Promising Technology, Disappointing Results

How to identify the root cause of low adoption rates?

Situation: A small company with promising technology had less than $10M in sales 5 years after launch. Expectations had been for more than $100M by this point.


Background:

  • Technology is used instead of drugs to significantly reduce hospital stays and prevent re-admissions
  • Company was pursuing several different patient indications with equal priority
  • Business model includes a piece of capital equipment and a disposable for single patient use
  • Procedure was not yet widely reimbursed

What our analysis uncovered:

  • U.S. annual revenue potential for the technology was large — in excess of $800M
  • Patient stratification indicated some ‘perfect patients’ would benefit greatly, some patients moderately, and some would experience only minimal benefit
  • The technology worked extremely well, but it was an open-loop system that required bedside monitoring and titrating
  • Many hospitals had purchased equipment, but few were in routine use
  • The current standard of care drugs, when used in high doses, were potentially increasing patient mortality

Conclusions:

  • Company was not helping physicians focus on treating the ‘perfect patients’
  • Physicians experienced significant patient complications when the therapy was not titrated appropriately
  • The selling organization sold equipment and did not focus on driving utilization of installed equipment

Recommendations:

  • Add feature to automate therapy titration (which was readily achievable)
  • Change sales compensation plan to reward increased utilization vs. equipment placements
  • Change messaging to physicians relative to most appropriate patients
  • Initiate a large trial versus drugs in order to shift the full market over to their therapy

Results:

  • All recommendations were embraced and aggressively pursued
  • Sales trajectory improved within a single quarter
  • Company was acquired within 9 months