MedTech Mindset Podcast: Navigating Regulatory with Monica Ferrante

EPISODE 6 – Navigating Regulatory with Monica Ferrante

In this episode, regulatory expert Monica Ferrante, VP of Regulatory and Quality at Aspire Bariatrics, talks regulatory strategy and approvals for new medical devices coming to market. 

Monica and Dan discuss:

  • FDA risk classifications and how to steer down various regulatory pathways
  • How FDA is changing in recent years
  • Trends in regulation–are medical devices under-regulated by FDA?
  • Formal vs. informal pre-submission meetings with FDA
  • How to go about finding trustworthy regulatory support

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Episode Transcript

Dan Henrich: Monica, thank you so much for joining me today, really appreciate you coming down. Would you mind introducing yourself and telling us a little bit about your background before we delve into our topic?

Monica Ferrante: Sure. I’m Monica Ferrante. I’ve been doing regulatory affairs for medical devices for, oh, probably more than 30 years, so I’ve been through the evolution. I’ve worked for large companies as well as startup companies and done a fair amount of consulting as well, so I have a pretty good breadth of device types, I guess, if you will.

Dan Henrich: Great, great. What’s your current role?

Monica Ferrante: My current role is Vice President of Regulatory and Quality at Aspire Bariatrics.

Dan Henrich: What type of products are you working on there?

Monica Ferrante: It’s a medical device for weight loss. It was a PMA submission because it’s a novel application of a device, and we were able to get through that process in less than a year and get the product approved and on the market so-

Dan Henrich: Great. Congratulations.

Monica Ferrante: Thank you.

Dan Henrich: That’s great. We already threw out the term PMA here. I think we have quite a variety of folks in our audience who are listening to this. Some of them know just what a PMA is, and they know what constitutes a Class I device or a Class III device, from the FDA’s perspective, and others don’t, so can we just briefly sort of run through what are device classes and what would be an example of kind of the different types of devices that would fall into the different risk classifications at FDA?

Monica Ferrante: Sure. Actually, the FDA started regulating medical devices pre-market in 1976, which may be a long time ago to some people, but not to me. At that time, they went through all of the medical devices that existed at the time, and they classified them. The purpose of classification was to assign a risk criteria and then, based on that risk, they would develop the regulatory pathways for bringing new products to market.

Monica Ferrante: A Class I device is the lowest risk. They are devices that are simple and straightforward. There was good historical data on their use and simple and straightforward to use. An example of a Class I device would be a manual surgical instrument like a scalpel or a hemostat, something like that.

Monica Ferrante: Class II devices are sort of the middle risk, if you will, moderate risk. Back in those days, the intent was, if there was a standard or a standard could be written for that particular product, in other words, the safety aspects and performance aspects were well enough defined that you could write a standard, then they would fall into Class II. That’s how they determined that, that particular classification.

Monica Ferrante: Everything else fell into Class III, which is the highest risk. That was generally intended for new technologies, implants, things like devices that had never been used before or an intended use that hadn’t been thought of for a particular product.

Monica Ferrante: For each of those classifications, there’s a typical but not always guaranteed regulatory pathway. For Class I devices, the FDA, in the past several years, has actually exempted a lot of those devices from any pre-market approval process, although there are a few remaining that would require a submission to the agency. Class II devices typically go through what’s called a pre-market notification process or a 510(k). That process is intended to establish substantial equivalence. Basically, it’s a me-too process. There are already products on the market like a ventilator, or a defibrillator, or a radiant warmer, an incubator, whatever, product that’s already on the market that already has certain features and functionality. In those cases, there are all consensus standards for basic safety and performance, so those types of devices would go through the 510(k) process, and they would receive permission or clearance to market after going through the review process.

Monica Ferrante: For a PMA, since it’s new technology or a new indication for use for a current technology and the risk is considered to be high because you don’t know what the risk is at that point, generally, a clinical study is required, a phase-one study or a pilot study on a small population to determine basic safety, and then a pivotal trial which would provide statistical significance of the claims that you want to make for that particular product.

Monica Ferrante: The timeframes for these submissions, there’s a statutory timeframe. For a 510(k), the FDA has 90 days to review your submission. That’s actual review time. Simpler Class II devices will probably go through in a little bit less or in 90 days. More complicated submissions may take longer, particularly if the agency has to ask you for additional information, but their clock or their target timeframe is 90 days. For a pre-market approval, they have 180 days to review all of the information. There will almost always be a request for additional information in a PMA. A PMA that’s reviewed and approved anywhere between 180 days and one year is actually a really great review time, and it means the submission was well-prepared and all of the information that the FDA needed to make their decision was there.

Dan Henrich: Okay, so a 510(k) is limited to Class II products that have what’s called a predicate. Is that correct?

Monica Ferrante: Yes.

Dan Henrich: What about when you’re dealing with a Class II product that … or something that would be defined as a Class II level of risk or will ultimately be defined as a Class II level of risk but doesn’t have a clear predicate? What does the pathway and the timing look like for that?

Monica Ferrante: Okay, so when there isn’t a predicate device, the product is automatically a Class III and requires a PMA. The FDA, several years ago, introduced a process called the De Novo process, which allows for a submission and, pretty much at the same time, a classification of a new device that has low risk. The De Novo submission may look a lot like a 510(k), but it will probably include clinical data. A De Novo submission review time, statutory review time is 120 days. Again, if you have a lot of information to review or if your clinical study has a lot of data associated with it and there are questions, that timeframe can extend, but the statutory timeframe is 120 days.

