I recently read “Winning Project Management Practices for Medical Device Development” on the StarFish Medical blog. I’m sharing the 6 tips and practices and recommend you read their entire article.
For years, I have been an investor for inventors, entrepreneurs, and startups. No, I don’t write checks or provide capital. My investment comes in the form of pro bono time. I knew when I started my business in March 2007 that I wanted to work closely with early-stage ventures. And I learned just as quickly that many early-stage ventures are hungry for assistance yet often lack funding to compensate for it. This presented a bit of a dilemma. I had just started my business and needed income to take care of my family. Somehow, I had to find a balance.
Fortunately, I did. Through networking and connections, I was able to find a couple of well-funded medical device startups in need of project management and quality system services. Plus, I established a partnership with Anson Group to be a consultant on their bench, if and when needed. These engagements took care of my financial needs and allowed me some flexibility. I could now “invest” in a few early-stage ventures where capital was lacking.
Many asked me why I would do this. To me, the answer was simple. Not all good ideas have funding. Not all good resources are funded either. But the lack of funding did not mean these early stagers didn’t need a little help and guidance. I never claimed to have all the answers. But I was willing to review business plans, have a discussion over coffee, and help make a connection or two. I just wanted to give back–to pay it forward so to speak. Plus, I have been very fortunate to have willing and patient mentors throughout my career who invested their time in helping me every step along the way.
After doing this for a couple years, I began to notice a trend. I put the word out that I wanted to work with medical device inventors and entrepreneurs. And quite a few of these folks found me one way or another. However, I learned that many of these contacts were not as prepared as they should be, in my humble opinion. Many wanted me to do quite a bit of the heavy lifting. Many times, the scenario would repeat itself. Inventor contacted me asking for help, usually identifying market opportunities, regulatory pathway, estimate on time to market, and estimate of budget. I would spend a couple hours researching and provided feedback to inventor. Inventor took the information and never called again, I suspect because he/she wasn’t ready to do anything with the information and/or didn’t like my answers.
So one day, after having done this dozens of times, a light bulb went off for me. The questions and issues each of these inventors is many times the same. Yet, I often times got frustated because the inventor did not seem to be passionate enough to take the idea to the next step. I decided to develop a process for these requests and created a questionnaire called “Building the Business Case“. The process developed was this:
July 12 is a big day. Creo Quality’s UniDoc software will be one of the exhibitors during the 4th annual Innovation Showcase. Attending this event in the past has given me a little bit of perspective as to what to expect during the event. I’m working on some of the finishing touches for tomorrow’s event right now. Good news is that I know the medical device market very well. Good news is that I know medical device regulations very well. We’re excited to have a couple key partners for this venture and can’t wait to hit the market running soon.
I hope you are able to come to the Innovation Showcase. There will be 60 companies exhibiting and reportedly over 1,000 in attendance. If you attend, be sure to find Creo Quality to learn more about UniDoc.
Today’s guest post comes from Rob Packard. Rob is a Regulatory Affairs and Quality Management System expert whose specialty is helping companies with regulatory submission of a Design Dossiers for CE Marking of high-risk Class III medical devices. You can read more of Rob’s work at QC is Dead and RA Review blogs.
I’ve read a few business plans that propose to obtain a 510(k), CE Marking and a Canadian Medical Device License all in six months. My first impression is, “Lots of Luck!” Often I will ask how many people are working on this ambitious regulatory project. If the answer in “one”, they haven’t even got a clue. For a low-risk device this MIGHT be possible, but there are “If” qualifiers:
On rare occasions a motivated team can accomplish the impossible. For example, I started helping a team last year around August 1st. The team was half-way done with their Technical File for CE Marking, already had a 510(k), and they had just finished a pre-assessment audit for ISO 13485. After an obscene amount of work, we achieved CE Marking of their Class IIa device by mid-November (~100 days). CMDCAS and a Canadian Medical Device License application would have killed us, so we postponed that goal for this year.
Why would you want to commit your team to such a ridiculous goal of 3 regulatory approvals in a 6-month period?
