Hear Bausch + Lomb’s Ophthalmology Play Book

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Bausch + Lomb Surgical’s Andrew Chang Has Big Plans in Ophthalmology Surgical.

Podcast Guest

Podcast Transcript
Tom Salemi: Hi, this is Tom Salemi. Welcome back to the OIS Podcast. Thanks for joining us today. We’re going talk a bit about Bausch & Lomb today. The company was a topic of conversation at OIS in San Diego. Of course Jay Michael Pearson, CEO of Valeant, the owner of B&L, spoke extensively about his plans for B&L. And it’s an area of interest for many people. The B&L franchise, of course, is huge in ophthalmology. Folks would like to see it restored or continue to be a leader in the sector. There’s been some concern about that since the acquisition by Valeant. But Mr. Pearson in his talk stressed that Bausch & Lomb sill be innovating and will be leading the charge once again. And today, I talk to one of the field generals for Bausch & Lomb. Andrew Chang is Vice President, Sales and Marketing of US Surgical. He’s also General Manager. And I got to meet him a few weeks ago at the Octane Ophthalmology Conference. He was actually on the growth stage panel, where I thought he did a great job. So I invited him to the Podcast not only to share his story and how he came to love ophthalmology as many of us do, but also what are his plans and designs and B&L’s plans and designs for ophthalmology. So I hope you enjoy this visit with Andrew Chang of Bausch & Lomb.

TS: Well, Andrew Chang, welcome to the Podcast.

Andrew Chang: Thanks for having me. I really appreciate it.

TS: You’ve been in ophthalmology for a good long time, working at several companies. What first drew you into the sector?

AC: Well I was in the KPMG annual audit and financial sector and healthcare sector was always a very, very promising growth sector for the financial services. So there was always an intrigue there. And then when I bumped into folks within the industry, my wife included, within ophthalmology, people just love the eyes. And I never could understand that, but until I got into it, I certainly appreciate the passion, and I share that similar passion for the patient and also the field as well.

TS: And how did you make the move from KPMG to ophthalmology? Where did you start?

AC: Yeah, it was one of those things where pure chance and luck and someone was looking out after me. I was in the sector for KPMG and I had a great mentor there that led me and pushed me towards the sector. And of course we were dating at the time, my girlfriend but now my wife. We were dating and then she had an opportunity to work for the pharmaceuticals on the field base level. And that’s where I was introduced to Tom Mitro and Vince Anido, true veterans of the space within Allergan to Ista to what they’re doing now at Aerie. And it’s been a fantastic ride. So that’s how they gave me the first shot and the opportunity from a field base work though business development, business analytics, to district manager. All the primary products as well I was fortunate enough to work though: Istolol, Vitrace, Xibrom, Bromday and then to some degree on the Prolensa side as well.

TS: What was the Ista ride like? I mean it’s an interesting story. I know you were at Octane last week. I saw you there. And Vince sort of told the Ista story about how he came in and how the company basically redirected itself entirely into a new direction with a new line of products. What was that experience like? It had to be an interesting first time exposure to ophthalmology and to life sciences.

AC: Yeah, absolutely. And I think every day was exciting. And just like Vince would always say, there are certain critical moments and pivot points within the company that could have went one way or the other, and I think that drew a certain type of talent to the industry and to the company. And by doing that, we really banded together. And through those pucker moments, as he says, and they were truly moments and defining moments in certainly many of our careers, but also the company itself, just figure out a way and got things done, which was really fantastic. The culture was really unseen at the time, and something that we really cherish even to this day.

TS: So that remains a strong network. Is there a real ISTA alumni network?

AC: Oh, absolutely, yeah. We’re all through social media or even just at conferences we would catch up and talk about things, how we did it right. But there are a lot of things we probably didn’t ride through too well, either.

TS: And then coincidentally, Bausch & Lomb acquired Ista in 2012. But you didn’t stick around. You went to OptiMedica. What was the motivation behind that move?

