The medical device industry is built on innovation and invention. They are the drivers of change and evolution in this industry. But bringing these emerging technologies to market can be challenging. In June 2018, MEDInnovation Boston, jointly presented by Medical Design Briefs and MDG Boston, brought together leaders from across industry to share their insights and expertise. Below are just a few highlights and ideas from some of those experts.
Do Something Nobody Else Can Do
John McDonough, CEO, T2 Biosystems. “The big breakthrough here is we have the ability to detect the presence of disease at the lowest concentration levels in the market,” explains McDonough. Infectious diseases that can lead to sepsis is a major challenge around the world. The company’s hemodialysis device has FDA clearance for detecting bacterial sepsis.
“We knew we had the ability to detect using this new technology but didn’t know if we had any clear advantage. The real focus of the first couple of years was on miniaturizing diagnostics. It was a concept that struggled.”
McDonough says the first big change he made was to change the company’s focus to have a clinical advantage. “Take technology and detect something significant that nobody else can do. Ignore size and cost. The biggest opportunities in diagnostics are to improve patient health in some profound way. The way to do that is to do something nobody else has done before.”
He also gave the following advice: Have a culture of perseverance. “Those first two years at T2 we couldn’t detect much of anything, and if we did, it didn’t have any meaning. We had an extraordinary group of board members and investors. That became very important, and that’s not always the case. Ours just always believed we were going to succeed. We were being open and transparent, and we were listening to their ideas. And sure enough, that’s what happened.”
Ben Schlatka, Co-founder and SVP of Corporate Development, MC10. “We had soft stretchable electronics. Because we felt we had a very disruptive technology, we intentionally kept the aperture wide the first few years of the business. We developed IP, and we created technology vehicles that we took out to multiple industries,” says Schlatka. He said they ultimately entered a phase where they developed a product — naturally interfacing electronics to the human body — that really defined the core value of the company. But before that, the company launched a product in another market.
“We built a supply chain and we worked with a major brand, but a lot of things happened outside of our control. From a commercial perspective, it did not take off and was largely out of the scope of things we could control.” His takeaway: “When you choose to launch a product, it is nice to have complete control over how it comes to market.” He also urged companies to have a large dossier of clinical research that has “validated your system in many different use cases. A lot of research done through our academic collaborators have produced data that have credibility and authenticity.”
Be Ready to Change Strategy
Nancy Briefs, President & CEO, Digital Cognition Technologies. DCT makes an AI platform that spun out of MIT in 2015. Briefs is the company’s third CEO in two and a half years. She says her first order of business was to figure out the company’s commercial strategy. And she did. The company’s product to assess cognitive state in clinical investigations received FDA clearance in December 2017. It is now in clinical trials in over 60 global sites. “With a market growing 32 percent a year,” she said, “why are we doing subjective testing?”
DCT uses artificial intelligence, machine learning, and signal processing to look at the process of drawing behavior — not whether the subject fails. “What we changed was only the assessment of the test. It increases trial efficiency. Because we are cloud-based, we can provide data in any form or rerun a hypothesis. It’s culturally fair and unbiased. We believe that lifestyle and drugs can change the course for the patient. If we could delay symptoms of Alzheimer’s along the way, we could save the U.S. economy over $300 billion a year,” she said.
Connect the Dots
Bryan Nolan, Chairman & CEO, Biometry. The company had just finished technology development. They saw a straightforward regulatory pathway. “There are CPD codes for this biomarker. A lot of the clinical work is being done and these are high-quality data sets. And the market groundwork was already being done actively by others. So, we wouldn’t have to spend $100 million developing all of that marketing,” he said. “There are a lot of patients with asthma, so what is really the problem?” He said they found that the products that were approved were way too expensive for home and primary care. Despite that, the competitor was still growing 20 percent year over year.