Dan Henrich: Okay, and so does that mean that, typically, then … You said when a new device, a device without a clear predicate comes to the FDA, they automatically assign it as a Class III. What would be the motivation for trying to get that class brought down to a Class II? Would it help you get through regulatory faster, or would it just lower the barrier for a competitor to come along and cite your device as a predicate?

Monica Ferrante: Well, it does both.

Dan Henrich: Okay.

Monica Ferrante: Actually, the purpose of a De Novo is that the FDA was receiving PMAs, full 180-day, statistically-significant clinical studies on devices that were extremely low risk. Their thinking is that that is not a good use of their time, the taxpayers’ dollars, or the company’s time and resources.

Dan Henrich: And it’s bad for patients, right?

Monica Ferrante: Yeah, and patients would be able to have access to that technology much sooner, so they created the De Novo process so that it would be a streamlined process where they could review information and be able to give it a classification. It may still end up being a Class III device depending on how things pan out with the review process and what concerns there are remaining with the device. It may not be the physical device itself. It may be the application or the intended use of the device that puts you into Class III, but the benefits of having that classification are several fold. It’s a shorter review time. The burden of proof is usually lessened, in terms of clinical data, and then the follow-on.

Monica Ferrante: A 510(k) submission and a De Novo submission that are approved, if you make changes to the device or if you make tweaks and adjustments to your manufacturing processes and so forth, the FDA addresses those when they come through for their QSR inspections. For a PMA, anything you change, any change to your labeling, any change to your product, any change to your manufacturing processes, you have to submit a supplement and pay the associated fees and get that approved before you can implement it, so it extends every process significantly, not just the initial approval but the ongoing maintenance, if you will, of that product.

Dan Henrich: Okay. Would that be the same process? If your device is approved for a particular patient population and you want, say, to use it … you want it approved for pediatrics or for some other patient population, is that a supplement that you have to submit, or do you have to start the process over again for your new indication?

Monica Ferrante: You generally-

Dan Henrich: Is it an indication? Is that what it is? Yeah.

Monica Ferrante: Yeah. For example, if you have a PMA that’s approved for the adult population and, per your example, you wanted to expand it into a pediatric population, you would have to do a study, and you would have to submit that to the FDA. If it’s the same product, it’s under the auspices of the original PMA, but it’s still a 180-day supplement with all of that additional clinical data and analysis, so it’s effectively doing another PMA to expand that patient population.

Dan Henrich: My guess would be then is when you’re advising young companies who have maybe not brought a medical device to market before, there are different pathways that they may be able to take in terms of who will be … what’s their first application for this device, who’s the intended patient population, and that ties into their overall go-to-market and business strategy, right, if they want to establish a beachhead in a particular area and have some type of revenue stream that that can then support a further study or whatever they need to expand into a larger market?

Monica Ferrante: Sure.

Dan Henrich: Yeah.

Monica Ferrante: An example of that would be ventilators. A ventilator is a Class II device. You prepare a 510(k) submission, and you get clearance to market, and you bring it to market. There is an application on a ventilator called high frequency or oscillatory ventilation that’s used in premature babies. That application is a PMA application, so in order to have that feature on your ventilator, you have to do the clinical study, and you have to submit it to the FDA and get that PMA approved. That’s kind of an example of a company might want to bring a new ventilator to market, start bringing in the revenue, and use that to fund their study for that oscillatory ventilation claim or feature.

Dan Henrich: Got it. Got it. Okay. That ties in next nicely, I guess, to our next question, which is if you are a new venture, a company that’s, perhaps, forming around the new medical technology that you’re looking to bring to market, how early do you need to begin talking with someone experienced about your regulatory pathway, and how will it tie into your go-to-market plan?

Monica Ferrante: Think it’s really important to start the conversation early. It’ll be a preliminary conversation. There may not be anything from a regulatory perspective that you have to do, but understanding what the device is, what you really want it to do in the market or for your patients, and understanding what the potential regulatory pathway is important. To your point, it may be a product that, if you bring it to market minus one claim, you might be able to get it on the market thru the 510(k) process and give yourself a revenue stream to build out the rest of it. It might be that it’s a PMA from the get-go, or it might be that it’s low enough risk or you can reduce the risk enough, by design, to possibly fit into the De Novo process. Understanding which path you’re headed down and sort of where the lines are, what pushes you over the threshold from a 510(k) into a De Novo or a PMA is important to know so that you can make the right business decisions.

Dan Henrich: I think what we often find with our clients at Smithwise is that their regulatory strategy impacts not just our design process but, really, the market feasibility of their product, and so, very often when we speak with someone who has kind of an exciting new technology, usually I would say they have thought about … they come in and say, “Oh, well this is going to be a 510(k), so it’s no big deal,” but they may have a pretty broad idea of the claims that they’re going to be able to make for their product, and their business model might account for different market segments that are maybe not going to be able to fall under that simple of a process.

Dan Henrich: I think that’s one of the reasons we’re covering this topic now is because there’s a lot of … we see both kind of a dismissive attitude on the part of some medtech entrepreneurs of the regulatory process because people think of the 510(k) pathway as no big deal, and we also see a lot of anxiety on the part of others. Maybe they’re better-informed ones, but they’re a little bit paralyzed by the regulatory process as well, and so it’s great for them to be able to start thinking through these things but, often, we will bring in regulatory support early on in the design process as we’re coaching people through what we call phase zero of product development, so it’s-

Monica Ferrante: That’s good.

