Mary Kay Ladone is SVP of corporate development, strategy, and investor relations of Hillrom of Chicago, IL.
Tell me about yourself and the company.
I am an executive with more than 30 years of healthcare experience in a variety of areas — finance, financial planning, operations, strategy, corporate development, and investor relations. I am also privileged to serve as a member of the board of trustees for Edward-Elmhurst Health, which is one of the largest systems in the Chicagoland area. I have been at Hillrom for just about five years after spending most of my career at Baxter International and its spinoff Baxalta.
I am happy to be a part of the Hillrom team. Hillrom is a medical technology leader. We have a diversified global business, with $3 billion in revenue spread across three businesses — patient support systems, frontline care, and surgical solutions. Hillrom’s portfolio spans all care settings — acute care hospitals, ambulatory or physician care, and the home setting.
I couldn’t be prouder and more excited to share with you some of my perspectives on our connected care strategy and how we continue to accelerate growth and drive value for our patients and caregivers. We are focused on executing on our strategic priorities and advancing our vision.
Some people might be surprised that the company’s home page highlights “advancing connected care” rather than hospital beds. What business units support that concept?
Hillrom has historically been known as the leading bed company, but if you have followed Hillrom over the last several years, you know that we have significantly diversified our portfolio. We have strengthened our business model and established a strong track record of performance. All of which has led to a pretty exciting and compelling transformation and transition of Hillrom into a medical technology leader. For example, today our hospital bed portfolio accounts for just less than a quarter of Hillrom’s total revenue versus about 50% of our total revenue 10 years ago.
Our vision of advancing connected care is tied directly to our mission of enhancing outcomes for patients and their caregivers. It is integral to everything we do across all three of the businesses. Our primary goal is to collect data and to turn that data into actionable insight that allows for real-time interventions and enhances patient outcomes.
Our connected care efforts are focused primarily on improving workflows, lowering costs, and improving diagnosis and patient care. We estimate that there are over 1.3 million Hillrom devices in the field that can be connected across a variety of the care settings, including acute care and surgical environments, the ambulatory or physician office setting, or in the home. Our diversified portfolio includes an ecosystem of smart devices, including our smart beds, communication, and connectivity solutions. We have sensors and devices that can continuously monitor patient vital signs. We have a suite of diagnostic tools. We have respiratory health products that are used in the home to treat cystic fibrosis and other respiratory diseases, such as bronchiectasis and COPD.
What is involved with turning a large amount of medical device data into information that a clinician can use for real-time decision-making?
We are continuing to invest — in both our internal R&D programs through organic innovation and through external or M&A — to build an ecosystem of connected devices that will put actionable information in the hands of the caregivers. You don’t want to overwhelm the caregiver with too much information, because that makes it less actionable and less valuable to them.
An example is the launch of our digital offerings or algorithms later this year that will target two of the most costly non-reimbursable expenses for the hospital — patient deterioration and patient falls. Our value proposition with these algorithms is focused on lowering hospital costs while increasing quality and enhancing outcomes.
In terms of patient deterioration, we are utilizing our EarlySense sensor. This is a contact-free continuous monitoring sensor that monitors heart rate and respiratory rate 100 times per minute. This data is then collected and aggregated. The algorithm can provide an alert through our mobile communication platform that provides for early detection and intervention at the first sign of deterioration. This is important, as patient deterioration or sepsis is an expensive complication that costs the healthcare system more than $20 billion annually. The earlier the intervention, the more likely the ability to achieve a better outcome at a lower cost.
Another example would be our Excel Medical acquisition, which brought to us medical device integration capabilities as well as waveforms that can be visualized on the mobile device. It also provided us with an alert and alarm management system. This system is set up to prioritize alerts, organize them, and send them to the caregiver in a prioritized fashion so that they can act on the most important of those alerts. It helps them improve their workflow and improve the workflow efficiencies across the healthcare system.
The acquisition of Voalte gave Hillrom a solution that includes devices, integration, and communication. Does that provide a competitive advantage given the importance hospitals place on reducing vendor count and complexity?
Yes. We have actually done two acquisitions in the area of care communications. You mentioned Voalte as an example. We have traditionally been the leader in the traditional nurse call systems for our acute care customers, but in doing so, we have realized that we could accelerate our connected care strategy by building on this leadership position and creating an ecosystem of solutions that leverages our smart beds as the hub for communications data and connectivity.
The acquisition of Voalte and then the acquisition of Excel Medical that I just mentioned differentiated Hillrom as the only provider of a comprehensive mobile communication solution that provides voice, text, alert and alarm management, digital wave forms, and medical device integration. You are right that it is important that our acute care customers can buy that one solution from one vendor and not have to piece it together and tape together a variety of solutions from a variety of vendors.
The pandemic has increased the use of remote patient monitoring, both in hospital areas that weren’t previously equipped for monitoring as well as the home. Will that have permanent impact?
Hillrom has been a leader in traditional patient monitoring within the acute care setting with our vital signs monitoring devices and other devices that we’ve integrated into our smart beds, like the EarlySense sensors we just discussed that monitor heart rate and respiratory rate. We also have a WatchCare device that monitors incontinence events and can help reduce infection and pressure ulcers. But you’re right, the pandemic has also highlighted the importance of remote monitoring capabilities, and this is one of our core focus areas as we look to shift care closer to the home.
I can give an example of one of the opportunities that we embarked upon at the beginning of the pandemic. Our company quickly pivoted our R&D efforts and we introduced what we called our Extended Care Solution, which combined our Spot 4400 Vital Signs device with a patient app and a clinical review portal to help extend patient care beyond the wall of the healthcare facility. Clinicians can access the patient’s temperature, blood pressure, and Sp02 measurements. The patient doesn’t have to be in the hospital setting. They can do this at home, and that provides an enhanced level of care. This is a trend that is accelerating given the pandemic, and one that we continue to look at both from an internal R&D perspective, but also from an M&A perspective, as a potential opportunity for Hillrom going forward.
What will be the company’s most important areas of focus in the next 3-5 years?
I think it goes back to our strategic priorities. One, about being a category leader across our various portfolios and businesses. We want to continue to expand internationally and penetrate emerging markets, where today our exposure to emerging markets is under index relative to our peer group.
We want to continue transforming our portfolio. We have recently exited some lower-growth assets and we have been turning to M&A as a key driver for future accelerated growth.
We have also been experiencing and demonstrating a strong track record of performance and operational excellence, during the pandemic in particular. We have stepped up to help our hospital customers during this difficult time.
We are focused on what we consider our core growth platforms. These would include the areas of care communications, respiratory care, patient monitoring, and surgical kinds of activities. All these care categories represent attractive markets and areas where we believe Hillrom brings capabilities as well as a competitive advantage where we can win. These are going to be the areas that will drive our success in the future.
Do you have any final thoughts?
The transformation we have seen at Hillrom from a bed company 10 years ago to a medical technology company today is exciting. It has been compelling. We have doubled our size in terms of revenue. We have rebranded the company. We have our vision of advancing connected care that we are all focused on, driving the growth across our key strategic growth platforms in areas that we believe are addressing some of the healthcare system’s biggest challenges. We hope to bring comprehensive solutions to the table that help our healthcare customers and caregivers and enhance patient outcomes over the long term.