Bausch + Lomb: Leadership & Innovation in Eye Care

What motivates me is really solving problems for people that today are unsolvable. Sight is such a precious gift. So, being able to preserve it or restore it for people who are struggling is just massive satisfaction. And so, to the extent I play a small part in finding the next treatment for someone who's visually impaired or blind, that would be the holy grail for me.

Thanks for having me, John. I'm looking forward to the discussion.

Sure, absolutely. Bausch and Lomb is a 172-year-old eye health company. We operate in the eye health segment in the broadest sense of the word. We organize around four businesses. One is a pharmaceutical business that makes prescription medicines for eye care. We have a consumer business that makes all the things you would buy in a drugstore or Walmart in the eye care aisle, vitamins, drops, and everything in between, contact lens solution. We have a contact lens business that makes contact lenses around the world. And lastly, we have a surgical business that makes everything an ophthalmic or retina surgeon would need to be able to do the surgery, whether that be lasers, capital equipment, implants, instruments, fluidics, surgical packs, gowns. So, very comprehensive eye care company. The brand is an iconic brand having been around for 172 years, but many of our products are sub-branded. So, in the consumer space, our vitamins for people suffering with macular degeneration are known as PreserVision. Our contact lenses — our newest one that's launching is called Infuse in the United States. Some of our drugs are for dry eye, example is Xiidra or Miebo. And then, in terms of cataract surgery or implants used in cataract surgery, we have an enVista product line of implants. So, we have hundreds and hundreds of brands in the eye care space.

Yeah, so it's interesting. Historically, it was a field that was driven by age. As your eyes age, they tend to deteriorate. That could cause presbyopia. That could cause cataracts and things of that nature. A new factor over the last decade has been screen time. As you stare at screens, you blink less. Kids that stare at screens tend to have their eye muscles be underdeveloped. They get a disease called myopia. And then, of course, pollution, diabetes is a big negative to eye health and can lead to a variety of different issues. And then, as we've lived longer, there's prevalence of other diseases like macular degeneration or geographic atrophy. And then, there's a whole host of genetic or inherited eye diseases that have been around and unsolvable. Across the entire field of eye health, many of our diseases are still treated, not cured. And so as a result of that, there is a lot of white space and opportunity for innovation and R&D to change the standard of care or change the paradigm for patients and how we deal with the disease. So take glaucoma as an example. Very high prevalence of glaucoma. We've always thought of it as a disease of increased intraocular pressure, but really it's a neuropathy. It's a neuropathic disease affecting the retina. And so glaucoma patients, while we can control the pressure with eye drops, still 30-35% have their eyesight deteriorate over time. And so we're always looking for novel ways to treat it rather than the standard paradigm.

Yeah, great question. Not easy to do. I'll tell you the way we went about it. One was to really invest in talent and R&D and really go out and try to hire or promote or develop the best R&D talent in the organization. I spent my first year really working with our head of R&D on recruiting scientists and building out the capabilities of our R&D teams. And once you have that in place, it gives you the confidence to say, 'Okay, now let's stop doing the incremental innovations. Let's get rid of some of these pipeline programs, and let's make bigger investments in programs that are going to change the standard of care for patients.' And the reason we believe we can do that is that we have the right people and the right talent with the right expertise and experience to lead these programs. And so, you feel more confident as a CEO investing behind a program when you're really confident in the talent of your team. And so, that really was the formula that I deployed. It took time, but I'm really excited when I look at where we are today across all of our businesses and our pipeline. I would say it's never been stronger, and we unveiled it in November at the New York Stock Exchange to our investors, and then we got tremendous feedback on the progress we've made.

