Annual Report and Accounts 2006 - Optos
Annual Report and Accounts 2006 - Optos
Annual Report and Accounts 2006 - Optos
You also want an ePaper? Increase the reach of your titles
YUMPU automatically turns print PDFs into web optimized ePapers that Google loves.
practitioner in maximising patient<br />
Operational <strong>and</strong> Financial Review<br />
15%<br />
adoption rates of the optomap®<br />
continued Retinal Exam. Developing a closer<br />
working relationship with National<br />
Health Service (“NHS”) bodies<br />
continues to form part of our<br />
approach to the UK market <strong>and</strong>,<br />
during the year, development work<br />
was undertaken within the Primary<br />
Care Trust (“PCT”) network. Our aim<br />
is to assist in establishing Primary Eye<br />
Care Centres for triaging <strong>and</strong> patient<br />
management.<br />
The commercial <strong>and</strong> operational<br />
teams have been strengthened to<br />
provide us with an improved market<br />
focus, <strong>and</strong> streamlined decisionmaking<br />
for growing our installed<br />
base <strong>and</strong> integrating the optomap®<br />
Retinal Exam into both our existing<br />
<strong>and</strong> prospective customer practices.<br />
We reorganised the structure of our<br />
US organisation into two separate<br />
east <strong>and</strong> west geographic regions.<br />
These are now led respectively by<br />
a Vice-President <strong>and</strong> supported by<br />
Regional Sales <strong>and</strong> Clinical Managers<br />
tasked with maximising the sales <strong>and</strong><br />
clinical effectiveness throughout each<br />
region. We opened a new Distribution<br />
<strong>and</strong> Service Centre (“DSC”) close to our<br />
Marlborough, Massachusetts office<br />
during the year. This facility provides<br />
the space, capability <strong>and</strong> capacity to<br />
support the continued expansion of<br />
our business in North America.<br />
Europe<br />
Revenues in Europe grew by 24%<br />
to $3.0 million, with $2.3 million<br />
generated by our UK business<br />
<strong>and</strong> $0.7 million in Germany. The<br />
European marketplace has very<br />
different characteristics than its North<br />
American counterpart. In the UK, the<br />
vast majority of eye examinations<br />
are carried out in a retail setting<br />
by ophthalmic opticians who tend<br />
to focus heavily on retail sales <strong>and</strong><br />
refraction rather than on preventative<br />
care. Accordingly, we have estimated<br />
that there is a smaller addressable<br />
market of approximately 400 practices.<br />
The market in Germany is comprised<br />
entirely of ophthalmologists operating<br />
in private practice, who carry out<br />
primary as well as secondary care. We<br />
estimate that the addressable market<br />
in Germany st<strong>and</strong>s at approximately<br />
2,500 practices. Our total installed base<br />
in Europe at the close of the financial<br />
year was 118, up by 40% from 84 at the<br />
same time last year, representing over<br />
3% penetration of the addressable<br />
market.<br />
In the UK, our focus is on contracting<br />
with <strong>and</strong> retaining top-tier optician<br />
practices, <strong>and</strong>, during the year,<br />
our activities were geared to this<br />
defined customer segment. The<br />
optomap® Retinal Exam is marketed<br />
<strong>and</strong> recommended to all patients<br />
as a health-screening examination<br />
requiring patient payment at the<br />
point of service. We improved our<br />
penetration rate during the year, with<br />
our installed base growing by 15% to<br />
77, up from 67 at the same time last<br />
year. We continued to participate in<br />
continuing education conferences,<br />
<strong>and</strong> during the year, developed <strong>and</strong><br />
offered a clinical conference series,<br />
held in four locations throughout the<br />
UK (London, Glasgow, Birmingham<br />
<strong>and</strong> Manchester), with a focus on<br />
acquiring new customers. In our<br />
existing customer base, we provided<br />
ongoing clinical, educational <strong>and</strong><br />
marketing resources, as well as<br />
technical assistance to support the<br />
“At the time of our initial public<br />
offering, we identified France,<br />
Spain <strong>and</strong> Japan as holding<br />
favourable fundamentals for<br />
geographic expansion. ”<br />
Laser sources for the<br />
