Ophthalmology off the Grid
Episode 15

Building a Premium Practice

Gary Wörtz, MD, speaks with Jeffrey Machat, MD, and Joel Gaslin, Executive Vice President of Sightpath Medical, about ways in which surgeons can differentiate their practices by going premium. Dr. Machat describes his experience implementing a new offering for presbyopia correction, and Mr. Gaslin shares strategies for investing in and incorporating premium technologies.

Gary Wörtz, MD: Open, outspoken, it's Ophthalmology off the Grid, an honest look at controversial topics in the field. I'm Gary Wörtz.

In this episode of Ophthalmology off the Grid, I kick it off with an interview with Dr. Jeff Machat, where we talk about inlays. The AcuFocus Kamra inlay is now approved for use in the US, and Jeff helps us separate fact from fiction when it comes to the capabilities of this new technology.

Jeff Machat, MD: It's really hard to imagine any practice today, in the US or Canada, that is not looking at the presbyopic patient group, the demographic, and saying, "I need to have a plan of how I'm going to manage these patients."

Gary: He’ll also help us identify the best candidates to start treating with this device. Later, I speak with Joel Gaslin of Sightpath Medical about making smart investments in technology for our practices.

Joel Gaslin: Just think about a femtosecond laser for cataract surgery. Let's face it, they're Ferraris and they do have speed bumps sometimes.

Gary: Listen in, it's going to be a great episode.

Speaker 4: Ophthalmology Off the Grid is an independent podcast supported with advertising by Alcon.

Gary: This is Dr. Gary Wörtz with Ophthalmology off the Grid, and today I have Dr. Jeff Machat with me from Toronto, Canada, and Jeff, I just want to say thank you so much for taking a little bit of your time to talk to us about inlays today.

Jeff: Absolute pleasure, Gary. Thanks for inviting me.

Gary: Absolutely. Jeff, in the United States, we finally have an approved device, we have the AcuFocus Kamra, and a lot of folks don't know if we should be ecstatic, hesitant, should we be excited, should we be scared? Now's the time where we really start trying to figure out fact from fiction. Is this something that we should be putting in our tool belt to offer to patients? Should we do that full sail, are there certain patients who aren't good candidates? We really want to figure out what's the low-hanging fruit with this technology and what kind of patients should we be starting with, perhaps, if we're going to start a program for inlays in presbyopia correction.

With that being said, tell us a little bit about your experience. I know you have this personally, one of your optometrists has this, you said other people in your practice. Clearly this is a technology that you have embraced, sell me on why I need to embrace this as well, because I'm really excited about the potential for a device like this.

Jeff: Yeah, absolutely, Gary. I'll tell you what's interesting: I was the patient. I turned 50, I was that person who needed more light, arms were too short, which is pretty common for me anyways, and I said, "I need a solution." It was my 25th year of refractive surgery, so multifocal ablations, laser thermokeratoplasty, scleral implants, I mean I pretty much tried everything.

Then it was my turn, and I had to figure out, and I looked at all the procedures out there and I said, a corneal inlay, the additive type of refractive procedure, made the most sense to me. I was not ready to have an RLE. I didn't want to have a fully invasive procedure because I saw that the IOLs were improving so rapidly, and so I wanted to buy time. It was that simple.

I look at every single patient that walks through the door in the exact same way, and I try and figure out, so who's the best candidate for this? Typically someone who has maybe plus 1.50, 2.00 D of hyperopia or someone who's had LASIK previously. They already know refractive surgery works, they already believe in you, they've gone along and had 15 great years, and, all of a sudden, they can't read, they need glasses.

Those are the top two groups that we treat, but you absolutely have to make sure of two things: one, their tear film is good, or you have to optimize it, and, two, you absolutely need these patients to have a clear lens. You need some way of measuring optical scatter, and those are the two big criteria that we have.

Gary: Okay, well that kind of brings me to a next critical part, which is the HD Analyzer. It seems like maybe perhaps in the earlier days with AcuFocus previous to having the HD Analyzer, maybe it was a little tougher to figure out, does this patient have a little bit of NS and that's going to perhaps cause a little bit of problem or how do I get this centered exactly where I want? Talk me through how the HD Analyzer maybe has helped as maybe you've had experience both before and now with the technology.

