Final Report on Expanding Accessibility of Affordable User ...ipekpp.com/admin/upload_files/Report_2_20... · maintenance requirements and costs. Through a partnership with Phoenix

KNOWLEDGE PARTNERSHIP PROGRAMME

Final Report on Expanding Accessibility of Affordable User-Centric Phototherapy Devices for Neonates with Severe Jaundice

D-Rev

Submitted to

Department for International Development (DFID)

IPE Global (P) Ltd.

August 2014

CONFIDENTIAL COMMERCIALLY SENSITIVE

D-Rev Final Report: IPE-KPP-2013-11 (48) – D-REV and IPE-KPP-2013-11 (49) – D-REV 1

Grant Recipient: D-Rev: Design Revolution Contract Numbers: IPE-KPP-2013-11 (48) – D-REV IPE-KPP-2013-11 (49) – D-REV Grant Period: 1 November 2013 – 30 April 2014 Contact: Krista Donaldson, CEO 695 Minnesota Street, San Francisco, California, USA +1-415-642-1143 [email protected]

Final Report for the Department for International Development

mailto:[email protected]



TABLE OF CONTENTS

Introduction 3 Organizational overview 3 The need and context 3 D-Rev’s approach 3

Executive Summary 4 D-Rev’s proposal 4 Summary of results 5 Milestone 1 6 Milestone 2 9 Milestone 3 15

Next steps for D-Rev 30 Conclusion 31



INTRODUCTION

Organizational overview D-Rev is a nonprofit product company founded in 2007 that designs, and works with local partners to deliver products that improve the lives and increase the incomes of people living on less than 244 INR/2.5 GBP per day. We are focused on developing products that alleviate poverty; gathering brilliant engineers and designers to maximize their talents and ideas to strengthen societies and equality; and delivering user-centric high-design products to users often overlooked by profit-driven companies. D-Rev follows three core principles: (1) D-Rev products are world-class, meaning they perform on par or better than the best products on the market. (2) We take a market-driven approach, meaning that products are designed to be radically affordable with profit margins built in so that they can integrate into local markets and be sold through the private sector. We believe this is the most sustainable path to scalable impact, and also holds our partners and us accountable to our customers. (3) We take a user-centric approach, working closely with end-users, field experts, key opinion leaders and all stakeholders in the customer value chain. We also select projects based on needs identified by experts on the ground. The need and context One of D-Rev’s key objectives is to reduce neonatal mortality and morbidity in developing countries by tackling one of its most persistent causes – neonatal jaundice or hyperbilirubinemia. Every year, extreme hyperbilirubinemia affects 23M infants globally, 90% from developing nations. If untreated, it can cause permanent brain damage (kernicterus) or death, making it the 5th leading cause of infant mortality worldwide. Phototherapy, exposing an afflicted newborn to intense blue light – in some cases, for as short as 24 hours – is a simple and effective treatment for neonatal jaundice. For more than 40 years, phototherapy has been the standard of care for the treatment of hyperbilirubinemia in newborns. The Clinical Practice Guideline on management of hyperbilirubinemia recommends phototherapy for afflicted newborns. Where high-quality phototherapy is readily available, the simple treatment has virtually supplanted blood exchange transfusions in effectively treating hyperbilirubinemia, and has effectively eliminated moderate brain damage, kernicterus, or death (Stokowski, 2011). However, existing treatment regimens for phototherapy are inadequate. Nearly all phototherapy devices are too expensive for low-resource facilities and regions where the need for them is dire. Phototherapy devices that meet the standards of the American Academy of Pediatrics (AAP) retail for over 184 INR/1,856 GBP. Moreover, such devices are not optimized for use by semi-skilled personnel; neither are they designed to deal with environmental conditions such as high humidity and temperatures, or the power surges and spikes prevalent in these low-resource areas. D-Rev’s approach D-Rev is developing a suite of radically affordable technologies to treat hyperbilirubinemia effectively reduce the number of deaths and disabilities cause by neonatal jaundice worldwide. Our due diligence at over 250 hospitals and clinics in Asia and sub-Saharan Africa has led us to conclude that one size does not fit all with regard to phototherapy treatment in low-resource settings. A platform of products at various price points is required to eliminate the burden of neonatal jaundice and its debilitating and costly impact on poor families.



D-Rev’s suite of products to manage neonatal jaundice encompasses two product platforms, Brilliance and Comet. Brilliance is an overhead LED phototherapy device that targets urban and district-level hospitals and above that maintain neonatal intensive care units (NICUs). Brilliance meets American Academy of Pediatrics (AAP) guidelines for intensive phototherapy; is culturally and contextually appropriate, based on extensive user research and feedback from doctors and purchasers; and minimizes maintenance requirements and costs. Through a partnership with Phoenix Medical Systems of Chennai, India, we manufacture, distribute and sell Brilliance to BOP markets globally. Phoenix is the largest manufacturer of neonatal equipment in India, and is widely respected for its quality products and high level of responsiveness to customers. The retail price of Brilliance is approximately 22,000 INR / 214 GBP in India and 31,000 INR / 306 GBP (plus shipping and local taxes) for international markets, approximately 10 percent of the price of comparable devices. We have seen global demand for Brilliance since its launch in late 2012, even with minimal investment in marketing and promotion. Sales have been strong since launch, with units immediately back-ordered. As of June 2014, over 650 units have been sold into 16 developing countries across South Asia, Southeast Asia, sub-Saharan Africa, and Latin America. Over 18,000 newborns have been treated with Brilliance. Our research has determined that Brilliance is too large and too expensive for community health clinics and private “micro-hospitals” common in peri-urban areas and that serve indigent populations. Comet complements Brilliance in our product line of devices. Designed to retail for approximately 13,000 INR / GBP 130, Comet is a radically affordable and compact LED phototherapy device that meets AAP standards and regulatory safety requirements at a fraction of the cost and power requirements of comparable devices. Comet is approximately the size of a desk lamp, making it more appropriate than Brilliance for cramped micro-hospitals and rural clinics. It can easily be folded up and stored when not in use, and is lightweight enough to be carried in a backpack to rural areas reachable only by foot or motorbike. Based on preliminary due diligence and field work in East Africa and Asia, we believe that Comet best meets price point requirements for public hospitals and clinics in sub-Saharan Africa.



EXECUTIVE SUMMARY D-Rev’s proposal To improve health outcomes for infants suffering from severe jaundice and their families, D-Rev won a 22,692,714 INR / GBP 222,030 grant from DFID to further the development and commercialization of its neonatal jaundice initiative products in India. Our project aimed to expand the accessibility of jaundice treatment by reducing the cost of and introducing D-Rev’s phototherapy devices to new low-income markets around the world.

Our project ran from November 2013 to April 2014, and encompassed the following activities: 1. New market due diligence activities, including market research and assessment, price point

analysis, and distribution due diligence in target markets in East Africa and South Asia; and 2. Reduction of the cost of phototherapy through:

a. Product iteration and cost reduction of Brilliance to expand the product platform for more choices and lower costs and provide more affordable options to health facilities. We planned to launch a second generation Brilliance with improved functionality, including automatically adjusting LED brightness over time and a modular fluxmeter to evaluate irradiance at the same price. We also aimed to launch Brilliance Basic, a lower-cost version of Brilliance, at 19,000 INR / 186 GBP.

b. Further development and commercialization of Comet. We sought support to enable product iteration following field-testing in northern India, Nepal and Kenya; design for commercialization which is necessary for hand-off to a manufacturing, distribution and sales partner; and a second iteration of Comet by the end of 2014.

c. Feasibility study of elimination of distribution mark-up for Comet through adopting a ship-in, swap-out model instead of having local distribution partners, in order to provide affordable medical devices and cost-effective servicing.