Yeah, it's really a good story. So, Bausch & Lomb invented the mass-produced soft contact lens in I think it was 1971. And those were called hydrogels. Then, in the late '90s, Bausch & Lomb invented the next new material called silicone hydrogels. For the last 25-26 years, the industry has been optimizing this material, silicone hydrogel. And Bausch & Lomb started it, but was late to the optimization of it. And so, when I got here, I said, 'It's really important that we restore ourselves back to driving innovation in material science and contact lenses.' And there's a real need because there's a lot of dropouts still in the industry because of end of day comfort. And so, I think it was my second or third day as CEO, I went up to Rochester, New York, which is where our contact lens R&D team is. And then during the lunch hour, they set up easels with posters. And teams, many of them younger talent, were presenting these posters to me. And I would spend 10 minutes or so at each poster and getting to know folks. To be fair, I wasn't really so interested in what was on the poster. I was more interested in the talent behind the poster and getting to meet the people. But I get to this one poster about this novel material using hyaluronic acid as its backbone. And I really was impressed by the team and the idea and the concept. And I called the head of R&D and I said, 'I wonder if we could turn this into a full-blown development program.' And I walked them through my rationale. We then met with the team. And I said to them, 'Guys, you guys have a winning idea here. Whether we can bring it to life remains to be seen. But I want to invest in it. And I'm going to meet with you guys every Friday till we figure out we can do it or we can't do it. And let's get started. But I'm going to give you one requirement. Not only do you have to change the game in material science, but we need to be able to manufacture this on our existing manufacturing lines because building new lines is a multi-billion dollar investment. And I'd rather invest in the R&D than in new manufacturing capability.' And so, that was a pretty big challenge. And so, over the course of the next three years, we've been meeting every Friday and the team does a lot of work between Friday to Friday. And lo and behold, they cracked the code, they figured it out, and now we're in the final stages of clinical testing on that contact lens with a target launch date for 2028.

So, the promise is best-in-class comfort, and potentially even — we'll have to see how the data plays out, right? We're doing the clinical studies, but potentially even better comfort at the end of the day than at the beginning of the day because the way the lens is built using hyaluronic acid, which is your body and your eyes' natural moisturizer, as the lens interacts with the natural enzymes in your eye, it releases more HA. And so, the longer you wear it, in theory, the more comfortable it should be. And so, it's really turning the whole paradigm on its head.

Yeah, we should have data in the second half of '26, so 5, 6, 7 months from now.

Yeah, so myopia is an epidemic. It primarily affects children who spend too much time indoors or staring at screens. The easiest way to solve it is to get kids outside more and looking farther away and exercising their eye muscles, but that's hard sometimes, particularly in urban settings and places like that. We see in Asia it has already been declared an epidemic. It's happening here in the United States and Europe as well. And today the current treatments are either — there's some spectacles that are approved, but there are contact lenses that help essentially strengthen the eye muscles. I'm oversimplifying. But they weren't designed for kids, they were repurposed. What we think is a breakthrough is we have a design we did with an academic partner that we think is really novel. It's designed for kids. We're using our best, most comfortable contact lens material, so it should be very comfortable for the kid. And then the treatment is on the outer rings of the lens. So, it allows them to see normally, but then exercise the periphery of their vision to help strengthen their eye and thereby treat the myopic condition. So, really cool. We're just about to go into clinical studies over the next few months and I'm very excited. I hope we can do it very quickly because at least in my field of work, nothing's better than helping children — and helping children see better to live better is really part of our company's mission.

Thank you. Yeah, we are as well.

Sure. So, I was in law school in Philadelphia and I needed a job. And so, I got a job working in the law department at Thomas Jefferson University and health system. And so, that became my first connection to healthcare. And I really liked it and so, as I completed my law degree and ultimately did an MBA, I took a full-time job at Jefferson. And from there I went into consulting at Price Waterhouse Coopers as a partner in their consulting group. And that's when I transitioned to pharmaceuticals. They needed some help in their pharmaceutical practice, I volunteered. And I started doing much more work with companies like Abbott and J&J and some companies that don't exist today, Pharmacia and Schering-Plough and others like that. And ultimately doing a big project for Schering-Plough, their CEO at the time, a guy named Fred Hassan, a real legend in the pharmaceutical industry, said, 'Hey, why don't you leave consulting and come work with me at Schering-Plough?' And it was a tough decision because I really enjoyed the job. I enjoyed the people I worked with, but ultimately I saw myself on the side of doing things, not advising. And so I made that change and I worked for him for eight years working my way up to become president of Schering-Plough. And then Merck bought us. And I decided I needed to find something else to do. And so I was interviewing with a bunch of folks. Warburg Pincus, the private equity firm that you know well, they had just taken Bausch & Lomb private. And they were looking for a CEO. And so I interviewed and got the job. It was my first CEO job. I ran it for about three and a half, almost four years. And they then got offered to sell Bausch & Lomb and they sold it and I left. And then spent almost the next 10 years creating what became Allergan and wound up selling that to AbbVie in the summer of 2020 during pandemic. I took a year or two just to do kind of family office and do my own thing. And I learned something about myself which was I wasn't ready to not be an operator. And that I wanted to get back in and run something and work with great people and do great things in this industry. And just by chance, the board of Bausch & Lomb reached out to me that they had spun Bausch & Lomb out of the old Bausch Health as an independent company, and they wanted a CEO, and would I come back? And I thought about it for a while, but ultimately I loved the company. I loved my time here in the past. I absolutely love the eye health community and the innovation and the entrepreneurship of this industry. And so it was an easy decision to come back, and it's been no regrets since. Best decision I made in a long, long time.

