For Derma Sciences’ CEO, Skin ‘Is’ the Game


THE HURDLE

Acquiring products with great potential in its niche proved only part of the company’s growth challenge. Lacking the name recognition of larger medical-device and wound-care companies, such as Covidien, Derma Sciences faced an uphill battle convincing healthcare facilities and professionals to try its products. “Five years ago, no one had heard of Medihoney,” says Quilty. “When our sales reps walked into a hospital or wound center and said, ‘I’m with Derma Sciences,’ people would say, ‘Who the hell is that?’”

Early on, sales and marketing overcame that hurdle by being “willing to run anywhere anytime,” he says. “In wound care, you can have a lot of clinical statistics, but you still basically have to make the rounds and talk to one clinician at a time. Now that we’re more established and our salesforce is bigger, we’re able to be more analytical and more disciplined about how we build relationships with facilities.”

THE ENDGAME
Under Quilty’s tenure, Derma Sciences has grown its single product line into a portfolio of 2,000 products and brought a 100,000-square-foot Canadian manufacturing facility into the fold. The company expects revenues to hit $95 million this year, driven largely by its advanced wound-care arm, which grew by 36.3 percent in 2013, as compared to the company’s overall growth rate of 9.7 percent.

Perhaps most exciting, however, is the pharmaceutical product for treatment of diabetic foot ulcers, burns and scars that Derma Sciences currently has in a Phase III clinical trial. “We’re in the final stage of development of what will be the first drug with a wound-healing indication,” explains Quilty, who sees the drug, known as DSC127, as a potential game-changer. “If it’s approved, it will be a first-line treatment for the 900,000 diabetic foot ulcers diagnosed in the U.S. each year. That represents hundreds of millions of dollars.”

THE LESSON
For Quilty, perseverance in the face of adversity is a cornerstone of success. “I think the most important thing we did was [to] develop a strategic plan early on—which was to focus on using our commodity business to support a focus on technology and growth—and to stick to that plan,” he says. “Inevitably, you run into problems along the way; and the minute things go wrong, it’s easy for you or your investors to succumb to self-doubt. We are realizing success today because we didn’t abandon our strategy.”