Doubling Down on Your Mission by Diversifying Your Medtech Portfolio

A couple of years after his stint as COO of laparoscopic weight loss startup Inamed — and its $3.5 billion acquisition by Allergan in 2006 — Bart Bandy took a break from corporate life.

He and his wife followed some of their interests and pursued the restaurant business, but it didn’t stick. Bart missed the world of medical devices too much and wanted to get back in the industry.

He worked in wellness and ophthalmology before he was recruited to another laparoscopic weight loss startup: ReShape Lifesciences. One element that drew Bart to the company was its recent acquisition of the Lap-Band, a once-popular surgical weight loss device previously owned by Inamed.

Bart believed that the Lap-Band’s decline in popularity came down to neglect of the brand, not a failure of the technology. He readily accepted the challenge of introducing the product to a new market, and extending ReShape Lifesciences’ portfolio with 21st-century additions. Notably, physician-prescribed weight loss support platform ReShapeCare, and weight loss product e-commerce site ReShape Marketplace.

“I got the chance to bring back something I'm fully committed to and fully passionate for,” Bart says. “If you have the opportunity to participate in the weight loss market, you can see the impact you have on people's lives. It's the biggest thrill in the world.”

In this episode of Medsider, Bart explains how he writes and tests his presentations for maximum impact, the challenges and solutions of moving manufacturing from Costa Rica to the U.S., and why he wanted to add telemedicine to ReShape Lifesciences without moving away from the brand’s core mission.

Key Insights from Bart Bandy's Experiences

• Diversifying your offerings will help create differentiation in the competitive medical device market. But don’t stray too far from your original mission: It’s better to be the top brand in a niche field than a jack of all trades.
• In 2020, ReShape Lifesciences made the difficult decision to move manufacturing of its Lap-Band from Costa Rica to the U.S. There were several benefits, but it was still a challenge. Bart and his team made the transition as smooth as possible by following the original blueprint to the letter.
• Your presentation deck is the first chance you have to impress investors, regulators, and board members. Make it clear, test it continuously on different people, and learn it inside out.

Differentiate Through Diversification

Making space for yourself in the competitive medtech market is tough if you’re only offering one product. That’s why ReShape has recently added two online offerings to its portfolio, which strategically support the Lap-Band while also diversifying the company’s profile.

ReShapeCare is a telehealth coaching program physicians prescribe to patients to help them manage weight loss therapies. That might include the Lap-Band, but it could also be a non-surgical treatment or a different type of surgery altogether. Most insurers reimburse for the program, which incentivizes doctors and patients.

To follow on from ReShapeCare, in July 2021, ReShape Lifesciences launched e-commerce site ReShape Marketplace, which sells products designed to help consumers lose weight.

Bart saw several benefits to adding a virtual support system for patients seeking weight loss help from their doctors.

When ReShape Lifesciences surveyed clinicians about their experiences with Lap-Band, many said that one element that put them off doing more surgeries was the burden of providing aftercare. ReShapeCare’s board-certified physicians take on some of that work on behalf of the practices.

The overt connection to physicians is an intentional part of ReShape Lifesciences’ branding. Bart says that the company is aiming to become “the premier physician-led weight loss solutions company.” The physician support piece gives the brand medical credibility, setting it apart from low-quality fad diet programs and apps, which consumers have grown skeptical of.

Holding this very specific brand mission statement in mind has helped ReShape Lifesciences navigate the tricky process of diversifying without diluting. As Bart says, “Stay in your lane.”

Before creating ReShapeCare, Bart and the team considered a few different diversification opportunities, including other minimally invasive surgeries and weight loss products that weren’t specifically endorsed by physicians. However, they ultimately decided to focus on their mission of becoming the leader in the field of physician-led weight loss solutions.

“Doing that allows us the chance to become stronger and more direct, and to create the brand that's going to be better known for exactly what we do,” Bart says.

The Easier Way to Move Your Manufacturing Process

Whereas many medical device companies are looking to move manufacturing overseas, in 2020, ReShape relocated its Lap-Band manufacturing from Costa Rica to the U.S.

