Dozens of banana-yellow robotic arms articulate over a winding assembly line at SmileDirectClub’s cutting-edge manufacturing warehouse in South Nashville.
The mechanical, elbowed appendages complete the repetitive tasks with rigid precision – no lunch breaks and morale boosters needed.
They snatch streams of moon-shaped nylon pucks from the conveyor belt, one at a time, and swiftly sort them into buckets.
Each mold has a personalized QR code.
The robots and their associated computer systems are inspected, cleaned and monitored by human workers.
The disruptive health-tech firm’s mission to “democratize orthodontics” is served by a growing army of robots using cutting-edge software powered by artificial intelligence informed by data from its 1.5 million customers.
This spring, a second manufacturing site called “Smile Farm” is set to open in Columbia with an initial fleet of about fifteen 3D printers.
The Nashville-based company’s new production line debuts after years of attacks from the dental industry, and government regulatory challenges complicating its global expansion strategy.
In January, SmileDirect announced that it is making $120 million in cuts and backing out of nine new markets because of regulatory delays and ongoing pandemic economic challenges.
Instead, it will concentrate on existing markets in the U.S., Canada, United Kingdom, Ireland, France and Australia.
The 7-year-old company, valued at more than $1 billion as a startup, saw its stock tumble more than 80% since going public two years ago.
But, during that period, it overhauled its production system.
SmileDirect’s new generation of technologies and software is many times more efficient than its original production line that relied on people to cut and polish mouth molds.
“We’ve got one of the largest 3D printing fleets here in North America through our collaboration with HP. It’s been a very successful operation,” Global Head of Supply Chain Dan Baker said. “These machines are the workhorses of our manufacturing process. They’re more reliable and efficient.”
In one room at the South Nashville manufacturing facility named “Smile House,” 60 desk-sized custom HP Jet Fusion 3D printers quietly construct steady streams of arched mouth molds.
“Behind the scenes of the manufacturing process, there’s a huge amount of information flowing that starts with the customers,” Baker said. “All of that is incredibly complicated. It blows your mind – the science to create the treatment plan to produce arches with such consistency and precision.”
Industry attacks slow down growth
SmileDirectClub moved to downtown Nashville in 2016 with rapid global expansion plans, arguing that new technologies make it possible to cut costly dental visits out of the equation when treating moderately misaligned teeth.
But the dental industry fought back, demanding federal investigations into the company’s practices in 2019.
At the same time, many media reports questioned its legitimacy as a health provider and told the stories of unhappy customers.
Meanwhile, Georgia, Alabama and California backed state dental boards. They imposed laws requiring in-person dentist visits for treatment. And short-sellers including Hindenberg Research targeted the disruptive tech startup’s stock.
The negative attacks took a toll.
The company’s stock trended down from more than $20 a share to just over $2 in the past two years.
But SmileDirect officials are reassuring investors that carefully-trimmed cutbacks will allow for ongoing operations and growth investments.
They fought back against the dental industry’s widespread claims that SmileDirectClub’s products are damaging.
They are suing NBC for $2.8 million, alleging that Tennessee’s Consumer Protection Act was violated by a “Nightly News” broadcast questioning the safety of the teeth aligners.
More:SmileDirectClub slams NBC with $2.85B lawsuit after newscast aired ‘hit piece’ about company
Feds block state bans
The American Dental Association sought intervention from the Federal Trade Commission and Food and Drug Administration to shut down SmileDirectClub’s business, and the American Association of Orthodontists launched an aggressive campaign against the company, in 2019 and 2020.
The ADA and AAO argued that no one should receive dental treatments without seeing a qualified dentist in-person.
But some of the claims have since been dismissed by the FTC and others.
In March 2021, the Better Business Bureau’s National Advertising Division recommended that the AAO end its marketing campaign’s “unsupported messages that SmileDirectClub’s direct-to-consumer teledentistry platform is risky.”
The independent regulatory board sided with SmileDirectClub that it is accurately representing its tech-enhanced treatment model, in which dentists review patient digital scans and records, but may not meet the patient in-person.
In September, the Alabama Board of Medical Examiners removed requirements that dentists be present for all orthodontic treatments after the FTC condemned efforts to keep SmileDirectClub from operating in the state.
“The Board of Dental Examiners of Alabama has agreed to stop requiring on-site supervision by licensed dentists of alignment scans of prospective patients’ mouths seeking to address misaligned teeth or gaps between teeth. These scans are routinely administered by dental hygienists and other non-dentist practitioners; the Dental Board’s decision limited consumer choice and excluded new providers in the state of Alabama,” FTC officials wrote in a statement. “The Board must no longer impede clear aligner platforms, or dental professionals affiliated with them, from providing clear aligner therapy through remote treatment.”
Cases in California and Georgia are still in process, and SmileDirect officials are hopeful the federal regulatory support will help the states find in their favor.
Seeking profitability
While SmileDirectClub saw revenue declines during the pandemic, it won greater social acceptance from the rising public trust in tele-health medicine.
Now the company enjoys a growing list of partners in the digital health-tech industry.
But, seven years after its founding, it still hasn’t become profitable.
The firm’s new plan to refocus operations in a smaller number of key markets is designed to reassure investors concerned with its unstable financial performance.
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Company officials argue that consumer demand will stay strong, despite a faltering economy, because of the increasing reliability of its technologies and its low price-point.
SmileDirectClub charges about $1,950 per customer to align mildly and moderately uneven teeth. An additional retainer to maintain the new teeth alignment costs another $99.
Teeth aligners offered by competitor Invisalign, in partnership with dental offices, start at $3,000.
SmileDirectClub customers receive sets of 12 to 18 aligners made using teeth scans and molds made with its robotic printers and arms.
The arches are cut precisely with lasers before they are mechanically sorted.
Customers then receive a bright purple box with their treatment, a lip balm and information packets.
The company expects its cadre of 3D printers to make more than 6 million custom teeth aligners this year.
“Some markets are ready for tele-dentistry and some just aren’t,” Baker said. “Our product offering is much more about convenience and affordability. Over 60% of counties in North America do not have a dentist.”
Sandy Mazza can be reached via email at smazza@tennessean.com, by calling 615-726-5962, or on Twitter @SandyMazza.
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