Three Strikes and This Medtech CEO Is Out

A lot of medtech CEOs are finding themselves in a tough position this year as boards of underperforming companies are deciding that change is in order. Venus Concept, a medical aesthetic device manufacturer, is the latest in the industry to part ways with its CEO.

Venus appointed Rajiv De Silva CEO on Monday, replacing Domenic Serafino. Serafino had been with Venus for 12 years and was a co-founder. The Toronto, Ontario-based company simultaneously withdrew its revenue guidance for the year and issued preliminary third-quarter revenue expectations well below analyst expectations and the company's previous estimates.

According to Venus, the decision to let Serafino go was not the result of any specific disagreement about strategy with management or the board, inappropriate action, violation of company policy, or any accounting irregularity.

Marie Thibault, a medtech analyst at BTIG, noted that this is the third consecutive top-line miss for Venus. The company is now expecting to report at least $21 million in revenue compared to the $24 million to $25 million previously forecasted.

"It was not clear what drove the miss, but we think withdrawing full-year guidance hints at potential ongoing commercial uncertainty and anticipated changes," Thibault wrote in a report issued Monday.

De Silva joins Venus with a rich pharmaceutical background. He currently serves as chairman at Covis Pharma, a private, multinational specialty pharmaceutical company, and is a co-founder of Asiri Skincare, a private company focused on topical consumer therapeutic skincare products. From 2013 to 2016, De Silva led Endo International, a multinational specialty pharma company, as president, CEO, and director. Prior to that, he was at Valeant Pharmaceuticals (now Bausch Health). He's also held leadership positions at Novartis, and he started his career at McKinsey & Company.

“We are excited to have Rajiv join the company to lead Venus Concept through its next stage of growth and development,” said Scott Barry, chairman and director at Venus Concept. “He is a seasoned executive with significant experience in larger, multinational healthcare companies. Rajiv has a proven track of record of managing companies through multiple stages of growth – both organically and inorganically – and through complex turnarounds that included organizational restructuring and capital structure transformation. With Rajiv at the helm, the board feels the company has a strong leader to execute its strategic objectives of achieving sustainable, profitable growth in the global medical aesthetics and hair restoration markets, and advancing product development, including our next generation robotic technology platform for medical aesthetic applications.”

Medtech CEOs are walkin' –  voluntarily or involuntarily

The medtech industry has seen an unprecedented number of CEO transitions this year, with some of the turnover being voluntary and some being performance-related.

Just last week, Cambridge, UK-based Avita Medical cut ties with its CEO. Avita replaced Michael Perry with James "Jim" Corbett. The transition comes at a time when Avita's shares are at their lowest level in years. Perry had served as Avita's CEO since June 2017.

At the end of August, Invacare gave its top executive the old heave-ho. The company did keep Matthew Monaghan on as a board director, but he is no longer the company's CEO, president, or chairman. The Elyria, OH-based company named Geoffrey Purtill interim president and CEO while the board searches for a permanent CEO. Purtill had been serving as Invacare's senior vice president and general manager for the EMEA and APAC regions.

Other medtech companies that have seen turnover at the top this year include Globus Medical, Better Therapeutics, Insulet, Integra, Fluidigm, iCad, and Senseonics (CFO transition), and Verily Lifesciences (CFO resignation, and other top-level leadership changes).