Gradian II: Marketing to Multiple Stakeholders in a Complicated Field

This post explores how Gradian Health Systems is tackling the challenge of marketing its Universal Anaesthesia Machine to four distinct but interconnected stakeholder groups: users, hospitals, Ministries of Health, and donor organizations. It was written by Julie Manriquez, Lyn Denend, and Professor Stefanos Zenios of the Stanford GSB’s Program in Healthcare Innovation.

The Problem/Solution Space

Of the more than 230 million major surgical procedures performed worldwide each year (1), roughly 15 percent are completed with substandard anesthesia. (2) This problem is particularly prevalent in developing countries, where hospitals often lack adequate infrastructure and equipment to perform safe anesthesia procedures. Although many facilities either purchase or receive donations of conventional anesthesia machinery used in hospitals in more developed countries, these devices are often inappropriate for the realities of low-resource surgical settings. According to some estimates, hospitals in developing regions experience an average of 18 power outages per month. (3) They also face regular shortages of compressed medical oxygen. Either of these problems will cause conventional anesthesia machines to shut down (4), creating devastating consequences for patients. Moreover, when conventional equipment malfunctions or breaks, hospitals in low-income settings frequently cannot get replacement parts and/or have no one qualified to perform the necessary repairs.

About Gradian and the UAM

Substandard infrastructure is a common problem, particularly in rural hospitals (photo courtesy of Gradian Health Systems)

In 1986, Dr. Paul Fenton, a British anesthesiologist, accepted a position as Head of the Department of Anesthesia at a busy teaching hospital in Blantyre, Malawi. Over the 15 years he spent working in that environment, he gained extended exposure to the many challenges that surgeons and anesthesiologists face in low-resource settings. After observing too many unnecessary injuries and deaths caused by surgeries that were interrupted or canceled due to the unavailability of anesthesia, Fenton designed a machine that could deliver safe, reliable anesthesia even in the midst of a power outage. The device, which he called the Universal Anaesthesia Machine (UAM), also generated its own oxygen from an integrated oxygen concentrator, which eliminated reliance on expensive cylinder or pipeline gas. If no electricity or other source of oxygen was available, the UAM defaulted to room air and always included oxygen monitoring to ensure the safety of the gas mixture. (5)

After testing the UAM at his hospital in Malawi, Fenton sought to expand production. However, it took him more than a decade to line up the funding and support necessary to bring the idea to market. In 2009, Fenton joined forces with the Nick Simons Foundation, a private philanthropy supporting the Nick Simons Institute, which trained health workers to address needs in remote areas of Nepal. (6) The foundation provided seed funding to further develop and test the UAM. Based on the positive results of those studies in the U.K. and Nepal, the Nick Simons Foundation spun out an organization it called Gradian Health Systems to produce and commercialize the UAM on a global basis.

Gradian was established as a wholly-owned subsidiary of the foundation. Structurally, it operated as a nonprofit, selling the UAM at its manufacturing cost so that sales and production of the device would become self-sustaining and scalable within several years. With philanthropic funding from the foundation, the company could underwrite the cost of end-user training at installation and a full after-sales service program. This structure was in line with the Nick Simons Foundation’s broader goals and Gradian’s specific mission, “to improve access to safe surgery and perioperative care by providing technology, service, and training to strengthen anesthesia capabilities.” (7)

One Challenge: Marketing to Multiple Stakeholders in a Complicated Field

Anesthesia providers in Nigeria receive training on using the Gradian UAM (photo courtesy of Gradian Health Systems)

Gradian’s UAM faced two primary forms of competition. First, as Erica Frenkel, Director of Business Strategy, explained, “We compete against conventional anesthesia machines that are designed for operating theaters in developed settings. That means they’re reliant on electricity and compressed oxygen.” (8) Even though this equipment was often not well suited to operating rooms in developing countries, several major medical device manufacturers had released basic models of their conventional machines in an effort to penetrate facilities in select geographies. “They’re coming out pretty aggressively in certain emerging markets,” Frenkel noted. The second type of competition came from other products, like the UAM, that were designed specifically for low-resource environments. “There’s really only one other company that makes another anesthesia machine that can be used in any circumstances,” she said. “Right now,” Frenkel summarized, “we’re seeing both kinds of competition. When a hospital or Ministry of Health needs to purchase an anesthesia machine, they’re looking at products across the board.”

