Strategy and businesses
Cochlear Implants business
Our Cochlear Implants business, operating under the Advanced Bionics brand, is founded on our firm conviction that the journey to better hearing applies to everyone, including consumers with severe or profound hearing loss. Our range of innovative cochlear implants, drawing on Phonakʼs deep expertise in sound processing, speech enhancement, and connectivity, offer adults and children worldwide a powerful, rich hearing experience with effortless comfort and convenience.
A cochlear implant differs from a hearing aid in that it bypasses the middle ear, converting sound into an electrical signal delivered directly to the hearing nerve. This signal conversion takes place in a sound processor mounted behind the ear, and it is here that the Sonova advantage is apparent: close R&D cooperation between our Cochlear Implants and Hearing Instruments businesses means that the advanced features and capabilities that we develop for our leading hearing aids are made available for our cochlear implant recipients. Noise-environment sensing sound processing, directional speech enhancement, seamless connection with our hearing aids for two-ear hearing, remote fitting, sophisticated adjustment apps, universal connection with phones and other streaming devices – the full range of our innovation is there to enrich the consumerʼs hearing experience.
Cochlear implants are a lifelong solution. For all our consumers – especially the families of children with significant hearing loss – the choice to go ahead with one brand needs the support of clear information and sympathetic counseling. We think of our recipients and potential recipients as a community; we work closely with them, offering online forums and mentorship, webinars, and events: ensuring that they know that we, together with the audiologists and surgeons who support them, are by their side to accompany them on their journey.
Marvel rolling out globally
The introduction of our Naída™ CI Marvel and Sky CI™ Marvel systems has received an overwhelmingly positive response from recipients and audiologists alike; the benefits of Phonakʼs Marvel platform – automatic adjustment to the listening environment, universal Bluetooth® connectivity, hands-free phone calling, integrated RogerDirect™ wireless communication – redefined the experience of using a cochlear implant system. More than three-quarters of consumers reported significantly improved hearing performance, while audiologists valued the wireless connection to the Target CI fitting software. We were the first cochlear implant company to remove the wire between patient and computer during programming, which is especially useful with pediatric patients. The Target CI fitting software itself is a sophisticated but easy-to-use tool that closely resembles Phonakʼs hearing-aid fitting technology in look and feel, thus making life easier for audiologists who fit both products.
STRATEGY AND BUSINESSES
Cochlear implants are sophisticated medical devices that undergo rigorous and time-consuming regulatory approval in each new market. New technology platforms therefore roll out over a longer innovation cycle than in the Hearing Instruments business. We are pleased that the Marvel CI systems have launched in 32 countries by the end of this financial year – eight more than in the previous year. We are also expanding the digital ecosystem for our Marvel systems, adding further apps and support channels to give recipients ever more control of their hearing experience. Marvel-related sales now represent a significant share of overall revenue for the Cochlear Implants business – a share that we expect to increase and fuel further growth.
We are also pleased to announce the approval of our HiRes™ Ultra implant by Chinaʼs regulators. Featuring our thinnest profile for easier insertion, HiRes™ Ultra is the only device with 16 independent current sources, combining the fastest stimulation rate with the widest input dynamic range a for the most natural hearing experience possible 1). Its circuitry provides nearly unlimited ways to deliver hearing nerve stimulation, which means that it can accommodate every current and future advance in sound processor performance. China represents a high-growth market for all Sonova businesses, and we are excited about the potential created by this new opening for our innovation.
A cochlear implant is not a product that can simply be bought off the shelf; the business of providing them necessarily requires many points of personal contact and a substantial commitment of time. Typically, a recipient will need to see the specialist audiologist for adjustments at least six times in the year following surgery – and cochlear implant clinics are few and far between in even the best-served markets. The cost in time and travel for recipients and hearing care professionals alike is a burden on them and on the industry, reducing audiologist efficiency and market penetration. Marvelʼs Made For All™ connectivity, however, allows the sound processor to be programmed remotely through an online connection to the audiologistʼs practice. This might seem merely nice-to-have to a hearing-aid user, but for cochlear implant recipients it is a liberating capability, given the far lower availability of trained audiologists for cochlear implants. In a market study, 88% of consumers said that they would use such a service, and 84% of audiologists agreed. Remote programming is just part of our vision of self-sufficient consumers, in full control of their hearing experience. The solution is under development and has completed its clinical trial.
Operating excellence supporting increased customer access
The momentum of the cochlear implant industry has been held back in the past three years by the difficulty of securing surgical appointments, supply shortages, and hospital staffing challenges. In response, our Cochlear Implants business has put significant effort into implementing the Sonova X business system for continuous improvement, analyzing our markets and processes and securing the foundation for consistent and repeatable success. This involves a rigorous review of costs and operating expenses – materials, manufacturing, supplier relationships, warranties – and also our sales approach to potential consumers and the clinics who refer them.
Repeatable success depends on product reliability: it is the single most important factor affecting the consumerʼs choice of implant. Our emphasis in recent years on uncompromising quality control in manufacturing along with comprehensive testing has yielded a cumulative product survival rate for our HiRes™ Ultra 3D V2 implant that is higher than any other in our history. We have seen a more than 20% improvement in our product return rate for external devices, such as our sound processors, every year for the past three years: a clear demonstration of our commitment to quality.
We have applied the same Sonova X principles that we use in securing operating efficiency to achieve commercial excellence through increased access to the market. Based on dedicated kaizen workshops in which we mapped the customer experience and value streams, we defined global sales practices and applied dedicated client segmentation to capture growth opportunities. Nearly a quarter of our new system sales were brought in through the commercial excellence initiative, which we will extend and further refine during the coming financial year. We also plan to launch a similar initiative in the business-to-consumer sales area, with the aim to increase the conversion of potential candidates by building brand contact and interaction to help consumers in making their choice – through social media, conversation with existing recipients, and other contact points. This type of approach will be extended to new recipients as well, to keep them informed and interested in further developments, capabilities, and accessories as they explore the new hearing world opened up by their cochlear implant.
In approaching audiologists and consumers, we are fully aware of the advantages of working in cooperation with the other Sonova businesses. In the 2021/22 financial year in Germany, 30% of our system sales were generated by partnering with Sonovaʼs Hearing Instruments customers and our Audiological Care business – ten years ago, that share was zero. We are now extending this partnership to important markets including the US, China, Korea, Australia, Brazil, and Italy. In the US, we launched in late 2022 a co-branded pilot between Phonak and Advanced Bionics to approach audiologists and explore the options for consumers in their databases with significant hearing loss. The response has been positive, as audiology clinics look to differentiate their market profile by offering more medicalized services.
- Koch DB, Osberger MJ, Segel P, Kessler DK. (2004) HiResolution and conventional sound processing in the HiResolution Bionic Ear: using appropriate outcome measures to assess speech-recognition ability. Audiology and Neurotology, 9:214-223. Spahr A, Dorman MF, Loiselle LH. 2007. Performance of Patients Using Different Cochlear Implant Systems: Effects of Input Dynamic Range. Ear and Hearing. 28:260-275. Firszt JB, Holden L, Reeder R, Skinner MW. (2009) Speech recognition in cochlear implant recipients: comparison of standard HiRes and HiRes 120 sound processing. Otology and Neurotology 30:146–152.