reliably before you move forward and burn cash unnecessarily. A start-up or early-stage MedTech passes through various stages in the commercialization process. Each one comes at a cost and those costs need to be accurately forecasted.
Take a close – and we mean close -- look at your financials and be brutally honest with your assessment. Crossing fingers and relying on good fortune are factors in a failed G2M strategy.
What are your current sources of investment capital? Are there other investors you could reasonably attract at this stage of the process? If it’s still early in the game, can you catch the eye [and purse strings] of an “angel investor” who understands the journey can be long but believes in your promising MedTech product or service? Do you have products you could license to other companies for royalties? Can you private-label your products or find distribution partners? You must address this foundational need before moving forward.
MANPOWER – Do you currently have the requisite “boots on the ground”, or at least a sales force at the ready when it’s “go time”? Who are these people and have they been properly and thoroughly vetted so there’s no wasted effort, time … or money? Sales growth is expensive, and a sales team is very expensive. Clearly define your sales strategy and decide whether you are committed nationally, regionally or to a geographically specific area.
If a sales force does exist, does it need to be bolstered with other sales professionals working on a 1099 basis? What does your sales structure look like? Do you need to turn to an expert who can help you source and assemble a qualified sales force from the ground up? And who will develop, spearhead and formalize the sales process, sales cycle, role plays, quota and compensation plan?
Finally, be sure to optimize your sales force before sending them out. This includes adequate sales training, equipping your team with all key messaging around market need, validated patient outcomes, price versus value, impact on physician workflow, supply chain reliability, contract positioning, product manufacturing, etc.
IDENTIFY YOUR PREFERRED SALES CHANNEL -- Are you leaning towards a direct-to-distributor approach or planning to barrel full-bore into the U.S. market? Have you done a deep dive on both approaches and identified which would be most profitable and have the greatest impact on patient outcomes? What’s the upside-potential of each, do a comparison. Do you have a proprietary product or a unique way of doing a procedure? Do you have any advantages over incumbents in that space – i.e., less expensive, greater value, improved outcomes, Made-in-the-USA, vertical integration, manufacturing, etc. Can you effectively “beat the bundle”?
Identify which channel is likely to be a more expeditious route to successful commercialization and profitability. And in some cases, it might just be time to pump the brakes a bit and investigate further before finalizing your channel strategy. Again, bold-faced honesty is critically important when answering these questions.
NAVIGATION – Are you 100% confident you understand the unique purchasing process at the hospital level and how best to navigate it? This includes a comprehensive understanding of how different entities operate -- GPOs, Integrated Delivery Networks [IDN], Government Collaboratives, For-Profit Systems, Not-for-Profit systems, essential hospitals, rural hospitals, surgery centers, etc. Yes … it is a lot to think about.
Further, do you already have relationships in place at the hospital? How are decisions made? Do you understand their supply-chain process? What about clinical versus non-clinical decisions? Again, how will decisions be made for your product and is your sales team properly equipped to navigate this process?
If no such relationships currently exist, it’s time to identify trusted friends, industry colleagues or consultants who can make introductions on your behalf. You’ve got to get the ball rolling, and the sooner the better.
Once again, it’s time to be brutally honest about your chances of success when it comes to navigating the hospital-level purchasing process. Where do you stand with relationships? Where do you need to be? How long will it be before you’re confident you can get your foot in the right door[s]? Do yourself a favor and formally map out this process from start-to-finish so you have a solid plan for success.
NAVIGATION 2.0 – Looking a little more closely at your relationship situation, identify who the right people are that you know and who the right people are that you don’t yet know. This includes what we call the “white coats” [surgeons, operating room staff, specialists, etc.] and the “blue coats” [hospital administrators and executives]. You can’t please one group and not the other if you wish for a smooth journey to market. Each group has its own list of priorities and you’ve got to be sure you’ve checked all the boxes that matter to each. Gaining buy-in across-the-board is challenging but doable. Just know who matters most and what matters most to all key players. Knowing this and delivering against it is your rocket ship to success.
In summary, once you know you’re adequately financed, sufficiently staffed and have identified your preferred route to market, you can begin charting your course for successfully commercializing your innovative, new and promising MedTech product or service.
Let Excelerant know if we can help … and good luck!
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ABOUT MICHAEL THATCHER – Michael has more than a quarter-century of executive leadership with an established record of success-building and motivating high-achieving sales teams. He has led all aspects of business, including strategy development, establishment of sales goals, overseeing sales efforts, revenue growth and operational enhancements. A collaborative and dynamic leader, Michael is a problem-solver whose consultative approach includes the establishment and nurturing of strategic partnerships, contract negotiation, structuring sales organizations, targeting strategically, disruptive technology product launches, and revenue growth.
Michael earned his B.A. from University of Florida and was also a defensive tackle on the school’s football team. He resides in Tampa with his wife and has three adult sons.
mthatcher@excelerantconsulting.com
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ABOUT JOHN DONOHUE – John has more than 25 years’ experience developing and leading all aspects of business development. He helped propel a $12 million medical device company to more than $600 million over a period of 24 years, positioning the enterprise as a power player in a highly competitive market. He is particularly adept at stimulating and accelerating revenue growth in diverse, rapidly evolving global environments in medical device, as well as developing comprehensive strategies for market penetration, the development of long-term strategic partnerships, and growing the customer base. He excels in solutions-selling, developing strategic partnerships, contract negotiation, revenue growth and expansion, and product launches.
John earned his B.A. from Valdosta State University and lives in the Atlanta area with his wife and daughter.
jdonohue@excelerantconsulting.com
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ABOUT EXCELERANT CONSULTING
Excelerant Consulting is the go-to organization for med-tech companies that need to position products and services successfully for value analysis committees, contract acquisition, and sales modeling and execution to commercialize the launch of medical devices or services with Group Purchasing Organizations [GPO], Integrated Delivery Networks [IDN], or Regional Purchasing Coalitions [RPC]. Our clients rely on us to enhance their product positioning, navigate corporate contracting opportunities, and provide sales support to accelerate sales growth.
For more info, contact Excelerant Consulting at info@excelerantconsulting.com .