Gradian generally was perceived as a good value in both product categories—the company offered a high-quality product at a competitive price. The UAM was CE certified and manufactured according to ISO quality standards. Gradian further distinguished the product from other companies working in the space through its commitment to comprehensive training and service, made possible by funding from the foundation.

The challenge was that Gradian’s small team had to market and sell the UAM to four distinct but interconnected stakeholder groups: users, hospitals, Ministries of Health, and donor organizations. The direct users of the product were the anesthesia providers who, in the developing world, were often not medical doctors. Instead, they were mid-level health care practitioners with specialized (although sometimes minimal) training in basic anesthesia delivery. These providers personally experienced the challenges created by the unreliable and unsafe equipment used in low-resource operating rooms. They were perhaps the easiest to convince of the UAM’s benefits but, as Frenkel pointed out, “They’re not the ones with the resources or decision-making power.” Those with the ability to make purchasing decisions resided at the hospital or Ministry level. However, a significant percentage of facilities and Ministries in the developing world were severely resource constrained, with operating budgets that could not accommodate regular capital investments. To acquire new equipment, such as anesthesia machines, many hospitals depended on nongovernmental organizations (NGOs) or international donor organizations to make these purchases. Decision makers within these organizations were furthest from the problem and sometimes lacked adequate information about the needs and constraints of the facilities they intended to serve. “The users and hospitals that know what they need are often not even involved in the decision-making process for the equipment that they’re going to get,” Frenkel said.

Complicating matters further, Gradian realized that the timing of anesthesia machine sales was important. “A hospital may buy one anesthesia machine this year and not purchase another for three years or more. So how do we identify and reach these folks before they make a decision?” Frenkel questioned.

Gradian had managed to get sales of the UAM off the ground mostly through referrals. “To date I would say our marketing has been primarily word of mouth,” Frenkel stated. “We have bid on a couple of tenders. But so far we’ve really relied on NGOs that have heard about the product and come to us, or we’ve ‘cold called’ them and it has just worked out. But clearly that’s not a scalable marketing plan.” Gradian needed a comprehensive strategy for tackling these challenges.

The Solution: Developing a Coordinated, Targeted Marketing Plan

In building its marketing strategy, Gradian decided that it was essential to reach all four stakeholder groups through a coordinated, yet targeted approach. Ideally, anesthesia providers would report to hospitals what they required; and hospitals, in turn, would pass this information along to their donors who would use it to make their purchasing decisions. To begin moving toward this optimal model, the Gradian team would pursue a multi-part plan:

Publish Meaningful Results

An anesthesia provider in Ghana learns to use the UAM (photo courtesy of Gradian Health Systems)

As a top priority, Gradian would continue to conduct field studies of the UAM in collaboration with well-known, respected partners. For example, said Frenkel, “Johns Hopkins University is doing a study in its simulation lab in Baltimore, as well as in the field in Sierra Leone.” Gradian, which sometimes provided funding for the studies, insisted that they be conducted according to the highest scientific standards so that the results would be publishable in peer-reviewed journals. “We see that as a really important component of generating credibility,” Frenkel commented. All four of Gradian’s target stakeholder groups responded favorably to the availability of positive scientific data about the UAM and its benefits. “The studies are really just an extension of our work,” she added, “but they provide an invaluable way to get information into the public domain.”

Build a Network of Key Opinion Leaders

In parallel, the company would actively seek to expand its network of “champions”—highly respected users and hospital personnel who had direct experience with the value that the UAM delivered—in Gradian’s target geographies. These advocates were unpaid, but passionate about improving anesthesia safety in their countries. As such, they could be engaged to answer questions about the UAM and share their experiences with other users and hospitals, either on their own or at Gradian’s request. As Frenkel put it, “It’s very influential and boosts our credibility in the sales process when we’re not the ones saying that it’s a great machine.” Moreover, with a small team, Gradian could not be everywhere at once. “Our champions become our spokespeople, or an extension of us on the ground,” she added.

