Aug. 24, 2019
Michael Ford, President, CGTI Corp.
He is President of GTCI Corp., a company specializing in assisting small and medium-size companies with market access planning, regulatory affairs, channel partner selection and training in Brazil.
Mike is an experienced business development and marketing executive with global experience in healthcare, life sciences, and diagnostics. He delivers sales growth, profitability and market share by selecting the proper partners and distributors to enter new markets, expand coverage in current markets, promote brand awareness and identify KOLs.
Mike began his career at Baxter Healthcare market analysis and research, operations, and sales for the US domestic market before being promoted to Baxter's Intercontinental division to manage strategic planning, marketing and new product launches for the Medication Delivery division. In 2003, he moved to Sao Paulo, Brazil to head Baxter's Hospital division.
Mike also worked for Thermo Fisher Scientific in the Global Export division as Director of Sales and Marketing for Latin America. Here, he selected and managed new channel partners to increase sales to labs in a variety of market segments, and focused on training and customized marketing catalogs.
Most recently he was with Nova Biomedical as a Regional Manager for LATAM where he established new partnerships and launched five new products into the healthcare and veterinary market.
WEBVTT
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Welcome to the loud time medtech leaders podcast.
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This is a weekly conversation with med tech leaders who have succeeded in Latin America today.
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Our guest is Mike for a Latin American market access consultant.
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Hey Mike, it's great to have you here today.
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Hi, good morning, Julio.
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Thank you for this opportunity and I hope it's beneficial for all of us.
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Excellent.
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Mike.
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Well listeners, Mike is, um, international inexperience, business development and marketing executive global experience in the healthcare or life science and lab industries.
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He delivers sales growth and market share gains by selecting the correct distribution partners to expand geographic coverage, brand recognition, and identify key opinion leaders with a specific emphasis in Latin America.
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Of course, he began his career with Baxter healthcare where he had market research operations and salesforce possibilities for the domestic market in the u s before moving to your intercontinental division to manage strategic planning and marketing.
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And later he also managed new product launches for the medication delivery division.
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Mike worked a year in Sao Paulo, Brazil and he spent 13 years with Thermo Fisher scientific as director of sales and marketing for Latin America, managing go to market models, selecting channel partners for specialized market segments and creating customized training and catalogs.
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So I'm really honored to have Mike here on the show and I look forward to our discussion today, mate.
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Thank you.
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Well Mike, let's begin by telling listeners of the podcast about your journey to Latin America.
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How do you get involved with the region?
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Well, I was born in Chile and I came to the United States to study at Indiana University as business and then I got an MBA in international marketing.
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So my dream while I lived in the US was always to have a global position with a multinational company.
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And obviously having lived in Chile, Colombia, Mexico, Latin America seemed like a very, very good fit.
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I'm Brazil as well, right?
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Yup.
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Brazil was after.
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That was during my educational life.
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My parents moved around, so they went from Chile and to Columbia and then back to Chili and then to Mexico.
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So home was where they were icy.
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And my career.
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I started with Baxter Health scare in the domestic division.
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At that time it was called the perennials divisions, so it was all the ivs and infusion lines that division grew.
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I went into marketing with the parental divisions.
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Then I went to an alternate site division which focused on more of the outpatient procedures, the dental and the veterinarian market and there I did more of the operations from salting and sales force compensation and analysis.
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Later I joined what was called Clintech, which was a joint venture between Baxter and Nestle and they sold intro and parental nutrition to ultimate site such as nursing homes and rehabilitation centers and also into hospitals.
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From there, Baxter had a position as the director of strategic planning and marketing for Intercontinental.
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I applied and got that position and my responsibility was the intercontinental region for Baxter, which basically is a Latin America, Australia, New Zealand and Turkey.
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I spent seven years as a global resource traveling to all the countries, setting up new subsidiaries or helping set up new subsidiaries, introducing new products such as anesthesia in management, infusion pumps.
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We also did the phase out of the allegiance.
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At that point in time, it was called American hospital supply and then it changed into allegiance.
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And those were consumables such as gloves and a disposable clothing.
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And when allegiance was acquired by Cardinal, we decided to divest of that business in Latin America on a direct basis.
