OEM Profile: Driven By Relationships
Cook Medical Hones Its Relationship Skills to Become One of the Industry’s Top-Tier Private Companies
Jennifer Whitney, Editor
While many companies in the industry roll out words such as “innovation” and “quality” at the heart of their promotional campaigns, Cook Medical went a little deeper last year when it rolled out its slogan for a semi-internal pride-boosting campaign. “What Is Your Promise?” the campaign asked employees. After all, the company recognized that neither innovation nor quality would be possible to achieve after 44 years of operation if it weren’t for one major factor: the employees themselves.
Cook’s headquarters in Bloomington, IN. Photo courtesy of Cook Medical.
“The thing that amazes me about Cook is that the core corporate culture of how to do business and deal with people and customers hasn’t changed in all the time I’ve been here,” French told Medical Product Outsourcing. “It’s not just management speak; I find it hard to believe it can happen, and it’s a really good thing.”
And he can back his statement up with hard facts. According to French, Cook Urology’s annual turnover rate is less than 10% among its employees. “In a company that’s non-commission based, you would think people would run. But the thing that keeps people here is that we see every employee is important, and we treat them like human beings by giving them autonomy,” he said. “We have a tremendous amount of respect for the people who work here. It’s virtually impossible to serve a customer right if you aren’t serving employees well. We maintain our quality by taking care of the people who produce our products.” Such a simple philosophy may not be sexy, but it works—very, very well.
Headquartered in Bloomington, IN, Cook is one of the world’s largest privately held medical device manufacturers of minimally invasive medical devices. With the company’s main competitors being industry giants such as Johnson & Johnson, Boston Scientific, C.R. Bard and Siemens Medical Solutions, Cook clearly is a force to be reckoned with in the device sector.
A Little Background
Although actual sales figures aren’t available for disclosure by the private company, it does report annual sales in excess of $1 billion—not bad for a company started in 1963 on $1,500 invested in a blowtorch, a soldering iron and plastic tubing to create a cardiovascular catheter, as well as some guidewires and needles, in a spare bedroom.
Indeed, founder Bill Cook is the self-made man who epitomizes the concept of working toward—and in his case, achieving—the American Dream. An athlete and choir singer who also played piano competitively during his childhood, Cook, an Illinois native who moved to Indiana in 1963 and still lives in the same three-bedroom home he and his wife purchased in 1967, once turned down a football scholarship to the University of Illinois and, instead, attended Northwestern University. Little did he know that, while his path would veer along some eccentric paths (volunteer tour bus driver for John Mellencamp, founder of a shot glass company), his biology degree would set the stage for building what’s now one of the largest medical device organizations in the industry.
Cook initially used his scientific knowledge serving as a surgical technician for the Army during the 1950s. Toward the end of the decade, in 1958, he co-founded MPL Inc., which later became the third largest hypodermic needle manufacturer in the United States. (In the ’50s, he also served stints as an engineering recruiter for an aircraft company and as a catalog editor and scientific product salesman for American Hospital Supply Corporation.)
On a parallel timeline, in 1954, a Swedish doctor named Sven-Ivar Seldinger was busy contemplating his realization that a small puncture hole made in a blood vessel healed more quickly than a cut—a huge discovery for its time. Seldinger would perform the first percutaneous entry using a small needle, guidewire and catheter.
After meeting Dr. Charles Dotter at a radiology conference in 1963, Bill Cook began working with Dotter and other US pioneers in the emerging discipline of interventional radiology to create the tools needed for this revolutionary surgical technique. Dotter later would be nominated for the Nobel Prize in Medicine for his work using Cook devices to create new interventional procedures.
It’s just this kind of relationship with a key opinion leader that has taken Cook on a journey of continued innovation. In fact, French said that along with investment in employees, the development of strong relationships with key opinion leaders and physicians is paramount to the company’s success. “Mr. Cook realized that one way to develop a business is to first have a relationship with key opinion leaders and work with those people to build what’s needed to serve customers. It’s Sales 101—discover the need, then meet the need,” French explained.
Take the case of his urology division, which is celebrating its 30th year in operation. Cook already was heavily involved with interventional radiology, French said, but having heard from thought leaders in the urological field that there was a real need for a singular focus on urological medicine, the company began building its presence by reaching out first to specialists in the field and developing relationships with them. “Every unit in Cook has come down that same kind of road,” he said. “The marriage of physicians, with their expertise, and manufacturers, with their expertise, can only mean good things for patients.”
A Multifaceted Conglomerate
Today, Cook Medical manufactures more than 50,000 products worldwide. With manufacturing facilities in several locations in the United States, as well as in Australia, Denmark and Ireland—combined with numerous sales organizations all over the world—Cook develops and markets cardiovascular, critical care, surgical, diagnostic and interventional products; urological equipment; OB/GYN devices; endoscopic instruments; endovascular stent-grafts; as well as extruded and injection-molded plastics and stainless steel tubing.
