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What Are Medtech CEOs Saying about COVID-19?

  • The global pandemic hurled a giant wrench into 2020 business plans across the medical device and diagnostics industry. Here’s what medtech CEOs had to say about the ongoing crisis during recent earnings calls.

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  • "This moment has strongly underscored two fundamental things to me," Robert Ford, CEO of Abbott Laboratories, said during the company's first-quarter earnings call on April 16. "The first is the biggest and most important, and that’s the essential nature of health and healthcare. Times like these make very clear what truly matters the most. The second, to bring it closer to home, has to do with the nature of Abbott. We’ve been in the business of improving people’s health from medical innovation for more than 130 years, and it’s in moments like these that the importance of our mission becomes even more critical, delivering for the people that depend on us."

    Abbott has emerged as a leading test maker in this battle with multiple COVID-19 tests already on the market.

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  • "Baxter's multi-year transformation has strengthened our ability to respond to COVID-19," Baxter CEO Joe Almeida said during the company's earnings call on April 30. "We are a more effective, agile, and resilient organization, plus our focus on portfolio innovation has broadened the range of products we have available to address these situations. We're also able to maintain our emphasis on the strategy and execution even as we, like many others, step up to address an unprecedented public health emergency."

    Baxter is one of the most insulated companies in the industry in terms of COVID-19 impact. While a small portion of the company's business is in the advanced surgery space where procedure volumes are down, that has been offset by higher demand across other parts of the business. Executives said that pandemic-related demand contributed to about $45 million in sales during the first quarter.

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  • "Our focus is to communicate with transparency and take actions consistent with our core values, while keeping employees safe and informed, providing patient support to customers, and effectively managing our operations," Mike Mahoney, CEO at Boston Scientific, said during the company's first-quarter earnings call on April 29.

    Mahoney said Boston Scientific has expanded its capabilities in virtual physician education, remote clinical support, digital sales, enablement, and training.

    "We're also partnering with our customers to enable a fast recovery, while also acting to reduce operational expenses and preserving our cash position," Mahoney said. "We have taken these immediate actions with the goal to preserve as many jobs and strategic programs as possible."

    In early April, Boston Scientific reported "significantly reducing" the salaries of its CEO, board of directors, and executive committee members as part of its mitigation plan for managing the financial impact of COVID-19. The company also reduced weekly hours of employees where appropriate.

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  • "The past few months have brought and likely will continue to bring – unprecedented challenges to global health and economic systems as a result of the virus," Dexcom CEO Kevin Sayer said during the company's earnings call in late April. "While this has been an incredibly difficult humanitarian crisis, we have also seen many encouraging examples of collaboration around the world from public and private entities. We have seen people working to bring care to those in need, protect the health of the vulnerable, and support the wellbeing of workers and families."

    Last month MD+DI spoke with Sayer about the role of continuous glucose monitoring (CGM) in the COVID-19 fight, how the company is blancing hospital demand (for the first time) with existing patient needs, and the potential opportunity the pandemic creates for using CGMs in hospital settings down the road. Click here to read what we learned from that conversation.

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  • "I'm encouraged by the recent indication of plateauing and even declining infection rates and deaths from COVID-19 in many areas around the world. But, we know that healthcare workers on the frontline continue to face unprecedented challenges," Mike Mussallem, CEO at Edwards Lifesciences, said during an April 23 earnings call.

    Over the past few years, Edwards has focused resources to improve the capacity and agility of its global production facilities, and Mussallem said that has really become apparant during this time. For example, he noted that in Europe there has been an increased need for supply of Edwards' pressure monitoring products in critical care. At that time the company was on track to more than double its production to keep up with this demand in critical care.

    "Our valued third-party suppliers are a critical piece of this infrastructure and we work closely with them in an effort to avoid disruption," he said. "We are proactively managing capacity, assessing alternative logistic options, and closely managing the supply of components. Our team's commitment to delivering life-saving technologies to patients is unwavering."

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  • Intuitive Surgical CEO Gary Guthart said during an April 16 earnings call that the robotic surgery pioneer is carefully analyzing customer procedure deferrals in response to COVID-19.

     "Patients undergoing da Vinci procedures do so in response to an underlying disease," he said. "While these procedures may be delayed in the short term, without treatment of some sort, the disease and its impairment persist and often worsens. Said simply, the vast majority of these patients will ultimately see treatment."

    Guthart said Intuitive is analyzing both the clinical drivers of return to treatment and customer plans and processes to recover.

    "The categories of benign disease and cancer are not entirely predictive of the urgency of surgical intervention," he said. "Clearly, aggressive cancers require treatment and are delayed at significant risk to patients. Likewise, some benign conditions require timely intervention as well. We are working internally and with customers to understand their needs to restart surgery for those patients whose condition requires action."