Jeff: Yeah, so I had my eye done I guess it's almost 4 years ago, 3.5 years ago now. We started with the AcuTarget, and frankly, the AcuTarget and the AcuTarget HD Analyzer are two separate instruments entirely. They're developed by different companies and they actually work completely differently. The HD Analyzer has some very unique features. It's amazing to be able to determine the clarity of the lens, is there optical scatter, how good the tear film is, dynamic tear film testing, what's the accommodation range like on the patient now and then postoperatively, and then of course it tells you where to place the inlay and then postoperatively assesses it. Five functions.

It's the visual function analysis of the lens and the tear film that make it our go-to device on every single patient that walks through the door to decide, do I do a corneal-based procedure or a lens-based procedure? It may share the same name as the original one, but it's a completely different machine.

Gary: I think that's a great distinction for people to know that the technology has not just iteratively become a little bit better, but they actually have changed full sail the way that the technology works and what it, the information it's giving you. It really makes sense to me that you want to have a machine at your disposal where you can fair it out whether you should do a corneal-based procedure or a lens-based procedure.

I'm not doing inlays yet in my practice, it's something we're evaluating, just like a lot of practices right now, but we kind of do the same thing when we have patients come in who are perhaps post-LASIK, and they want an enhancement or they want something done, they want to see clearer. And we are trying to figure out, all right, is this coming from maybe some regression of the LASIK, or is this coming from something going on in the lens? With our OPD III that we have, it's really good at telling us, all right, these are the aberrations in the cornea, here are the aberrations in the lens, this is what it looks like if you put them together, and it really helps us determine whether or not we want to go and do a LASIK or a surface ablation enhancement, or if we want to go ahead and do a lens-based or dysfunctional lens replacement type procedure.

I can definitely hear what you're saying from that standpoint, that it's got to be very nice to have a piece of technology that really simplifies who is going to perhaps do well with one procedure versus the other.

Jeff: We have an iTrace as well, and we use it for the exact same purpose. It's really hard to imagine any practice today, in the US or Canada, that is not looking at the presbyopic patient group, the demographic, and saying, "I need to have a plan of how I'm going to manage these patients," and therefore you need a piece of technology that helps you.

Gary: I 100% agree, and we got our OPD fairly recently, but it was just because we realized that there was a number of patients coming in for LASIK screenings, and they were 55. That's a really tough age group to know, you know, because you look with a slit lamp and you maybe see a little bit, and you're trying to convince yourself that it's clear if you want to do LASIK or maybe it's a little bit more opaque if you want to do cataract surgery. You kind of play mind games with what's going on, but it's really nice to have objective data to really help drive you in one direction or the other.

Some other things that we've heard, perhaps that some patients maybe earlier on had some issues with maybe either corneal thinning or progressive erosion perhaps, the long-term need for steroids. I'm sure that's got to be very individualized, and we know it's not common, but can you share anything with us about how do you maybe minimize that if you're just starting out or even, in general, in the population? Any way to minimize that?

Jeff: Well, let's take a step back, because it's so interesting, where I'm at all these different refractive surgery meetings and people will start talking about corneal inlays, and there's so much misinformation. Just like the AcuTarget has taken this quantum leap towards the AcuTarget HD and it's a completely different type of unit, the Kamra inlay procedure has really changed. If you look at what they're doing in Europe and where a lot of the problems came from, or even the FDA trials, we've had some very significant learnings.

First of all, even when I began, which was 3.5 years ago, right after I had my own eye done, number one was, at that point, we were using 200-micron flaps and implanting the inlay under that. First of all, much more dry eye, much more wound healing, which means much more hyperopic shift, much more haze, much more fluctuating vision, much slower visual recovery. When we switched to pockets, that all changed. It changed dramatically.

The second thing we learned was that when you start to look at the FDA trial results, you realize that the type of femtosecond laser and the settings that you had also change things dramatically. When they stratify the data based upon which femtosecond laser people were using and what settings they had, and most people just used whatever they used for LASIK, it makes a huge difference. You're seeing through a 1.6-mm aperture, and you need to have an incredibly smooth bed. It will definitely have huge effect, just like any lens aberrations.

People who had their settings of 6-6 or better, or tighter, did a lot better than people who used 9-9 or 8-8. There was a very significant difference in the clinical results, and Ziemer, which is what I use, which has an overlapping raster pattern with low energy, had even the best results. We really saw a difference there, so what has it told us? It told us that, right now, you have to have pocket software, you want to use the IFS or the FS 200 or the Ziemer, you want to have very tight raster patterns, so 4-4 is probably what I would recommend to people today, so you have nice smoothness. We're typically going minimum 200 microns to 250 microns. In fact, 250-micron depth is my go-to.