The answer is that most companies have the common sense not to. Instead, most companies pick one market and focus on that. Most US-based companies pick the US market and submit a 510(k) first. Why?!
The 510(k) process is harder than CE Marking, new technology takes three years longer on average to get approved in the US than Europe, and the rules change faster than the US FDA publishes guidance documents to explain what they are doing.
Canada is the least rigorous of the three markets I mentioned (If you really want easy, New Zealand only requires registration—there is no “approval” at all for that market.). The Canadian market is 10% of the US Market size, and New Zealand is…well not worth comparing. Europe, however, is a big market.
Most small and mid-sized medical device companies rely upon distributors to sell their devices rather than developing their own direct sales force. What difference does it make if you are selling to a distributor in Austin, TX or Galway, IRE? If your company is going to use distributors, pick the easier regulatory hurdle first and work your way up the ladder of difficultly while your distributors bring in some cash.
Success in any business is about sales, sales and sales.
Before you even start designing a medical device, you should be talking to potential distributors. Distributors and sales people are one of the best sources of product ideas. If you are a CEO/founder hopeful, you are more likely to succeed if your background is sales and marketing. Engineers can invent 100’s of medical devices and mousetraps (MD&M), but it is rare to find an inventor that can sell—let alone explain the difference between the strategic marketing plan and the advertising plan.
My advice is to start with the strategic marketing plan for Canada and then one or two countries in Europe. If you have trouble identifying distributors for your type of device in these markets, then you are not competent as a sales and marketing person. You need to get help!
If you don’t know where to look for help, you might ask your regulatory expert. Regulatory experts have to research the competitor products in order to identify known risks and typical adverse events. Regulatory experts also need to identify the competing products before they can be certain of a regulatory pathway. Authorized representatives are sometimes quite helpful in identifying distributors too.
My final advice is to save the US Market for last!
We just received exciting news that Creo Quality’s UniDoc has been selected as one of the exhibiting companies at the upcoming Innovation Showcase on July 12, 2012.
This is awesome, and we are super stoked about participating in this event.
If you ask me this question, my answer will always be “absolutely critical”. Why? Design Controls are the FDA regulations pertaining to medical device design and development activities (the FDA Design Control Guidance is pretty decent). Design control documentation is your objective evidence demonstrating you designed the right product and that it is safe.
Interestingly, though, this week, I’ve had conversations with two different medical device startups who have decided to push forward with their design and product development resources without worrying about complying with FDA Design Controls. Okay, neither stated it exactly this way. But when I challenged each on how they plan to ensure design and development documentation and records comply with FDA Design Control regulations, I got blank stares and a long pause. Neither realized or really appreciated the gravity of my question (just for fun, you should should FDA warning letters and find out how many times “failure to comply with Design Controls” is stated).
In the first case, the startup CEO tried to skip over my inquiries. I think he thought I was trying to make a pitch for hiring CQ throughout the project. I left this conversation stating something along the lines of “. . . Please make sure you address Design Controls and have appropriate documentation and records to comply with FDA regulations. It’s like insurance. And I’m not suggesting you use CQ. Just make sure to meet the regulations.”
In the second case, one of the other service providers assisting with product development efforts realized the criticality of ensuring Design Controls are properly documented. They contacted me and asked if I could consult with their firm to make sure everything is documented appropriately.
Okay, I realize having resources to write quality system procedures and design control documents isn’t sexy. I realize that these resources are probably in the category of overhead. But nothing could be more deflating to a company than launching a product without good, complete documentation in place. Sure, a company could easily launch a product, ignore FDA regulations, and may never get caught. But what if they do?
How do you ensure you give your medical device the best chance for success? Jessica Urban, Director of Program Management at Stratos Product Development suggests five factors to success in product development:
1. Wait Until the Technology is Really Ready
2. Choose the Right Team
3. Use a Systems Approach
4. Use a Risk-Based Approach
5. Dedicated Project Management
For an in depth look at Jessica’s strategies, check out her article Five Factors To Success In Product Development.