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  • "In medical devices, we are experiencing a near-term negative impact and expect this to continue while elective procedures are deferred and hospital resources are redeployed to address patients impacted by this pandemic," Alex Gorsky, CEO at Johnson & Johnson, said during an April 14 earnings call. "That said, medical devices has historically been a strong market and we believe the underlying fundamentals of the market remain intact. We continue to see tremendous potential over the long term to serve our patients and customers."

    Gorsky also noted that J&J is using its supply chain delivery and 3D-printing expertise in collaboration with Prisma Health to manufacture and distribute the VESper ventilator expansion splitter device, which addresses the acute ventilator shortage during the COVID-19 pandemicm and at no cost to healthcare providers."

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  • LabCorp CEO Adam Schechter acknowledged during the company's April 29 earnings call that LabCorp's unique role across the spectrum of diagnostic testing and drug development has enabled the company to rise to the challenge and help combat the novel coronavirus. LabCorp is supporting the protection of people currently and previously infected by the virus, and the company is involved in the development of potential treatments and vaccines, Schechter said.

    "Our teams, like many who are directly involved in fighting this pandemic, have been working around the clock, and they remain energized by all that we are doing to minimize the impact in the United States and around the world," he said.

     

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  • Despite the pivotal role Quest Diagnostics has played during the pandemic by bringing COVID-19 testing to the U.S. market, the company hasn't been immune to the negative impact that many other companies around the world are facing.

    “COVID-19 testing is critical to managing the pandemic And while the volume of testing is substantial, it is not nearly enough to offset the reductions we're seeing in the rest of our business," Steve Rusckowski, CEO at Quest Diagnostics, said during the company's April 22 earnings call.

    As the virus began to spread throughout the United States in March, Rusckowski said, Quest saw a reduction of volumes of more than 40% during the last two weeks of the quarter. In April, volume declines continued to intensify and he noted that volume declines were bottoming out at around 50% to 60%.

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  • Orthopedic devices has been one of the hardest-hit sectors of the industry as hospitals have deferred elective procedures such as hip and knee replacements. Stryker CEO Kevin Lobo said during the company's first-quarter earnings call that during April, sales dropped by 35% to 40% compared to 2019. Looking at the rest of the second quarter, however, Lobo said he is encouraged by the planned gradual resumption of elective surgeries in the United States and abroad.

    Fortunately for Stryker, the company has a roughly $2 billion medical portfolio that helped to offset the decline that Stryker saw across the rest of the company.

    Graphic design by Amanda Pedersen; Background image from Adobe Stock.
  • How does a $24 billion life sciences company manage through a pandemic? It's actually pretty simple when you get right down to it.

    "One, make sure our colleagues are safe; two, keep our business running so we can serve our customers; and three, manage our company appropriately so we can come out stronger," Marc Casper, CEO at Thermo Fisher Scientific, said during the company's April 22 earnings call.

    While a significant number of Thermo Fisher employees are working from home during the pandemic, Casper said many still have to go on site in order to serve customers during this critical time. So, like most companies with essential workers, Thermo Fisher has implemented health and safety protocols at its sites following CDC guidance and local regulations, and the company has assembled an outside panel of medical experts to provide additional insights.

    "I couldn't be prouder of our 75,000 colleagues for working together as one team to fulfill our company's mission, which is to enable our customers to make the world healthier, cleaner, and safer," Casper said. "Our mission has never been more relevant than it is right now."

    As for maintaining business continuity, Casper said that once the pandemic hit, Thermo Fisher "immediately established incident respones teams to create a process for managing new protocols at our sites and navigating the challenges presented by the situation."

    "Our third guiding principle is to manage the company appropriately, so we come through this period an even stronger industry leader," Casper said. "We have the benefit of a very experienced team that successfully managed the company through the financial crisis of 2008 to 2009 and other periods of disruption around the world."

    Casper emphasized the company's focus on executing its long-term strategy, while ensuring that it navigates the short-term challenges, and also generates new opportunities. In fact, in early March Thermo Fisher announced its plans to acquire Qiagen, a deal that is expected to boost its molecular diagnostics offerings. Specifically, the acquisition will give Thermo Fisher Qiagen's QIAstat-Dx Respiratory Panel 2019-nCoV test kit.

  • Zimmer Biomet CEO Bryan Hanson kicked off his remarks during the company's first-quarter earnings call earlier this week with an all too relatable tale. Hanson said he has been home with his family for more consecutive days over the past two months than he has in the past 20 years.

    "And I know for sure that they cannot wait for this to be over because they want me to get out of the house," he said. "So again, hopefully, you're managing through this as best as possible. This certainly gives us an opportunity to learn things about ourselves that we did not know before, and our families."

    While some executives have looked to past economic declines for perspective, Hanson recognized that there really is no true comparison for this global pandemic.

    "There really is no proxy that you can look back on that would give you the pathway forward as a result of looking at that historic view," he said. "There's nothing that compares to this. I mean, when have we ever seen a global pandemic shut, basically, the world down."

    Graphic design by Amanda Pedersen; Background image from Adobe Stock.
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