Dan Henrich: Yeah. Well, it’s great to have folks like you to call on in those situations. I think a lot of the anxiety that people feel centers around interactions with FDA. I have heard, from a lot of people who have dealt with the FDA very intimately over the course of their careers, that there’s been a big shift in kind of the agency’s approachability, you might say, or there’s been a positive evolution of interactions between industry and the FDA in the past few years. Can you tell me a little bit about the negotiation process and when … How do you know how much information to provide to FDA and when to start that conversation, and are you ever afraid to say too much too early before you have your data together or … you know?

Monica Ferrante: Their process has changed, and it’s actually well documented in a guidance document as far as the meetings that you can ask for versus the submissions, the pre-submissions that you can have them review. The reason for that whole evolution is because having an open-loop system is not beneficial to either side of the equation. I mean if you think you’ve prepared a proper 510(k) or a proper PMA, and you submit it to the agency, and they pick it up and they go, “Oh, my God. Half of what we need is just not here, and it’s because they didn’t know,” maybe it’s a product there’s no guidance document for or something.

Monica Ferrante: It wastes the company’s time and resources, and it wastes the FDA’s time and resources, so they’ve discovered and have been given permission or latitude, if you will, to have this open communication to foster those early conversations so that they can understand, A, where the technology is going, because if industry doesn’t bring it to them, they go out, but they may not get access to knowing what the newest, greatest things are that are going on, and how can you regulate something you know nothing about? So they’ve sort of opened the doors a little bit so that those conversations can happen.

Monica Ferrante: It’s important for a company to meet with the FDA once they know enough about their product to have some real questions. Coming in and saying, “Hey, I have this idea. What should I do about it?” you’re going to get a blank stare. Actually, the processes won’t let you do that. If you’re requesting a meeting or you’re doing a pre-submission, the guidance document tells you what information you have to provide to the agency. You have to describe your product. You have to describe what areas you have questions and concerns about and what are those questions so that the meeting or the pre-submission review can be meaningful, so the earlier the better as long as you actually have something to work with.

Dan Henrich: Yeah, yeah. Okay. Do you ever have a client or a situation where the person coming at this from the industry side may be concerned that a pre-submission meeting will lock them into a particular approach that they’re not ready to commit to?

Monica Ferrante: Well, the guidance documents actually describe a formal … and this is generally in the area of clinical studies, a formal pre-IDE meeting. If you request a formal meeting, the information that you have to have to go into the meeting is much more extensive, and you will get concrete, binding information on both sides of the equation. What you are told is binding. What they are told is binding. Nobody really does those meetings. Generally, you want to request an informal meeting, so …

Dan Henrich: Okay, so within an informal meeting, the … I don’t know. Guidance maybe is a bad word to use because it has official connotations-

Monica Ferrante: Yes.

Dan Henrich: … in this area, but the feedback that you get from the agency in an informal meeting is that. It’s informal. It doesn’t bind the agency to look at things in the exact same way when your actual submission comes in. Is that correct?

Monica Ferrante: Right, because what you may be submitting may be different than what you discussed in the meeting. In those meetings, the company is trying to understand some aspect of their product, their submission, and they’re the experts, so they’re there to explain what the product is, what their goals are for the market clearance for the device and for their patient population and so forth. What the FDA’s goal is in that meeting is to say, “Okay. I’m hearing what this is. Here’s what we’re going to need to successfully review that submission when you bring it to us based on the regulations and based on what the market requirements are.” Those are sort of the two sides of the equation. They’re not going to tell you how to do your job or what to do with the product. They’re going to tell you what they need to review it based on what you’ve told them the device is going to do, so-

Dan Henrich: One thing I want to ask you about, Monica, is you mentioned … I think, in your last response, you used the term IDE. Can you tell our listeners what is an IDE and how does it fit into the various regulatory pathways?

Monica Ferrante: Yeah. I apologize for the acronyms. It’s a world of acronyms out there. Actually, I believe one of your other podcasts had to do with clinical studies?

Dan Henrich: Yeah, yeah.

Monica Ferrante: IDE is investigational device exemption. Basically, if you have a product that requires a clinical study to go through the review process at the FDA, you will most likely require an investigational device exemption. It’s a document that you submit to the FDA that describes the clinical study, the patient population sample size, statistical analysis you plan to do, so forth and so on. An approved IDE is required for what’s called a significant risk device. If you have a non-significant-risk device, which would be something like a patient monitoring system that could be monitoring a patient while their normal device is taking care of their health, so a non-significant-risk device, you would still need all of that same documentation, but you wouldn’t need to submit it to FDA and get an approval back prior to starting your study.

Dan Henrich: Okay, so it’s really the approval to use your device within certain clinical study parameters on humans. Is that correct?

Monica Ferrante: Yes and, interestingly enough, the exemption technically is not for the study. It’s technically to allow you to take your unapproved product across state lines.

Dan Henrich: Okay, interstate commerce clause, yeah.

Monica Ferrante: It is [crosstalk 00:24:32]-

Dan Henrich: I remember that from Conlaw, yeah. Okay, so for most 510(k) products, though, where you’re not required to perform a clinical study, you can submit pre-clinical data, right, in terms of showing substantial equivalence? Is that how it works?

