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Full Text Listen Q&A Michael Mussallem

‘We need to show up with evidence’. By: Lee, Jaimy, Modern Healthcare, 01607480, 1/26/2015, Vol. 45,
Issue 4
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‘We need to show up with evidence’
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Q&A Michael Mussallem
Since 2000, Michael Mussallem has served as chairman and CEO of Irvine, Calif.-based Edwards
Lifesciences, a medical-device manufacturer best known for marketing heart valves. Worldwide sales in
the first three quarters of 2014 were $1.7 billion, up 12.9% from the same period the previous year. In
December, Edwards announced an agreement for the exclusive right to purchase CardioKinetix, which is
developing an implantable device to treat heart failure. Before joining Edwards, Mussallem was a senior
executive at Baxter International. He serves on the executive committee of the Advanced Medical
Technology Association and the executive committee of the Healthcare Leadership Council. Modern
Healthcare reporter Jaimy Lee spoke with Mussallem about Edwards’ plans, how his firm demonstrates
the value of its products to health systems, and the prospects for repeal of the medical-device tax. This is
an edited transcript.
Modern Healthcare: How has provider consolidation affected Edwards’ growth strategy?
Michael Mussallem: Because our products are so important clinically, our primary customer would have
been physicians. More and more, there’s been involvement from economic buyers that want to make sure
they understand the economic value of our products along with the clinical value. That’s probably the
single biggest change. We don’t necessarily feel like we need to be large, but we feel we need to be
really good. We need to be trusted. We need to show up with evidence. And we need to support
providers in providing great healthcare for patients.
MH: How has Edwards changed the way it sells the value of its products to health system administrators?
Mussallem: We’ve gotten a clear message that administrators want to hear from clinicians that our
products offer high clinical value. They want to see the evidence. So we have in a very organized fashion
pulled together all the clinical evidence that talks about, for example, the nearly 30 years of data on the
distinguished performance of Edwards’ heart valves. We also established a health economics group,
which helps us assemble the economic evidence supporting Edwards’ products. That group also provides
direct assistance to providers on how they can improve the value they offer to their patients.
MH: What are you doing to offset the pricing pressure associated with provider consolidation?
Mussallem: Hospital systems are aggregating their volumes and are becoming far more sophisticated in
the way they purchase. We try and live up to that sophistication by being able to address all the questions
that they have. Our experience is they really want to deliver great value to their patients, and they want to
make sure that the money that they’re spending for our critical supplies helps their clinicians achieve their
goal. We’re happy to be able to do that. It means we’re required to be more sophisticated and bring more
evidence than we ever have in the past.
MH: Has that changed the way you’re designing clinical trials?
Mussallem: We’re most known for our innovations in transcatheter heart valves, which are valves that can
be replaced without open heart surgery. In large randomized trials, not only are we collecting clinical data
on the impact on mortality and the other complications, we’re also collecting quality-of-life data, health
economic data. These data show how cost-effective this therapy is compared to past therapies or other
MH: How receptive are hospital administrators to technologies you’re developing or selling that help
reduce cost?
Mussallem: It depends. It certainly helps when we have clinicians who are passionate, who understand
what kind of opportunities exist and have good, open dialogues with their administrators. We’re finding
more receptivity among administrators than we’ve ever found in the past as they try and solve problems
that weren’t easy to solve when you operate a hospital system more in silos. But now, when you look at it
as an entire patient encounter—how much value do we deliver for what cost—it becomes a conversation
that high-level administrators are having with us more often.
MH: How are you talking to administrators about technology like your ClearSight noninvasive technology,
which can add cost per patient but may save money in the long run?
Mussallem: The theme of what we’re trying to help hospitals with is what we call enhanced surgical
recovery. The idea is if you achieve proper fluid balance before a surgery, you can reduce complications
and shorten length of stay, and there’s a tremendous amount of data that supports that.
Our new ClearSight technology allows a noninvasive way of collecting that sophisticated information. With
an investment of about $300 upfront, you are able to save literally thousands on the back end and
improve patient satisfaction in the process. This was something the British National Health Service
implemented, and we’re trying to help adoption in the U.S. today.
MH: Are hospitals willing to spend more money on a technology like this?
Mussallem: I think hospitals are getting it. In the past, for example, there would just be an anesthesia
budget, and they would just see the increased cost in that budget but not see the reduced cost from the
shorter length of stay or the reduced complications. Now, there are administrators for whole service lines
who are taking a broader look at hospital economics, so they are very interested in this kind of approach.
MH: Edwards announced in December that it invested in a company called CardioKinetix. Do you
anticipate that the company will make other deals like this?
Mussallem: Our strategy continues to be very focused, with 95% of the products we sell in the No. 1
position around the world. So we don’t try and be very large and diversified. We try to be excellent at what
we do, and we’re totally focused on structural heart disease and critical-care monitoring. The
CardioKinetix investment is a great example of a new therapy that has some tremendous promise for
heart failure patients that have few options. They’re in a randomized clinical trial, and we won’t know the
results for a couple of years. But it’s a perfect example of the kind of thing that Edwards likes to invest
in—early stage potential breakthrough technologies that change medical practice and produce much
better answers for patients.
MH: What’s your expectation for Congress repealing the ACA’s medical-device tax?
Mussallem: We’re pleased that there seems to be bipartisan support for re-examining the medical-device
tax, and we think the odds of that making progress have improved. It is going to take a bipartisan effort.
It’s probably going to take support from the White House. We’re cautiously optimistic that we will have
some progress this year.
By Jaimy Lee
This article is copyrighted. All rights reserved. Source: Modern Healthcare

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