Summary of Results The impact of DFID’s funding on the success of Brilliance was significant and pivotal. While D-Rev has been working on Brilliance since 2009, the structure, timing and approach of DFID’s support enabled us to advance the project 6-9 months ahead of schedule, accelerating our scaling to new markets and our product development of the next version. Since November 2012, Brilliance has entered 8 new countries and through DFID’s support of the partnership of D-Rev and Phoenix, we will release the next generation of Brilliance, called Brilliance Pro, in the next few months. Over half of the impact that we report at the end of 2014 for our phototherapy devices, will be a direct result of DFID’s generous grant. The grant from DFID has allowed us to achieve the following results, grouped by milestone: Milestone 1 (13-December 2013): COMPLETE

Completion of technology transfer of Brilliance Pro

Brilliance Pro production-ready prototype successfully built at partner manufacturer

Field trials of Comet started in Kenya, and initial feedback interpreted from India trials Milestone 2 (14-February 2014): COMPLETE

Comet field trial feedback interpreted from India, Kenya, and Nepal

Comet direct shipment feasibility study completed

Phototherapy market due diligence started in East Africa, Pakistan, Bangladesh, and initial scoping in Afghanistan



Milestone 3 (30-April 2014): COMPLETE

Initial due diligence for phototherapy market in seven target countries (Kenya, Bangladesh, Pakistan, Afghanistan, Uganda, Tanzania and Ethiopia)

Brilliance Basic technology transfer completed

Brilliance Basic production-ready prototype built at partner manufacturer

MILESTONE 1 – 13-Dec 2013 Summary of Achievements:

1. Brilliance Pro Technology Transfer Complete 2. Brilliance Pro production-ready prototype built at partner manufacturer 3. Comet field trials started in Kenya and initial feedback interpreted from India

1. Brilliance Pro Technology Transfer Complete The transfer of the technology from D-Rev to Phoenix Medical Systems, our Indian manufacturing partner, was accomplished in November 2013. D-Rev is currently making final revisions to the design to facilitate mass production, CE mark approval, and easy end-user assembly. Brilliance Pro (referred to as “Anakin” internally) is an upgraded version of Brilliance, D-Rev’s overhead phototherapy unit that was released on the market in November 2012 through our partner, Phoenix Medical Systems. Brilliance Pro includes the following enhancements:

Automatic light intensity adjustment according to tilt angle to ensure effective intensity delivery, especially when Brilliance Pro is used with additional critical medical equipment (e.g. an incubator).

Automatic light intensity adjustment according to the lifetime of LEDs that extends life of Brilliance Pro. All LEDs begin to fade over years of use – this upgrade detects degradation and inputs extra energy, to help ensure that the unit maintains the light intensity necessary to provide effective jaundice treatment for years.

Full integration, ensuring that it works with an ultra-low-cost light meter (internally referred to as Bullseye). This would allow doctors and nurses to monitor the light output of Brilliance Pro to ensure effective treatment for each baby. D-Rev has designed Bullseye to cost a fraction of existing light meters which retail for over 181,000 INR / 1,760 GBP.

More efficient light output, resulting in less “light spill” (when blue light spills out of the treatment area and effects the rest of the NICU), requiring fewer LEDs, and needing less power.

Lighter weight head and improved tilt mechanism for ease of use.

2. Brilliance Pro production-ready prototype built at partner manufacturer Phoenix Medical Systems built a production ready prototype of Brilliance Pro in December 2013. The prototype will be displayed at the Phoenix Medical Systems booth at NEOCON (the largest neonatal medical equipment tradeshow in India) in Hyderabad, India December 13-16. Brilliance Pro is scheduled to be available for commercial sale at the end of March 2014. We estimate pricing of the product, including the light meter, to be $600 (36,074 INR / 352 GBP).



First prototype of Brilliance Pro built by Phoenix Medical Systems

3. Comet field trials started in Kenya and initial feedback interpreted from India Comet units have been deployed for field testing, in the following locations: Kenya: Nepal Jamaa Mission Hospital, Nairobi One Heart Worldwide (4 units), Baglung Jacaranda Health, Nairobi PHC Kusmishera, Baglung St. Mary’s Mission Hospital, Nairobi Dhaulagiri Zonal Hospital, Baglung Nyaya Health Bayalpata Hospital, Accham India: SNCU Panchkula (2 units), Panchkula CHC Kalka, Kalka PGI Chandigarh, Chandigarh

Figure 1: Map of field trial locations for all Comet units (NOTE: some units in Nepal are awaiting their final destination)



Comet units were delivered to 3 hospitals in and around Nairobi, Kenya in November 2013. D-Rev Design Engineer Samuel Hamner conducted a training session with the clinical staff at each location. The training included an overview of neonatal jaundice, including its diagnosis and treatment protocols, a demonstration of how to effectively use Comet, and a walk-through of the feedback collection procedure. D-Rev will collect qualitative feedback from the clinicians to understand the context that the device is used in (i.e. additional treatments, environmental conditions) and form-factor feedback including the device size, color, and attachment mechanism.

D-Rev team members AJ Viola, Neonatal Jaundice Initiative Product Manager, and Krista Donaldson, CEO, visited our clinical partners in India one month after the initial training and Comet delivery. Without in-depth interviews and feedback form collection, the responses were informal.

1. Even though Comet was designed to be flexible, clinics set up Comet in one place and configuration and then do not move it. D-Rev will need to evaluate other clinics as part of future trials to understand if medical staff put Comet away when it is not in use. In two of the three hospitals in India, the unit had not been moved since its initial setup.

2. We observed that innovative features (e.g the detachable base and the V-bar on the clamp that allows attachment to a bar or rail) need to be explained in detail and reinforced with clear graphical reminders. These features are conceptually unfamiliar to our target users.

A user said that from their impression, Comet could not be used with incubators (because there is no place to attach Comet, and the head configuration does not allow for the stand to be straight up with only the head tilted at 90 degrees). S/he wrongly assumed that Comet could only be used in the step-down units with open care units, bassinets, and hospital beds. This incorrect perception affected their usage of Comet.

1. For future field-testing, we recommend a one-page “Quick Start Guide” that graphically shows the various configurations for Comet’s attachment. NOTE: The image shown here was implemented and attached to the Comet units delivered to Kenya. 2. A user found the hinges on the stand difficult to bend and suggested thumb screws be used, rather than the current bolts, that could be tightened and loosened (but not removed, because he was sure they would get lost). 3. One clinician wanted to be able to view patient treatment time and total machine times (standard displays for phototherapy devices). The clinician acknowledged that it would make the device more expensive, but concluded that the features are important. 4. Generally, we received very positive feedback – clinicians were ‘very happy’ and ‘impressed’ with Comet. At one clinic, the nurses

expressed their approval of Comet, stating that it was “quite good” at treating the babies. (We understood that to mean that it was more effective than their other devices.)

Samuel Hamner delivering a Comet unit to St. Mary’s Mission hospital in Nairobi



MILESTONE 2 – 14-Feb 2014 Summary of Achievements:

1. Comet field trial feedback interpreted from India, Kenya, and Nepal 2. Comet direct shipment feasibility study completed 3. Phototherapy market due diligence started in East Africa, Pakistan, Bangladesh, and initial

scoping in Afghanistan

1. Comet field trial feedback interpreted from India, Nepal, and Kenya

Garrett Spiegel, Comet Product Manager, visited sites where Comet was being tested in India and Kenya in February 2014 with Randy Schwemmin, Director of Technical Operations, and Robert Weiss, Business Analyst. Estimates from examination of five Comet units indicate that approximately 100 babies have been treated so far, approximately three times the number expected.