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They took the business.
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And so we had a need for new products and growth.
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And I think that the key in all of this was that you have to have a customized approach for each segment and each country, you can't have a cookie cutter approach to all of them.
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Just because the word say Mexico, it doesn't mean it's going to work in Brazil.
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Uh, after being with Baxter in Brazil, I spent a year there, had a lot of success.
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It was a little bit of a turbulent time.
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It was when Lula first got elected.
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So there was a lot of anxiousness in the market in terms of investment, in terms of political and economic stability.
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But I think that you have to be focused on your plan.
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You have to be focused on your strategy.
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And as long as you stay true to your mission and your objectives, you'll have success.
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The worst thing you can do is to panic.
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A lot of companies tend to do that.
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The companies that have staying power are the ones that usually in the long run succeed and get good results.
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I left Baxter and join Thermo Fisher scientific.
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I was in charge of Latin America sales and marketing and that was a change for me because Baxter acted mostly through their own subsidiaries in Latin America.
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Whereas Fisher at their main go to market model was through distributors.
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So managing distributors, making sure that you get the right amount of attention for your product lines, making sure that you have a person that is dedicated to finding where the opportunities are that understands the market and helps you understand the market.
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And when I say market, it's not just where to go sell and what's public, what's private, really all the intricacies of the market in terms of regulatory, in terms of what's the culture of that particular country.
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So you have to have really good insights and the only way to do that is to really get in touch with your customers and talk to the end users.
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Even if you have distributors, you have to go talk to the end users.
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You can't just let the distributor do whatever it is that they're used to doing because they are going for what's in their best interest.
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And when you look for distributors, you have to look for partnerships.
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You have to look for demand generation, not just an entry or a channel into the market.
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So what you do is you have to work with them, train them, provide support, provide all the materials they need, all the documentation.
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Registration is getting more and more complex.
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Therefore, when you provide all these support function or these support materials, you also have to make sure that they understand that you expect some certain critical milestones and objectives to be met.
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So that has to be clear from the beginning.
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Latin America is like a mutual fund in a way.
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One year Mexico will do well.
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Then the next year Brazil will do well.
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Then the next year it's Columbia that is having a good year.
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You rarely have a year where they all do great.
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That's a great way to put it.
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Great analogy by the way.
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So you have to understand that you have to back the distributors where there's a good opportunity or good opportunities and where the funding is readily available.
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Some markets take a long time from the bid specifications to when it's finally awarded.
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It can be two, three, sometimes four years.
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So you have to also understand where are the short and the medium range opportunities.
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Okay.
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Mike, so let's speak in generic terms about your overall perception or opinion about Latin America.
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Some market for medical devices and medical technologies in general.
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I mean it's positive, it's negative.
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I mean what's your take in that?
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America?
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For me it's positive.
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I think that traditionally Latin America has been a little slow to adapt to new technologies.
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The ministries of health are so inundated with different requests that what you need to do and what the companies are that are having success are doing is they need to make sure that they do, again, support their partners with training, with education, that they identify the key opinion leaders in that market and that they know who makes decisions at the Ministry of Health levels, who are the key decision makers.
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If you can work with those three groups, you'll have success.
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It's going to be as fast
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as a product that comes out or instance in Europe and all of a sudden it's made in Germany and three years later it's adopted by most countries in the European community.
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I think that Brazil and Mexico are the first to adopt Mexico probably because it's proximity to the u s because there is trade agreements and it's a country that for many years we've understood and many US companies have local operations there.
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Brazil, because it's the largest market, so everybody wants to be in Brazil, but Brazil is a very different market than Mexico.
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Brazil is a very protected market for the locals.
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Whereas in Mexico, if you have local operations, you are treated the same as a local company, so it is a mixed bag.
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I think that smaller countries are a little bit slower to adapt to these technologies because they kind of wait to see what the experiences in the bigger countries and because companies too that are investing want to go into the larger markets as well because the potential for sales is greater that that is changing a little bit because there are some markets like Chile, which is from a regulatory point of view, very easy access, so that shortens your time from the point you start either setting up a legal entity or working with distributors until you have the product.
