TheraTears: From Summer Project to International Brand
How Dr. Jeffrey Gilbard turned Advanced Vision Research into one of America's fastest- growing companies.
BY JERRY HELZNER, SENIOR ASSOCIATE EDITOR

Jeffrey P. Gilbard, M.D., had originally intended to pursue a career in business. But while in high school, after submitting an early-decision application to the Wharton School of Business at the University of Pennsylvania, he began reading the textbook that was going to be used in the freshman Economics course.

"I enjoyed the first 100 pages, but then I hit the accounting appendix, says Dr. Gilbard. "I withdrew the application and went to Brown instead. I started doing molecular biology research as an undergraduate and became an ophthalmologist."

PHOTOGRAPHER: DARIO PREGARX

Today, at age 50, Dr. Gilbard is both an ophthalmologist and a businessman. In fact, he's the founder, CEO and chief scientific officer of Advanced Vision Research, the nine-employee, Massachusetts-based company that develops and markets the TheraTears line of over-the-counter eyecare products. In this article, I'll describe how Dr. Gilbard turned a medical school summer research project into an international company that's now generating more than $15 million a year in sales and that's twice been named to Inc. magazine's list of America's 500 fastest-growing privately held companies.

Researching Dry Eye

Jeffrey Gilbard decided that he wanted to become an ophthalmologist when, as a college student headed for a medical career, he had the opportunity to observe physicians practicing their respective specialties.

"I saw a cataract operation and it involved two doctors working together," he recalls. "It was like poetry in motion. That moment, I became hooked on ophthalmology."

In medical school at Columbia's College of Physicians and Surgeons, Gilbard submitted a summer research project designed to develop a method for measuring the osmolarity of tear microvolumes in patients with dry eye, which could then be used as a diagnostic test. Though he didn't receive a grant to fund his project, a member of the medical school faculty, R. Linsy Farris, M.D., shared his interest in that area of research.

"Dr. Farris had this machine called a nanoliter osmometer in his lab," recalls Dr. Gilbard. "No one had been able to get it to work accurately. I spent the entire summer of 1976 tinkering with the machine, and reading about dry eye and ocular surface physiology in the medical school library."

That summer, young Gilbard developed the first technique to collect tear sample microvolumes without getting reflex tearing or sample evaporation, and succeeded in getting the nonoliter osmometer to work accurately. One day, while reading in the library, it dawned on him that elevated tear film osmolarity could explain all the pathological changes on the eye surface in dry eye, and that artificial tear solutions ought to be hypotonic.

Still thinking as a researcher, Gilbard freely discussed his theories on the value of hypotonic tear solutions at a medical meeting. A few months later, a large company successfully commercialized an artificial tear product along the specifications Gilbard had outlined.

"I didn't get a penny," says Dr. Gilbard. "That's when I began thinking as not just a scientist, but also an intellectual property lawyer. I recognized that I was capable of developing valuable intellectual property and had to protect it."

This work, performed while he was still in medical school, led to Dr. Gilbard in 1980 being awarded a National Eye Institute (NEI) Project Grant to conduct further research in dry eye. He remains the youngest in the history of the NEI to receive such a grant.

He Finds the Missing Piece

Once he arrived in Boston and set up his lab at the Schepens Eye Research Institute, Dr. Gilbard began trying his formulations on his dry eye patients.

"My hypotonic formulations worked better than the other stuff that was out there, but the patients weren't coming back and tap dancing," notes Dr. Gilbard. "I knew something was missing."

More years of research followed. Finally, the light bulb went on above Dr. Gilbard's head. Why did the living cells on the eye surface need a tear film? What did they need from the tear supply? His answer: oxygen and electrolytes.

"The solution that later became known as TheraTears restored both conjunctival goblet cells and corneal glycogen levels, and also reduced rose bengal staining," says Dr. Gilbard. "It actually promoted healing, first in animal models, and then in dry-eye patients."

With these impressive results -- and a promising product -- now in hand, Dr. Gilbard still thought of himself more as a researcher than an entrepreneur. He made the rounds of pharmaceutical companies, requesting $150,000 up front and a 5% royalty on sales.