Connect with Users Through Conferences and Professional Societies

Another way that Gradian would involve users was to engage with them through medical conferences and professional society activities. “Even though their voices are quiet in the grand cacophony of bureaucratic decisions like these, the end users need to be heard,” Frenkel explained. “We certainly can’t go to every hospital in Africa,” she continued, “but through conferences and events we can reach large numbers of potential users.” For instance, Gradian had recently attended the conference of the Kenyan Society of Anaesthesiologists, where it was able to demonstrate the UAM to numerous anesthesia providers from the area. The team’s hope was that these users would start asking for the device when they returned to the hospitals where they worked. Gradian also used these interactions as a way to gather user feedback. “They help us understand the anesthesia community’s needs and interests,” Frenkel stated.

Develop Targeted Marketing Collateral

While all four constituencies stood to benefit from the UAM, each one had slightly different needs or “pain points” that the device would help address. The Gradian team worked to carefully understand the differences between its stakeholders’ points of view and then created marketing messages and materials that were tailored to each group “We developed a whole cadre of collateral that we used to speak to the different constituencies,” said Frenkel. These materials were used to broadly raise awareness among users, hospitals, Ministries of Health, and governments/NGOs.

Make the Most of Large-Scale Tenders

In an effort to win more contracts for large-scale government and NGO orders, Gradian invested significant time and energy into better understanding the tender process and how it could optimally present the UAM in its proposals. “Part of it is understanding how the decision-making processes work for these major organizations,” Frenkel said. Another key aspect was raising awareness among these entities that affordable, appropriate technologies like the UAM even existed. To assist the company in this area, Gradian hired an outside consultant “to help us learn how to really speak to these types of organizations,” she noted.

Create a Database of Donor Organizations

To reach high-volume purchasers outside the tender process, Gradian planned to develop a list of the wide variety of organizations that made purchasing decisions for individual hospitals. For example, “In Malawi, we targeted a number of organizations that we had worked with, and in Uganda we’re starting to get a sense of organizations that train users but also fund equipment,” Frenkel said. The Gradian team gathered information about these organizations and also started tracking what it could about their purchasing cycles so that a team member could approach them at an appropriate time. “The idea is to get ahead of the organizations, before they make a decision about anesthesia equipment, so we can make them aware of the UAM, begin a dialog, and answer their questions,” she explained.

In 2012, Gradian was implementing this approach to help the company address its marketing challenges. “It’s like a huge knot we’re trying to untangle,” Frenkel described. “I wouldn’t say by any stretch of the imagination that we’ve solved it, but we’re working on it.” So far, the early phases of this plan had enabled Gradian to expand the sites where the UAM was being used from 2 to 11 countries.


(1) T.G. Weiser, et al., “An Estimation of the Global Volume of Surgery: A Modeling Strategy Based on Available Data,” The Lancet, July 2008, pp. 139-44, (September 13, 2012).
(2) The Challenge, Gradian Health Systems, (September 17, 2012).
(3) Ibid.
(4) Ibid.
(5) “Birth of the UAM,” Gradian Health Systems, (September 17, 2012).
(6) Company, Gradian Health Systems, (September 17, 2012).
(7) Ibid.
(8) All quotations are from an interview with Erica Frenkel conducted by the authors unless otherwise cited.
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The East Meets West Foundation: Expanding Organizational Capacity

This post describes how the East Meets West Foundation helped its overseas partner expand its engineering and manufacturing capabilities as it pursued the need for an infant phototherapy solution designed to meet the requirements of low resource environments. It was written by Edward Sheen, Lyn Denend, and Professor Stefanos Zenios of the Stanford GSB’s Program in Healthcare Innovation.

The Problem/Solution Space

Worldwide, 60 percent of all newborns experience infant jaundice caused by hyperbilirubinemia (excess levels of bilirubin in the bloodstream). (1) The percentage of infants affected in Asia is even higher. Bilirubin is a yellow-colored pigment created when the body replaces old red blood cells. The liver breaks down bilirubin so that it can be re-moved by the body, but in premature babies with immature liver function and those with certain underlying diseases, bilirubin levels may be high enough to cause brain damage and permanent disability.