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In the market, it can be six months, whereas in Brazil will probably be at least one or two years depending on the product you have.
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It's different classes and the regulatory perspective.
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All right.
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Let's speak about the specific countries where you have experienced might.
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Oh, Brazil obviously because I work in Brazil is a great market where all the multinational companies are European, Japanese American, so it's a very competitive market.
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But the one thing that Brazil does have is that their regulatory requirements and their sort of product registration requirements, standards are high.
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So that limits who can really sell into Brazil, you are dealing for the most part, 80% of your competition is going to be the same for a company in Europe as it is in the u s as it is in Brazil.
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So you should know your competitors, what you need to figure out as the market.
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Other Countries, oh, Mexico is a country where you have a huge advantage if you have local manufacturing, they're sort of bidding system for aims and east is you get automatic 15% of the 100 points of your local.
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So that's a huge, huge advantage to have.
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Argentina is a market that, although it's about one fourth of the Brazilian market, it is a market that from a regulatory point of view requires for instance, US companies, they require u s certification.
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So from that it also limits some of the competition, but in Argentina you have a lot of local companies that are strong, so you need to understand how you are going to stack up against the local companies.
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Columbia is another good example that Columbia is a market that is growing.
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I think that the issues in Colombia and mostly with the reimbursement or reimbursement schedules are updated very slowly.
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I think that might be part strategy, part just bandwidth.
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The strategy part is that if the government doesn't move very fast and the companies need to sacrifice margins, but now with the devaluation that they've had and since 2015 and things like that, they're having to react because they're not getting the quality that they used to, so they understand that, but it's a slow process.
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I think in general you have the Caribbean for instance.
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It's a lot of small little markets, but the prices are higher than in the big markets, so if you have a good partner in the Caribbean, you can have a lot of success.
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Peru is a market that is rowing.
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It's a stable country in terms of the exchange rate, not so stable right now in the last few years politically.
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But you can say that about a lot of Latin American markets.
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So you have to watch the political, the anomic regulatory aspects of the business, and then you really need to understand who are the players.
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Sometimes companies fall in love with their distributors, then their distributors fall out of favor or miss out on opportunity and then they start focusing on other opportunities.
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So you have to make sure that you are constantly reviewing.
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You should have business reviews with your distributors every quarter.
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So we can say that you've had experience in pretty much all major countries in Latin America.
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Yeah.
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At some point in time.
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In the past when as well as a great market.
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Well, it does change and it can change slowly over time or it can be fairly drastic.
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But yeah, I think overall they're cycles also, one market is good and then five years later it's not, it's average or it's not so good.
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And then another market will be the one you need to focus on again.
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You need to understand what the dynamics are in the regions so that you're also focusing on the markets where the opportunities are this year or next.
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We need to look at the longterm strategy, but in order to really grow and make a return on your investment, you need to focus on where the opportunities are.
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Very good.
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All right Mike, so let's speak about go to market or market access strategies and I'm gonna ask you two questions here or we're going to speak about two ideas here.
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The first one is about having a proactive versus a opportunistic strategy.
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In other words, some companies have a practice strategy where they have a very well thought out plan.
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They create a market access plan or go to market plan for each country they are planning to enter in Latin America or they have a very opportunistic or reactive approach where they just wait for the shooter to meet them at a trade show or via email or something.
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So what's your take on this
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serious has been that if you're going to do opportunistic type of selling, it has to be through your current partner where you already had a very well thought out market access plan, a go to market plan because the nature of the business in Latin America and some countries, the public segment can be up to 80% 70% of the business.
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So when I say opportunistic business, it's bids that everybody's involved, so you have to really work them to win.
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If you're going to just throw prices, your chances of winning are very, very low.
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So you have to have an approach where you have a market plan, you have the right partners where you can rely on 80% of your business being there year after year.
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Then the other 20% are hopefully more, maybe 40% if you get the right partners or if you get the right environment.
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That can be opportunistic.
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It is a mix, but you can't just rely on opportunistic.
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You have to rely on sound business plans in order to create demand in order to have key opinion leaders in order to meet the influencers and those will help.
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You will be opportunistic.
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If you go just after the opportunistic business, you will never succeed.