AC: Yeah, you know, ironically at the time, Valeant was starting the acquisition mode, was interested in Ista and Bausch & Lomb came in as a white knight, acquired Ista, and that’s where I was able to connect with a lot of great people there. And again, a lot of great mentors and folks at the time, Dan Wechsler, is how we connected. And it was just one of those moments where, during the acquisition, there were other opportunities that were around the corner, and again, Bobby Osher, Dr. Osher and Dr. Johnny Gaden at the time said, You should really look at this company called OptiMedica. We know Mark Forchette. He’s a great leader, can really change the world and change cataract surgery. And I was sold. I love technology; that’s kind of the thing I do. And I love leading different organizations and really setting the pace and gold standard of care. I think we did quite a bit of that at Ista and changing the paradigm for cataract surgery on the drug side, and we’re certainly wanting to do that here and there with OptiMedica.

TS: And then of course the consolidation movement caught up with you there as well, and it was acquired by AMO. What was that experience like?

AC: Yeah, you know, for the OptiMedica space, it was jumping in, being very lucky to have a great team there already set up. And my job was really to create awareness, put the brand up there, get things and projects started nationally and internationally. So that’s what we did. And of course it was acquired by AMO, and right before the close, that’s when Dan Wechsler at Bausch & Lomb, he was heading up the – he’s their area group chairman at the time for eye care for Valeant, and said, I think you should come and help us out with those changes about to occur. It’s a pretty dramatic change. He was absolutely right in every sense. And it’s going to shock the system, but you can come in and help us out with it. And that’s why I said, Sign me up. And I love it and I certainly love all the products that Bausch & Lomb had, and great breadth of portfolio that led to our current strategy today for what we call the premium vision strategy.

TS: And you’re General Manager and Vice President of Sales and Marketing of US Surgical for B&L. Is that the position you came in at?

AC: No. In fact, that was just one of those things that kind of spun all around. And in fact, when I first came in, it was primarily to work on the equipment side. There was a couple of things that Dan wanted me to work on which I absolutely was ready for and ready to go on the Stelaris and the phaco side, and the laser cataract surgery side. So that’s how I came in. And shortly thereafter was moved into the General Manager role and just overtaking the entire US Surgical space for Bausch & Lomb and Valeant.

TS: And what exactly are you overseeing at B&L?

AC: Yeah. So my role, it’s a decentralized model with Valeant, which is a very interesting model. You certainly read about it, but it’s in execution – it’s truly in execution mode, and how you deploy your resources on the regional level. And it’s one that I really do believe it. I really do have to be really diligent in executing that strategy to all the regions. And what that means is each of the countries and business units own their decision through their P&L. So what we do as a general manager, we own our own P&L. Research, development, acquisition decisions are made at this level. And it’s fairly quick. It’s a very fast-paced environment, and things change quite a bit. In fact, we’re always changing something every couple of months. But that’s the strength of the decentralized model in that we’re able to make decisions very quickly, and it goes up to Ari, and Ari Cohen and Mike Pearson, really, decisions are made within 30 to 40 minutes of quick hit meetings.

TS: And that is unique. Mike Pearson, of course, was at OIS in April, and he was on our Masters of the Universe panel. He talked about how Valeant integrates companies, and said just that, that they make quick decisions within a week or so of acquiring a company, and he’d rather make a decision and then have to make a correction later on if he had to than not to decide. And I found that really a fascinating way of looking at things.

AC: Yeah, exactly that. The mode and we want to act quick to make the right decisions. And if it’s not working, let’s course correct now, and not having a full committee to make a decision is really our strength.

TS: I’ve seen a report that was put out, I think a bit ago. But it was showing some significant growth in your cataract refractive products and in Stelaris. The report also said the IOL business was among the fastest growing. What is your particular business unit? How well is it doing? How well is it performing? Can you give us an update?