Monica Ferrante: Yes. 510(k)s are me-too, so you’re going to submit performance data to standards to your requirements and so forth. The FDA just came out with a new guidance document called Safety and Performance for 510(k)s where they’re expanding the abbreviated 510(k) process a little bit. That’s to say that you don’t have to take your predicate device and do a comparative bench study anymore. You can do what they’ve actually always allowed you to do in the past, which is do a study against a standard and provide that data, so just an aside.

Dan Henrich: I know there have been recent changes or proposed changes to limit the body of available predicates to a more recent period of time. Is that going to …

Monica Ferrante: That’s kind of part of this same guidance, but what they’re really trying to do is is make sure that you’re comparing yourself to something that’s reasonable in terms of sort of the state of technology. Claiming a predicate device from 1980, depending on what the product is, may or may not be reasonable to do, so they want you to be working on state-of-the-art product to the extent that … You know.

Dan Henrich: Yeah, yeah. Does substantial equivalence then mean that you’re now going to have to demonstrate that your predicate has not just previously been approved by the agency, but it’s sort of predicated off of the standard of care, effectively, or …

Monica Ferrante: What that does is that eases your process. For example, if you have an electromedical device, go back to the ventilator, there’s a performance standard for a ventilator, which tells you about the features and functionalities that all ventilators should have. There’s the 601 standard, which is electrical and mechanical safety, and then EMI standards to make sure that you’re not emitting or susceptible to radio interference. Your submission would have to have test data to all of those requirements, and then your predicate device would be something fairly recent that also has testing to those same standards. The way you get at that is, on the FDA website, you pull up the summary of safety and effectiveness that’s on the website for your predicate device, and you’ll be able to see what testing they did compared to what you’re planning to do, so-

Dan Henrich: Yeah, yeah. Okay. This all sort of ties into a conversation that I’ve been a part of recently if I’m at a cocktail party or just out and about making small talk. Of course, when you meet someone, they ask, “What do you do, and what kind of company is that that you work for?” When I mention that my company designs medical devices, often, they bring up, I’ve found, one of two things. One is there’s a Netflix documentary called The Bleeding Edge, and there was also a Wall Street Journal article published, I think, at the beginning of this year or maybe the very end of last year. Basically, the narrative that these pieces are building is that medical devices are dangerously under-regulated by FDA and that they haven’t been addressed in the same way that drugs have over the past, say, 30 years.

Dan Henrich: There’s been a lot of backlash from industry towards those types of sentiments, and I think the way that a lot of members of the public are seeing it is sort of as a, “Well, who do we believe? Are we going to believe the people who make money from bringing new drugs to market or new devices to market, or are we going to believe the journalists who are documenting this without an agenda?” I wonder if you could just tell us what are your impressions, sort of, of that general sentiment that FDA has been sort of sitting on its heels for quite some time and letting their regulatory system for devices become outdated?

Monica Ferrante: Very interesting question. I get that question a lot. Actually, there is a push in Europe to align medical device regulation much more with the way drugs are regulated. If you look at the overall history of regulation in the United States, I’m talking all the way back to 1906 when it kind of all started. Actually, it started before that, but the evolution has always been the drug industry being regulated and certain things being applied, and then devices did come along afterwards. There’s a pendulum that swings. I think we talked about this a little before we got started.

Dan Henrich: We did, but I want our listeners to hear it too because it was well put.

Monica Ferrante: The regulation pendulum goes from, “Leave us alone. We’re fine. You don’t need to regulate us at all,” to, “Oh, my God. They’re killing the American people. Every single thing that gets done needs to be regulated.” The pendulum swing goes back and forth. It has for the past, well, since 1976. The swings are getting smaller, which is a good thing because it means that we’re honing in on a nice balance between appropriately protecting the public health while appropriately promoting the public health. In fact, the FDA changed their mission statement several years ago to exactly that. It used to be protect the public health, so we need to make sure everything is as safe as it can be no matter how long it takes. It was actually the advent of the AIDS epidemic that caused that philosophy to change, and promoting the public health, making sure that our citizens have access to the best and the greatest medicines and medical devices became part of their mission.

Monica Ferrante: It’s a scientific process, but the FDA can only evaluate whatever science has put in front of them, and they have to evaluate it based on the regulations, so they try to balance the risk versus the benefit of a particular device. You try, in your clinical studies, to determine what those risks are, and you address those risks as best you can through risk mitigation and design through proper application of the product to the appropriate patient population and so forth, but it is a little bit of an iterative and learning process. It’s never going to be 100% the first time out the door.

Monica Ferrante: I will say that the agency, being science-based, is sort of blind to public sentiment in that regard while they’re doing their assessment. There have been times when people have petitioned the FDA and said, “You should never have approved that medical device,” and it turns out that the people that are making those claims may not understand the number of people that have actually benefited from that therapy and that it’s a small subset that has had the issue. Whenever you read these things in the literature or in various social media or publications or whatever, you kind of have to take the perspective of digging into the detail. What is the context of that particular failure, and how was it responded to?

Monica Ferrante: That way, as the public, you can be better informed and you can understand, oh, the FDA didn’t see that coming. They did address it, and now the product can be safely used in a more limited application, or the FDA actually has had it right all along, and one particular event is being blown up to be a terrible, terrible travesty when, in fact, it was anticipated and understood by both the medical community and the FDA as something that could potentially happen. There’s never any device or even any drug, for that matter, that’s zero risk.

