Michael Mussallem has been chairman/CEO of Edwards Lifesciences (Irvine, California) since the company's spin-off from Baxter International in 2000. Prior to 2000, Mussallem held a variety of positions with increasing responsibility in engineering, product development and senior management at Baxter, including group VP of its CardioVascular business from 1994 to 2000 and group VP of the biopharmaceutical business from 1998 to 2000. From 1996 until 1998, he was the chairman of Baxter's Asia Board, overseeing the company's operations throughout Asia.
Mussallem recently was appointed chairman of the board of the Advanced Medical Technology Association (AdvaMed) for a two-year term and is a member of the board of Advanced Medical Optics (Santa Ana, California).
He also is on the boards and executive committees of the California Healthcare Institute (La Jolla) and OCTANe, a business development group supporting innovation in Orange County and Southern California.
BB&T: Med-tech is a fascinating business sector, both from the standpoint of ideas and the people behind them. Do you have any med-tech "heroes?
Mussallem: When I think about heroes in med-tech, I think about people who are making an impact in patient care. In many cases, it's applying technology to unmet patient needs. What I'm mindful of right now is that we're celebrating our 50th anniversary as a company, and I'm naturally reflecting on some of the legacy founders just around Edwards.
If you go back to 1958, Miles "Lowell Edwards — the guy who the company is named for — teamed up with a surgeon by the name of Albert Starr and they developed the first artificial heart valve. And we've had the opportunity to work with so many clinicians — and I'll call them our trusted partners — who have inspired us. These are a lot of my heroes, names like Alain Carpentier and Tom Fogarty and Jeremy Swan and William Ganz and Toby Cosgrove.
These are guys that helped us really create this company, and today the 5,600 employees around Edwards continue to try and do the right thing and help patients and transform patient care. It's these heroes that really inspire us.
BB&T: Could you reflect on some of the professional experiences you have had that have gotten you to where you are today?
Mussallem: I joined Baxter in 1979 as an engineer, and I was fortunate enough to have a great variety of different assignments and different businesses, with increasing responsibility during that time. It was everything from manufacturing to engineering and product development, and then ultimately general management.
I had my first shot at general management in 1984 and had a chance to touch a variety of businesses and regions of the world. I even had a chance to have responsibility in Asia Pacific for a while, sort of coordinating all of the company's strategies there. Ultimately, I ended up with responsibility for our cardiovascular and biopharmaceutical businesses, and then, as chairman and CEO of Edwards since our spin-off in 2000.
All of those have been tremendous experiences, so I've grown a lot through my own career. And I also serve on boards that I learn a lot from. I'm on the board of Advanced Medical Optics. I'm on the board of the California Healthcare Institute, which has a uniquely California focus on healthcare, and then of OCTANe, which is more of a technology focus, in Orange County. So I'm engaged.
When I look back at all of those experiences, and think about those that have had an impact on me, I think of a couple things.
One is, just the opportunity to stay in an assignment long enough to have been able to manage through a full business cycle. That gave me the chance to see how the changes that I implemented either worked, or needed more work to improve and really have impact on the business, [that was] was an important experience for me.
The other thing impactful for me was that I had opportunities to step into businesses that weren't necessarily running very well, that had issues. And they offered me the opportunity to jump in as a younger, less experienced manager ... and to take on more responsibility than I might have had and allowed me to gain valuable experience more rapidly than I would have had if I had been placed in an already successful business or a very important initiative.
BB&T: We're very interested in the California Healthcare Institute and the kind of things that come out of it. One of the things I like about healthcare, and med-tech in particular, is that there's such sharing in terms of the organizations that people get involved with.
Mussallem: It's a unique organization in which you bring med-tech companies and biotech and pharmaceuticals and the medical schools and universities together to advocate for intelligent policies. And when they come together in common ground, that group has a very powerful point of view.
BB&T: At last month's AdvaMed meeting in La Quinta, you said one of the priority points of your term as chairman would be to emphasize "a high-integrity agenda. Would you elaborate on that?
Mussallem: Just to put this into context, you can feel that the public just expects more from us as industry today than ever before. We're either expected to be perfect in our work or completely transparent in our shortcomings. We need to learn from our past and get out in front of the public expectations and exceed them.
This is quite the challenge, but we want physicians and patients to be armed with accurate and complete information, so they can make really well-educated healthcare decisions, so my goal as chairman of AdvaMed is to establish our industry firmly as the "white hats healthcare industry that we all know and believe that it is. We have a reputation for being transparent and respected in our honesty and openness; for example, we have this strong Code of Ethics that we have voluntarily adopted, but I think we ought to consider even expanding that code and making it a living document that reflects the elevating expectations.
BB&T: You called for an "activist agenda for AdvaMed. Can you expand on that a bit?
Mussallem: As you know, there are many challenges that our industry and healthcare system are currently facing. There is an unsustainable rate of healthcare spending. We've got non-uniform and inefficient delivery of healthcare. There's a lack of insured patients. And so, as we — the collective we — try to overcome and fix these challenges, there are some pretty mighty forces at work within the healthcare debate, and many that are self-interested. In order to positively influence the outcome on behalf of patients, we need to make sure that we increase our collective industry voice so that we have impact.
To do so, we need to come in with even stronger relationships with stakeholders. If we successfully make the case that we're dedicated to patients and leaders in innovation and we're the entrepreneurs of today and tomorrow in the industry, we're going to be respected for who we are and what we do. We need to be close to those partners, those stakeholders — meaning physicians and patients and really energize this whole industry into action.
