Ben Burton, president and CEO of iuvo BioScience, talks with us about his five-year strategic plan, targeting aggressive growth both organically and through mergers and acquisitions. The acquisition of Moog’s laboratory services business and recent divestiture of iuvo’s sterilization facility, LINK, in Erie, PA, will allow the company to focus on investing in expanding testing services.
Ben spent more than eight years at Bausch + Lomb as vice president of quality for its pharmaceutical business. We had the pleasure of tapping into his thought process on acquisition strategy—considering both cultural and branding implications.
Michele: You recently made a divestiture to narrow your focus. What’s the impact to the brand?
Ben: We have developed an overarching business strategy, which we call Vision 2020. This thought process involves bringing focus to our operation to prepare and grow the business. Divesting Erie was ultimately the best opportunity to ensure that both parts of the business had an opportunity to be invested in and grow. Vision 2020 lays out our strategic thinking for growth, which includes provision for aggressive organic growth as well as smart M&A.
From original purchase of the business through today’s growth, we’ve established the following Action Agenda:
Year 1: Stabilize
Year 2-3: Expand
Year 4-5: Breakthrough
Acquiring within your space is a part of your growth strategy. How do you approach these acquisitions?
Our main focus is to add capability and horizontally integrate across the product development continuum—from Research to Release—using both organic opportunities and M&A’s with established credibility. Our customer base is about 75% medical and 25% pharmaceutical, but we’re seeing the pharmaceutical industry grow at a faster rate. From R&D to product development, from clinical strategy to execution, our approach remains flexible and responsive.
The global growth rate is 4-6% CAGR—and up 20% year-over-year through April—so we know we’re in a good spot with the decisions we have made. Our goal now is to invest in talent and capabilities. We recently added a genetic toxicologist and are actively evaluating ways to expand our local footprint to account for our growth and added capabilities. It’s those kinds of investments that are important for us to make.
At the end of the day, all that matters is that my team can solve problems and add value to those we serve.
For a lot of the companies Launch Team has worked with through M&A, it’s the transition strategy that determines success. How do you approach the cultural or brand implications?
When you have an M&A situation, there are decisions you have to make regarding how to brand the company. I have to ask myself, what should the footprint of the brand look like during the M&A? I suppose it depends on what will bring the most value, balancing between cultural strength and the actual brand presence.
It’s my job as the leader to share with my existing team the value of the new companies and employees we bring in from an M&A. We recently added someone to our business development department for the pharmaceutical industry, and he has done a great job in growing the presence of our changing brand.
What’s your sniff test?
We often evaluate how to leverage the business with cross-selling opportunities. Our sniff test is seeking out companies that have what we don’t have. For us, it really comes down to if the partnership is a solid strategic fit; cultural fit is certainly a close second, and of course the valuation.
We evaluate opportunities with companies that can:
- Help us fill the pipeline
- Focus on performance and accountability
- Are a great technical fit
- Truly embrace a client-first mentality
Do you see ego get in the way of smart branding?
Between goodwill paid for a brand, and the founder’s emotional tie to it, you often see it on both sides. Often the right decision is to carefully plan the transition and sunset the brand when it makes sense for the newly formed company. If there is a strategic opportunity, you have to do what makes sense. The right timing is important—but not always inherently evident.
How do you keep your people in sync?
I am working closely with HR to implement a first-time manager training. This will focus on working closely with management to develop technical mastery, leadership, and communication skills for difficult conversations and providing feedback. There is great value in investing in talent development.
You started to blog about your corporate culture. Do you see that as valuable to your customer?
Our blog has become a great platform to establish a sense of culture. Trust and expertise are critical to our customers, and our new “Meet the Scientist” interviews are great ways to share information and connect.
What do you see happening in the market? Is there a movement toward pre-clinical R&D outsourcing?
It’s not very publicized within the medical device industry, but pharmaceutical R&D is downsizing. Organizations see R&D as a necessity but don’t want the fixed cost associated with hiring and maintaining large scientific teams, so it’s more cost effective to outsource. For startups, there’s an uptick in venture capital which drives the technical areas we’re involved in. We’re seeing:
- Strong deal flow
- A pick-up in investment
- Increasing interest in roll-ups
Our pharmaceutical services division can help entrepreneurial companies compete and scale, and larger companies become more competitive and innovative.
You’re a quality guy turned CEO running a sales team. What surprises you about this role?
- Sales cycle. I’m often surprised by the length of the sales cycle, especially for a new client. You have to establish credibility, get them over the emotional hurdle of change, and become an approved supplier. In some cases it’s not what you think you will get from a lead. There truly is a science and art to it.
- Value of culture. Since we purchased this business from the previous owner (Moog Inc.), we’re now a small business. It’s vital for us to have this agenda of who we’re going to be and how we want to develop employees. There’s an emerging understanding that urgency and growth are vital to achieving our strategic vision. We’ve further cemented this with our “Reinvent…Together” initiative. My role here is to drive sustainable growth, be an expert in the field, create awareness, and nurture employees.
If you had to choose between a technical expert who’d follow the sales process, or a salesperson with strong relationships, what would you choose?
Relationships matter, but the extent differs industry to industry. We find that new pharmaceutical clients want to “dip their toe in the water” and understand your team and your experience, so we’re able to develop in-depth relationships quickly. Medical device companies seem to be more time and price sensitive. In either case, it’s all customer service, really, and listening is the key to figuring out customer needs.
What’s next for you?
I love what we’re building, and we have a real opportunity to improve the lives of both the end users of the devices and therapeutics we help bring to life and our employees. We’re developing core expertise in a number of therapeutic areas such as wound management, implantable devices, and ophthalmology. We embrace the challenge of differentiating ourselves from the competition, and with the team we have assembled, the future is truly bright for iuvo BioScience.
Tasting Notes: Michele and Ben tried Lagerithm from Roc Brewing Co., a Vienna-style lager with a light honey aroma. Possessing a unique hop character, it was overall very balanced, clean, and slightly warming.