The initial reason was straightforward: When ReShape bought the rights to the Lap-Band, it signed a two-year manufacturing agreement with the seller, which expired in 2020. “And the deadline did not include any excuses for a pandemic,” Bart says.

However, a silver lining emerged. When he and the team crunched the numbers, they realized that moving manufacturing to the U.S. could have some significant benefits.

The major expense of manufacturing in the U.S. is manual labor. But given that the Lap-Band doesn’t require much of that, moving the process to the U.S. didn’t add significant labor costs.

It also saved on shipping, since the components of the Lap-Band were already being made in America, and shipped to Costa Rica for assembly and sterilization. Keeping everything in the same country meant no international shipping. It also makes it easier and faster for the team to communicate with the factories if there’s an issue.

Despite the benefits, moving a manufacturing process is a logistical challenge at the best of times. The COVID-19 pandemic added new layers of difficulty.

Bart and the team simplified the transition as much as they could. It helped, he says, that the Lap-Band had changed ownership a few times before, and many of the manufacturers who made the components had weathered those transitions. They were less phased than you might expect.

On top of that, Bart and his team kept the manufacturing process as close as possible to how it had been done before — just in a different country.

“We looked at the existing manufacturing and completely emulated it, down to which type of oven to buy for the sterilization, and how to run that process,” Bart says. “Instead of recreating the wheel, we did everything to the existing specs.”

Although there were some areas of the process they could have made more efficient, on the whole, this carbon copy approach made the transition run more smoothly, especially when it came to getting approval from regulatory agencies. Since ReShape wasn’t adding anything new to the device, the company saved on the amount of paperwork it had to submit, and the regulatory rubber stamp came through sooner.

Don’t Overlook the Importance of Your Presentation

You only get one chance to make a first impression, and that will typically be in the form of a presentation. Take it seriously, and never settle for good enough, Bart says. He has four specific tips for making your presentation as strong as possible:

Make your purpose clear.

You won’t always be present when someone is going through your presentation: Sometimes you’ll be emailing it to potential investors or hires. They need to be able to understand immediately:

• What your business does
• What your mission is
• Your objectives
• Your value proposition
• What differentiates you from competitors
• The benefits of working with you

Laying out all that information feels like just another hurdle you want to rush over — but this is your big opportunity to convince your recipient that you’re worth their interest. Don’t blow it with a half-hearted effort. Make sure you’ve covered everything in a way that doesn’t require further explanation to get a handle on.

Sell your team.

Explain why the people at your organization are more impressive than the teams at your rivals. Highlight their previous experience, and why it makes them not only great at their jobs, but a safe bet.

“One of the most crucial things I've seen investors discuss is, If I give you money, who's going to use it? What are they going to do with it?” Bart says. Answer that question for them in your presentation.

Work on your presentation continuously.

Your presentation can always be better. Yes, really. Even after you’ve presented it 50 times, keep fine-tuning and improving.

After a while, it gets hard to take an objective look at something you’ve created. So bring in people who haven’t heard it yet to hear a fresh perspective.

Since you’ll be giving your presentation to people with different backgrounds, try to reflect that diversity with your test audiences.

“We had investors look at it, regulatory people look at it, attorneys look at it, outside mentors,” Bart says. And every time, their comments led to a new and improved version.

Practice, practice, practice.

Your presentation should be as accessible to you as the plot of your favorite movie or the lyrics of your favorite song. Practice it over and over until you can deliver it backward.

That’s only a slight exaggeration. Learning the presentation by rote isn’t enough, Bart says. You have to be familiar enough that you can easily switch from Slide 5 to Slide 11 and back to Slide 7, depending on your audience’s demands.

You have to be able to answer questions without notes and without going back through your slides, from people with different angles. Investors, for example, will have a different focus than regulators who will have different thoughts in comparison to the board of a company you’re trying to acquire.

“Help people understand exactly what they're trying to find out from you, because remember, they're giving you 15 minutes: You’d better make the best use of it,” Bart says.