An infant receiving phototherapy with Firefly (photo courtesy of East Meets West)

In the U.S. and developed nations, infant jaundice is treated with widely available photo-therapy, in which blue-light of a specific wavelength is shined upon the skin. The blue light causes chemical reactions within bilirubin molecules that enable the body to excrete bilirubin harmlessly into the urine and stool. Infants with jaundice who receive photo-therapy have the same opportunity to enjoy normal, healthy lives as other newborns. Within a couple of weeks, their liver function usually matures sufficiently to metabolize bilirubin such that no further phototherapy is needed.

Every year in South Asia and Africa, more than 5.7 million newborns with jaundice do not receive the simple phototherapy needed to prevent brain damage. Newborn jaundice and complications caused by jaundice account for an estimated 6–10 percent of neonatal mortality worldwide. (2)

About the East Meets West Foundation

The East Meets West Foundation (EMW) is an international development agency with the mission to “transform the health, education, and communities of disadvantaged people in Asia.” (3) EMW is headquartered in Oakland, California but operates programs with its local partners throughout Vietnam, as well as in Cambodia, India, Laos, Myanmar, Thailand, and the Philippines. EMW medical programs provide direct assistance to patients and build health system capacity by training medical staff as well as building improved medical facilities. Current programs include Breath of Life, Operation Healthy Heart, Support Network for People with Disabilities, green coffee supplements, dental care, and hospital construction.

A mother with a baby helped by Breath of Life (Photo by Hanh Nguyen for East Meets West)

In 2012, Breath of Life (BOL) was EMW’s largest medical program. BOL targeted hypothermia, respiratory distress, hyperbilirubinemia, and other common causes of infant mortality in the developing world by providing a complete package of custom-made, low-cost medical equipment to neo-natal care providers at no cost. The BOL suite included a continuous positive airway pressure machine (CPAP), which treated infants in respiratory distress, an infant resuscitation station, pulse oximeters, hand sanitizers, and phototherapy machines to treat neo-natal jaundice. Collectively, this equipment constituted a neonatal intensive care unit (NICU) that was both cost-effective and low-maintenance. To help ensure that the equipment was used correctly and consistently over time, EMW’s BOL team proactively worked with care providers and administrators at the hospitals to help them integrate these technologies into their operations. (4)

According to EMW President John Anner, a critical part of the solution for reducing neonatal mortality in the developing world was “the development of facility-based neo-natal intensive care technologies that can be delivered to millions of families around the world.” He continued, “This does not mean that every town in rural India and Africa has to have a NICU stuffed full of modern pieces of equipment that each cost more than a new car. But it does mean that every family should have access to a facility that offers the basics.” (5) Anner underscored the need for equipment that was affordable and durable, with limited consumable parts. Moreover, it should be engineered specifically for low resource settings and supported by “a comprehensive solution that addresses issues of staff capacity, long-term viability, robust after-sales service, and so on,” he added. “The moment the equipment arrives at the hospital or clinic is the moment the intensive work starts, not finishes.” (6)

One Challenge: Expanding Organizational Capacity

Following its launch in 2005, Breath of Life had addressed many of the needs outlined by Anner. Between 2005 and 2009, BOL distributed more than 450 CPAP machines and more than 500 other pieces of neonatal care equipment to more than 130 hospitals in 58 different provinces in Vietnam. BOL also provided training on equipment use and advanced newborn care to more than 2,000 Vietnamese physicians and nurses. These efforts supported the treatment of approximately 20,000 infants per year. (7)Based on the program’s success, the Lemelson Foundation supported its expansion to Cambodia and Laos in 2008, which by 2010 had increased the number of hospitals served to 200 and the total number of infants treated each year to 45,000. (8)

As EMW expanded BOL in Asia, it recognized the need to develop more effective therapy for infant jaundice. Conventional phototherapy equipment from wealthy nations was too expensive for widespread adoption in the developing world. Even when donated, this equipment was not suited to operate in hot and humid climates with unreliable electricity and rugged terrain, and broke down easily. Within five years, approximately 98 percent of western phototherapy devices donated to the developing world were broken or no longer being used because these regions had limited technical capacity for basic maintenance. (9)