India Garrett Spiegel and Randy Schwemmin returned to the National Rural Health Mission (NRHM) in Haryana Child Health Division, Special Care Newborn Unit (SCNU) Panchkula, Post-Graduate Institute-Chandigarh, and Community Health Clinic (CHC) Kalka. All of these facilities are public and fall under the Haryanua NRHM, which is recognized as one of the strongest in India. SCNU Panchukla, CHC Kalka and PGI-Chandigarh collectively had four Comet units for approximately four months. Spiegel and Schwemmin were able to successfully collect data from three of the four Comet units in the field. The 4th unit, from SCNU Panchkula suffered a blown power supply and needed to be taken back to San Francisco for further testing and data retrieval.

(clockwise starting at top right) Comet in use at SNCU Panchkula in India; baby being treated with Comet at CHC Kalka, Dr. SK Gupta assessing a baby at CHC Kalka, baby being treated with Comet at SNCU Panchkila



Insights from medical staff interviews at these three facilities:

Size and convenience are more important than price in several cases since the clinics are often small and cramped. [Note: price may be a lower priority because of the relative effectiveness of the Haryana NRHM.] One nurse said that although she would like a portable unit, the portability was hampered by the difficulty of moving the power supply and cord. In future we plan to provide a detachable cord that will make this process easier.

One clinic is currently paying 1200-1500 INR / 11.70-14.60 GBP per replacement compact fluorescent tube bulb for their older phototherapy unit. With the necessary replacements of six to eight tubes annually, the total maintenance cost of that device is 7,200-12,000 INR / 70-117 GBP per year – an expense which would be eliminated by an LED unit like Comet.

Nurses reported that they constantly manipulated Comet – adjusting the head of the unit every two to three hours to feed and access the baby. This means that the adjustability of the head is important as well as consistent measuring and re-measuring of the effective treatment distance.

One clinic claimed to use Comet on babies with higher TSB (total serum bilirubin) level, the most severe cases, because the nurses believe Comet reduces bilirubin levels faster than other devices.

Several doctors and nurses expressed interest in the addition of a therapy counter to keep track of dosage and treatment time.

Kenya Messrs. Spiegel and Weiss visited St. Mary’s Mission Hospital, Jacaranda Maternal Health Clinic, Jamaa Mission Hospital, three locations where Comet units were installed. They later delivered one Comet device to Pumwani Hospital following the request by the NICU medical supervisor. The Comet unit at Jacaranda Maternal Health Clinic has not been used since it is primarily a maternal hospital – mothers typically leave within 24 hours after birth and the hospital does not have any jaundice diagnostic capabilities. Jacaranda is working with a pediatric resident from UCSF who plans to help build capacity for jaundice diagnosis and treatment in the future. Insights from medical staff interviews at these four facilities:

1. For medical treatment in general, the head doctor reported that because of severe budget constraints, the staff resort to “quite a lot of improvisations”. This hospital’s biggest need for medical devices was affordability.

2. For any baby with jaundice “below the face” (moderately high, as determined by clinical assessment), the baby should receive a TSB blood test. However, one doctor estimated that the lab does not have enough reagents to conduct the necessary test 75% of the time. When the testing cannot be done in-hospital, it must be done at a lab outside of the hospital which costs the family approximately 300 INR / 3 GBP. Medical staff reported that it can take a family three days to raise the needed money, at which point if the baby did in fact have severe jaundice, it would often be too late for treatment to be effective.

3. Priorities that one doctor looks for when purchasing a phototherapy device:

Cost

Ease of maintenance

LED (or at least blue light)

Ability to tilt in order to treat a baby with more than one light at once

Portability to easily move the device from on bed or cot to another



4. One facility always uses an incubator for babies in the NICU because they lack a warm room or overhead warmers. The clinic decided to create a custom mounting bar for Comet to increase the ease of use with incubators. Comet must seamlessly integrate with other medical devices.

5. Procurement process at the public hospital:

Purchasing cost of standard LED phototherapy unit ranges from 300,000-800,000 KES (approximately 206,000-550,000 INR / 2,000-5,370 GBP) with an additional annual maintenance cost of 35,000-60,000 KES (around 24,000-41,200 INR / 234-403 GBP)

Equipment over 500,000 KES (approximately 344,000 INR / 3,360 GBP) is submitted to, and then approved by the board of trustees.

Medical staff learns about new equipment by doing research on the internet. They must get a minimum of three quotes before submitting the request to the board of trustees.

They rely on the company/vendor to handle importation.

6. Cost of treatment at one private facility:

Varies from 500-2,500 KES (344-1,720 INR / 3-17 GBP) per day for phototherapy. If patients are unable to pay, support is determined on a case by case basis.

As mentioned above, the family is sometimes also responsible for the cost of the diagnosis blood test (approximately 437 KES / 301 INR / 3 GBP per test)

Nepal Feedback from Nepal was received during initial hand-off, not after any substantive use. Hospitals without warming solutions (incubator, overhead warmer, space heater) are unable to use the device until a solution was procured. The need to expose the infant’s skin to the light for adequate treatment is difficult for clinics in a cold environment that are concerned about hypothermia. 2. Comet direct shipment feasibility study completed During fieldwork conducted in Nepal, we investigated how customers find and purchase supplies for their clinics and hospitals. Remote clinics buy supplies through monthly shipments from a porter who walks the final distance from a bus stop to the clinic. Even in the remote clinics, district level administrators often decide what the inventory allotment for each clinic will be, which determines the contents of each shipment. These insights lead us to develop certain product requirements to accommodate direct shipment:

1. The product must be small and light. 2. It must also fit in standard shipping boxes and does not exceed weight limits. 3. The product can be carried by a porter on foot or cycle. 4. The power cord should be easily swapped for local plugs. 5. The packaging should be able to withstand parcel shipment abuse. 6. The product can be assembled with common or no tools and little technical expertise. 7. It can be installed and put into use with no additional training. 8. There must be no necessary replacement parts, or alternately, if replacement parts are

needed, they must readily be available or are included in as part of the purchase. Sales Channels We explored three options for future sales channels for Comet: an internal sales force, distributors, or direct internet or catalog sales.

a. An internal sales force would be too costly and complicated to manage given the need and location of target clinics.



b. Distributors would be able to hold Comet inventory in-country, close to future customers. They would also carry the financial risk by buying the inventory in advance. We could find a distributor that has a local sales force with the capacity to visit clinics and hospitals for sales and servicing. Sales and servicing will increase the market uptake – and impact – of Comet, but distributors expect to receive a hefty margin (30-50% or more) that would inflate prices beyond the price point that target consumers can afford. While D-Rev/Phoenix would not have to manage a full sales force, managing a network of distributors can be complex and resource-intensive. Additionally, our experience from scaling Brilliance suggests that it is challenging to find distributors in our target markets who will accept price transparency and not pay kick-backs.

c. If Comet is distributed through direct internet or catalog sales, we could eliminate distributor markup and gain time with fewer relationships to manage. D-Rev would control branding, as well as manage the customer experience since we would be in contact directly with customers. Furthermore, there are potential economies of scale in centralizing sales, as well impact data collection. This type of sales, however, relies on customers “discovering” or seeking our product online, which in turn requires D-Rev to generate awareness and sales. Though Comet will be purchasable from anywhere with internet access, there would not be local contacts – meaning the customer would have to arrange import through their local customs and would not have any servicing options in country. Servicing is a key requirement for all products, and other options such as toll free or online support need to be better investigated.

Supply Chain We are considering several options for Comet’s supply chain including:

1. Inventory held at manufacturer and direct shipped to customer 2. Inventory held at distributor 3. Inventory held at 3PL and direct shipped to customer

Our research indicates that Hong Kong and Singapore are the two global hubs with the lowest costs for a distribution center regardless of the location destination of the shipment. Both cities are well-established logistics centers in free trade zones that allow for avoidance of some tariffs and duties. Because logistics and warehousing are the largest industries in these cities, their infrastructures are high functioning and tailored to support these services. Lead times and total costs, key metrics for Comet, are lower than anywhere else in the world. The figure below gives an overview of our process for identifying logistics partners capable of delivering to our target markets.