Did you know that the seven big Facebook holders, including Mark Zuckerberg, Dustin Moskovitz, and Sean Parker, hold shares totaling $25 billion? By comparison, all the 12 health care billionaires on last year’s issue of the Forbes 400 Richest People in America had a combined net worth of a measly $28 billion.
Forbes’ Matthew Herper concludes, “There’s not really much doubt: if you want to reach the upper echelons of wealth, creating a social networking site is a better bet than inventing a drug.” Sound depressing? Never fear, He had some suggestions as to how the medical device industry could change so that entrepreneurs might break through the glass ceiling and enter the upper stratum of the mega wealthy:
I personally love facebook. I use it every day. I post pictures and videos of my kids and keep in touch with people that I probably never would know how to contact if it weren’t for facebook. However, it seems to me that saving lives and making things that improve people’s quality of living should be worth more than the convenience of being able to share a picture of your kid in his Halloween costume with someone you haven’t seen since high school 25 years ago.
It may seem impossible to get investors interested in your medtech startup when the trend seems to be that venture capitalists prefer later stage medical device companies, overseas ventures, or Web-based or digital media companies. Not to mention that the current economic climate is not exactly conducive to anyone who is trying to secure money for their projects.
Charlie Chi, PhD, suggests using a capital-efficient business model and to accomplish as much as you can with as little cash as possible. She offers some great tips for medical device startups:
If all else fails, take heart in the fact that not all venture capitalists are only interested in late stage development companies. Mike Carusi, general partner at California venture capital company Advanced Technology Ventures, is a firm believer that you can strike gold by investing in early stage companies. He goes so far as to say, “Many of these late-stage deals are crap,” to an audience gathered at the Medtech Investing Conference in Minneapolis. His confidence stems from the fact that Advanced Technology Ventures’ philosophy of investing in younger companies helped it see pay day in two major deals. He believes that investors focused on late-stage companies are missing out on these types of deals. ”The reason they are late-stage companies is because no one was interested in them.” Take that, all you naysayers out there…
Did you ever stop to consider the color of your medical device and how it may appeal to your consumer? I know it sounds a bit crazy, but perhaps it is worth considering.
CMF, or color, materials and forecasting design, is a design expertise which is becoming more and more prevalent. As products and markets become more complex the need for specific knowledge about color, materials, surface finish and trends has increased.
Medical devices can be given a personal and sophisticated competitive edge when we work with color pallets beyond navy blue, black and silver and with high quality manufacturing techniques and sophisticated finishes. Thoughtful and careful color, materials and surface design create more accepted, appreciated devices which are a natural part of users’ daily lives.
I actually pulled up a website of a company called Fairings that makes specialized coverings that surround an existing prosthetic leg. The site states:
Fairings infuse the individual’s lifestyle and taste into the design from the start. But to make this an even more personal part of the prosthetic leg, Fairings can be enhanced with patterns, graphics, and materials—including leather, ballistic nylon fabric, chrome plating, and even tattoos. By creating a unique custom form that presents the individual, Bespoke Innovations hopes to change the way the world thinks of prostheses.
Am I suggesting that you take your already stretched budget to go out and hire expensive designers to investigate the recent hip trends and somehow transform your product into the new “it” device? I really don’t think anyone wants leopard print surgical tubing, pastel circuit boards, or even leather prosthetic legs for that matter, but CMF certainly is something to keep in mind if you want your product to stand out in today’s market.
FDA, PMA, SAE, V&V, CPT… I see acronyms tossed around all the time when researching for my blog and have no clue what most of them mean. I have never dared mention my lack of understanding to anyone for fear that I might come across as dim-witted, but last week I saw an article in MedCityNews that made me feel like maybe I was not alone. The author lists the above acronyms as the Top 5 Anxiety Provoking Med-Tech Acronyms (APMAs). In case you are as clueless as I was, here’s the rundown:
Food and Drug Administration
Pre-Market Approval
Serious Adverse Event
Verification and Validation
Common Procedural Technology
Is there an acronym that really makes you PO’d?
Add your (least) favorite med-tech acronyms to the APMA Hall of Shame by clicking here.