"I thought it would take a week to license the TheraTears patent," he recalls.

It didn't happen.

Going it Alone

Determined to bring his product to market, Dr. Gilbard found a contract manufacturer for TheraTears, took a 1-hour night course on starting a mail-order business, and read a book called Guerilla Marketing Weapons that he found in a $1 clearance bin at Staples. Using lists of dry-eye patients he had accumulated over more than a decade of research and treating patients, Dr. Gilbard sent out "rapid notification" letters, asking each person who ordered TheraTears to provide him with the name and address of his or her doctor. He also asked each patient to see their doctor after 4 to 6 weeks of using TheraTears.

Dr. Gilbard then sent "doctor-to-doctor" letters to all of these physicians, telling them that their patients were now on TheraTears and would soon be coming in for an appointment.

"When the dry eye patients came in and told the doctors that after years of trying they had found an eye drop that really worked, TheraTears achieved immediate credibility," says Dr. Gilbard.

By 1995, Dr. Gilbard was selling boxes of preservative-free, single-use vials of TheraTears to patients via the mail, and through doctors and a few drug stores. But he soon achieved another breakthrough when he got an appointment with the CVS drug store chain and obtained chain-wide distribution for the product. Eckerd stores picked up the product shortly thereafter.

At one point, demand for TheraTears surged so quickly that his one contract manufacturer couldn't keep up with orders.

"That was one mistake I made early on, not anticipating the growth in demand and not having a second manufacturer on board," says Dr. Gilbard. "We soon corrected that situation."

In 2000, Dr. Gilbard's company, Advanced Vision Research, introduced TheraTears in a bottle with a disappearing preservative. Then, in January 2003, TheraTears Liquid Gel, a longer-lasting lubricant gel primarily for nighttime use, and TheraTears Nutrition, a flaxseed oil/fish oil/vitamin E supplement in capsule form, were both launched.

"TheraTears Nutrition is the first systemic treatment for dry eye," says Dr. Gilbard. "Healthfood store flaxseed oil had gained some popularity. We figured out how it was working, and developed a blend of ingredients that worked more effectively, more consistently, more safely, and across a broader range of patients."

More recently, the FDA has approved TheraTears Contact Lens Comfort Drops that, when placed on the lens just prior to insertion, makes insertion of a lens more comfortable. The drops also provide added comfort when used during wear, says Dr. Gilbard.

"Do you know that 20% of people who try contact lenses give up on them because of dry eye," notes Dr. Gilbard. This spring, the company will introduce another extension of the TheraTears brand, "economy-size" TheraTears in a bottle.

The Timing Was Right

Though he has clearly developed his skills as a business executive over the years, enabling TheraTears to become one of the best-selling tear brands in the United States, and a product with international distribution, Dr. Gilbard is quick to say that TheraTears came along at just the right time.

"The aging of the baby boomer generation has made dry eye more prevalent," he notes. "And the advent of the LASIK procedure has created a whole new market for us. TheraTears is now widely used before and after the LASIK procedure, as studies have proven that our product can improve patient outcomes and patient comfort."

For the future, Dr. Gilbard says Advanced Vision Research will continue to develop a wider range of over-the-counter products for corneal and external diseases. He says the mission of his company is to offer products "that are unique, that are category creators, and that really work.

"And we may begin to develop some prescription products, as well," he adds.

In looking back at the stunning growth of his company and the TheraTears brand, Dr. Gilbard says that being able to reach doctors directly has always been a key element in achieving success.

"I've always written all our TheraTears' ads, and my goal with our advertising is to get to the doctors and demonstrate the benefits of our products," says Dr. Gilbard. "The doctors know a good product and they help us to bring these benefits to as many patients as possible."

When asked if he might sell his company to a larger pharmaceutical company and take more of a consultant's role, he says he likes being the person controlling the product development process and making the big decisions.

"I'm having a great time. I love what I do. Our best days are ahead of us," he concludes.