AC: Yeah. Just based on reading everybody’s earnings and all the quarterly reports as well as market scope, we were able to regain the number one spot in the PCO market. Again, this is great folks that have give me a lot of advice, like Andy [Corley?] that we saw at Octane, and other folks that I’ve bumped into that really guided and directed to what we need to do to get back into the number one spot and become a market leader again in the space. So that’s what we did. So we took great advice, and really went back and reinvigorated, reinvested and doubled our investment within education on the promotional side, but also on the education side as well, and working hand in hand with folks like Cal Roberts has been fantastic because we all share that common vision. And it’s really about – and this is what Mike believes in as well – during any integration, all customer facing activities, whether it’s sales based, customer service or clinical outcome based, they will not be touched, and we will drive that and continue driving that focus in the field. And I think that’s part of what’s driving our success, if you look at our reinvestment in that space and will continue doing. And we still have a lot of ways to go, and I know we can certainly do more and always improve upon it.

TS: And that was also brought up at the OIS meeting, the focus on customers. I mean it was said, Mike Pearson said it, others say it, the businesses always say we’re in it for the customers. But is it – what is it like at B&L? Is it really a stronger focus on engaging the physicians and the customers than perhaps you’ve seen in other companies? Not disparaging other companies, but what is customer focus like at B&L? Is it truly different?

AC: Yeah. And I think even looking at where we were a year and a half ago, the customer focused activities like the education programs that the team has put together has dramatically changed. And the marketing and sales team and the leaders really put it together really nicely for our customers. And it’s about educating and improving outcomes. And if you have that in mind, you can deploy resources around it, and you feel good, and that’s the right approach to make. And again, we have great team members like our team with Chuck Hess leading the helm, and Brad Herd on the sales side. And we drive that execution in the field. And I know people say it, but we’re actually out in the field quite a bit. I would say close to 50, 80% of the time, where we do make it known and an effort to be in the field to understand what the customer wants internally and externally. And that’s something I think, an approach that certainly wars on you, but we believe that’s what can lead us to better decisions in the marketplace. Because we are making the decisions on the development path. And I think what Mike was saying was absolutely true. We have 36 new projects now for surgical, and we evaluate them quarter by quarter. If they’re not hitting their targets, we’re moving on to the next project. Or we find a better alternative. And I think I mentioned that at Octane as well, and so did Mike. We’re not married to where the idea comes from, as long as it’s the best idea and the best path forward, and it makes sense for the market. Sometimes, unfortunately, sometimes you have a really great technology, but it’s just not commercially viable. And whether commercially viable in the clinic or even for a company. So our job is to figure out how do we make that commercially viable, if it’s really a unique product. And a lot of it has been small improvements and enhancements. We had ten launches last year, which is really significant for us. A number of 510Ks within 12 months, which is a big leap. And we keep pushing the team. The team is fully committed to doing that.

TS: If the ophthalmology sector has a street, I think the word on the street would be that B&L isn’t really innovating, and there’s some general concerns about the direction it’s going. At the – well, first of all, do you hear that as well? And is that something that you feel the need to address in talking with patients, or if you’re talking with a podcaster like myself?

AC: Oh, yeah. I absolutely do want to address that. Because that’s something that we know that – it was more from what the financial sector was hearing. What we were doing and through a disciplined approach, and deliberate approach, was to look at all of our projects when we first came in. And it was tough, and we made a lot of decisions, and some were right, and some were wrong. But we certainly made decisions fairly quickly on which projects were sort of the pipe dream and that didn’t work for us. And what that meant was within our preference and our model, we would like to have projects closer to the end stage, meaning the close to commercialization or approval, or even post approval. So that’s what we look at. From a pecking order we go for an acquisition that’s already developed and the risk isn’t there from a marketability and a commercialization standpoint. Then the other options are whether it’s co-development or licensing and when the product is ready. So we did make some hard decisions at the time, but also created a lot of value and launched a number of products, just like you have seen. I think a lot of people were waiting for that shoe to drop and it never occurred. And in fact it took the other route, where we continue to invest. If you talk to a number of people that work close to us on the surgeon side, and some of the community, but certainly we still have a little bit of that hangover which we’re trying to correct in terms of perception. But only time will correct that anyway from what we do.