The peripheral intervention group is the company’s largest and was the core group when the company was founded. As the company planted its roots in radiology, over the years it streamlined into various business units, which total eight at present.
Recognizing that women tend to oversee a family’s health, combined with the fact that they tend to live longer than men, and because gender-specific medicine still is in its infancy, the company launched its most recent unit, Cook Women’s Health, in May 2006. This move was an answer to the need for more of a singular focus on obstetric and gynecologic products in areas such as pelvic floor repair, high-risk obstetrics, assisted reproductive technology and gynecologic imaging, according to Christina Anné, global leader of the Women’s Health unit.
“We looked at different diseases, indications and solutions that we could bring to the table,” Anné told MPO. “We created a roadmap and found that there were already a few products we could list in that roadmap. The good news was there were still a lot of opportunities left. Women often are considered as a small man, but they have different needs. A lot of pharmaceuticals and devices are on the market based on studies and randomized trials done on males. Women need different solutions, different products. We’re very driven and we want to do the best for the female patient. It’s very fun to lead.”
How could it not be fun to lead, given the division’s significant success in its first year alone? According to the company, the Women’s Health unit grew 30% in North America in its first year of business, with its sales force expanding by 50%. The company also said that sales across all of the Americas grew 28% and are forecasted to continue in similar fashion throughout the remainder of 2007.
In the past few years, the company has been working toward unifying all the units’ brands and separate companies, so that they no longer work in silos as separate entities. Since Cook has its devices in far-reaching places such as Europe, Japan, Canada, Australia, Africa and the Middle East, each Cook affiliate in these locales has its own personnel, physician resources and economic solvency. However, each company shares technology and product distribution channels. Europe has been a particularly lucrative region, as Cook noted in one news release that it doubled its sales there over a four-year period ending in 2006, with growth attributed to its successful import operations.
The company doesn’t buy or acquire technology but, instead, creates and develops its own line of products with its key opinion leaders. That’s not to say Cook doesn’t develop partnerships or relationships with other innovators, though, such as the Urology division did in July when it formed an alliance with Convergent Laser Technologies to market and distribute Convergent’s Odyssey lasers and laser fibers for the treatment of kidney stones.
Although the company doesn’t outsource a large portion of its manufacturing, Cook does rely on some select vendors to produce certain catheter technologies, wires and needles, French said. In these instances, he noted that Cook’s operations and quality teams are closely aligned to ensure that manufacturing problems don’t occur.
“You’ve got to find someone with the expertise to produce what you need,” French said. “But more important, you have to validate that they can do the work in a timely fashion. One thing you can’t have happen is get a vendor on board and then have it unable to produce the product or supply the material for some reason. Cook’s quality is on the line here. When a product goes bad it doesn’t matter who made it. It’s our name on the product, and we’re sensitive to that.”
Although French said Cook keeps growing every year, Bill Cook still comes to work early every morning. With the company’s myriad medical technologies in so many device market segments, continued growth seems inevitable as it keeps penetrating new markets and advancing medical research by providing financial support to universities, hospitals and physicians.
As the first US company to market coronary stents in 1993, one product the company is excited about is its Zilver PTX, a self-expanding nitinol stent coasted with paclitaxel. In 2003, Guidant actually proposed a $3 billion buyout of Cook, though the deal fell through after the stent failed to meet clinical endpoints in the trial.
Although drug-eluting stents are hardly new to the industry, Cook currently is holding a Phase II trial (conducted simultaneously in the United States and Japan, a first for the industry as a whole) to evaluate paclitaxel-eluting stents for the treatment of peripheral arterial disease, a condition that affects 10 million Americans and currently doesn’t have a treatment of this type available to patients.
“Currently, drug-eluting stents are the primary therapy for obstruction in the coronary circulation. And it is hoped similar technology, used in the legs, will help those who suffer from peripheral arterial disease,” noted the study’s principal investigator, Dr. Richard Saxon, assistant clinical professor of radiology at the University of California, San Diego, in a recent press release.
“One of the things we’re doing right now is developing core technologies—based on what might happen to medicine in the future. Our goal is to develop first-world medicine around the world,” French said. Combination products with drug/device and biologic/device design concepts, such as those involving stem cells and biomaterials, are at the forefront of the company’s research at the moment. Describing the company’s pipeline as “very rich,” French said the marriage of Cook’s devices with pharmaceutical products puts the company in a good position for the future.
Although everything scientific is serious business, keep in mind that founder Bill Cook has created a conglomerate that also includes sectors such as real estate and transportation. Well known in Indiana for his contributions to his community, there may be one slight risk of overshadowing all his medical achievements with his latest endeavor. Cook Group has been involved in the preservations of historic French Lick and West Baden, IN, creating a grand destination resort that opened to critical acclaim last November.
Perhaps it will be yet another place to form relationships?