Dan Henrich: Yeah. Well, one of the things I think just very few members of the public appreciate is the number of devices, perfectly good new medical technologies that simply don’t make it to market because of a number of things that derail it from its path. That might be a regulatory problem, or it might be a market problem that, simply, the market can’t justify the cost of developing this device, especially if it’s for a small patient population. One thing that we see, I think we all become aware of things that go wrong and grab top headlines, like superbugs in endoscopes or the vaginal mesh class-action lawsuits and things like that.

Dan Henrich: What we don’t become aware of, I think, as just members of the public, is all the products that do not make it to market because they have encountered some barrier that they just can’t get over for one reason or another. Now, being on the inside of the industry, I’m extremely encouraged when I see FDA take proactive steps to try to lower unnecessary barriers while still ensuring safety and efficacy so that new devices can come to market, particularly for small patient populations where the market … just to make the market case and make something make business sense and attract the investors that it will take to develop the product can be so difficult.

Monica Ferrante: Yeah and, to that end, the agency hasn’t lowered its standards, for example, for pediatric devices and so forth, but they have eliminated user fees and things like that, so they’re doing … within the realm of what they have control of, they’re trying to facilitate the whole humanitarian device exemption, which is the device equivalent of an orphan drug, if you will, where they reduce cost but not necessarily performance thresholds so that companies that have those kinds of technologies have a much better chance of actually bringing their product to market.

Dan Henrich: Right, right. Yeah. I’m not sure if it will be the next podcast we release, but we have an interview coming up with a pediatric device specialist, and I think he and I are going to talk a bit about what are those programs that FDA is instituting to try to compensate for some of the deficiencies in the free market model when it comes to bringing devices to market for underserved populations or for very small patient populations where it’s just difficult to overcome that barrier? They can’t lower the safety or efficacy standards, and we don’t want them to, but how can the FDA or how can the Patent and Trademark Office or how can other government agencies facilitate still navigating those products through the same regulatory pathway in terms of ensuring that they’re safe but lower barriers in terms of the overall cost to bring them to market?

Monica Ferrante: Yeah.

Dan Henrich: Yeah. One other thing, Monica, that I certainly wanted to discuss with you is we talked a little but about how, when you’re evaluating your regulatory strategy, which pathway will you try to steer a device down, at least when you’re first establishing your revenue stream if you’re a medtech entrepreneur? What about the idea of bringing a certain type of product to market which is kind of on the line of whether or not it’s actually a medical device or whether it’s a piece of consumer health technology? Can you talk a little bit about how a company might evaluate whether they want to be regulated as a device and how they would approach that situation?

Monica Ferrante: Well, that’s sort of the very first step of your product idea. Is it a medical device or is it not a medical device or is it something that could bridge? The FDA has established several guidance documents in areas that are of high activity, so apps. Are there apps that should be regulated as a medical device, or should they not? The guidance document addresses that, actually, pretty clearly. Same thing, when does exercise equipment become physical therapy equipment and things like that? They’re trying really hard to provide some framework in terms of when you’ve crossed the line and you really are a medical device.

Monica Ferrante: They actually did that with 23andMe. When they first came out, they were like … they didn’t even think about whether or not they were a medical device. They had no clue, right? Interactions with the FDA and, “Oh, yeah. We sort of cross that line.” They did the submission that they needed to do, actually, through the De Novo process, and now they’re adding functionality. They added a diagnostic for BRCA, so that’s been approved under a De Novo or cleared for market under a De Novo and so forth, so they are expanding on their technology, moving more and more into medical and doing the appropriate regulatory work along with it.

Monica Ferrante: If you’re in an area where you’re not sure if you’re a medical device, that’s a really good time to call the FDA and say, “Hey, this is the product. These are the things that we want to say about it. This is what we want it to do. Is there a line or where is there a line?” That doesn’t prevent you from staying in the commercial world. It just informs you that, when you’ve crossed the line and you’re moving into the medical world, what you’ll need to address.

Dan Henrich: Is coming to market, say, with limited claims as to what your product does, is that a strategy that a company might be able to employ in order to gather the data that they will need to show to FDA, or is that … It sounds like a tricky-

Monica Ferrante: Yeah. Well, I mean it’s-

Dan Henrich: Maybe it’s not a fair question to ask you, but-

Monica Ferrante: You can do that, absolutely. The question becomes how do you gather that data and what are the processes that you need to do that? If you’re testing a product that’s not a medical device but you’re testing potential medical claims, is it an investigational device that you need to follow the regulations for clinical studies and informed consent and so forth? There are a lot of interesting questions there that need to be evaluated, but yeah, it’s all possible. It’s a matter of how you sort of work through it.

Dan Henrich: Yeah, yeah. It sounds, to me, that when you’re dealing with a young medtech venture and they’re just starting to think through a lot of these things, they really need to form a relationship early with a really qualified regulatory consultant, maybe even one that has experience in a particular area. Do you have any recommendations in terms of how people should go about forming those relationships? Should they take multiple meetings at first? What if they don’t feel they have great referral networks? How should they go about finding a regulatory consultant and then determining that that person is trustworthy?

Monica Ferrante: Yeah. There are a lot of ways to do that. There’s an organization called RAPS that is actually regulatory affairs professionals. If you go on their website, they have listings of regulatory people who are actually certified, but obviously, in this age of the internet, you can do your own searches. There are a number of different ways to come across regulatory professionals. I think the main thing, to your point, that you want to have a conversation with that person about, their comfort level with your area or your device type or whatever and your comfort level with them.