BOL included a “bili bed” to treat jaundice but, according to Anner, it provided suboptimal phototherapy and “just didn’t work that well.” (10) Additionally, the equipment could only be operated within an intensive care unit, which exposed jaundiced neonates to critically ill infants. As Anner explained, “The intensive care unit is a very dangerous place. That’s where all the germs live. The hospitals we work in often put two, three, four infants to a bed. Any of those babies that have sepsis easily transmit all those germs to all the other babies. If you have a single baby that does not have to be in the intensive care unit, then you can make a big reduction in infection rates as infection in many of these hospitals is the number one killer of babies.”

As the BOL program grew, it also sought to expand from large, provincial referral hospitals to small district-level and community hospitals, as well as health care facilities in rural areas. These health care settings did not have the staffing, technical expertise, and electrical power sources needed to utilize the bili bed or the complete Breath of Life NICU suite. EMW was interested in an infant phototherapy solution designed specifically to fit the needs and conditions of these environments.

Based on its experience in the field, EMW had a detailed understanding of the design requirements for a new jaundice solution. Yet it did not have the design capabilities needed to develop the product and neither did its existing partners. EMW had been relying on Medical Technology Transfer Services (MTTS), a local Vietnamese firm, to manufacture and deliver its neonatal care tools. MTTS specialized in adapting Western technology to the needs, resources, and other conditions of the local environment. EMW routinely presented MTTS with specific clinical problems, financed the necessary re-search and development to create or adapt solutions, and then purchased the finished products. However, at the time, MTTS did not have a team of seasoned design engineers. Anner would have to look elsewhere for this support.

The Solution: Establishing a Partnership for Custom Product Design and Organizational Learning

In deciding how to address this challenge, EMW took a forward-looking perspective that would allow it to strengthen its existing partnership with MTTS rather than simply work around it. Anner wanted to find a way to augment MTTS capabilities while also developing the new phototherapy solution. “I wanted to get MTTS moving away from sheet metal bending into work with plastics, injection molding, or plastic extrusion, which is a capacity they did not have, and which did not exist in Vietnam,” he recalled. His goal was to help MTTS to “move along the knowledge trajectory” to develop more advanced engineering and manufacturing capabilities.

Firefly allows a mother to interact with her infant during phototherapy (Copyright Design That Matters, all right reserved)

The EMW team prepared a design brief and shared it with several well-known design companies. It ultimately chose to work with Design that Matters (DtM), a nationally recognized nonprofit design firm headquartered in Cambridge, Massachusetts. EMW and DtM began collaborating in 2009. This decision was driven, in part, by DtM’s willingness to partner closely with MTTS throughout the design and development process.

DtM’s mission is to develop products and services that allow social enterprises in developing countries to overcome barriers to achieving scale and impact in the health care, education, and clean water fields. The company had acquired substantial experience designing low-cost, contextually appropriate innovations for neonatal care in low-resource settings. These innovations included NeoNurture, a model incubator fashioned from used car parts, and a low-cost CPAP device.

Using EMW’s design brief as a launching point, DtM engaged hundreds of volunteers from academia and industry in the U.S., Europe, and parts of the developing world to contribute their expertise towards solving the following problem:

Low-resource hospitals providing overnight care that wish to improve treatment outcomes and reduce newborn referrals need a cost-effective, intuitive, durable tool that can be placed in the mother’s room to provide individual infant phototherapy to otherwise healthy newborns with mild to severe jaundice while allowing infant warming.

The team’s main challenge was designing a phototherapy solution that could yield effective clinical outcomes while being compatible with low-cost manufacturing, maintenance, and repair techniques to enable neonatal care teams in Vietnam to take over production, distribution, and servicing. Yet “the techniques still needed to give the device a high-quality, professional aesthetic.” (11) Anner told DtM early on, “I really want you to come up with a medical device that looks just incredibly cool so that physicians in rural hospitals would say, ‘I really like that. That looks great. I want that in my hospital. It looks like something that works well.’”

