One Year Post-IPO: Transformation in Progress
By: Leslie Trigg
Chief Executive Officer
The past year has shown that momentum is building for a system shift in the long-stagnant dialysis space. Here’s how Outset Medical is uniquely suited to drive this effort forward.
An IPO in the middle of a pandemic? While virtual IPOs are now considered commonplace, when Outset virtually rang the bell on September 15, 2020, we were one of only a small handful of medical device companies to do so since the beginning of the COVID shutdown in March of that year. Uncertainty was high as was curiosity (our own included!) about exactly how well this virtual IPO would work.
Our NASDAQ opening bell ceremony took place via Zoom, in a somewhat surreal, but celebratory “Brady Bunch” moment with the faces of employees, patients and providers all larger than life on the famous NASDAQ Times Square marquee. Although initially disappointed we weren’t able to celebrate this milestone in person, we now look back at our virtual gathering as a benefit. Outset is rooted first and foremost, in community. Community with one another, community with our providers and community, most importantly, with the patients we support. Using a live video platform the morning the stock opened meant that everyone in our community could share in the experience.
Little did we know at the time, however, that this whirlwind week of raising $275M in an IPO would be one of many dramatic moments for the company during the next 12 months. For most of us, the most meaningful successes over the past year were not connected to our public offering, but to the impact we’ve been able to have on patients both in the acute and home settings.
For example, Outset was awarded a second contract from the U.S. Department of Health and Human Services (HHS) to deploy Tablo for preparedness and response to disasters and public health emergencies such as COVID. Our clinical and field service teams supported many hospital personnel, both in the U.S. and in Guam, training them to use Tablo for COVID surge relief. During the Texas snowstorm and power outages this past February, the Laredo Medical Center and Outset teams dialyzed more than 100 patients with Tablo, as featured on the KGNS News.
On another front, enabling patients to dialyze at home, and access the benefits of flexibility, control and autonomy, stands out as another incredibly meaningful achievement over the last 12 months. Hearing from Tablo users that they were able to return to work again and return to activities with friends and family, feeling not like a patient but like a person again, is extremely gratifying for all of us.
We also had the opportunity to deepen our impact on the acute setting of care. Earlier in 2021, we communicated a goal to secure sales agreements with seven of the eight largest national health systems by the end of this year. Our unstoppable team met this objective earlier than promised, in the second quarter. New order placements on the acute side continue to be driven by health systems recognizing the Tablo system’s economic value and ease of use, in addition to their interest in insourcing their inpatient dialysis program to take back control over patient quality, compliance and costs, all critical in today’s environment. We have also made meaningful progress toward another stated year-end goal, to sign agreements with a third of the Top 100 U.S. regional health systems. Our success in adding new customers and expanding within existing customers resulted in more new site installs in the second quarter of this year than in any other quarter in the company’s history.
Enabling rapid growth takes tremendous operational planning and execution as well. In the fourth quarter of 2020, our exceptional manufacturing team met its goal ahead of schedule to begin manufacturing Tablo consoles at our new state-of-the-art facility in Tijuana, Mexico. Our supply chain team performed miracles to help ensure a consistent, risk-protected supply of all components while our quality team worked tirelessly to help ensure the production of our consoles and disposables met industry-leading standards.
None of this happens without the right people in the right places at the right time. We consider our Outset community the best team in med tech and one unified by a collective conviction that patients deserve great, not good enough. Over the past year this team only got stronger, with the addition of new board members—Karen Drexler, Andrea Saia and Katie Szyman—and new executive leaders such as Steve Williamson (Chief Commercial Officer), Jean-Oliver Racine (Chief Technology Officer) and Nabeel Ahmed (Chief Financial Officer).
With all that Outset accomplished on its own the last 12 months, it’s also very clear we can’t create a transformational change by ourselves. Recently, we announced impactful relationships with innovative dialysis care providers to drive home adoption including Moving Health Home and the Innovate Kidney Care (IKC) campaign. Alongside partners such as ASN, the National Kidney Foundation, CVS, Intermountain Healthcare, Anthem and others, IKC is focused on urging CMS to modernize dialysis regulations and eliminate the remaining payment disincentives that continue to mute the pace of home dialysis adoption.
While home dialysis barriers still exist, numerous new tailwinds have emerged at the same time. For example, as of January 2021, CMS’ ESRD Treatment Choices (ETC) Model, which pays dialysis providers more (or less) per treatment based on their growth rates of home dialysis and transplantation, went live as did new eligibility for kidney failure patients to enroll in Medicare Advantage. We are also awaiting word on our CMS Transitional Add-on Payment Adjustment for New and Innovative Equipment and Supplies (TPNIES) application for the Tablo console. We are very encouraged by these and other forward-thinking policies that will serve to incent providers to make home dialysis more available—and enable greater flexibility, convenience and autonomy for patients.
For us, September 15, 2020 was Day One. We were, and are, just getting started. Our ultimate aspiration is an audacious one: to fundamentally change when, where and how dialysis is delivered in order to restore identity, agency and self-worth to patients with kidney failure. Our first year as a public company has given us the chance to get closer to realizing that vision and provided a launch pad for continued learning and significant future growth. Better begins now.
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