Comet’s must-have requirements for logistics support: 1. Must be able to deliver DDP (delivery duty paid, or to the customer’s door). 2. Should be able to provide import/export logistics support from manufacturer (in India) to

the final destinations (global). 3. Can provide assistance with managing customs negotiations. 4. Is capable of managing returns. 5. Can manage warehousing of bulk shipment of finished goods. 6. Has the ability to break bulk shipment and repackage. 7. Possesses basic information sharing capabilities (with D-Rev) and transparency. 8. Is able to distribute throughout markets in low-income regions (and already has experience

doing so).

The rationale of key requirements is provided below.

Comet’s nice-to-have capabilities for logistics support:

Minimal quality assurance

Robust information sharing technology (shipment tracking and visibility)

Sales/customer interaction Infographics that show our order fulfillment and order payment processes follow.



3. Phototherapy market due diligence started in East Africa, Pakistan, and Bangladesh, and initial scoping for Afghanistan Market Analysis Scope of Work We conduct the following due diligence activities in new markets: (1) Identification of high-need, high-potential markets; (2) Assessment of regulatory and competitive barriers; (3) Building relationships with in-country partners to execute market-entry strategy. In short, we identify and select promising targets, consider potential obstacles, then design and execute a strategy to enter the market. We typically identify high-need markets by visiting hospitals and clinics in country. This fieldwork is supported by extensive pre-visit research that provides a macro-level view of the health sector in each country. In-country, we visit a mixture of target hospitals and well-regarded local institutions. Although public teacher-training hospitals are, for example, not necessarily the most resource-limited, they handle a high volume of patients and are recognized as centers of influence in the local medical community. We also visit hospitals in regional centers – second-tier cities across the country – that typically handle a high volume of patients for a given state or province. Finally, we reach, where possible, the resource-constrained hospitals that have a social mission – for example, clinics serving a refugee camp or conflict-affected area – and are well respected in the community. These places sometimes attract international doctors with global connections. Assessment of regulatory and competitive barriers is done in tandem with key experts in public health, including doctors at hospitals we visit, private sector partners, and ministry health officials. Distributors and market consulting firms are often knowledgeable about import/export procedure and the specifics of customs duties and taxes. We also meet with Ministry of Health officials who help us understand the medical device registration process and identify policy priorities that could help support our mission. To do the landscape analysis, we visit hospitals to observe what phototherapy devices are being used and the prices for which they are purchased. Experts in the business community sometimes can share their impressions of the phototherapy market size and how products are positioned. In many cases, LED phototherapy is available for import, but only at “premium” prices that low-resource hospitals cannot afford.



The third aspect involves building relationships with partners to help execute a go-to-market strategy. For D-Rev’s model to work – for our products to have scalable impact – we require partners. Typically, medical device companies rely on a local distribution agent who is licensed to import medical devices and sell to hospitals. Effective local distribution partners also provide marketing and after-sales servicing. Ideal partner distributors would actively and regularly promote our product to low-income and public hospitals and private clinics, ensuring that Comet reaches the populations that most need it. And while Brilliance is designed as a low-maintenance, easy-to-use product, end users must be able to access installation and repair support locally. To identify candidate distributors, we rely on word of mouth recommendations from medical practitioners, commercial services representatives of foreign governments in-country, and introductions from trusted sources.

MILESTONE 3 – 30-April 2014 Summary of Achievements

1. Completed initial due diligence for phototherapy market in seven target countries – Bangladesh, Kenya, Uganda, Tanzania, Ethiopia, and initial scoping in Afghanistan and Pakistan.

2. Completed technology transfer of Brilliance Basic, an even lower-cost alternative to Brilliance.

3. Brilliance Basic production-ready prototype successfully built at partner manufacturer. 1. Initial due diligence for phototherapy market in seven target countries Summary of Activities To improve health outcomes for infants suffering from severe jaundice, D-Rev aims to expand the accessibility of jaundice treatment by introducing Brilliance to new low-income markets. Due diligence in these markets at D-Rev extends far beyond financial analysis; we do market research, assessing both the need for medical devices, as well as market demand, and the existing landscape of possible solutions (which may include non-traditional approaches). With DFID support, D-Rev completed due diligence in:

South Asia: Afghanistan (scoping only), Bangladesh, and Pakistan

East Africa: Kenya, Uganda, and Tanzania

Horn of Africa: Ethiopia The goal of this work is to find market-based distribution solutions to ensure that affordable high-quality medical devices produced in India reach hospitals in high priority low-income countries. D-Rev staff conducted on-the-ground primary research in five of seven markets identified above; we did not travel to Afghanistan and Pakistan for logistical reasons resulting from security and lead times for entry. Seven D-Rev staff members spent more than 26 weeks in Bangladesh, Ethiopia, Kenya, Tanzania, and Uganda, and additional time communicating with key contacts in Afghanistan and Pakistan via phone and email. Over this time, D-Rev staff interviewed:

Doctors, nurses, administrators, and procurement staff at 65+ hospitals and clinics

Medical device distributors in East Africa and South Asia

Dozens of key contacts including:

Ministry of Health officials

National pediatric and neonatal association leaders

Faith-based health providers

Private health providers, consultants, and device companies

NGO, health funders and embassy offices



For each target country, we obtained a detailed understanding of market conditions and assessed how readily we could create impact through market delivery of Brilliance, including necessary strategies. We prioritized the seven countries and fit them into a landscape of potential target markets. In this report we both provide our results from the seven markets we evaluated – including detailed country-specific reports attached in Annex I – and describe a framework for how an impact-driven company can conduct market due diligence. Finally, we outline next steps: finalizing due diligence, devising actionable strategies, and executing those strategies in high-priority markets. Market Assessment Strategy Our market assessment strategy is to engage experts and frontline workers in-country who can help us put together a picture of the market for jaundice treatment solutions. We have divided these local experts into three categories: (1) Hospital-based professionals, (2) Key opinion leaders, and (3) Private sector contacts. Below we list our goals for market-assessment interviews with each category of contact.

1. Hospital-based Medical Practitioners and Administrators. When we visit hospitals our goal is to understand the need and market from the perspective of healthcare providers who use our devices, and to understand purchasing from administrators who make decisions. In the case of private hospitals, these people are sometimes the same individual, but each stakeholder has different motivations and criteria for purchasing a specific medical device.

Meet and build relationships with key physicians knowledgeable about jaundice

Understand the end-user’s device needs and preferences in terms of design, cost, etc.

Understand practitioner’s capability to administer effective diagnosis and treatment

Delineate market demand: how many phototherapy devices are needed and where will those devices serve the needs of the population

Understand the competitive landscape (see what other devices are being used) and device preferences (what practitioners like and don’t like about individual products)

Meet and build relationships with purchasing decision-makers

Deeply understand the procurement process from the purchaser and end-user’s perspective: how they learn about new devices, set specifications, and allocate budgets, as well as barriers to purchasing and opportunities to streamline the purchasing process

2. Key Opinion Leaders

Government officials (Ministry of Health, Trade, Device Regulation)

Understand government policy priorities in regards to newborn health

Understand technical standard-setting in regards to phototherapy

Learn about device registration, public procurement, or other regulatory processes

Find “key champions” in government to expand D-Rev’s network of influencers

Regulatory advisors

Gain helpful general market-entry guidance (e.g. US Commercial Service)

Assess need and availability of consulting services for complicated regulatory markets (Private companies)

Non-Profits

Piggyback on existing health equipment, advocacy and training programs

Understand role of donors (local, bilateral and multilateral) in medical equipment purchasing

Understand donor and global health community’s role in setting policy priorities

Identify promising NGO/faith-based health providers



3. Private Partners

Meet and vet potential distribution partners

Understand specifics of logistical and regulatory challenges, including customs clearance, tariffs, taxes, device registration

Understand market share of different devices, annual volumes, and profitability

Estimate an affordable target price point for a product in that country

Meet private health providers

Understand opportunities in the private healthcare market, particularly in aid-driven markets

Identify promising private sector health providers

Learn market strategies from other for-profit health companies

Market Prioritization Methodology Our key research question was: “How do we prioritize markets for maximum impact?” There are many potential high-need markets for Brilliance and other neonatal medical devices, including markets where our products are already sold. With finite resources it is critical that D-Rev and similar organizations figure out where to best leverage markets, and where to invest time, staff, and resources to achieve the greatest possible social impact. We use three main dimensions, each with country-level indicators, to prioritize markets: need, market demand, and market structure.