Right away, the whole issues with melting, I haven't seen it, I haven't even heard about it in anyone that's doing that. Only when they were using flaps that were about 170 or less.

The other thing that we learnt from the FDA trials is, two-thirds of the patients were +0.50. The people who saw the best were actually the people who were -0.50, -0.75. In my personal practice in Canada, we do LASIK, even if they're +0.25, and we make them -0.75, and then a week to a month later, I'll make the pocket and insert the inlay.

Gary: As I'm hearing this, it sounds like there's been a big learning curve, there's a lot of things in the procedure that what was done early on maybe is tainting people's perspective of what can be delivered now on the other side of this learning curve.

Jeff: Right. And the fourth, and just to add to that, is the HD Analyzer. We can now really tell if it's centered. In the original unit, I would have a patient take three readings, and the inlay would move, which clearly it wasn't. Whereas now, I actually know where the inlay is, we've learned a lot. We also know people tolerate a superior decentration much less than an inferior decentration.

We've learned a lot of different things in terms of how people are. Explant rate is 2% or less globally. It's not 10% or 25%, as people talk, if people are using the latest approach and technique. In my practice, I mean, we've done hundreds of them, and it's rare for people not to be happy. I'll tell people though, look, only about 20% of people get this overnight vision miracle like LASIK where they can read, and I was one of them.

Sondra Black, my clinical director, it took her about 6 weeks, and that's more common in females with a compromised tear film to take longer. We put collagen punctal plugs, 3-month plugs, in everybody, and we use Restasis in 100% of females and about 60% of males. We're very aggressive with our tear film management, with meibomian gland dysfunction management, really trying to optimize these patients, but we have really happy people.

I would say 80% of the patients that I treat are super happy; about 18% are happy, they would never want it removed; and about 2% will fail. They never neuroadapt, it never connects with their brain, they just can't do it, or they develop haze that is not treatable with steroids, and that's pretty much it. It's overwhelmingly, people are really happy, really excited about it, it's been a great addition to our practice, and it's increased our RLE practice four-fold.

Gary: Wow. Because you've got patients who are sort of giving, you're giving them options and you're talking to them about this or that and some may vote for one or the other.

Jeff: They come in for Kamra, they're all excited, you use the AcuTarget HD Analyzer, you see that they have lens aberrations, and you go, "Okay, look, this is where your problem is, we're going to have to do a lens procedure, not a corneal procedure," and they go, "Okay," and they immediately understand that.

Gary: Yeah. Well, I think you raise a lot of very interesting points, and I tell my patients that my success rate with cataract surgery exceeds 99%. I tell them also that in medicine, nothing is 100%, so when we talk about new technology, we talk about efficacy. I think that if you can get to 98% of your practice, and I believe you, you're sitting here telling me this, I have no reason to doubt you. I believe that that's achievable, and so if we could use the right settings on our laser, if we can select the right patients, if we can do the right corneal based procedures and stay away from those patients who have perhaps the lens-based refractive problems.

I think 98%, it's really hard in a refractive market, in a refractive technology, it's really hard to get beyond 98% because your margin is just so low. I also tell my patients, "You see with your brain. Your eyes feed your brain the information, and we're making some aberrations or we're changing some things." Any time we do surgery, whether that's an inlay, whether that's LASIK, especially with multifocals or torics, we're changing the way they were designed to see in some way, shape, or form, and it does take a little bit of time for them to adapt to that.

That's actually very encouraging for me to hear that, that you're having this much success, that you are a patient, not only a doctor who is doing this, you've had it done yourself and you're enjoying it. I've actually listened to your optometrist, Sondra, and she always says that you were the worst person to have an overnight wow effect, because she didn't have that result, but she's great to talk to the patients, to set them up, that this is likely going to be a journey and that at the end of their journey, they're going to be very, very happy.

One other question, real quick, is when you do LASIK, I assume you're doing probably like a 110 flap, you're doing a thin flap LASIK, or are you doing surface ablation with these patients, prior to their inlay?