I think I am going to form my own support group called PWDUAAAAI. (People Who Don’t Understand Acronyms and Are Afraid to Admit It)
The medical device review process adopted by FDA has won many critics for years for being too complicated, vague and slow, especially when compared to the European device approval process. In an internal report, the U.S. Food and Drug Administration is defending its approval process for medical devices, while trashing some of the regulatory practices used by its European counterparts. FDA officials are critical of a number of EU standards, noting that European regulators seek less evidence and allow “private, for profit companies” to sign off on product approvals in member countries. Even if the EU system is quicker, it is far from better, the report argues. U.S. companies have repeatedly argued that they lose valuable time and money waiting for FDA approval as they seek to improve the lives of patients they serve.
I am reminded of when my two sons get in a fight. I am usually alerted to the battle when someone screams, “He hit me!!” to which the other one replies, “Well, he kicked me first!” as if that negates any responsibility he had in the altercation. Whether or not the EU has an effective process really has nothing to do with the FDA’s efficiency. I believe the FDA needs to take care of their own problems and not worry about what the Europeans are doing, or, as I tell my sons, “take responsibility for your own actions and keep your hands and feet to yourself.”
In announcing the next phase or version 2.0 to the Innovation Pathway program introduced in February last year, CDRH Director Jeffrey Shuren said that the program is going to bring about a new way of doing business at the FDA. The new regime will be one where safety and innovation are complementary rather than at odds with each other. Through Innovation Pathway 2.0, the goal is to get entrepreneurs in companies or academia who are designing the next innovative, breakthrough product to collaborate with the FDA early on. That will help iron out regulatory uncertainty that tends to gobble up time when a novel product is actually submitted for a de novo or a premarket approval.
I like the sound of this, but I’m not going to hold my breath… We’ll see what happens.
The debate continues… Is the FDA doing the best it can, or is it slowing the medical device approval process? It depends on who you ask. A new bi-partisan report from GAO praises the FDA for trying to fix the process, then basically notes they haven’t actually fixed it.
The medical device industry says FDA is too cumbersome and slow and that it is thwarting innovation. FDA says it is doing better than it gets credit for and slams some device industry studies backing its position as flawed and misleading.
“Even though FDA met all medical device performance goals for 510(k)s, the elapsed time from submission to final decision has increased substantially in recent years,” GAO notes. “Specifically, from FY 2005 through FY 2010, the average time to final decision for 510(k)s increased 61 percent, from 100 days to 161 days.”
Obviously the medical device industry has something to gain if the FDA speeds up its approval process. So, the question remains “Is the FDA doing its best?” I blogged last week about a recent Consumer Reports Poll in which 8 in 10 people surveyed allocated more importance to avoiding safety problems in devices, as opposed to encouraging innovation or to getting them to market faster. So, if you subscribe to the old mantra “the customer is always correct”, perhaps the FDA is doing exactly what it was intended to do.
I came across an interview that Medgadget did with Adam Bazih, MD, who is a not only a doctor, but an entrepreneur and a managing partner at product and creative development agency. I thought it worked in nicely with our series on product development as it focuses on the responsibilities involved with being an entrepreneur in the medical device industry, so I decided to reprint it here.
Medgadget recently had the chance to interview Adam Bazih, MD, an entrepreneur and angel investor with, as he puts it, “a focus on social media, web startups, and all things medical.” Dr. Bazih is a managing partner at Boombang Medical, a division of Boombang Inc., which is a full service product and creative development agency in Los Angeles. At Boombang, Dr. Bazih manages product development and strategic services to a wide range of medical and healthcare companies, in addition to internally developing healthcare products, brands, ideas, and intellectual property.
Dr. Bazih graduated with honors in microbiology and chemistry and then went on to study medicine and business. He has multiple pending patents, authored scientific publications, and has received numerous scientific research awards. In addition, he has developed and licensed multiple medical device products, in addition to co-founding K_space, an integrated MRI and fMRI hardware and software company. He is also an advisor to and board member at a variety of technology companies, and a member of the Tech Coast Angles.
Medgadget: What attracted you to medicine initially?