1. Need: As a non-profit focused on social impact, our first criterion is medical need within the country: the proposition being that scaling our device in that market is filling a critical gap in reducing neonatal mortality and morbidity with effective jaundice treatment. This means prioritizing those that do not currently have sufficient access to effective phototherapy. D-Rev’s impact-directed market approach is somewhat counter to the for-profit model, where companies seek well-resourced markets with minimum established levels of demand that meet an internally-defined acceptable profit margin. Need, however, is often correlated with poorly-functioning markets and low ability to pay. Even for D-Rev, as a non-profit, there is tension between need and demand – generally the markets with the highest need have the lowest market demand. Because we scale our products on the market, we wrestle with the fact that markets with more money and better functioning health care systems have a lower need for affordable phototherapy than those high-need markets which satisfy our drive for impact. Our approach so far has been to identify high-need, relatively high-functioning market economies like India and launch our products there, moving into progressively more complicated and high-need markets over time. All of the countries analyzed as part of this due diligence are medium- to low-functioning market economies, and any organization pursuing a similar market-based model will likewise need to address this tension. Need Indicators:

Neonatal mortality rate

Current availability of effective phototherapy

Genetic or blood type factors (G6PD deficiency, RH- disease, ABO incompatibility, etc.) exacerbating jaundice prevalence.

2. Market demand: The second dimension, market demand, takes into account the population

of the country, the number of hospitals with newborn units, demand for hospital services,



patient ability to pay, the sophistication of practitioners and health providers, the priority of neonatal health (and jaundice) compared to other conditions among practitioners and policy officials, and effective and adequate partners for importation and distribution. Market Demand Indicators:

Size of population, hospital sector coverage, number of live births

Demand among government, private, and non-for-profit health facilities

Presence of effective medical device distribution partners

Bias towards/perception of Indian medical devices

Aid-driven relative to market-driven health sectors

Awareness of jaundice, capability to diagnose, and level of priority locally

Competitive landscape of medical devices

3. Structure: The third dimension is structural: local medical device regulatory requirements, logistics challenges, shipping cost(s), customs & tariffs, opacity of the government tendering process, and any other barriers that make entering the market a difficult, expensive, or resource-intensive proposition. Structure Indicators:

Tariffs, taxes and other importation fees

Presence and pervasiveness of corruption

Logistical barriers that create long lead times or significant additional expense

Burden of device registration and regulation

Procurement process (centralized/decentralized; transparency/opacity)

Language and cultural factors, security, ease of travel/transport We recognize that our methodology will evolve over time as we learn more about the markets we enter. Market Prioritization by Country Step 1: Dimensional Ranking We prioritized the seven target countries along the three dimensions described above. All seven countries met our criteria for high need, but differed on both structural barriers and market demand.

Country Need Demand Structure

1. Kenya High Med. Low Med

2. Bangladesh High Med. Low Med

3. Pakistan High Med Low

4. Afghanistan Very High Med. Low Med. Low

5. Uganda High Low Med

6. Tanzania High Low Med

7. Ethiopia Very High Low Low

Note that high, medium and low refer to ranking in each of the three categories: Need, Demand, and Structure

Step 2: Prioritization Based on our analysis and ranking across these three dimensions, the seven countries investigated during the grant period fall into medium or low priority tiers. In-depth analysis is available in the country report annex. Below are summaries of the key points that drive our overall priority rankings.



East Africa and Horn of Africa:

Kenya – Medium priority. Kenya is a low-volume market for phototherapy, and the number of equipment tenders is correspondingly low. However, the regulatory environment is favorable, there are many competent potential distribution partners, and the private health sector is growing and well-organized. Additionally, Brilliance is priced comparably with competing devices while providing superior durability and quality. As a vibrant market economy with sophisticated (though under-resourced) health providers, Kenya may serve as a gateway to the East African region, and can also serve as a test bed for market development activities.

Tanzania – Low priority. Tanzania is a small market poorly served by medical device distributors and where many medical practitioners complain of mismanaged resources. Partly due to a lack of diagnostic capability, jaundice is not seen as a high priority condition by practitioners or administrators. Based on this research, we do not believe there will be a relatively high impact return on investment, or that the market will be self-sustaining in the immediate future. If grouped with Kenya and Uganda for market entry the likelihood of success in Tanzania improves.

Uganda – Low priority, despite significant need for jaundice treatment. The public health system is extremely under-resourced (and greatly mismanaged, according to experts). In such a setting, jaundice is not viewed by practitioners as a top priority and the current market for phototherapy devices is small. Like Tanzania, we do not believe that Uganda represents a high-impact opportunity for our phototherapy device on its own. If Uganda can be part of a regional market strategy together with Kenya and Tanzania, the impact return-on-investment improves.

Ethiopia – Low priority. Significant market development needs to take place to counter the market and structural barriers to entry, which include low public awareness of jaundice, lack of diagnostic capability, limited resources, low birth-in-hospital rate, and a low number of hospitals and NICUs (especially relative to population size). With no domestic seaport, shipping is expensive and lead times are long; and currency convertibility issues make payment challenging. We have heard that the government is planning on significant expansion of its health sector in the next five years.

South and Central Asia:

Afghanistan – Medium priority. Our research determined that the market for Brilliance in Afghanistan is small, but the barriers to entry are low with no need for device registration and a promising potential partner for distribution. Positive factors include geographic proximity to India and the presence of Western aid organizations. Negative risks include significant security issues (one of our key informants for this research, Dr. Jerry Umanos, a pediatrician at CARE Hospital in Kabul, was killed on 24 April), and the potential withdrawal of health-related aid funds following NATO drawdown. Next steps are to clarify key details on shipments and to move forward with a distribution partner.

Bangladesh – Medium priority. Given the large aid market, market entry and product adoption would require upfront and possibly resource-intensive investment. D-Rev would need to have effective partners in-country who could unlock private sales (i.e. a distributor), public sales (i.e. a health minister), and NGO sales (i.e. key donor support from USAID/UNICEF/DFID/World Bank). If the above conditions were met, impact could be substantial because of the large population size, policy focus on child health, and high level of international donor attention.

Pakistan – Medium priority. Positive factors such as a large, high-need population and medium ability-to-pay are balanced by significant structural barriers to importation of neonatal medical products from India due to political tensions. Long lead times for obtaining travel visas from the USA also hampered planning, making it impossible for D-Rev staff to



travel to Pakistan during the grant period. Finally, security issues pose a challenge that, while not insurmountable, require additional forethought, time and financial investment for a small organization like D-Rev.

