Microline Surgical, Inc.
May 13, 2013 Issue
The Most Powerful Name In Corporate News and Information
Microline Surgical is providing a Cost Effective Eco-Friendly Solution for Today’s OR with their Reposable Laparoscopic Instruments and new Innovations in Endomechanical and Energy Medical Sectors of Surgical Devices
About Microline Surgical:
develops and manufactures high precision open and laparoscopic surgical
instruments. Microline's laparoscopic reposable instruments provide a
eco-friendly solution for today's OR. The MiFusion product
line offers a broad spectrum of open and laparoscopic instruments used to
seal and divide tissue utilizing proprietary Thermal Fusion technology.
Sharad Joshi has over 25 years of experience in the medical device field including management positions as President, COO, New Business Development, Marketing, International Sales, and R&D at Microline, Blue Torch, Alliant Medical Technologies, and Boston Scientific. Sharad has been the inventor and author on numerous patents and publications and has been responsible for bringing many new medical technologies to market.
Prior to joining Microline, Sharad was the Co-founder and CEO of Blue Torch Medical Technologies where he currently serves on the Board of Directors. As CEO, Sharad lead an organization that develops and markets internationally, nerve identification technologies for prostate cancer, and expanded open and laparoscopic indications to gynecology.
Sharad has earned a Bachelor of Science in Mechanical Engineering with a Pre-Medical minor from Northeastern University and graduated cum laude with an MBA from Babson College.
Microline Surgical, Inc.
Interview conducted by: Lynn Fosse, Senior Editor, CEOCFO Magazine, Published – May 13, 2013
CEOCFO: Mr. Joshi, what attracted you to Microline Surgical?
Mr. Joshi: I came to Microline Surgical about 6 and a half years ago. Our Executive Chairman, then President and CEO, Dr. Jean-Luc Boulnois is an entrepreneur at heart who had a very strong vision for growing the company substantially. He grew the company and expanded the already exceptional reposable product line, and I wanted to join him in the mission to improve the way surgery is done worldwide. Jean-Luc attracted me and many others to Microline. In a previous role, I was the founder, President and CEO of Blue Torch Medical Technologies. I was attracted to his global vision and he has a very strong technical and business background. He was a true visionary in growing this business and he asked me to become part of his team to substantially grow the business. Since then we have more than doubled in revenues.
CEOCFO: Why was this the time for a change in leadership?
Mr. Joshi: At this point in time Jean-Luc was already becoming more involved in strategy and future partnerships and I was running all aspects of the current business. We decided to split the roles even further. From my chief operating officer title, president and COO, he would focus even more on strategy and larger partnerships. I would continue to manage the day-to-day operations but also be responsible for executing that strategy.
CEOCFO: Would you tell us about what is happening to Microline Surgical today?
Mr. Joshi: What is very unique about Microline is that we are a leader in reposability long before it was even known in this industry. It combines the word “disposable” and the word “reusable,” hence the word “reposable.” Microline offers an extremely high quality hand piece that provides surgeons tactile feel and a high performance instrument in his or her hand combined with the cost effectiveness of a disposable tip that is replaced for every patient. Some people call this the ultimate “razorblade model.” This has become very well known for everything from coffee machines to razor blades to printer cartridges. In the medical device world, it provides a single use disposable instrument that is fresh for every patient, with very high quality, but our costs are about a third of that of our competitors who typically sell fully disposable instruments that are typically made of cheap plastic disposables often made overseas. Our manufacturing operations are located in Massachusetts.
CEOCFO: What are the structural advantages to your model?
Mr. Joshi: Fundamentally, it allows us to give surgeons the tactile feel that they need but keeping costs very low for the hospital in a global economic environment that is looking to reduce its overall healthcare burden.
CEOCFO: Do doctors like the non-disposable feel of the instrument?
Mr. Joshi: In many other areas in medicine, it is less important and a fully disposable instrument is just adequate. We are unique because we are in the field of laparoscopy or minimally invasive surgery, which typically means that our instruments are on one end literally in the hand of a surgeon and on the other end is inside the body of the patient. Surgeons are tactile people and they typically like to feel structures before they cut. They started doing surgery in an open manner where they use their fingers to feel and retract. Having Microline’s reposable model allows us to put much economic and ergonomic value into the hand piece and therefore optimize that feel. For example, there is a very close one to one relationship between what goes on in the surgeon’s hand and what is happening in the patient’s body that surgeons require. This is much like the difference in a high quality vehicle and knowing the feel of that vehicle on the road versus a lesser car that would be sloppy and less precise. Believe me, in surgery it is even more important. Surgeons truly seek this out they tell me it is very difficult to do with a cheap fully disposable instrument because their hospital has to keep the costs low enough. Our model, since we are only selling them a tip for each procedure, gives them a wider variety of choices over those tips, reduces the costs to the hospital and reduces the carbon footprint. Medical waste at hospitals is typically incinerated and when you can dispose of a small tip as opposed to a large disposable device the hospitals saves money. When the hospital pays for shipping or storing our devices, they also save money. Microline has been a green company long before it was even fashionable to be one. This is largely from the genius of Hughues de Lafocade and Henri DeGuillebon, our founders. They created a patented connection between our disposable tip and our hand piece that we enjoy today.