Monica Ferrante: I mean, to me, working in this arena with the FDA, it’s about relationships and conversations and the ability to communicate, so finding a person that you can do that with, in terms of the regulatory expertise, if they need to go and research something to figure it out, that’s not necessarily a bad thing. The regulatory environment and landscape changes, so you need someone who can know where to go to figure things out and who to ask and when to ask as much as someone who already has all the expertise in their head. You’re not necessarily always going to find that.

Dan Henrich: Yeah, yeah. Great, great. Well, thank you. I’m sure we could keep talking about this for a really long time.

Monica Ferrante: Oh, yes.

Dan Henrich: I know this is going to be helpful. This has been helpful to me even though I have a little bit of a background in it. I think it’s going to be really helpful to our audience and to folks who are just starting out on that journey to bring their products to market so, Monica, I want to thank you so much for your time.

Monica Ferrante: Oh, thank you. It’s actually something that I love to talk about. I love my work, so-

Dan Henrich: That’s great. That’s great.

Monica Ferrante: It’s always changing.

Dan Henrich: Great. Well, thank you.

Monica Ferrante: Thanks. 

Written by Daniel Henrich

Written by Daniel Henrich

Director of Marketing at Archimedic

MedTech Mindset Podcast: Branding in MedTech with Bill Gullan

EPISODE 5 – Bill Gullan and Finch Brands

In this episode, branding expert Bill Gullan, President of Finch Brands, speaks with Smithwise Marketing Director Daniel Henrich about what branding is and why’s it’s critical in the world of medtech ventures. 

Bill and Dan discuss:

  • What branding is, and what it’s not
  • How company identity and go-to-market strategy are reflected in a brand
  • When is the right time to worry about branding?
  •  Developing market and buyer insights
  • Naming your product and company

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Episode Transcript

Dan Henrich: Some of our listeners, Bill might be wondering why are we talking about branding for a MedTech audience.

Bill Gullan: Sure.

Dan: I’m sure you have this experience even just as a marketer. People tend to have, outside the world of marketing, a pretty narrow definition of what marketing and what branding is.

Bill: Right.

Dan: They think of Mad Men ad agencies as what marketing is, and branding is maybe logos and color pallets.

Dan: So, what do we mean when we talk about the world of branding?

Bill: Well, there’s a lot of similarities with Mad Men in terms of how I look and how I behave. No.

Bill: I’m glad you asked, thanks for having me.

Bill: Branding as a discipline is often misunderstood and in part that’s because the word is thrown around fairly loosely and liberally.

Bill: We define branding to be the sum total of how you think and what you do to assert difference and provide expectation of what an experience is gonna be like. So, that includes colors and names and logos, and packaging, and websites. Those are artifacts of a brand.

Bill: But, branding is an overall discipline, is a much larger concept than simply that which emerges from a branding process or are things that you can pick up or hold, or say, or read.

Dan: How does the process of coming up with those tangible aspects of your brand that people are gonna associate and think of as your brand. How do you go about tying those into your deeper sense of identity as an organization?

Bill: That’s a good question, and one of the premises of the question is a very important idea, which is that branding is again, not just a graphic designer set of choices for what might look pleasant.

Bill: It’s based on a deeper system of belief: a sense of purpose, a sense of direction, a sense of difference, a sense of value. That ultimately is expressed creatively.

Bill: And so, when we talk about branding, one of the things that’s really important and often where our processes start, though not exclusively. Is that definition of purpose.

Bill: And so, we spend a lot of our time working with leaders of companies on concepts like vision, mission, and values.

Bill: Those might not typically be associated with branding. Branding is just not the stuff that appears sort of above the waterline.

Bill: In fact, in many ways the hardest and most important element of branding, is what exists most deeply. But beneath the water, and so that often strategically and sort of emotionally comes from that core purpose in the sense of the why that everyone talks about.

Bill: And then, it shows itself through all the communications and touch points that are both internal and external. By the way, we like to say at Finch Brands that the best brands are built inside-out. So, we spend a lot of time on the inside piece. Whether its working with organizations that are going through some M&A activity or some transition, or launch, or whatever the case may be.

Bill: The ambassadors or the carriers of the brand, the deliverers of the brand’s story are gonna be the team.

Dan: Right.

Bill: Client-focused or not, product-focused or not. Those are gonna be those folks who really need to understand and buy into what it is that we’re doing here and what we stand for, and what makes us different.

Bill: If they get that, and have been in some maybe efficient, yet inclusive way, co-authors of that. There is both a muscle memory, but also a sort of concerted and deliberate impact on the work they do every day and consequently what the company puts out into the world.

Dan: So, it’s kind of a chicken and egg situation in terms of constructing a brand as an expression of your corporate identity and culture, and values. Are your employees that way because we’ve said this is how our organization is going to be. Or, do you attract and seek out people who are already part of that?

Bill: That’s a great question, and the answer is both.

Bill: In the early stages, and for those of your listeners who are sort of in an entrepreneurial situation, whether it’s an idea and a couple of people, or early stage companies. Often leadership and co-founders, and early leaders of building a product or whatever are true believers and are there for some common sense of opportunity, yes, but also purpose.

Bill: So there is a need to kind of define or memorialize that, document that often what’s in the hearts and soles are often a greatest service to an organization like that is to help sort of extract it and package it in a way that everyone can act on.

Bill: However, to the premise, again to the question. These core principles that underlie brands also, underlie culture. And thus, the best organizations are those that into the hiring and onboarding and training, and rewarding process of how teams are built as companies grow. Those core principles, be it values or other components of who the company is, have to insinuate themselves into these core processes that have to do with people and have to do with culture.