Adam Bazih, MD: Since I can remember, I’ve been interested in science and technology; that seed was planted at an early age. My real interest in medicine probably started in high school after volunteering at a hospital. Health and illness are intimate experiences, which cradle both science and emotion. I found that very appealing.
Medgadget: How did you get interested in becoming an entrepreneur in the medical device arena?
Bazih: I would say it was partially unexpected and partially ordained. Entrepreneurship has always been that fascinating star in the sky for me. I think growing up during the computer/software and Internet revolution fueled my interest in ideas of creation, venture capital, and blending professional specialties. Secondly, from my work in healthcare, I continuously found myself asking, ‘can this be done better or differently?’
All in all, my interest in becoming and transitioning to entrepreneurship peaked while at UCLA. It was there that I had the opportunity to interact with a guru in the product design space, Tylor Garland at Boombang Inc. and Robert Heller, MD from a local angel/investor group (Tech Coast Angels). Both are now dear friends and colleagues.
Superficially, medicine/science and business seem in conflict, but I would take the counterpoint to that view. When in balance and appropriately framed, healthcare and business can be very synergistic. The recent boom of mobile healthcare applications devices is perfect example of this.
Medgadget: What advice would you give to a physician looking to enter the medical device industry?
Bazih: Learn as much as you can, be open-minded, and surround yourself with the right people. It’s human nature to focus on what we are good at. It is hard for one individual to be a master at everything: team building and management are critical ingredients for success.
Again, commercializing a medical device requires multiple skill sets from a variety of fields, everything from quality control, R&D, finance, marketing, industrial design, etc. My advice is to early on develop a clear road map, process charts, and a commercialization plan. Having these assets will help one better allocate resources and identify strengths and weaknesses.
Lastly, never ignore your competition and market trends. The medical imaging market is a perfect example of this, where reimbursements, referrals, and technology are constantly shifting the landscape.
Medgadget: What kind of responsibilities do you have on a daily basis as an entrepreneur in the
medical device sector?
Bazih: My responsibilities are probably not that different from most entrepreneurs. I spend a lot of time managing people, expectations, and assets; it’s really like being a conductor. I always tell people, being an entrepreneur is like keeping 20 pots of water boiling at the same time with 4 burners. Entrepreneurship is pure choreography, balance, and leadership.
Most of my work is very exciting and stimulating, but as with any job, it’s occasionally tedious and mundane. Be prepared to pull your sleeves up an get dirty. Like people, companies go through stages, as requirements and responsibilities change. Early on, technology development, prototyping, branding, and fundraising are common challenges. As monies are raised and milestones are met, companies can shift into more sales- and marketing-centric roles. Being able to quickly adapt and shift gears are essential parts of the entrepreneurial spirit.
Medgadget: How difficult is it to transition from practicing medicine to doing what you do now?
All in all, it wasn’t difficult, because I embraced entrepreneurship and was ready for the change. This said, transition means a lot of practice, a lot of anxiety, and making quite a few mistakes as well. Persistence pays.
I would say the biggest difference between medical practice/research and business is structure. Although, an enormous amount of uncertainty exists in medicine and research, especially in today’s economy, there is still an underlying, albeit often awkward, orderliness. In entrepreneurship and product development, it’s a bit like containing chaos and controlling for entropy. The map is constantly shifting, teams are dynamic; it’s a different kind of responsiveness, and it takes time to get used to.
I spend a lot of time working with Tylor Garland and Boombang, both advising and consulting to aspiring medical entrepreneurs, as well as incubating our own intellectual property and devices. With the right team, specialties, and creativity, the entrepreneurship process is magic.
Medgadget: Is there anything you miss by not focusing on clinical work?
Despite the tremendous amount of work and effort, clinical work does provide quite a bit of instant gratification. In a single day, one can make an enormous difference in the lives of his/her patients. In business, a lot of work and planning are for longer-term goals. Ninety perfect right in business can often mean failure: a lot of eggs riding in one basket so to speak. For the most part, I feel that clinical and research work have an inherent day-to-day fulfillment mechanism built in. Business has this as well, but again, it’s more long-term. Much of it is milestone based. One needs to be prepared and committed for the long haul.