CEOCFO: What is Microline Surgical’s market reach today and how is it increased?
Mr. Joshi: We sell in 65 countries throughout the world. Our headquarters is here in Massachusetts where we also manufacture our devices which is a very significant and different from our competition. They largely manufacture in China or Mexico. We have an office in Amsterdam, an office in Paris and now Hong Kong to service the 65 countries. A major component of our growth is clearly global expansion, with an emphasis in Asia-Pacific and Latin America.
CEOCFO: When do potential buyers realize that they should be working with Microline Surgical’s products?
Mr. Joshi: It depends on who we are talking to at the hospital. For example, in the hospital if we are talking to a CFO, they would be very interested in the fact that we sell products that are typically half to a third of the cost with the same or higher quality as the companies they may be working with. The CFO can easily do some quick math that shows that they can make significant savings to their bottom line while improving their healthcare delivery. If we are speaking to a doctor, we want to have a dual conversation with them about the clinical efficacy of our products as well as the cost benefits. The OR manager is a conversation somewhere in-between. When we are speaking to a nurse, we are talking about how easy our products are to prepare, make ready for the surgeon and a wide variety of tips that can be specialized to the needs of a given surgeon. Every surgeon that does even the same procedures might require—because of their case and preferences—a particular set of tips or a particular set of instruments. Reposability allows us to easily accommodate a wide selection. We have many more tips than most of our competitors. The other area of growth, aside from global expansion, is to leverage our core technologies. We have a strong endo-mechanical technology and a very strong energy technology, which is called MiFusion.
CEOCFO: What will Microline Surgical be doing with those technologies?
Mr. Joshi: We have reposable technologies in both areas so they still benefit from that high quality, and low cost dynamic. What is unique about our energy is that it allows us to grow the company in areas where the future of medicine is going. In the future of medicine, surgery is moving to smaller ports, fewer ports and in some cases no ports. They are going from multiple ports to fewer, larger ports to smaller and of course everyone in the whole supply chain of the hospital needs to be concerned with the best possible device they can give to the surgeon and to the patient at the highest possible value. In the future, more devices and more surgery will be done with automatically assisted devices. In some cases today it is done by robots and motorized devices. In most cases today it is manually done. In the future there will be devices out there that provide access, high levels of visibility and rigidity in order to create a field of surgery within the body. However surgeons will always need the essentials of surgery, which is what Microline provides. The essentials of surgery include cutting, coagulating, sealing, grasping and dissecting. Microline provides all of those in spades in a model congruent with the economic realities of healthcare.
CEOCFO: Is the Microline Surgical name brand-recognized by doctors?
Mr. Joshi: We are very well known worldwide. We do not have the kind of brand recognition that the three big behemoths in the industry have but we are very well known in all of those 65 countries. Our brand stands for and is synonymous with high quality, cost effectiveness and delivery with each and every surgery.
CEOCFO: Does Microline Surgical approach hospitals directly or through buying groups? Any new strategies or ideas?
Mr. Joshi: It depends on the country. In the United States, more and more purchases every day are done through buying groups. So 60% of our revenue in the United States are done through group purchasing organizations or GPOs. In other countries we have strong distributors with a large presence who distribute our products, train the surgeons and hospital staff and provide service to the entire organization. Regardless of who we use to distribute our products, we also have a very strong world class group of sales and technical people within our organization that directly interface with our customers.
CEOCFO: Do you see a change in direction or philosophy with CEO?
Mr. Joshi: My predecessors have certainly set the stage and have built this company over the past 25 years. In general, our ability to partner with and collaborate with other organizations will enable us to double and triple in size and continue the trends of doubling our revenue every 5 years. Any change will be consistent with our founding philosophy but change only as surgery does.
CEOCFO: What is happening in the research and development area?
Mr. Joshi: We continuously work on developing and delivering the next generation of our existing reposable products as well as new innovations that are truly unique in both endomechanical and energy medical sectors of surgical devices. We have a wide variety of products and with each one we will want to continually advance. The way surgery is being done is changing so our instruments can also adapt and change. In the future, they will be done potentially Trans-lumenaly through channels of other sophisticated access devices. Medical devices will become smaller and more nimble. There will be individual devices that perform many more functions within the body for the surgeon rather than just one. The devices will require many degrees of freedom in their movement in order to do many of these essential surgical functions.
CEOCFO: What makes Microline Surgical an exceptional company to investors and people in the business community?
Our approach to our medical devices is very different than the large
companies that are out there. There are very few companies that are similar
to Microline in its size, its levels of success, its growth rate and,
frankly, its ability to simultaneously innovate and service millions of
“We continuously work on developing and delivering the next generation of our existing reposable products as well as new innovations that are truly unique in both endomechanical and energy medical sectors of surgical devices.”- Sharad H. Joshi
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