Bill: So, often for early stage organizations there is a process to develop and document those core beliefs. And then, to imbue everything that comes after in hiring and training, and a lot of that is important in what comes after with those core sets and precepts.

Bill: Another thing often where this is really put to the test, I mean here at Finch, we work a lot with companies and brands that are in transition and that often means, how do you integrate a company that you’ve acquired? How do you make choices and how do you educate new members of the team? Who maybe for a couple of years have been glaring across the trade show floor at you. And now all of a sudden they’re part of you. How do you, in a really quick short-hand pro-enrollment kind of way, engage these folks.

Bill: Often, by growing you earn the right for this to be challenging. And so, I think one of the topics we’re gonna get into is … and it may be surprises for someone in my position to urge restraint in part of entrepreneurs when it comes to time and investment associated with branding in the early stages of a business. But, when you reach a level of scale, where … one of the core elements of smart branding is consistency. There’s a reason why UPS trucks aren’t all different colors.

Bill: So, consistency means that these internal lessons are well taught, and well received. So often, when brands grow and when there’s another ring of employees outside of that core founder base, is when this becomes even more important culturally to document these things.

Dan: Yeah.

Dan: That’s all, I think all those thoughts are really important for those members of our audience who are early-on in their stages of developing their company, defining their identity.

Dan: Often I think, we’re dealing with MedTech startups who have maybe most commonly maybe two people, and those people have a very well defined but maybe not well articulated or a common understanding of who they are and where they wanna go.

Dan: But, as they start growing their team, that doesn’t always come to the forefront, or they’re not always putting that at the very beginning of their conversations to say, “Here’s who we are when you’re joining us, or here’s who we think we wanna be.”

Dan: So, I think, marketer to marketer, you and I can talk about that all day, but maybe let’s dive into some of these other questions that we outlined.

Bill: One thing I’ll say though just to put a really fine point on it and then underline it, and then bold it, and then italicize it.

Bill: All these [inaudible 00:11:44] are situational Dan, I mean depending on capitalization, depending on go-to market strategy, depending on all … so, with that caveat, generally speaking, it is not in the interest of early stage, in my opinion, early stage one or two person shops. Even if they’ve raised friends and family. Even if they raised series, whatever. To plow a ton of resources into branding.

Bill: What they could do, or should do is maybe have a trusted advisor in the form of a firm, or even just a mentor to the business help maybe mediate some of these conversation. Help maybe build some frameworks around “What’s our first vision mission? How do we do that?”

Bill: Certainly, you want your market facing website, you want your investor and client pitch deck to be really well integrated, to be consistent and to be reasonably sharp.

Bill: But, beyond that there are better uses of process. In my opinion, most often when it comes than plowing a ton of money into having the best branding without a minimally viable product or with a bunch of vapor, or with a lot of things still to be untangled, because that’s the things about that stage. There’s a lot when it comes to target markets, when it comes to how stakeholders are defined, when it comes to zigging and zagging. Everything changes.

Bill: And so, other than that kind of core sense of purpose and maybe the development of a look and feel in personality at the very sort of early stages. You just don’t wanna have to bother with that and tie up your resources. It’s all gonna change anyway.

Dan: Yeah.

Dan: I think you maybe have then just sort of answered what we had talked about as a next question in terms of when is the right time to start worrying about branding?

Dan: But, when’s the right time to start worrying about maybe those mission vision values underlying parts?

Dan: I think a lot of our listeners, you don’t have to sell them on the fact that it’s maybe too early to plow a lot of money into the process. But, what should they have done even at the very early stages of their company before they start growing their team from an organizational identity, underlying future branding standpoint?

Bill: I would not plow a ton of money into it, but I would certainly think about vision mission values from day one. I would certainly among even a very small self contained team of founders and sort of early stage team members. I would certainly think through, again, not be paralyzed by it, but think through and document a best guess on vision. Which is sort of that North star, what’s our purpose?

Dan: More the internal-

Bill: The power of what we do mission, which is sort of the high level answer to how we do it and values. Which these are the norms and behaviors that we wanna encourage within our culture among the many things that we can ask people to do. These are 3 or 4, or 5, that we think are essential to building that type of company that we want to. That’s important to get done.

Bill: It’s also important early on, to get an effective market facing website done. Now, the good thing is with SasS, web options like Squarespace and others, you don’t need a big dev team, and you really don’t need a big design team. These are fairly easy to do, so you’re able to control cost.

Bill: So, I think those are things that you really do wanna think about early. And, you really wanna engage those true believer inner ring types of folks into conversations like that.

Bill: You probably wanna do the best you can on naming, and I don’t mean the best you can on hiring some crazy naming firm to go through 37 rounds of ideas. But, you should name with an eye toward, not just your neighbor’s  dog who you happen to like, but I mean a name with an eye toward conveying something about what you’re building.

Bill: But, when it comes to the larger stores, I think the moment when you really probably need to think about it, invest in that, is when you are going to market with scale. That doesn’t necessarily mean hundreds of thousands of people sorts of scale, but when the meetings that you’re taking are a little bit less about, “Hey, you can be a development partner. This is what we’re working on. What do you think?” And more about, “I want you to buy this. I want to transact with you.”

Bill: And, the more that those types of conversations are both dominating your investments in terms of hiring and sales and marketing, and also just how you’re gonna evaluate your own performance. That’s when you kinda need to start getting the stuff right, or right enough.