Market Entry While markets, typically countries, may share structural similarities and key leaders in the private and NGO sectors, each individual market requires a unique entry strategy. D-Rev and others seeking to enter these markets need to consider each country’s medical device regulations, level of sophistication of medical expertise, diagnostic capabilities, and policy priorities. In this section we share some lessons about aspects beyond these common market-entry criteria. D-Rev will incorporate these findings into our product design and delivery cycle, and we would be happy for DFID to share non-commercially-sensitive information with other companies planning market entry for their products. Design Process and Customer Value Chain

1. Design processes need early-on integration with distribution and scaling knowledge. For example, we learned:

The features of a device impact its ability to win public tenders. For example, a competitively priced phototherapy device that cannot be integrated with an infant incubator may be disqualified.

End-users who generated purchasing demand are more comfortable with well-known traditional product embodiments: for phototherapy that often means a lamp head attached to a rolling stand, as compared to a novel or state-of-the-art product

Shipping, customs and import fees can drive costs as much as, or in excess of, the cost to manufacturing. Designing for efficient logistics, such as minimizing shipping costs, promotes affordability of the final product.

2. All markets had substantial need for high-quality jaundice devices. Devices of substandard quality, which were poorly maintained, and often had missing or broken bulbs, were common in every market visited. While we viewed phototherapy devices that are poorly maintained, doctors and purchasing decision makers see an added value for medical device purchases that include local representatives with regular servicing options.

3. High need does not necessarily correspond with perception of need. In countries with very low-resource hospital systems like Ethiopia, Tanzania, and Uganda, poor knowledge of jaundice and lack of available diagnostic and phototherapy options result in an environment where jaundice management is not a priority. Without adequate data on jaundice rates, especially in the absence of affordable treatment options, hospitals are likely to ignore jaundice as an issue.

4. Purchasers sometimes have a price pain point. For example, public hospitals in Kenya can authorize 100,000 KSH (about 69,000 INR / 670 GBP) for discretionary equipment without entering a complex public tender process. Items above this threshold encounter greater additional obstacles and a longer time to purchase. While it is difficult to pinpoint customer’s maximum price for a new device – cheaper is always preferred – pain points like this one can delineate the upper boundaries.

5. It is crucial to identify the true set of buyers. While many facilities care for newborns, we learned that health facilities without warming devices are unlikely to offer phototherapy. We learned from the fieldwork associated with this due diligence, that only large hospitals actually treat jaundice. Other facilities that might seem like logical places to administer phototherapy – maternity clinics and health centers often send jaundice patients to already overcrowded referral hospitals. They do this not because they lack phototherapy devices but because an outpatient health clinic, which many lower level facilities are, is not the appropriate setting for multi-day jaundice treatment.



Distribution and Scaling

1. Local servicing is key, particularly in markets where there is low trust of device performance relative to cost. It is almost universally expected that a reputable medical device company is represented by a reputable local distributor.

2. Marketing is high-touch and traditional. Hospitals learn about new medical devices through distribution agents who market their new products to doctors and administrators at the hospital (e.g. at a forum like Continuous Medical Education). We had previously hypothesized that potential purchasers learn of devices online, but we did not see evidence of this in the seven target countries.

3. It is important to invest time to closely vet, build relationships with, and select distribution partners that are a good fit. In-country distributors may be eager for the prestige of carrying a world-class product that is designed and manufactured overseas. Distributors, like most businesses, are more concerned about profits than social impact – it is easier and more profitable to sell high cost items to well-resourced hospitals than target public hospitals and other high-need facilities. But to create impact, we want to sell affordable products to resource-limited hospitals. This requires a high-touch effort with distribution partners to set clear expectations around affordability, price transparency, and sharing impact data. Investing time up front to select distribution partners who agree to our impact goals results in the high standards necessary to achieve social impact.

4. Distributors can take a variety of forms. In addition to traditional for-profit distributors, which may be excellent partners in many settings, we found in Africa a network of faith-based associations that manage distribution and procurement of medical devices for member hospitals.

Public Sector Procurement

1. Public procurement systems were similar across countries: demand is generated from the end users, and only the most high-need supplies are typically allocated money in a hospital’s budget. New medical devices are generally an afterthought compared to high-volume consumables.

2. Established medical device companies have a competitive edge because of credibility. New medical devices can sometimes win tenders, but demand will have to be generated based on end-user need and case load at the hospital level. There can even be biases on country of origin: Western products, even if merely a repackaging of OEM devices made in China or India, are more attractive in public tenders. Sometimes this is explicit, as in Bangladesh where public tenders divide products into their tiers based on the product’s country of origin (India comprises the 3rd and lowest tier) – and we saw Indian-made medical devices rebranded by a Swiss company as a way of avoiding this restriction.

3. Key opinion leaders – pediatricians and neonatologists at leading local universities – often influence the policies and technical standards around devices for treating jaundice. For example, many countries have a national pediatric or neonatal association. In Kenya and Bangladesh we met doctors involved in leading these associations and found them to be very knowledgeable about the key players in the sector, and often influential themselves.

4. Some countries have public procurement agencies that provide warehousing and distribution of medical supplies to hospitals. The public distribution agencies, however, are demand driven: they fulfill tenders generated from end users and provide some technical support. They do not speculate on demand by purchasing a new product and marketing it to hospitals. In essence, public distribution agencies set standards and provide logistics for medical supply distribution, but are not potential partners for entities like D-Rev to promote new and innovative technology.



Aid-Dominant Markets D-Rev adheres to a model where product distribution is scaled by market forces rather than donations or subsidies. Nevertheless, some countries do not have sufficiently functioning markets for purchasing medical equipment, or their health sectors are supported predominantly by bilateral donors. In such situations – some degree of which characterizes many low-income countries – we have to consider strategies for accessing the foreign aid market in a thoughtful manner.

Donor awareness is key to scaling. Donors in markets like East Africa and Ethiopia tend to support one-off purchasing of new medical devices, while Ministry of Health procurement budgets go to basic supplies and hospital infrastructure. Therefore raising donor awareness of new, high-quality affordable technologies is a critical strategy. We have found that donor reactions to D-Rev range from enthusiasm to wariness based on the donor’s level of prior awareness and level of trust/distrust in the market-based model.

Governments set priorities for donations. Even in markets where bilateral and multilateral donors support a substantial proportion of the health budget, host country governments set their own health priorities and typically have final say in budget expenditures. Coordinating with Ministry of Health and any other relevant government agencies is equally critical for aid-driven markets as coordinating with donors.

Consider a “programmatic” approach to aid markets. In better-resourced settings it is feasible to just sell a new product into the market and see if it succeeds. In D-Rev’s target markets, we may need to find NGO partners who can implement supporting activities, such as training and education, or affordable diagnostics – to create an environment that enables our products to succeed.

Beyond traditional market entry approaches for Brilliance, DFID supported the evaluation of a direct-to customer model for Comet, our portable, low-cost phototherapy device.

Direct-to-customer shipping does not currently seem feasible for adoption and usage in the seven target countries. Hospitals learn about new devices from distributors or other hospitals, and except for a very limited set of sophisticated providers, typically do not purchase through the internet. An in-country agent for distribution and after-sales service is expected by purchasers and almost certainly a pre-requisite to bid on public hospital tenders, where impact will be the greatest. This finding may change over time as more products become available in target high-need countries.