Yeah, you know, my wife was kind of helpful on that. I'm a get up and go to the office every day person. I never really worked from home. Even in pandemic, I went to the office every day. I'd been doing it so long, it's just, you know, I either go to the airport or I go to the office, right? So those are the two places I go every day. And when I was doing my own investing in my own family office kind of activity, I was getting up early, going to the gym, going to the office, coming home at 7:00, 8:00 at night. And my wife said, 'You just don't seem as happy as you used to be.' I knew it, but I needed to hear it, I think, externally to know, 'You know, you're right. I'm not good at just advising people. I like to do things.' And that comment from my wife, I think, was really instrumental for me saying, 'You know what? You're right. I'm much happier when I'm doing it and feel accountable for delivering than when I'm just advising.' And this may sound odd or corny, but you know, and I was what, 52, 53 at the time. And then it dawned on me what the key for me at least to happiness is. Happiness for me is very simple. It's when you're excited every morning to wake up and go to work. And you're excited at the end of the day to go home and be with your family. And if you got those two things working, what more could you ask for?

I hadn't heard that, but that resonates. I think that's exactly right. But at least my recipe for happiness is I wake up every morning excited for the day, even if there are big challenges in the day. You know, I feel like I don't know, it's like an athlete. I'm putting on my uniform every day to go in and give the best performance I can. But at the end of the day, you know, driving home, I can't wait to get home and be with my family.

You know, if I had to pick let's try to narrow it down to maybe two, maybe three. But I think one is a realization that success is about the talent you surround yourself with. When you want to run a pharmaceutical company or medtech company or in Bausch and Lomb's case, it's both. You need really talented people on the team. I use a lot of sports analogies, but it's kind of like a football team, American football I'll use. You know, you can have a great quarterback, but if you don't have a great line and great receivers and a good defense, it doesn't matter how great the quarterback is. You're not going to win Super Bowls. Super Bowls are won when the team is very talented at all positions. And that's true for leaders. You need to hire people smarter and better than you to push you and challenge you. You need to give them the room to operate. You need to coach them through the tough things. And you need to ask great questions. But most importantly, you need to hire really talented people. I think the second attribute I would define as curiosity. When you run a science-based company and you're not a scientist, I'm not a scientist. I wish I was. If I could go back and get a redo, but I'm not. You know, you have to be exceptionally curious. People who work with me will know I spend a lot of time very early in the morning. First thing I do when I get up is I scan the literature of all the different journals. I look at everything to read and study in order for me to ask questions of our talented scientists. Have we thought of this? Have you ever thought this application would work? And I send out emails early in the morning, you know, 5:30, 6:00 a.m. Did you look at this? What about this? Have we seen this? And so, it's really being very curious and pushing yourself. And then maybe the third, I think one attribute I learned from Fred Hassan, my mentor at Schering-Plough, but really humility. You know, I think that the organization isn't here to serve me, I'm here to serve it. My job is to make everybody else's job easier. It's not for them to work for me, it's for me to work for them. And so I take that very seriously and actions speak louder than the words. So, just a silly example, it may seem very simple, but I show up at every meeting on time. And one day somebody asked me at Allergan, 'Why are you always on time? You know, the previous CEO was always late.' And I said, 'Look around the room. There are 18 of us in this room and if I'm late for 30 minutes, that's nine hours of productivity lost from really great people. And so, not only do I want to be on time, but I want to run this meeting really efficiently because your brain power is way too important.' And those are just one simple example, but that's I think what great leaders do is realize they're there to make everybody else better, not to make themselves better.