Jeff: I'm a firm believer that LASIK is the way to go. I know some people have done PRK Kamra; I'm not a subscriber to that philosophy. Their philosophy is basically, well, you know, most people are going to be blurry for a month, they're going to need lots of drops, do it all at once, have a single interface. My belief is that it's the central part that the patient is looking through, and that's going to be the last part of the epithelium to smooth out.

I like LASIK because I can always lift that flap and enhance if I need to; I know exactly where I am with my target refraction; I'm not stimulating keratocytes, which could then develop more wound healing effects; and it's worked really well. I do LASIK, the next day the patients are, "Wow, this is amazing." Then they come back a week later, I do their Kamra, and I say, "Okay, this is going to be different." They already trust me now, they believe in me, I say, "This is going to be slower. If you're in the 20%, you'll heal fast. If you're in the 80%, you'll heal slow." It buys that trust.

Gary: I think that's such a huge part of this. LASIK is so nice because it's relatively pain-free, like you said; patients get that wow factor; and it's the building blocks of trust, right, a nice foundation from which to build successive procedures upon.

I think that, as I'm sitting here kind of thinking about this myself, if I were the patient, I paid a lot of money, went through a big procedure, the next day I wake up, my eye is in horrible pain, and it's going to be awhile before I see well, and I'm already starting to think, "What did I get myself into?" You can start playing those mind games with yourself and really wonder, "Did I get ..." You know, if you start being negative, then everything ...

Jeff: From a marketing perspective, all their friends are calling them.

Gary: Right, exactly. Really, I agree, you really want them to have positive experience upon positive experience. That's I think very good medicine, and I think it's also great from a business and branding and marketing perspective, too.

Jeff: I tell other surgeons the same thing that I went through myself. I say, "Look, corneal inlays are in their infancy. We are just introducing this as part of our refractive armamentarium. It's going to get better. We're going to learn more, our techniques are going to get better, our results are going to get better." A lot of people do like three or five or even 10, and they think that they've learned everything. At 100-plus, I'm still learning, 200-plus, I'm still learning. Just like with LASIK, it's not the first handful. I tell them, "You've got to do 30 or 40, then you start feeling comfortable." Now I do it, it is so easy, it is so quick, it is so much fun, it's a great procedure, and we're going to have more inlays and more choices, and you've got to get involved now because it's only going to build on what you do.

What I like about the Kamra, very simply, is I'm binocularly balanced. I still have great stereopsis. I haven't given up distance vision to gain near. I went back and did surgery within 3 days of leaving Japan, and I don't have any spot that I can't see. So I see distance, intermediate, and close. Since I had it 3.5 years ago, my right eye has gotten worse, more presbyopic, and my left has stayed J1+.

Gary: That's awesome.

Jeff: It prevents the progression of presbyopia from affecting you, as any refractive inlay would do. There's a lot of different reasons and, number one, so it didn't work for me, take it out. We've had patients, didn't work for them, the brain, they had more glare, they couldn't get adjusted to it, we took it out, we did an RLE, they were happy. You have all the choices in the world.

Gary: Talk to me a little bit about haze. I guess that would be the one area where I'd feel like, you know, we always like to operate under the do no harm mantra, and, at what point, if you start seeing haze, I know it's rare, especially now …

Jeff: It’s 4%.

Gary: It’s 4%. If you start seeing it, is it just more aggressive steroids to start? Have you been able to rescue people that way? Or, when you do, if you do have to explant, what are you doing to try to minimize haze or make that haze regress, if possible?

Jeff: Right. I think of it like the early days of PRK, the old Summit UV 200 excimer laser. You know, it didn't matter what you did with steroids, the point was there was a small percentage of people who would haze up. It was just the nature of the beast. You would literally over-treat most people just to catch those people, and you'd have people who stopped their drops after two weeks, non-complaint, and they stayed crystal clear. You had other people that used them for 6 months and they still developed haze.

This is similar. But 4% of people will do it, we don't know who is the 4%. Once you see it, once it develops, they start to become hyperopic. That 4% will suddenly come in, and they don't say, "I see hazy," they say "My reading vision has gone down." You take a look, and you see. Hmm, haze. You put them on steroids. We usually will hit them hard for 2 weeks, pred forte four times a day, for 2 weeks, and then reassess them.

