Aptiva Medical zeroes in on CGM, readies to scale on all fronts

FORT LAUDERDALE, Fla. – Aptiva Medical will use its recent acquisition of VeraMed Health and a laser focus on continuous glucose monitors (CGMs) to position itself as a leader in the market, says David Wallace, co-founder and managing partner of Greenleaf Ventures, which launched Aptiva three years ago. 

Building to scale 

“With Aptiva we think we’ve built our best operating platform and when we tie that to the VeraMed acquisition, it’s a platform that we have ready to scale,” he said. “They have a good patient base, and it was a good size for us and the perfect timing to add that to our platform and (getting ready) to scale on all fronts.” 

Greenleaf Ventures has a track record of building and scaling successful health care companies in the medical supply and pharmacy sectors, including Access Diabetic Supply and Arriva Medical. In 2014, it acquired Liberty Medical out of bankruptcy and restructured it, later selling it to Cardinal Health. 

Competitive bidding & market dynamics 

Since the acquisition announcement, Greenleaf has fielded numerous calls from small providers who are considering exiting the space due to the return of Medicare’s competitive bidding program, Wallace says. CMS has proposed including CGMs in the next round of the program. 

“With competitive bidding hanging out there, you get a lot of smaller providers trying to decide, ‘What do we do if there’s significant reimbursement changes,’” he said. “A few of these players are very familiar with what happened to diabetes testing supplies (in the original mail-order program).” 

However, the market dynamics are very different now than they were in previous rounds of competitive bidding, Wallace says. First, there are only two major manufacturers of CGMs and they have similar pricing; and second, the current administration is pro-wearable. 

“I think when CMS thinks it through, I don’t think they are going to achieve the savings they think they will,” he said. 

Stay focused, stay fast 

Throughout its various businesses over the years, Greenleaf Ventures has made the strategic choice to stay very focused on the business at hand, whether it’s targeting certain product categories or specific payers, or designing the most efficient operating platform, says Tim Stocksdale, company co-founder. 

“If you can streamline and simplify, it’s sort of like building the fastest drag racer – you want to stay in your lane and go as fast as you can and be the best at what you need to be,” he said. “That’s our approach now. Our focus is, how do we become the best at CGM and then we can talk about additional product lines once we’ve achieved that.”