P200 MA device<br />
In Germany, we entered our second<br />
full year of operation <strong>and</strong> we made<br />
good progress in establishing <strong>Optos</strong><br />
as a known <strong>and</strong> credible provider<br />
in the eye <strong>and</strong> health care market.<br />
We installed 24 P200 devices during<br />
the year, bringing the total installed<br />
base to 41, an increase of 141% over<br />
the previous year. A key operating<br />
objective during the year was to<br />
strengthen our infrastructure. To<br />
this end, we opened an office in<br />
Mannheim <strong>and</strong> recruited staff with<br />
established contacts in the German<br />
ophthalmic market. We now have in<br />
place a resident Managing Director<br />
who is responsible for the day-to-day<br />
operation in Germany, <strong>and</strong> additional<br />
sales <strong>and</strong> service-focused personnel<br />
who have the know-how to deliver<br />
on our aggressive objectives in this<br />
market.<br />
Our sales <strong>and</strong> marketing efforts also<br />
grew in quantity <strong>and</strong> quality during<br />
the year. We had an effective presence<br />
at the three major national exhibitions:<br />
Deutsche Ophthalmologische<br />
Gesellschaft (“DOG”), Kongress der<br />
Deutschen Ophthalmochirurgen<br />
(“DOC”), <strong>and</strong> Augenärztliche<br />
Akademie Deutschl<strong>and</strong> (“AAD”). We<br />
also participated in joint <strong>Optos</strong>pharmaceutical<br />
marketing events <strong>and</strong><br />
initiated a local doctor-led customer<br />
awareness series, aimed at increasing<br />
awareness of our P200 device <strong>and</strong><br />
the benefits of the optomap® Retinal<br />
Exam. Satisfied customers are an<br />
excellent source for referrals <strong>and</strong> new<br />
customer leads. To ensure we continue<br />
to be responsive to the needs of our<br />
customers, we conducted our first<br />
User Meeting <strong>and</strong> launched a quarterly<br />
communications programme where<br />
doctors receive a range of materials,<br />
including German patient marketing<br />
collateral, recent clinical research from<br />
our German research site – Ludwig-<br />
Maximilians-Universitätj (“LMU”) – <strong>and</strong><br />
a broad range of templates to assist in<br />
their individual efforts to integrate the<br />
optomap® Retinal Exam deeper into<br />
their practice. Penetration in Germany<br />
stood at 2% of the addressable market<br />
at the close of the financial year, up<br />
from less than 1% at the same time<br />
last year.<br />
Increase in installed bases in the UK.<br />
A total of 77, up from 67 at the same<br />
time last year.<br />
141%<br />
Increase in installed bases in Germany.<br />
A total of 41, up from 17 at the same<br />
time last year.<br />
During the year, we designed,<br />
commissioned <strong>and</strong> built our European<br />
Service Centre to support our<br />
expansion plans in Europe in both our<br />
existing <strong>and</strong> targeted new markets.<br />
This facility provides additional<br />
manufacturing <strong>and</strong> distribution<br />
capacity. We now manufacture<br />
three modules of our P200 device<br />
<strong>and</strong> provide distribution facilities to<br />
mainl<strong>and</strong> Europe <strong>and</strong> the UK. This has<br />
enabled our manufacturing team to<br />
make significant progress in improving<br />
the quality of our output. We have<br />
brought in-house the manufacture<br />
of assemblies, which was previously<br />
outsourced, resulting in reduced costs<br />
<strong>and</strong> improved reliability.<br />
We have also taken the opportunity<br />
of training the Technical Operations<br />
team in continuous improvement,<br />
workplace organisation <strong>and</strong> lean<br />
manufacturing techniques to support<br />
the continuing development of our<br />
capabilities. Our exp<strong>and</strong>ed materials<br />
control team have established the<br />
processes supporting expansion into<br />
Europe. These new processes have<br />
also driven up inventory accuracy<br />
<strong>and</strong> have had a positive effect on<br />
the quality of our planning <strong>and</strong><br />
schedule adherence in shipping to<br />
our customers.<br />
14<br />
<strong>Optos</strong> plc <strong>Annual</strong> <strong>Report</strong> & <strong>Accounts</strong> <strong>2006</strong>