If they improve, typically they'll come back and they're back to J1, J2 and they're happy and they're myopic again, everything is great, then just slow taper off. If there's no improvement, then you're done, it's not going to help. About 75, 80% will respond, okay? If you get to them early, they will respond, you taper them off, they'll stay quiet, and I've had people stay quiet for years after. It really does work again.

Now, if they develop a haze and it doesn't go with steroids, then you have to take out the inlay right away, because it acts like an -itis, it's not going to disappear, and that's it. Then you can let it all settle down, the haze will disappear over time, but just like a PRK haze, it takes a long time, like a year-plus, and you could always stick another inlay, you could go at a different depth, which I've done as well, or you could look at another procedure like an RLE. I've never had anyone lose BCVA from that.

Gary: I think that's a really key point. If you're looking, if you're following these patients, it's not to say that it's untreatable. You look at them, if they develop haze you treat it, if they're not getting better you take out the inlay, and it gets better over time. Those are all things that are really music to my ears, as I'm one who's kind of thinking, "What am I getting myself into? Am I going to cause headaches for myself?" The reality is ...

Jeff: I'm going to interview you next time.

Gary: Okay, yeah. That sounds good, I'd love that. As we have patients who are presbyopic, they're so motivated, they want help, they want us to be able to provide the best for them, I'm really enjoying my multifocal practice, which is something I never thought I would say because of the new low adds I'm using. I'm really having a blast right now taking care of presbyopia because patients really value the correction of presbyopia, and I know I can just tell from what you're saying that this is a part of your practice that you really enjoy.

Jeff: Yeah, we use a lot of Symfony, the extended range of focus lenses are huge, and Symfony and the IC-8, which is the Kamra inlay in an IOL, that's the future. Patients are really, really happy going down that line, but the low adds, I'd say that's probably 70% of our practice now, either in combination or alone. It's incredible.

Gary: Well, Jeff, thank you so much for giving us all of your insights, not only as a physician who's doing this, but your own perspectives as a patient. These are the real pearls that I want docs out there to understand, to know and I just really find it valuable to have these conversations and hopefully others will as well, so thank you.

Jeff: No problem, my absolute pleasure Gary, thank you.

Gary: Okay. This has been Dr. Gary Wörtz with Ophthalmology off the Grid.

Technology is changing quickly, and that makes it difficult to decide which platforms we should invest in within our practice. I had the opportunity to speak with Joel Gaslin from Sightpath Medical over Skype to learn more about their services and how they work to provide access to high-tech platforms for all physicians and patients in a cost-effective way.

Today we have with us Joel Gaslin with Sightpath, and I think many of us in the ophthalmology world are familiar with Sightpath and the other variable access technology platforms that are out there. Joel, I just want to say thank you for coming on and giving us a little bit of a rundown of the value your company can provide to surgeons who are maybe looking to dabble or looking to gain entry into the either femtosecond laser assisted cataract surgery market, maybe bladeless LASIK, or maybe even some of the other services that you provide.

With that being said, just want to say thank you for coming on, and why don't you give us a little bit of an overview of the services you provide and where you see that adding value.

Joel: Thanks, Gary. Grateful to be here. Appreciate the time and the opportunity to visit with you for a little bit. Sightpath is, as you alluded to, thank you, the market leader in variable access to really what we call our three primary platforms. First is cataract surgery, which is our largest segment, where we operate in about 425 different sites around the country, where we provide full access to everything people need to do cataract surgery, which really stem from the founding belief that care closest to home is what's best.

Evolving from that was next our LASIK platform, which we operate in about 250 sites around the country with full access to the excimer laser platforms we use, and then the femtosecond laser is the intro laser we used for that. Then we have our nicely growing segment is our femtosecond laser for cataract surgery business where we bring the LenSx lasers from Alcon into facilities and it travels with an engineer so it's always up and ready.

As you alluded to also, there is no capital outlay with working with Sightpath. We realize we're a service company, and we have lots of different ways we do business and we really just try and find unique ways to help people meet their goals and be profitable from case one.

Gary: Yeah, and honestly, I've used Sightpath in the past, and companies like yours, in many ways, they allow the solo guys or the small guys compete with some of the bigger guys that are out there. I've kind of been on both sides of that coin, I find myself in a center now where we actually end up having a lot of the technology at our disposal in our surgery center and in our clinic.