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You'll be there one year and gone the next.
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Excellent.
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Yeah, was hit.
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Then.
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The caveat is with having a[inaudible] approach, Mike, is the fact that if you meet a shoot or a trade show, for example, you do a handshake deal, you have a couple of beers with a guy and now he's controlling yourselves in a country like Columbia orienting or something.
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I mean that's significant countries and very likely you didn't do much due diligence because you already had a handshake and a couple of years and that's really your due diligence and very likely that the shooter will fail in the next year or two.
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So if you don't choose, you're the shooter, right?
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It's probably about three years of lost sales.
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What do you think about that?
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Yeah, I think that you have three types of distributors.
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You have proactive distributors, then you have passive distributors that they have your line, they look to do bundling or integration when they can.
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And then you have the ones that just collect brands and they like the day I represent this company and I represent that company, we do it all.
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We are the best.
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The other guys are never involved.
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And then you talk to somebody else and they tell you the same thing about that company.
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So I think that passive distributors in some markets sometimes can help you, but it depends also on your go to market strategy.
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If you're going to have a one authorized distributor, you better select the right one.
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You better do your due diligence, you better make sure that they're going to have a dedicated person, that they're going to have inventory, that they're going to invest and that they're receptive to you training them to you making visits with them.
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Because if you don't visit the customers and you don't just visit the customers that like them, you listed the customers that don't buy from them and find out why.
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Finding out, okay, why does this guy not buy from you?
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Or why does this hospital, why does this particular group not buy from you?
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That's the ones who will go after.
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Don't comfortable with the sales you have.
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Okay.
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Let's say these discussing about how to choose the sewers for him a little later.
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Let's continue with the market access or the go to market strategy.
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Mike.
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So the other question that I had here is about the management approach that some companies have.
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I mean I think basically two management approaches.
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One is a hands off approach where you just sell products to your distributor, just dump inventory to the guy and you hope that the guy sells something.
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And the other approach is what I call a hybrid approach where you have, of course you're the shooter and of course you should have done your due diligence, but you also have a local person that is representing your interests and that is really understanding the market from your perspective, not from the perspective of the shooter.
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Because as you rightly said earlier on, he should only will give you a piece of the whole puzzle.
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Is that in his best interest to give you the full story.
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So what do you think about these two approaches?
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The handoff managing approach with just dove inventory to the shooter and hoping that he says something or the hybrid approach where you have an agent or somebody local who is working with the shooter or supporting these shooters in co-marketing activities, visiting clients, whatever, and helping you understand the market from the perspective of you as a manufacturer.
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Yeah, so if you have a hands off approach, it rarely works.
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And the only times that I've seen it work is when the person that is the distributor used to work for your company so they know the product, they know you and the market identifies with them and your company.
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So they're basically an agent of yours.
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They're going to be fighting because at some point in time it's going to be an important part of our sales.
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But that's one or 200 a hundred and the way you classify it as a hybrid in a hybrid relationship, it's a partnership.
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It's not the manufacturer telling the distributor how much he's going to sell or the distributor telling the manufacturer where they're going to be able to sell is working your strategic plan, your market access plan, your go to market plan, whatever you want to call it together and you have to have your vision, your mission, your strategies.
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You have to have objectives, you have to tactics, you have to evaluate opportunities, risks.
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You have to do a Swat analysis.
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You need to really go through the whole market.
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You have to understand the market, they have to understand you.
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You have to understand their capabilities.
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You can have a guy that can sell a lot, but if he can't pay you, then you're in trouble.
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So they have to have financial capabilities.
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They have to have marketing capabilities on that.
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Nowadays more and more is becoming digital.
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In Latin America.
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That's growing a lot.
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So if somebody is really into the digital marketing, that's something that it will serve you well in the future.
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People that are not doing that will be left behind.
00:20:41.000 --> 00:20:43.009
You have to have good logistics.
00:20:43.220 --> 00:20:49.539
A lot of people focus on the cost or the acquisition cost of the product and the distributor has terrible logistics.
00:20:49.539 --> 00:20:54.309
I mean then you wonder why they don't sell and it's because the cost of their logistics is too high.