I think if we could harness that voice, we could advance policies that are really in the best interests of patients. The key elements of a successful activist agenda are to develop that stronger grassroots capability, where we can really activate our employees, our suppliers, the physician customers and the patients to speak in a single voice and to try and leverage those into our advocacy efforts.
BB&T: You noted that the med-tech industry is blessed with a plethora of young companies that start with an idea. In an interview with the Orange County Register last year, you emphasized the need to reach for new ideas. One thing you said particularly struck me. It was: "You need to be willing to take some chances — that the organizations, the cultures, the people that are most likely to succeed are the people that probably take the most shots on goal. How does that fit with where the industry is headed and, the role of innovation in the healthcare economy?
Mussallem: In general, innovation has a tremendous impact on individuals, their health and their productivity. Being healthy just drives more productivity in this world than most people realize. They take that for granted, but it is our long lives, our healthier lives that are making this world a more productive place.
I like the concept of shots on goal as one of the easy analogies — I think of it almost from a venture capitalist's perspective, because these guys do this for a living. Most VCs would be very pleased if, out of their 40 shots on goal, or 40 companies that they have supported with their funds, if four of them were successful. To make sure that we reward successful technologies is important, because it takes those repeated attempts to make the breakthrough. It's just important to protect that.
The value of technology that's demonstrated on the AdvaMed website really helps communicate the value that we drive. Hopefully, key policymakers and stakeholders have a chance to see the impact that we have on millions of patients' lives. When we think about healthcare economic challenges, a lot of those can be addressed with more technology, not less technology, especially when it's really appropriate innovation. That's why it's so important that government policies and regulations not limit or ration innovation.
It's natural, unlike many industries, that we allow these smaller companies that innovate and add value, to really have an impact on the system and lower the cost and raise the quality of healthcare in America.
BB&T: What are the main challenges that face innovators in the health science, either in terms of entrepreneurship itself or in terms of governmental regulation — or both?
Mussallem: I've been involved in health sciences innovation for a long time and it's a very difficult challenge. I think it's even less predictable than it is in other industries. It's very complex, and on top of that, when you consider the fact that medical technology is highly regulated, so then to have a success, you also need to work closely with the regulators, such as FDA, or with the reimbursement authorities to ultimately have a win.
So by its nature, the odds are against you when you begin the process of innovation. And that's why the regulation needs to be thoughtful. Certainly we believe in a very strong and healthy FDA. It's good for our industry and it's good for the patients that we serve.
That's why when we get into these discussions about funding for the FDA, we very much support greater funding because they have a tough job. They have to keep up with the task of protecting the health and safety of the public, and also keep up with today's pace of very rapidly evolving technology. And it's a huge challenge.
When you couple that with the increased demands of a more educated public, they need the resources so they can be reliable and thorough, but also responsive.
BB&T: At this year's AdvaMed meeting Dan Schultz's [director of FDA's Center for Devices and Radiological Health] presentation was interesting. He's very calm about presenting his priorities, and recognizing that you only can do what you can do, given the funding that you've got. I always like his presentation at the AdvaMed meetings.
Mussallem: I do too. He has been around a while, and he has a good perspective. It must be tough for him to remain calm when [the FDA is] under the pressure that they're under to deliver.
BB&T: If you could make one change in the current U.S. healthcare system, what would it be?
Mussallem: If it was just one thing, I'd say I'd go after access to healthcare, to make sure that all Americans had access to high-quality, affordable healthcare. As a matter of fact, I'd like to see it for all the citizens of the world. It's relevant for our industry, because medical technology companies are creating new life-saving, life-enhancing innovations every day, and we just believe that patients should have access to them.
If healthcare reform could have an answer for this problem of access while they're solving this, it's important. That's why it's so critical for us to be involved in this debate, to help demonstrate ways that we can do both.
BB&T: There's a perception that AdvaMed is a "big company organization, but you noted in your talk at the annual meeting that in fact, 75% of your members are small companies. To attract new members to AdvaMed, what are your main "selling points?
Mussallem: AdvaMed provides different advantages to large and small companies. I really believe that our strength is our diversity. The small companies benefit from the larger companies because the larger companies come with a global footprint — they have well-funded advocacy efforts, they have relatively vast resources and experience. As we engage in the debate to ensure that there is a healthy environment for innovation and technology, and that patients are not disrupted by all that burdensome bureaucracy. So it's a big plus that small companies can ride on the coattails of those larger companies.
Conversely, the larger companies benefit from smaller companies' entrepreneurial spirit and their new products that are so valued by the policymakers. The sheer volume of small companies is a significant benefit, as we're able to impact policy with our strength in numbers — just the broad representation of public interests that are out there.
Small companies are just popular. They're the source of job growth, the source of economic development. And it's a bit of the American way. It's the little guy, it's the underdog, and those personal success stories where somebody start with an idea and ultimately touch lives around the world is just very powerful. When you bring that together, it's just easier to get a seat at the table with this large, diverse group, and it makes our voice more substantial.
BB&T: Wrapping up, is there any one question I haven't asked you that you wish I had?
Mussallem: I would just say that I am very proud to be the chairman of AdvaMed. I love my job [at Edwards] — it's my primary focus on a day-to-day basis — but at the same time, I care about our industry, and I'm honored and proud to be chairman of AdvaMed.
It's a unique opportunity for us to make sure that technology and our innovation has an opportunity to impact lives, and I take my current assignment as energizing.