“We realized [their product] is extremely complicated inside — it’s all sensors. The cost of goods is driven by the calibration process.” Biometry’s market niche would be to monitor how the biomarker changes over time. “So, if we wanted to address this market, we would have to fundamentally change the sensor technology. What if you could build a gas sensor like an IVD test strip? We needed to make billions of them. They’re not very expensive. They’re single-use disposable. And response time is really good. A low-cost sensor would make it affordable for home monitoring.”
But he added that if you want to de-risk and develop technology, you don’t want to sell 90 percent of the company in the process. He advises: First, fail as fast as you can and spend as little money as possible. If it’s not going to work, get out fast. Just because you have a technology that works, doesn’t mean you’re anywhere near having an actual product. Make sure that the technology can perform against FDA, analytical, and clinical requirements. “The goal is to benchmark the technology against every single line item in the FDA 510(k). The other thing that is necessary is meeting the market requirements,” he noted.
“The biggest challenge for us was formulating the chemistry. The technical challenge behind it was any change to the test strip changed the specificity of it. It took a lot longer than we expected. But what was important was that we didn’t burn a lot of cash in the process. We only spent money on the engineering to solve these problems. We were able to develop our strongest IP around this process. Where we ended was with something that people could afford out of pocket.”
Let Culture Trump Strategy
Jeff Burbank, CEO, NxStage Medical. “Two fundamental ideas would drive us — one that labor costs would go up over time and the cost of delivery therapy in a center with controlled staffing ratios would continually go up. The other opportunity was that we could avoid complications associated with having therapy at three times a week. To do that, we had to move the technology into the patient’s home,” he said. To do that, they focused on how to deliver the technology to match the patient’s lifestyle and focused on the clinical objectives rather than letting the economics dictate the way therapy could be delivered.
To do this all in a new clinical environment is highly challenging. How did they do it? His advice is to continue to evolve your products and evolve your business model. Always invest in clinical data and ensure that you have the body of evidence that you need to grow and expand indications. Continually, always be forcing the culture. “I will take culture over strategy any day of the week. Culture solves your strategy. When you’re growing at 300 percent three years in a row, and 60 percent of the employees were hired in the last six months, they don’t know what the company culture is. You have to invest in culture to teach them how to do that every chance you get,” said Burbank.
“Things to keep in mind: you can help patients and still make money. All healthcare is driven by financials. Understand the stakeholders’ economic pull. I’ve never seen a medical device that has less than five customers, and most have eight or 10. You need to understand exactly what their stake is in the game. Never forget that the reason those investors are at the table is because they’re trying to get a return on their investment. They’re not your friends. They’re there to make money and they will always choose money over you. Understand that and embrace it.”
He also said to embrace potential areas of risk. “Don’t let your passion get in the way of taking input from the people who are trying to help you. Be amenable to board members and investors to make sure they feel comfortable that they can guide you and avoid catastrophe. Important balance between having a mission and listening to influence.” Other pearls of wisdom: Clinical justification is the license to go after economics in healthcare. Technologies are not adopted for pure clinical justification. Be somebody people want to work for because the single most important thing is the team you put together — the human assets that you bring to the challenge. “You don’t have to be the smartest person in the room — you have to be the person who brings the smartest people to the room.”
Embrace Emerging Technologies
Sam Onukuri, Head, Johnson & Johnson’s 3D Printing Centers of Excellence. “Personalization is an important aspect for all of our companies — pharmaceutical, device, and consumer. All of us are facing issues including an aging population, reimbursement, and uncertainty around healthcare policies. At the same time, we have a plethora of emerging technologies.” He said J&J sees 3D printing as one of the areas. “We can create fast and efficient workflows using these technologies. By creating this highly efficient, powerful workflow, we can develop highly customized products. When we started, the biggest gap we saw was in materials. One thing we did was develop materials for specific applications such as implants,” he said. Because technology evolves so fast, he said that J&J has many technology partners to maximize their opportunities.
This article was written by Sherrie Trigg, editor and director of content for MDB. For information on future MEDInnovation Conferences, visit here .