00:20:55.000 --> 00:21:04.420
It has nothing to do with a Bali as nothing to do with the effort they put behind that they just don't have the right supply chain partners and supply chain is becoming more and more important.
00:21:04.839 --> 00:21:11.950
If your distributor doesn't understand the market and the competitors, you're in trouble because you need to understand the market on the competitors, so help them.
00:21:12.339 --> 00:21:25.029
For instance, I've done market research, I've subcontracted or I've contacted external parties in countries so that they do a market research for me on a given, say anesthesia market because then it's not biased.
00:21:25.240 --> 00:21:30.130
It's always going to tell you everything's sunny side up because they want you to work with them.
00:21:30.970 --> 00:21:37.930
But there'll be days when the sun doesn't come out, so you have to really build a trusting relationship.
00:21:37.960 --> 00:21:40.829
It doesn't have to be, they don't have to be your friends in that.
00:21:40.869 --> 00:21:48.190
They can be your friends like they have to be your partner first and you have to be good to them as well as they have to be good to you.
00:21:48.191 --> 00:21:51.279
You can't just say, oh, we found this great distributor and just say, okay, you know what?
00:21:51.280 --> 00:21:54.220
We'll do the marketing plan and then let them figure it out.
00:21:54.221 --> 00:21:55.990
No, you have to work with them.
00:21:56.349 --> 00:21:59.019
It is a 50 50 proposition if you're going to be successful.
00:21:59.069 --> 00:21:59.369
Okay.
00:21:59.371 --> 00:22:08.250
You touched on my next question here is what's your recommended strategy to search, conduct due diligence and select the shooters?
00:22:08.250 --> 00:22:08.609
Mike,
00:22:09.519 --> 00:22:21.700
I think that number one, you need to understand who your customers are going to be and talk to those customers and if you're going to be in, I dunno, I'll, I'll just pick'em infusion pumps.
00:22:21.880 --> 00:22:27.490
You go to who you think traditionally have been your target customers and you find out who they're mined from.
00:22:27.859 --> 00:22:36.339
See if they already have an infusion line, then they might not be interested in, they may not be able to work with you, but find out what is it that the end user looks for in a provider.
00:22:36.700 --> 00:22:37.539
That's very important.
00:22:37.869 --> 00:22:43.630
Some customers, public hospital, I want them to put the inventory here for free for you know, 180 days.
00:22:44.109 --> 00:22:45.609
Well that's hard to do.
00:22:45.849 --> 00:22:49.750
So I think that in selecting a distributor you have to look for financial strength.
00:22:50.140 --> 00:23:02.920
You have to look for market knowledge, you have to look that they are vertically and horizontally integrated themselves so that they have the bandwidth and they have the leadership and they have to be innovators.
00:23:02.980 --> 00:23:06.640
They have to look at, they have to be willing to think outside the box.
00:23:07.000 --> 00:23:13.690
They have to be promoters and demand generators and they have to have a person dedicated to your line.
00:23:14.019 --> 00:23:17.019
Otherwise it's really hard to be successful.
00:23:17.230 --> 00:23:20.440
That person has to be your eyes and ears in the market.
00:23:23.660 --> 00:23:25.069
And what about managing distributors?
00:23:25.130 --> 00:23:28.039
I mean any tips on how to keep them in line?
00:23:28.040 --> 00:23:30.200
How to keep them top of mind?
00:23:30.289 --> 00:23:32.029
I mean your company, top of mind on them.
00:23:33.130 --> 00:23:37.269
Well, I think that some of that is dictated by the market.
00:23:37.329 --> 00:23:42.400
You lose in Mexico, you lose the Ims Institute of[inaudible] sociality the bid.
00:23:42.609 --> 00:23:46.549
You're going to be out of that business for four years, so you have to be realistic.
00:23:46.579 --> 00:23:48.200
Do you lose 40% of the market?
00:23:48.740 --> 00:23:58.880
You need to be ready the next time, so you need to start preparing two years before the bid comes out, but you're not going to have much of anything in terms of sales if you don't prepare so you better prepare.
00:23:59.329 --> 00:24:04.130
Otherwise you're going to be pretty much out of the market for two or three, maybe longer.
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