I'm kind of on the other side of that coin now, but I recall when I was in solo practice and going out into the hinterlands of Kentucky, I wanted to bring some of the high technology to my patients, and it really wouldn't have been cost effective for me, especially given that I had multiple locations, to for example, purchase an excimer laser for each location or purchase a femtosecond laser for cataract surgery for each location.

Honestly, even just bringing phaco equipment and a technician and a microscope can be challenging sometimes, so I really feel like your company has provided maybe the little guy or the guys who are out there trying to make a difference in some of the smaller markets, or someone who's up and coming, you really allow those guys to have access to technology that maybe they wouldn't otherwise have. I think that's really important, I think it really levels the playing field and allows people to gain access to that technology even if they're not at a large center.

Joel: You're right, Gary, that's typically how people have thought about Sightpath, and if I may be so bold as to suggest sort of a changing megatrend in our business, is that you can almost ... I really think about Sightpath almost like software as a service, and if you think about how that technology has evolved over time. We used to buy a box of software, you'd plug it in and then go about your business and really, Salesforce was the first sort of multi-tenant solution software platform that came along where people said, "Hey, I'd rather just have somebody else deal with this continually changing technology, upgrades, all things that come along with that."

While you're absolutely correct, we started in sort of small markets, I would say we ... that's still the bread and butter of our business, we really see a lot more, we're in the sort of the I would call it mid markets even, we work in some really big centers, like we've just begun working with the entire Emory system, where people are just saying, "Hey, ophthalmology changes so fast, there's so much happening and Sightpath can manage all my maintenance agreements, they can handle all my supplies, they have expert technicians that stay up to date on all the latest trends, do a lot of work," we have backup staff, redundancies, all the stuff that they need that they don't really want to deal with.

We're starting to see that as, especially when you introduce femtosecond lasers for cataract surgery into it, with a lot of the big hospital change and things just saying, "Look, we don't want to deal with that piece of equipment." It's really a nice place for us and really is, I think, an interesting trend in our business and if you sort of look down the line, depending on where you sort of fall on the camp of office-based cataract surgery, that really makes it interesting for a Sightpath model, where you can just have it there for a certain period of time, then it moves out, you can take that space and use it for something else, and ...

Gary: It sounds like you guys have really sort of tried to create the easy-button solution.

Joel: Yeah, exactly.

Gary: There's so many headaches that we have to deal with, and you're exactly right, sometimes you feel like investing in a technology and by the time it gets physically in your location, something better has already come out.

Joel: Yeah, you're right. If you think about, just think about a femtosecond laser for cataract surgery, whether it's LenSx or whatever. That's a very sophisticated piece of equipment and while, as you suggested earlier, if you have a big center and you've got multiple staff redundancies, people who are interested in dealing with a piece of equipment like that, it's pretty easy for you to start going along and using it.

What people really appreciate about our service is that engineer who's there and knows how to clear those error messages that invariably come up with software, is comfortable doing that, that day to day and just that's all they do, they really love having that person there. It's also the fact that they're manufacturer certified engineers, so they can take that piece of equipment apart, they can put it back together. Let's face it, they're Ferraris and they do have speed bumps sometimes. Having that sort of belt and suspenders approach of a guy that travels with it is frankly what people really like about our service.

Gary: I think you're exactly right, and I can speak to that personally. I was doing LASIK with Sightpath a few years ago, and my volume wasn't really high, so I was doing LASIK maybe once or twice a month, but it made me feel very comfortable having a technician who, he knew this laser like the back of his hand. If there were any errors that came up, anything that was maybe something that I had a question about with the functionality of the laser, with calibration or other issues, I got to tell you, this guy knew his stuff backwards and forwards.

Honestly, I walked in to the laser suite without a lot of anxiety because obviously I knew how to do my part well, but that anxiety you have about what if there's an equipment malfunction or what if things don't go the way they're planned? I knew that I had really good backup with someone that was very knowledgeable about the equipment.

The other piece of that is if you're doing procedures on a variable basis, maybe once or twice a month like that, it really doesn't make a whole lot of sense to tie up an entire room and beyond that, having a laser that's sort of with a dust cover on it 80% of its lifetime.

Joel: If you ... I've used the phrase with people that Sightpath is sort of Geek Squad meets Uber, a little bit, right? We have sort of on-demand, and then we have this person who comes with it and interestingly, if you look in our society right now, there's a big trend towards underutilized capacity. I was at a, if you're familiar with the Geek Squad at all, it was founded by a guy named Robert Stevens, who's from up here in Minneapolis.