Next Steps: Initial Due Diligence The market due diligence was invaluable to generate data and insights that allow us to evaluate how D-Rev, and other companies, can take a market-driven approach to scaling Indian-made products to high-need markets. An important finding is that after the due diligence process, none of the seven markets are top priorities relative to other countries D-Rev has evaluated prior to this work. We fit these seven countries into the overall landscape of countries D-Rev has researched and/or entered. Here is how we currently prioritize those markets on which we have information (in bold are the due diligence countries investigated under this grant):

Markets Priority Tier Next Step

India 1st Market Entry

Philippines 1st Market Entry

East Africa (Kenya, Uganda, Tanzania)

2nd Market Entry



Bangladesh 2nd Market Strategy

Pakistan 2nd Market Strategy

Afghanistan 2nd Market Entry

China 2nd Market Strategy

Ethiopia 3rd Market Strategy

Indonesia 3rd Market Strategy

Thailand 3rd Market Entry

Following the work performed under this period, the next steps for D-Rev are:

1. Conduct initial due diligence for remaining target high-need markets. Although we originally assumed that we would need to conduct due diligence activities in several West and Southern African countries, the current work has indicated to us that only Nigeria and South Africa could plausibly join the top tier of high-impact markets for D-Rev. Because Ghana often serves Nigerian markets, we would also include it as part of West Africa due diligence similar to how we would consider East Africa as a region for market entry. We would conduct a similar due diligence process in these three countries. Additionally, we would complete due diligence activities in Afghanistan and Pakistan. Projected Timeframe: 6-8 months Estimated Budget: £70k (GBP)

2. Specific, actionable strategy for entry to global high-need markets.

Once we complete due diligence in Afghanistan, Nigeria (including Ghana), and South Africa, we will have a full understanding of the key markets that serve the highest need populations. We will be able to rank order market entry as well as define country-specific launch strategies, timelines and first sales. Projected Timeframe: two to three months Estimated Budget: £25k (GBP)

3. Execute entry strategy in each priority market.

Steps to market entry include:

Securing the participation of partners

Managing our supply chain of distribution relationships

Solving customs and importation challenges

Supporting in-country marketing and business development

Coordinating with policy makers on treatment specifications, child health priorities, reducing trade barriers on medical devices, etc.

Facilitating transfer of impact data

Initiating supplementary activities (e.g. baseline studies on jaundice rates)

Continuously identify market gaps, re-assess, and adjust strategy Few companies have successfully scaled affordable, high-quality medical devices via the market in developing countries. The sector is still new and growing. Our hope is that these activities will generate positive spill-over: valuable, transferable lessons for any medical device company that wants to scale their impact in developing markets. We estimate market entry as an average per country (recognizing individual countries may be less or more, and there may be savings over time): Timeframe: < six months to first in-country sale; 12-24 months for full market entry



Estimated budget per country: £120-170k (GBP) Annexes Please find attached PDF ANNEX I: Country Reports Kenya Tanzania Uganda Ethiopia Bangladesh Pakistan Afghanistan ANNEX II: Regional Analysis East Africa Regional Market South Asia Regional Market ANNEX III: Africa Manufacturing Assessment South Africa Manufacturing

2 & 3. Brilliance Basic technology transfer complete. Brilliance Basic production-ready prototype built at partner manufacturer. Summary of Activities When we started this project, Brilliance, was on the market in India and around the world. We have since completed the design for Brilliance Pro, the second generation of Brilliance that will enter the market in 2014. With the introduction of Brilliance Pro, we will re-name the original Brilliance as Brilliance Classic. Our project pipeline below describes the current state of each product in the Neonatal Jaundice line with regards to D-Rev’s design process.

The goal of Brilliance Basic was to achieve a cost reduction of Brilliance (now Brilliance Classic).This cost reduction would allow D-Rev and Phoenix to expand the product platform for more choices and lower costs. We identified which features of Brilliance Classic are critical to delivering effective



phototherapy treatment and remove those deemed unnecessary. Our original plan was to add this newly pared down product, “Brilliance Basic” to the product line and market itas an even lower-cost alternative to Brilliance Classic, thereby expanding access to effective phototherapy in high-need areas. However, through this process of evaluating the Bill of Materials (BOM) of Brilliance Classic and building a Brilliance Basic prototype, D-Rev determined that the total cost savings of for a basic model based on Brilliance Classic were less than anticipated. Therefore we decided not to complete a technology transfer or a production-ready prototype. We did, however, discover potential cost savings in paring down the features of Brilliance Pro to create a basic version of Brilliance Pro, which we will continue to explore for market and production viability. Steps to evaluate the viability of Brilliance Basic:

Assessed feature list of Brilliance Classic phototherapy to determine minimum required features in order to deliver effective treatment.

Prepared bill of material for minimum required feature set to determine component list for Brilliance Basic.

Estimated cost of a manufactured Brilliance Basic unit, compared estimates with current product line to determine feasibility of the product line.

Built a prototype Brilliance Basic unit. Feature Analysis D-Rev used its experience working on-the-ground in low resource settings and interviews with medical professionals and users to determine which of Brilliance Classic’s current features are most important for our users to deliver effective phototherapy to patients. We also reviewed tender specifications for government purchases to understand which features were required in order to successfully win a government bid – as government tenders are the access point for our target market. Essential features: stand, tilt mechanism, hour meter/therapy timer, on/off switch, height adjustment, high-quality power supply Non-essential features: LCD display, intensity adjustment, observation lights, reset button, lightmeter, data collection BOM Analysis

D-Rev determined that a power supply, logic board, and power board were not required and could be replaced with simple current driver for each string of LEDs.

D-Rev determined that the LCD display on the face of Brilliance Classic could be replaced with a simple analog hour meter to capture therapy time in a low-cost way.

D-Rev determined that a single hard on/off switch was sufficient for operation and could substitute for additional soft power on/off buttons.

In addition to the component savings, the above changes reduced manufacturing time for the total system.

Table 1 (below) summarizes the cost analysis performed on four versions of Brilliance:

Classic: Existing version of Brilliance available on the market since 2012.

Pro: The next generation, feature-rich, Brilliance to be launched mid-2014. Has a lightmeter, data collection, and intensity adjustment. It is also easier to manufacture.

Pro-Basic: A basic version of Brilliance Pro, using the Pro embodiment but removing features as described above.

Classic-Basic: A basic version of Brilliance Classic, using the Classic embodiment but removing the LCD display.



Total Mechanical

Electrical Cost Savings

Notes

Classic

$176.59 (10,631 INR / 104 GBP)

$78.83 (4,746 INR / 46 GBP)

$97.76 (5,885 INR / 57 GBP

N/A

Classic-Basic

$171.60 (10,330 INR / 101 GBP)

$78.83 (4,746 INR / 46 GBP)

$92.77 (5,578 INR / 54.42 GBP)

$4.99 (300 INR / 3 GBP)

N/A

Pro

$220.04 (13,236 INR / 129 GBP)

$99.83 (6,010 INR / 59 GBP)

$120.21 (7,236 INR / 71 GBP)

This is with the machined heat sink ($36 / 2,167 INR / 21 GBP)

Pro-Basic

$177.72 (10,698 INR / 104 GBP)

$99.83 (6,010 INR / 59 GBP)

$77.89 (4,689 INR / 46 GBP)

$42.32 (2,548 INR / 25 GBP)

Electrical is driver, meter, LEDs, classic small parts

Table 1. Brilliance versions explored for greater market penetration

Product Line Feasibility As can be seen in Table 1, the difference in cost between Brilliance Classic-Basic and Brilliance Classic is only $4.99 (301 INR / 3 GBP) which does not translate into enough cost savings passed onto the purchaser to make Brilliance Classic-Basic a viable addition to the product line that includes Brilliance Classic. The cost difference that is compelling is the $42.32 (2,548 INR / 25 GBP) saved between Brilliance Pro and Brilliance Pro Basic. We believe this cost savings is significant enough to be passed onto the purchaser, affect purchasing decisions, and expand the impact of the Brilliance line by making effective phototherapy accessible to more hospitals and clinics. Brilliance Pro Basic Prototype Unit Based on the analysis above that determined that Brilliance Pro Basic is a viable option for the Brilliance product line, we built a working prototype of Brilliance Pro Basic using the chassis of a prototype Brilliance Pro unit. We removed components based on our BOM analysis above for the lightmeter, the LCD display, logic board, power board, power supply, SD card slot, and front panel. We installed a new current driver to maintain proper power outputs and an analog hour meter to record total machine time.