TS: And what is – is it essential for a company to be known for innovation, to really carry some cachet with physicians? Do you need to have your own internal programs that you’re developing? Or is the statement that Mike Pearson made at OIS, you know, the fact that innovation really comes from outside of the walls of big companies, and that we’re looking for startups and entrepreneurs and physician entrepreneurs to sort of come up with the new technology? Is that an acceptable philosophy in the eyes of your patients and – sorry, your customers and the people you talk to?

AC: Yeah, that’s a great question. I think we are not married to it either way. And again, if we can develop it in house and we can do it faster and better, we will definitely invest toward that. In fact, Mike has signed off a huge project for Valeant on the refractive side for Bausch & Lomb. And it’s a 20 plus million project, Teneo that he mentioned on an earnings call. And it’s a huge investment to make, but it’ll create that innovation and leap for the sector when, and I really do believe that the refractive market will come back to some degree in a growth state. Certainly not to the peak, but it will certainly come back. Just pure demographics alone on the sheer patients that are available. And to address the innovation question, I think it is important to show that you are innovating. But it’s a lot of the small steps that come along that way, whether we’re making improvements in the software or technique. And but we are making those big leaps as well, which we believe will work. And a lot of the technology does come from the outside. If you look at all the different companies, and not to – if you look at our company a lot of the technology wasn’t developed in house. Look at Crystalline and Truline was an acquired technology. If you look at a number of the other companies and you go down their list, they were all acquired through more innovative companies or smaller companies at the time, and they were able to put it into the big machine and be able to market it further, but also invest in it further as well.

TS: And it’s said that all Bausch & Lomb employees really are charged with finding new innovation and new technologies. Is that something that you’re sort of on the lookout for when you’re talking to –

AC: All the time, yeah. Absolutely all the time. We’re always looking and there’s always a great opportunity, and there’s always great technologies out there. It’s how you see it can fit into your commercial entity or your R&D group, or how do you make it work and make it successful. Because you certainly don’t want to take it knowing that you can’t make it better. But then sometimes you get really enamored by a technology and sometimes you do make that mistake. And we don’t get any – as industry folks, we certainly don’t get any credit for investing in bad products. So we want to make sure we invest in the right products.

TS: Terrific. And just last question: What do you see going forward for Bausch & Lomb in ophthalmology? Do you see the next 5 years being high growth or slow and steady? What’s coming up?

AC: Yeah, you know, we all rest on and depend on what the market doe, obviously in a number of procedures and what the surgeons do. We want to be in that space with the surgeons hand in hand. And we’ve kicked off a number of big projects where we are getting that feedback from all of our surgeons around the country and around the world to working our next generation products, big and small. So we definitely look forward for that partnership and that continued education. And I say innovation because it really is, and it’s a lot of the enhancement innovation that we’ll make within the 5, 10 years that I believe we will be able to impact the market and really change ophthalmology. And it’s a big, big responsibility of ours, and I certainly cherish that every day, and I know our team does as well. It’s a great field to be in.

TS: Excellent. Well, I really enjoyed this conversation. Thanks for taking some time to join us today.

AC: Well, thanks for the opportunity. I appreciate it.

TS: Well, that wraps up this Podcast. Thanks again, Andrew Chang, for sharing your story and for sharing Bausch & Lomb’s story going forward in ophthalmology. I hope everyone enjoyed this peek inside. Tune in next week for another tale of innovation. And of course, go to ois.net for information about our upcoming OIS in Las Vegas. If you’re a presenting company, now is the time to fill out an application if you want to present at OIS. Please get that in as soon as possible. And of course if you want to attend, all the registration information is up there. We’re ready to take your information. So thanks again for listening and we’ll talk to you next week, and eventually we’ll see you in Las Vegas.