Sticking to the plan
How a New Zealand Hi-Tech Award winner is building a global digital health business
In the third instalment of our Hi-tech heroes series, Concentrate talked to Garth Sutherland, Founder & Executive Director at Adherium, winners of the Most Innovative Hardware Product category at the 2017 Hi-Tech Awards.
Developing medical technology products is not for the faint-hearted. You can’t usually escape the need to prove clinical efficacy, a complex and laborious task. Let alone the need to localise products across global markets, build high quality support and find channels to market amongst the behemoth pharmaceutical and medical companies.
Adherium have stuck to their own plan for over 14 years, and are starting to reap the rewards. A ‘medication monitoring system’ called the Smartinhaler™ is the first commercial incarnation of their work, comprising a connected platform of sensors, apps and cloud technology that work with a patient’s asthma inhalers to help them and their care providers to ‘adhere’ to their medical regimen.
Adherium has proven that by enabling people to better ‘adhere’ to their prescribed medicines, they are likely to experience better health outcomes – hence the company name.
Telling a clear story
Such clarity of message is not always the hallmark of technology companies, and it’s something the company has worked through over its 14-year history. “It’s one of the benefits of being around a while,” says Garth. “We’ve evolved our storytelling over time to try and communicate who we are and what we do and make it easier for people to understand us. We made mistakes along the way with that, but we’ve learnt and we’ve improved and it’s getting there. It’s a work in progress and it always will be as the company grows.”
The ‘New Zealand Inc’ story has been a positive for Adherium. “For asthma, it’s a strong association – we actually have one of the highest rates per capita in the world. We also have an electronic health record and we’re good innovators so it’s natural that something like Smartinhaler™ would come out of New Zealand. It’s been good for us from that perspective,” says Garth.
The company was originally called Nexus6, but when tech behemoth Google bought out the Nexus 6 smartphone, the company’s online findability collapsed, says Garth. As they were transitioning from private to public company (they listed on the ASX in 2015), they took the opportunity to develop the new moniker.
Securing global channels to market
Effective channels to market is something that characterises NZ Hi-Tech Award winners, and Adherium is no exception with its multi-pronged strategy. In terms of distributors, in 2015 the company has secured a global deal with pharmaceutical giant AstraZeneca, which has 50,000 employees and turns over $US23 billion annually. The partnership incorporates Adherium devices into AstraZeneca’s global support programmes for patients with asthma and chronic obstructive pulmonary disease (COPD).
“We started by selling to clinical researcher and through producing great clinical data we were able to secure a world class global partner in AstraZeneca. On top of that we’re now adding other channels, and we’re broadening our offering which is exciting.”
Garth stresses that it has been a long and intense journey to get to this point. “There’s a lot of effort in getting up to here. We’re ready for the prime time but we had to do many years of hard graft, working on the technology and the research, simplifying it, keeping it up to date with the latest technologies, driving down the cost, creating all the clinical evidence to support the value proposition. So that when the stars aligned we were ready for a world class relationship like the one we have with AstraZeneca.”
A direct service
In the direct channel to market, Adherium have shown real innovation through the Smartinhaler.com platform, where they sell the solution using a SaaS (software as a service) type model. “When you really understand what we’re doing, we’re providing a management system and that is actually a service, an ongoing daily experience,” says Garth, “We are about helping patients adhere to their medication. That requires ongoing interaction with patients and caregivers.”
“From the business’ perspective there are ongoing costs of delivering this high-quality service, so it is naturally aligned to the SaaS model. There are content elements, data storage elements, compliance elements, and regular communications. Updates to the apps, updates to the Cloud, new interactions, release of new value-added features. It is a service.”
They don’t take a ‘build it and they will come’ approach though. Adherium are investing in digital marketing activity to drive customers to their service. “. . . it requires a multi-channel approach with a real focus on digital. That requires an investment and this is where bringing medical technology to market is typically a funded process – there’s a cost of acquisition associated with it.”
The exhaustive path to market readiness
In this digital age of complete transparency, having a great product is often the best marketing you can do, and Adherium have worked long and hard at getting that right. “For a company that’s producing medical technology, there needs to be clear, clinical data. The technology has to be validated to be accurate, and designed and manufactured in accordance with regulatory and quality standards.”
Getting the technology ready, running the trials and getting it all written up is a complex and lengthy process. Adherium now has more than 70 peer-reviewed journal articles published about its technology in world leading journals like Lancet and Thorax.
The company also had to comply with requirements around patient data privacy and data security, localise the product to the multiple language and legal jurisdictions they are selling into, provide the right level of support to them, and ensure all the intellectual property is well protected. That’s while also thinking about achieving scalable manufacturing.
Global from birth
Adherium went global early on, says Garth, “ . . . our very first sale was in New Zealand and the very second sale was in Australia, third in the US, we were born global from day one. With New Zealand being a small home market and asthma a global issue we pretty quickly dipped our toes into those complex international issues.”
Building the business has been much of a direct touch activity though, says Garth. His advice to other tech entrepreneurs is there is nothing like getting on a plane and showing up in the market. “It’s all about relationships, face-to-face relationships. It just means air time, time on planes, time in front of people. We’ve now got it to the point where we we are building up our international team in the major markets.”
Adherium is just getting started, says Garth, pointing to the core problem of adherence being a significant global challenge in healthcare. “We have huge plans. We’re all about adherence – asthma and COPD are our starting points but adherence is a much bigger issue than just those two diseases.
“What we’ve proven is our digital technology can have big impact on chronic diseases like asthma and COPD. That’s what our focus is and that’s a big global health issue, adhering, $500b issue globally, that’s what we’re all about– a big problem to crack, it needs to be dealt with and we’re only just getting going. It’s huge.”
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