Full Brilliance Pro-Classic Unit

Full Brilliance Pro-Classic Unit

Brilliance Pro-Classic Unit with light meter components removed

New current LED driver to replace power supply and power boards



Next Steps: Brilliance Basic Production-ready Prototype D-Rev determined that the total cost savings of Brilliance Classic Basic were less than anticipated. Total BOM savings over Brilliance Pro were approximately $35 (2,107 INR / 21 GBP), which is significant, but costs savings over Brilliance Classic were only $5 (301 INR / 3 GBP). This is largely because the required feature set for delivering effective phototherapy was more extensive than we originally anticipated. For example, we were not able to remove the tilt mechanism or the height adjustment from the unit, even though they are expensive components, because they are critical to the user in NICU settings. Due to this lack of total cost savings, D-Rev decided we will not invest further in a separate product line for Brilliance Classic Basic. While Brilliance Classic Basic, as it was originally conceived in this proposal, will not be a new product line, we determined that there is value in replacing the existing Brilliance Classic with

Brilliance Pro-Basic. We investigated the production processes for the separate embodiments for Brilliance Classic and Brilliance Pro and determined that there are economies of scale to exploit from replacing Brilliance Classic with a “basic” version of Brilliance Pro. Such economies of scale include accelerating the return on investment in tooling from using the same molds and simplifying the assembly process. Additionally, using the chassis of Brilliance Pro to replace Brilliance Classic will make the unit easier to use by increasing the ease of tilt and making the LCD display more readable. Once CE mark has

Full Brilliance Pro-Basic Unit

Brilliance Pro-Classic Unit with LCD display and front panel buttons removed, analog hour meter added.



been achieved for Brilliance Pro, D-Rev will begin the process of phasing out Brilliance Classic in lieu of a less feature-intensive version of Brilliance Pro-Basic, allowing us to maintain cost while improving the product overall. The Brilliance line of products will benefit from ongoing technical development to reduce its final cost to the end user. The next set of design revisions will focus on four main objectives: 1. Reducing Bill of Material costs and warranty claims by developing a cheaper, more robust power supply 2. Reducing the shipping volume to cut freight costs 3. Exploring the technical and logistical implications of manufacturing the rolling stand in target markets to cut import duties and VAT 4. Developing the Brilliance Pro Lightmeter accessory into a standalone product that can operate on any phototherapy device and not only Brilliance Pro Project timeline: 12 months Estimated budget: £95k



NEXT STEPS FOR D-REV DFID-India significantly accelerated the development, scaling and reach of D-Rev’s neonatal jaundice products. Our goal is to take the next three steps to move our high quality, affordable Indian products into low-resource, high-need markets in a way that is both economically sustainable and effective at achieving international development goals. The first two steps are a direct result of the work done as part of DFID support; the third is related. We will work to: 1. Expand our product platform to increase the number of affordable options. This project uncovered that products like Comet are the critical piece to meeting gaps in high-need regions where: (a) there are no affordable and suitable options, (b) local capacity for manufacturing is not present, and (c) shipping costs are high. This project validated the potential of Comet to end brain damage and death from jaundice in Sub-Saharan Africa and we are committed to completing its design and development. Timeframe: 1.5 years The estimated cost to bring Comet to market is £463k GBP. 2. Increase depth of due diligence activities to support business development and distribution in target markets: East Africa, Pakistan, Bangladesh and Afghanistan, and increase reach of due diligence to understand markets in South Africa, Ghana and Nigeria.

Finalize due diligence for introducing Brilliance to new markets. Our current work identified Nigeria and South Africa as high-impact markets for D-Rev, we would expand our market due diligence to include regional entry strategies for West Africa and East Africa. Timeframe: 6-8 months

Conduct due diligence in other potential markets: South Africa, Nigeria and Ghana. Once we complete this due diligence, we will rank order market entry, define country-specific launch strategies, timelines and first sales – and will fully understand these key markets serving populations with the highest need for phototherapy. Timeframe: two to three months.

Execute the identified entry strategies in high-priority markets. Timeframe: < six months to first in-country sale; 12-24 months for full market entry.

The estimated cost to complete the market diligence for Brilliance and Comet in all regions is £177k GBP. 3. Transition to scale of Brilliance phototherapy in India and East Africa. We are a finalist with Saving Lives at Birth for a transition grant to fund this work.

As part of our assessment of Brilliance’s impact in India and other low-income countries, we have identified two barriers which we will overcome with directed, accelerated support for scaling:

A) Low awareness of Brilliance among target users/purchasing decision-makers. Our proposed

grant will accelerate scaling of Brilliance to high-need hospitals by testing three approaches of

varying resource requirements to address purchasing demand gaps: (1) High Touch Approach:

hospital-level purchasing and logistics support with consultative selling in the Indian states of

Tamil Nadu, Assam and Madhya Pradesh, as well as Uganda; (2) Medium Touch Approach:

affordable and replicable mass marketing in India and East Africa to drive market penetration;

and (3) Low Touch Approach: Search Engine Optimization (SEO) of commonly used keywords

relating to Brilliance (e.g. phototherapy, bililights, jaundice) in the top 10 out of the 25 countries

contributing to 80% of all neonatal mortality, as identified by UNICEF’s Every Newborn Action



Plan, particularly those countries where private hospitals serve the poor. We selected these

approaches based on the range of resources required, our analysis of market conditions prior to

Brilliance’s launch, target user feedback, and sales and inquiries data from Brilliance’s first 1.5

years on the market. We will measure and publicly disseminate the results of each approach to

evaluate cost effectiveness and impact. These results will inform future decision-making around

scaling market-driven global health interventions.

B) Country-specific logistical challenges to market entry and purchasing. Our goal is to have a

toolkit of high-impact, context-specific activities for successful and affordable scaling into high

priority countries. Success of market entry depends on a wide range of factors that include:

trade barriers; economic policy; public, private and NGO health resources and infrastructure;

cultural context; social openness and progressiveness; medical training, and the existence of

viable distribution partners. Market inefficiencies and hidden logistical barriers, such as

corruption, pose additional challenges to entrants in low-income markets with high need.

We will assess the replicability of models that are successful in India, including delineating the differences and commonalities, and analyze the viability of selling Brilliance in UNICEF’s high-priority countries. Leveraging what we learn from the India program, we will formulate demand creation activities to successfully enter each viable market, including Uganda as an entry point into the East African markets.

Timeframe: 4 years Estimated cost: £1.03M GBP



CONCLUSION The grant from DFID accelerated D-Rev’s progress in a short period of time on product development and market entry that are critical to our mission of ending kernicterus caused by neonatal jaundice in India and worldwide. Prior to DFID’s support Brilliance was installed in 5 countries, and as of May 2014, Brilliance has been installed at low- and middle-income hospitals in 14 counties.1

This funding enabled us to make leaps forward in developing our next generation of phototherapy devices, and to conduct critical due diligence activities to help us prioritize markets where the need for our low-cost, effective phototherapy devices is dire. As a result of this grant, we are on schedule to scale Brilliance and the rest of our neonatal jaundice line, Brilliance Pro and Comet, to identified high-need markets around the world. We are grateful to DFID for this generous support at a critical time in our product development and distribution cycle. We look forward to continuing the conversation and to working together in the future to ensure that affordable products reach those who need them the most.

1 For the latest Brilliance impact figures, please see D-Rev’s Brilliance Impact Dashboard. Please note that for countries, we report installations (confirmed installation in hospital), as compared to sales (to distributor or hospital).

http://d-rev.org/impact/brilliance/



Documents

Final Report on Expanding Accessibility of Affordable User ...ipekpp.com/admin/upload_files/Report_2_20... · maintenance requirements and costs. Through a partnership with Phoenix