The resulting product was named “Firefly.” As DtM CEO Tim Prestero explained, “The firefly is a symbol of hope and joy, light in darkness, and is found worldwide.” (12) The new product offered numerous innovations, including energy-efficient, long-lasting LED lights; lighting above and below the bassinet to maximize the body surface area of infants receiving treatment, which yielded the potential for reduced treatment time and lower rates of infection; a compact and portable design that allowed installation in the recovery room next to mothers and kept babies out of the intensive care unit; and a bassinet designed to hold only one infant, which discouraged multiple infants from blocking light or spreading infection. (13) Firefly also had a low manufacturing cost and offered cost-effective performance relative to competitive products. DtM estimated that Firefly could cure newborn jaundice for $1.50 per infant compared to $5-8 per infant with other phototherapy devices (clinical trials ongoing). (14)

Throughout the design process, DtM provided MTTS with introduction to modern engineering methods and training, as Anner had hoped. Together, DtM and MTTS discussed every engineering detail and selected materials and manufacturing methods that would improve the performance of Firefly while enabling local production. DtM provided MTTS with new metal tube bending equipment at a low cost, and instructed MTTS engineers how to operate it to form Firefly’s structure. (15) DtM also introduced MTTS to other low-cost manufacturing techniques, including vacuum forming, aluminum extrusion, and injection molding to improve the durability and aesthetic of Firefly. (16) Each of these new capabilities would enable MTTS to better serve EMW’s product design, development, and production needs in the future.

In parallel, DtM also realized significant benefits from this partnership. Although DtM had a track record of developing innovative design concepts, it had virtually no experience bringing them to market at a large scale. Through MTTS, EMW provided DtM with access to local production and product support capabilities. Perhaps most importantly, EMW shared with DtM its extensive network of neonatal care partners throughout Southeast Asia, providing the clinical infrastructure and organization needed for testing and distribution to patients.

EMW completed a clinical trial in November 2011, and Firefly officially cured its first infant with jaundice one month later. With Firefly, the baby required only 17 hours of phototherapy; physicians estimated that with a conventional phototherapy device, his cure would have required 2 to 3 days of treatment. (17) As of mid-2012, Firefly was undergoing larger-scale clinical testing and production, and the team was expanding the project to India, the Philippines, and Cambodia. Having achieved significant synergy, EMW and DtM also continued working together to develop additional neonatal care tools for Southeast Asia.


(1) “Hyperbilirubinemia and Jaundice,” Lucile Packard Children’s Hospital, (June 14, 2012).
(2) “Project Firefly,” Design That Matters, (June 14, 2012).
(3) “Overview,” East Meets West, (June 14, 2012).
(4) “Breath of Life: Neonatal Health, Program Overview,” East Meets West, (June 14, 2012).
(5) John Anner, “My Daughter’s Story: Fighting Prematurity, Advancing Technology for Newborns,” January 3, 2012 (June 14, 2012).
(6) Ibid.
(7) “Breath of Life: Key Statistics,” East Meets West, (June 14, 2012)
(8) Lemelson Foundation Fact Sheet, (June 14, 2012).
(9) “Firefly Phototherapy: A Brief Intro,” Design That Matters, (June 14, 2012).
(10) All quotations are from interviews conducted by the authors unless otherwise cited.
(11) Leslie Gordon, “Designing for Places That Can’t Afford High Tech,”, March 22, 2012, (June 14, 2012).
(12) “Firefly Lights up Vietnam Hospitals,” East Meets West, (June 14, 2012).
(13) “Firefly,” Design That Matters, (June 4, 2012).
(14) Ibid.
(15) Leslie Gordon, “Designing for Places That Can’t Afford High Tech,”, March 22, 2012, (June 14, 2012).
(16) “Yanko Design Features Firefly Phototherapy,” Design That Matters, (June 14, 2012).
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SafePoint II – Sustaining Adoption

This article, written by Lyn Denend and Professor Stefanos Zenios of the Stanford GSB’s Program in Healthcare Innovation, explores how the SafePoint Trust proactively sought to align stakeholders around the adoption of auto disable syringes in Tanzania to help ensure … Continue reading

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