BVI Medical is clear-eyed on its growth strategy, which is more than appropriate for a company that makes ophthalmology devices and supplies. It’s literally in the business of eyes.
Massachusetts-based BVI is using acquisitions to build a comprehensive product portfolio for its customers—a “one stop shop,” Todd Patriacca, the company’s CFO, told CFO Brew. Key acquisitions by the private equity-backed company include a Belgian intraocular lens (IOL) manufacturer in late 2018, and two years later, a Florida-based supplier of raw materials used in IOL production.
“We’ve got a really complete product offering for our customers to be able to go to one place and get the equipment they need for the surgery and all of the supporting materials,” according to Patriacca, who joined BVI in 2023.
Patriacca added that BVI’s acquisition strategy is now one of adding “complementary products” and growing its footprint. In 2023, it acquired Medical Mix, a provider of surgical ophthalmic products in Spain and Portugal.
Acquisitions like this “allow us to not only then go direct and capture that margin that the distributor was getting on top of our products, but also really give us more strategic ability to push more of our products through that sales organization,” Patriacca said.
Informed buyer. BVI is surgical in examining its acquisition targets, wielding internal company data as a benchmark. It’s the same data BVI has used to hone its own operations, which management can also use to determine room for improvement in the target company, according to Patriacca. For example, the target company may benefit from better pricing strategies or more efficient inventory management, he said.
“We’re able to use, whether it’s statistical modeling or other analytics, to really take a look at how we’re managing our inventory,” Patriacca explained.
“Looking at potential targets,” he said, BVI can ask the question, “are there opportunities there based on what we know we were able to do within our business?”
Eye to the future. BVI has been busy with acquisitions in recent years, but it isn’t about to turn a blind eye to new opportunities. Patriacca identified a couple key areas he and other execs are looking to for growth.
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“We’ll be focusing more on improving the manufacturing operations and the technology there, as well as continuing to try to innovate and round out our product portfolio in any of the areas that we feel we still have some gaps,” he said. One example: BVI has developed a way to mold lenses rather than machine them. This method reduces cycle time and scrap levels, according to Patriacca.
BVI started bringing in people with backgrounds in “lean manufacturing,” a discipline that’s focused on reducing waste, and the investment is paying off, Patriacca said.
“[BVI is] really focused on how we eliminate waste from our manufacturing processes and overall make a better product at the most efficient cost that we possibly can,” he said. “And that’s taking a bigger hold within the organization as we’ve made some personnel changes over the last several years and really focused on that continuous improvement mindset and eliminating waste.”
The journey, not the destination. Patriacca is uniquely suited to execute BVI’s strategy. He got his start in public accounting, before spending nearly 20 years at an industrial manufacturer. When Patriacca came across BVI, the company was looking to hire a CFO with a background outside ophthalmology and medical equipment manufacturing “to bring a different perspective to the business,” he said.
Patriacca’s background certainly fit the bill. But what exactly did BVI need from a finance chief who wasn’t familiar with their line of work?
“The board decided that they wanted to look at some folks with an industrial background, just because [those] companies typically don’t have the margin profile of medical device [manufacturers] and tend to be, I’ll say it: thriftier,” he said.
BVI was investing heavily in product development, “a cost that doesn’t have any coverage,” Patriacca noted. The company needed someone who could take a disciplined approach to spending and operate on slimmer budgets “to really make sure we can deploy appropriate capital allocation to those new development activities to drive future revenues and make sure that we’re meeting customer needs and, ultimately, patient needs.”