I happened to be at a conference where he was speaking the other day, and he was talking about, that's sort of his next sort of frontier that he's working on is this notion of tapping and accessing and monetizing underutilized capacity. If you think about it, that's what Uber is, and there are lots of things happening, so we have all these lasers that sit around in places and they work maybe one day a week or two days a week.

Really what Sightpath does is we take that capacity and unlock it and make it work all the time. It's a little bit of a, maybe sort of a green egg a little, what we do as well.

Gary: Sure, no I think that's really important. Our economy is always moving and people are always looking to figure out new ways of changing business models, but I really feel like the value that you provide is, like you said, is honestly, I've always thought about it in the sense of a smaller market, but you're really right, I think you guys are providing value, probably across the spectrum.

Joel: Another place we find, even in sometimes bigger centers or I would say sort of medium-sized centers, especially with femtosecond laser, is that proliferates. Sometimes people just want maybe one extra day a month or one extra day a week to, I call it kind of a pressure relief day. You may have a doctor who would bring more cases or would maybe be a little more efficient if he had another room, so we bring in a full room of cataract surgery equipment and instruments and a technician or femtosecond laser. Just something to one day a month be able to say, "Hey, Dr. Wörtz would really love to have two rooms that day," or three rooms, or whatever the case may be. We're seeing that pop up a lot as well, a lot, too.

Gary: Got you.

Joel: Just another trend out there.

Gary: Yeah. One other thing I've encountered in the past, and maybe you can speak to this a little bit, is sort of the idea of volume minimums. You all have to make it worth your while to bring technology, because if you're bringing it to one center, that means you're not at a different center. Talk to me a little bit about the volume minimums and ways you help doctors be able to pool their patients to come in on one day rather than trickling in on multiple days.

Joel: Yeah, our pricing is pretty straightforward in that we're, as you suggest, we're a stop-based business. What that means is we really incur our costs when we stop. Whether it's a hotel expense, fuel expense, install the lasers or the equipment or whatever the case may be. When we incur those costs, the more cases we do, the more efficient we do.

We usually, we feature what we call tier pricing. The more cases we do throughout the day, the more efficient we become and we share that with the facilities. From a pure minimum standpoint, you're absolutely right, there is sort of a Mason-Dixon line of where we have to make a certain amount, otherwise we're losing money when we show up, and that's generally about six cases.

For a LASIK surgeon, you say, "Okay, that's three patients, I can generally muster three patients a month." People find that that's not too hard. On the femto platform, as we are, for cataract surgery, we're starting, we're in the six to eight range, I can tell you across our fleet of 31 lasers that we have an average per stop of about nine, and we've got some that do some really high volumes and some that kind of stick around seven to ten. That's sort of where we're falling right now, and that's how we model the fleet out.

We're running now on the femtosecond laser for cataract surgery at a run rate of about 1,600 cases a month and we've done almost 40,000 procedures now, so we've got a lot of experience on that end. Those numbers kind of stay ... Those work, I can tell you that those low numbers were not super profitable, we believe, especially on the femtosecond laser for cataract surgery, we believe if we make the investment, which we have, in the fleet, we believe that the technology will proliferate in the market and ultimately we'll grow with our physicians. Our hope is we get more profitable as they get more profitable, and it seems to be bearing itself to be true.

Gary: To that end, it seems like whenever a new device comes out, it always requires potential capital outlay for other devices to use it. For example, the AcuFocus Kamra is a new corneal inlay that's been approved and recently I think Raindrop has been approved by the FDA, so as a refractive cataract surgeon, LASIK surgeon, someone who's interested in presbyopia correction and these new technologies, we already at our facility, own two femtosecond lasers. One for LASIK and one for cataract surgery, and now the question is if we get into the business of doing corneal inlays, unfortunately neither one of our femtosecond lasers has a upgrade for pockets.

We're sort of going through the calculus of all right, what is our capital outlay going to be and would it make sense to buy another femtosecond laser, and that's really when I started kind of thinking, you know, maybe Sightpath might be a solution before we go full Monty with inlays, maybe this would be a solution for us to try it out, see how it works on the patients that we're considering, without having to incur the expense of a brand new third or replacement second femtosecond laser.

