Hindsight 20/20: Ian Gilham
Hindsight 20/20 is a Q&A feature where medtech industry veterans share their long experience taking diverse businesses – be they start-ups or publicly-listed entities – from strength to strength and navigating through times of crises. In this instalment, Ian Gilham, the former CEO of Anglo-Nordic IVD company Axis-Shield who oversaw its acquisition by Alere, discusses what to look out for should you find yourself with an acquisition offer on the table and why the success of a business boils down to the team – not the individual – running it.
With a PhD in Biological Sciences, Ian Gilham started his career as a bench scientist but soon made the transition to commercial roles within the in vitro diagnostics sector, working for established names such as Abbott and GSK. The turn of the millennium marked a significant milestone when he joined Anglo-Nordic IVD firm, Axis-Shield, in 2001 as chief operating officer then took the helm seven years later. As CEO, he oversaw the acquisition of Axis-Shield by Alere Inc. in 2011. (Also see "Alere finally bags Axis-Shield with slightly increased offer" - Medtech Insight, 6 Oct, 2011.)
Following the acquisition, Gilham has been sharing his experience and knowledge with several diagnostics and biotech companies and is currently chairman of Horizon Discovery Group PLC, BioSurfit, genedrive and Multiplicom.
Ian Gilham, former CEO of Axis-Shield and IVD industry veteran
I think that's where the board comes in; having an independent board and a chairman who have done it before and can take the steps to renew the management team and get the right skills set in.
So I got a position in Abbott Labs, then the world leader in commercial diagnostics, in technology licensing and acquisition, which bridged the gap between science and business. In tech licensing and acquisitions, you really get into patent acquisitions, understanding the IP, the strengths and weaknesses, prior art, etc. I really got a good grounding in IP [in that role], and it is important to understand this in a high-tech sector, as a lot of the value of the company is in the IP estate.
I really enjoyed the commercial side of technology acquisition and licensing and then moved on to a pure commercial role and ran Abbott's eastern European business. Abbott was a great business school generally; I learnt very quickly about country organization, finances, business planning, all that.
Invest in a strong team and a strong board. Having people who understand special areas, who you can go to and get advice is absolutely critical. You need to recognize you can't do it all yourself and that you need to get the best IP people, the best finance people, the best commercial people you can afford to bring them in or have them consulting to help you build a strong business. And it's not just advice: with those kinds of people on board, you are much more likely to get funding. Because you have a very strong business case and tested it against people who have done it before.
There might be those who are thinking that if they can sell the company and get X times more money in two years, they'll be thrilled. While there are others who might think this is a 10-year project for them, that they want to invest money in the company, make acquisitions, grow the business, set up offices in the US or in China, etc. So they want to invest in a longer period of time to get an outcome.
If you get an offer from somebody who says they want to offer so much, you as the founder might have views on that but ultimately the market/investors will decide what a good price is. You are not the decision-maker.
3 in 30: Three quick-fire questions in 30 seconds
What do you do to help unwind from the stresses of your job?
I enjoy sport and am a member of the Great Britain age-group triathlon team.
Who, outside the medtech industry, do you see as a role model and why?
[Double Olympic champion triathlete] Alistair Brownlee – humble and dedicated with an unbelievable focus on achieving his goals and being the best athlete he can possibly be.
If you weren’t a medtech executive, what would have been your career Plan B?
I’d probably like to be a medical doctor. Can’t think of anything more satisfying than helping to make sick people well – which is probably why I’m so passionate about the medtech industry.
There is a feeling that to be a CEO of a business, you need to be fiercely independent and successful and visionary; most people aren't like that and the good news is, you don't have to be. There are plenty of good people out there with a lot of experience and you can learn from it.
In terms of which functions to focus on more than others, all the functions are important. You'd need R&D expertise to manage the product development process, a regulatory person to oversee the requirements for registering the product in different markets, a commercial person to assess how you would want to sell the product whether to go direct or through a distributor, and then there is also the reimbursement aspects, how to get your product reimbursed, whether that is a one-year project or ten-year project. You would need all of those functions filled all the time, but the balance shifts as the company goes through the different phases of growth. It's important to understand which phase you're at and thinking ahead, and getting the resources to be prepared for that phase.
We learnt this lesson when Axis-Shield was plan to launch a point-of-care blood testing instrument in the US. In the early days, we would hire people from Europe to head a US operation and then have them spend one week in the US and one week back. This didn’t work out for this product launch and we got it wrong twice. The third time, we got a VP of sales who was actually based in the US; it was a very expensive hire, but what I learnt was sometimes you need to bite the bullet and spend the money, because you're learning about the market and you need their knowledge. It's the same in China. We had an office in China and at first, we were running it from Europe but when we finally got a local to oversee the business there, suddenly we got product registration, suddenly we got sales, suddenly we understood the market.
So, at the appropriate phase of the business, you need to be prepared to invest properly in the right person.
All companies run into problems – whether it's a product problem, a manufacturing problem, or competitor problem – but it's what you do about it that matters. It's about putting your heads together during a crisis and having an experienced team that knows what to do so there is minimal impact on the business. You learn from that and you put new quality controls in place so it doesn't happen again.
Ultimately, it's about people. The success of a company is not so much about the technology itself but the quality of people who deliver that technology. It's all about the team you put in place, the support and the advice you get, recognizing when business is transforming from one phase to another and realizing the different skillsets you might need then and when you might need to refresh the team again.
From the editors of Clinica