A national purchasing agreement existed. Physicians wanted the product. Patients had a significant clinical need. Yet one institutional purchasing barrier effectively prevented access.
Situation
Advanced BioHealing marketed DERMAGRAFT, an advanced wound-care product used in the treatment of diabetic foot ulcers. The Veterans Affairs system represented an important market because of its large population of patients with diabetes and the serious consequences associated with chronic, non-healing foot ulcers.
DERMAGRAFT cost approximately $1,300 per application, making institutional purchasing and reimbursement processes critical to product access.
Advanced BioHealing had established a national agreement with the Department of Veterans Affairs allowing VA facilities to purchase the product. At the Baltimore VA, however, the Prosthetics Department—which controlled the tissue-purchasing process—would not purchase DERMAGRAFT despite interest from the treating podiatry department.
Repeated attempts to address the issue locally were unsuccessful. The problem was no longer product demand. It was an institutional purchasing barrier.
Approach
Rather than continuing to pursue the same local decision-maker, I investigated how purchasing authority operated within the VA system.
The key discovery was that the Baltimore VA did not operate independently. Its Prosthetics leadership ultimately reported through the regional Veterans Integrated Service Network (VISN) structure.
I contacted the appropriate VISN-level leader, explained the situation and met with him to review the existing national VA agreement with Advanced BioHealing.
After reviewing the agreement, he determined that the Baltimore VA was required to make the product available under the established purchasing arrangement.
The initial VISN direction did not resolve the problem. When the local purchasing department still resisted, I returned to the VISN leader. He subsequently issued a direct written instruction, copying me on the communication and making clear that compliance with the purchasing agreement was mandatory.
The institutional barrier was finally removed.
Result
The Baltimore VA went from zero DERMAGRAFT purchases to as many as approximately 20 applications per month, becoming an important account within the region.
More importantly, physicians gained access to an advanced wound-care option for appropriate patients with difficult-to-heal diabetic foot ulcers—patients for whom successful wound healing can be critical to avoiding serious complications.
The broader regional strategy contributed to approximately 250% sales growth.
The PharmaKonsult Principle
The solution was not more selling.
The physicians already wanted the product. A national contract already existed. The obstacle was understanding where the actual decision-making authority resided and how the institution operated.
That experience reflects a pattern I have applied repeatedly throughout my career:
Identify the real barrier. Determine who has the authority to change it. Develop a practical solution. Then convert that solution into measurable commercial performance.
For pharmaceutical, biotechnology and medical-technology companies, particularly in complex institutional markets, commercial performance can depend as much on understanding the system surrounding the product as on the product itself.
About Joseph McCoy
Joseph McCoy is Founder and Principal Consultant of PharmaKonsult and an executive commercial strategy advisor with more than three decades of pharmaceutical and biotechnology commercial leadership experience across neuroscience, rare disease, endocrinology, institutional healthcare and specialty pharmaceuticals.
