PETER FEROLA, GENERAL COUNSEL, BIOTELEMETRY, INC
Peter Ferola talks GC through a busy few years at BioTelemetry – including highlights from the company’s ten strategic acquisitions, corporate restructure, and a new venture into digital population health management.
GC magazine: Can you tell me about your journey to becoming a lawyer? Was it something that you always wanted to do?
Peter Ferola (PF): No! As a matter of fact, I started my career in the business world – I worked for 13 years as vice president and corporate secretary for a publicly-traded consumer products company. The part of my job I found most interesting was my responsibility for investor relations, corporate development, the legal department and the non-financial SEC reporting. I started to migrate more to the legal, regulatory and M&A portions of my job, and eventually realised it was time to make a change. I dived right in and headed to law school.
I attended law school full-time, and clerked for a securities litigator and worked for a securities law professor, researching and writing articles. During my third year, she recommended me to Georgetown’s LL.M programme for securities and financial regulation. So when I secured my first job as a lawyer after graduation, I practised M&A and securities during the day, and attended that programme at night.
GC: Why did you decide to leave private practice and return to the business world?
PF: That was another interesting turn of events. I knew that I ultimately wanted a general counsel position, but I didn’t expect the opportunity to come so soon. I was in Greenberg Traurig’s corporate/securities group, and one of our clients was looking for a general counsel. It was appealing to me – particularly because it was a publicly-traded company. That was also my first entree’ into life sciences – the company designed, developed and commercialised blood glucose monitors.
GC: What drew you to the healthcare sector?
PF: I had been around public companies for the vast majority of my career, but the healthcare aspect added an additional layer of complexity on top of the SEC-reporting requirements. I found that to be quite challenging – and I was looking forward to a new challenge.
GC: What are the health sector’s main challenges for a GC?
PF: Unlike some other business sectors, the health sector is highly regulated – specifically, our devices are FDA-regulated, our business is regulated by Medicare and Medicaid, and there are state licensor issues that we deal with as well. The state and federal regulation landscape is continually changing depending on how the pendulum swings with regard to trends in the industry.
In addition to regulatory challenges, we are constantly dealing with private payors on reimbursement issues and defending our intellectual property. BioTelemetry has a robust patent portfolio, and we have had a number of enforcement actions over the past few years.
GC: When you joined BioTelemetry, you were faced with a turnaround situation. Can you talk me through some of those challenges?
PF: In a nutshell, I came to the company on the heels of a significant Medicare reimbursement rate cut, so the company was on a massive cost-cutting campaign to compensate. I inherited two related class action shareholder suits, and the company had no Medicare compliance programme, so one of my first tasks was to implement that programme. Just a few months later, we had a tag-along federal False Claims Act investigation to contend with. So, much of 2011 was a clean up year.
In 2012, things started to turn around. We were executing on our strategic plan to grow organically and diversify, all on a somewhat modest budget. Since 2012, we’ve made ten strategic acquisitions and we started enforcing our patents against certain competitors who were infringing. We were quite successful in taking several competitors off the market and obtaining injunctive and monetary relief in those matters. I was also tasked with a corporate restructure project, in order to position ourselves for diversification and growth. We formed a holding company (which was when we changed our name to ‘BioTelemetry, Inc.’), and we positioned three operating subsidiaries underneath the BioTelemetry corporate umbrella.
GC: Which of those acquisitions has particularly stood out for you?
PF: The acquisition of LifeWatch earlier this year was probably the most significant. It was the largest acquisition in our company’s history, and the combination created one of the most comprehensive technology-enabled healthcare services companies in the US. So that was a big move for us. It accelerated our strategic plan by a couple of years, in terms of growth.
The reason that it was challenging was that we were a white knight entering a hostile takeover process that was already underway. We had approximately six weeks to complete due diligence and launch our own competing tender offer, which we managed to do about two days before the deadline. We had to contend with numerous due diligence issues: the company had subsidiaries in Israel, Turkey, Macedonia, the UK and India. In addition, they were a SIX Swiss Exchange-listed company, so most of the transaction was governed by Swiss law, which added another layer of complexity in addition to the typical US FDA, Medicare/Medicaid regulatory due diligence and FTC clearance. So it was very gratifying to complete!
GC: Have there been any other highlights of the last year for you?
PF: We completed the acquisition of TelCare in December 2016, and that was our first entrée into digital population health management in the diabetes care space. The company was an early-stage technology-enabled service platform, and it was the first company to receive FDA clearance on a cellular-enabled blood glucose monitor. What makes that interesting is that the system transmits real-time results to a cloud-based analytical engine, which synthesises data, monitors trends and, most importantly, provides caregivers with critical information about patients’ status.
GC: Can you tell me about the legal team you manage at the company?
PF: There’s an associate general counsel and me! Since it’s just the two of us, no day is ever the same.
Unlike other companies I’ve worked for, which farm out most of the corporate, securities and M&A work, our team is quite active in these areas. We don’t do everything in-house, but we do a significant chunk of it. It can drive significant efficiencies (and cost savings) when your team has that skillset.
GC: What are the main challenges that you and your team are facing over the next year or so?
PF: Integrating the LifeWatch acquisition – that’s going to be our primary focus over the next 12-18 months, given the size of it and the number of moving parts that are involved, and supporting the team in executing our strategic initiatives.