As we had talked offline a little bit, it sounds like your fleet of IFS lasers, some of them have already been upgraded, or actually, a fair amount of them have been upgraded to create pockets. Tell me a little bit about that side of the business as well, as that's kind of a new place for the business to go.

Joel: It is a new segment of the business for us, and we ... As you mentioned, we did talk a little bit about that offline, and we own 17 mobile interlays units, of which about 40% are upgraded to IFS, and the others are 60hz, simply because they work fine and as you mentioned, too, it's an expensive upgrade, to upgrade that equipment. What we find is that from the, at least initially in the market, the Kamra procedure itself, you know, our business works, Gary, when we have some volume to the procedure. When we start having to come and do one and two procedures, it just doesn't work that great.

I would say, we opportunistically upgrade the lasers. If we are in an area and our rep comes across an opportunity that says, "Hey, this guy, it's a new client," or to sort of add value to a current client, we really look at, "Okay, so can we help some other people get started on that?" We also talked about the AcuTarget device, and at least at this point, when we first started talking to AcuFocus after they gained approval from the FDA, they didn't want us to mobilize that AcuTarget device and our EDP of operations, Dan Robins, the guy who's been doing this for 18 years, and he and I looked at each other and he kind of chuckled because we mobilize many wave scans. I mean, I think we mobilize 35 or 40 wave scans, and it certainly can't be any harder to mobilize than that.

We believe we could if given the opportunity to do it, but again, it's just, it sort of gets down to economics, because we don't really know where the technology is in that market right now, we try and be early in the market, yet we really can't be first, because we want to scale it nationwide. There's a tremendous amount of risk in doing that, so while we are ... We understand our position in the market, and we are in a bit of the risk mitigation business, we're also, you know, we're not State Farm either. We try and balance it, does that make sense?

Gary: Yeah, yeah it does. I will say, though, as sort of on the physician side, I do think having access to an AcuTarget HD and a mobile platform as well as an IFS, that would really be a nice solution for guys like myself who are maybe looking to get into the market, prior to making a really large capital investment. That may be something for you and for them and I know Jim Mazzo, he's a great guy and they've got great leadership over there, so not questioning what their strategy is, but as we all look for opportunities to make a difference, that may be something that down the road, becomes an opportunity for all involved. I think that's something to probably have an active dialogue going forward, I think it's potentially a good idea.

Joel: I appreciate that, you're right, and they do have good leadership and they are frankly a lot different than anyone else, they have a unique position in the market, they're a first mover and they want to move whatever they can to fully optimize their opportunity, I completely understand that.

Frankly, we've had sort of the same discussions with the Avedro folks on corneal crosslinking. We're kind of in the same place there, and that's another, and you didn't ask me about that, so we don't have to talk about it, but that's another sort of technology. We had a lot of people come by and ask us if we were going to get into corneal crosslinking, and we just don't know at the time, frankly, right now.

Gary: Sure, sure. Well, this is an exciting field that's always growing and with these new approvals, like you said, with crosslinking and with the new inlays, it wouldn't surprise me if we had a conversation in a year or two and you do offer those services.

Again, I think the more services you can offer, the better, from the physician's standpoint, but we understand that it is a business, you got to make sure that it makes sense and you've got to have buy-in from the companies who are going to be helping you mobilize those devices.

Well, Joel, I really appreciate all of the information that you gave us. I think your company really does provide a lot of important access to technology, that's why I wanted to have you on. I think it's important for ophthalmologists to know that maybe just because they don't have technology in their office, it doesn't mean they can't have access to it, and the more access we have, it really is kind of like the rising tide floats all boats.

Joel: That's great.

Gary: Thanks again for coming on.

Joel: Well, thanks for having me on, I appreciate you taking the time and the folks at BMC for the work you do, and this was a great idea. I love podcasts, they're easy to consume and a good way to get more information on something.

Gary: Absolutely, it's nice to listen to to and from work, isn't it?

Joel: I do it when I'm on the Stairmaster in the mornings.

Gary: There you go, there you go. Well, thanks Joel.

Once again, this is Ophthalmology off the Grid, with Dr. Gary Wörtz.

Thanks for listening to this episode of Ophthalmology Off the Grid. Send us your thoughts on this episode by tweeting @eyetube.net or emailing us at OOTG@bmctoday.com. Until next time.

Speaker 4: Ophthalmology Off the Grid is an independent podcast supported with advertising by Alcon.

10/31/2016 | 44:56

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