Dan: Yeah and that’s when not having it is going to start to clearly impact the results of those conversations?

Bill: Correct. Yes.

Dan: Okay. Give me a moment here just to look at this list because I think our conversation has been following this stream of thought all by itself.

Bill: I always jump the gun.

Dan: No problem, I think it’s better for it to come out in natural flow of thought.

Dan: So, let’s talk specifically about MedTech and healthcare. You’ve worked with a lot of healthcare related clients. And I’m sure you’ve encountered this as marketers we’re always told that we need to humanize our brands, especially if it’s a business to business brand. Or, especially if you’re doing something that’s not very sexy, right? You need to find a way to connect emotionally on some level to your stakeholders.

Dan: I think what often comes out of that in healthcare space is a broad claim that companies make that there are really patient-centric.

Bill: Yes.

Dan: But, if everybody is just saying that, then your humanization maybe falls flat and it becomes very generic and you’re not really differentiating yourself at all.

Dan: So, how can MedTech players, how can folks in the startup realm define their brand in a way that’s both humanizing, but not overly broad?

Bill: Yeah, great question. And I have a blizzard of thoughts, so please help me keep them structured.

Bill: The first thought is an old adage that, again, marketer or marketer is probably something you’ve heard 100 times, and I’ve heard 100 times.

Bill: But, continues to have the most profound impact on me and acts as a check in terms of my own direction and the work we’re doing with clients, which is, and I forget who said it, Professor Levitt said it. Which is that, “People don’t wanna buy a quarter inch drill, they want a quarter inch hole.”

Bill: What that is imploring us to do as marketers is to focus less on features and more on benefits. So, part of appealing to and remember to master the emotional and rational sides of our stakeholders, and they always … people are people. So, there’s always a rational and emotional piece to this. Is to remember to communicate through the lens of benefits, not product features. Because of the fact in MedTech, many of your most high potential founders are coming at this with product knowledge and as engineers, and are approaching this, and that’s their comfortable place. That’s where their soul resides, it is particularly important that people like that are remembering to talk about the hole, not the drill.

Bill: Now, you’re right. This whole, “Hey, I’m making this device that the patient will never know by name, or identify by name. Yet, I read somewhere that I need for this brand to be emotional, so I’m gonna talk about saving the world.”

Bill: No, you’re right. There’s a disconnect there that falls flat, it’s cringy, it’s trickily, it isn’t something that’s gonna connect.

Bill: But, by goodness, if you are selling through let’s just take a medical center, and you think about the need states and the frustrations of the chooser and user in this. Let’s say the nurse. Boy, what problems are you solving for her or him? What are the things that day in and day out are areas that really motivate and constrain him or her?

Bill: Some of those are emotional. I mean nurses who, and again I’m over-generalizing here, but let’s say if you’re dealing with head nurses and their team at an assistant living facility. When you think about it, you really go through and build a map of the journey that they deal with day in and day out, all the touch points with their patients, with their colleagues, administrators, all the challenges that are thrown on them day in and day out.

Bill: And, you talk to a couple of them and you understand what deeply frustrates them, and you really hopefully have hit on a problem that you’re solving for your product. There’s incredible terrain to make that emotional.

Bill: And so, emotional brands isn’t just going to this as far as you possibly can in terms of the actual end-user of this and saying that we’re gonna save their lives. That’s a recipe for not connecting.

Bill: But, when you look at your stakeholder, in some cases it’s a complex web of stakeholders. And you really think about the problem you’re solving and the impact you’re having on their day, and on their sense of themselves, and on their sense of their own performance and efficacy. You will find terrain there that is absolutely possible to sort of anchor into.

Bill: In the MedTech realm, even if you don’t touch the end-consumer, or you don’t wanna run the risk of saying, “Oh, we make the world a better place.” Or, what you’re dealing is sort of definitively un-sexy, you’re helping someone have a better day and get a better outcome. And, it’s important for you to get your finger on what that is.

Dan: Yeah. So, as a follow up to that, how can brands know how to strike the right balance between being really aspirational in what they claim in making somebody’s day better or saving their lives. Without kind of like overextending themselves and laying claim to something that they really haven’t earned. So, I think what comes to mind is, I think I was listening to it, an old episode of your podcast the other day.

Bill: I think … I’ll piggyback on what I said earlier, because this may not be satisfying, “How to” answer, but the best way not to do it, is not to do it in this case.

Bill: If you have a clear sense of how your stakeholders live and work and what they value and where they need allies, and the role that you’re playing in being that ally in a certain sphere in a certain sector. If you really, really know that well, and you’ve been able to sort of articulate again, rationally and emotionally the value that you create for them, or the problems that you solve for them. You will, and you should always resist temptation to claim to be a savior in areas where you’re not, but you should be able to calibrate that message pretty effectively if you have a pretty good sense of how they live and what they do.

Bill: I’ll give you an example, we’ve been working on a branding process for a company that’s mindblowingly amazing, that may be a hyperbole but we like them very much, we respect them very much called, Belmont Instrument, the rebranding is Belmont Medical Technologies. They’re sort of flagship product, which is known in the ER as “The Belmont”. Is this temperature regulation, the rapid infuser that helps regulate temperature when it comes to blood transfusions and get rid of the bubbles and other things. I mean this is literally lifesaving, but it is a tool for critical care providers to save lives, and there’s a temptation because the tool is lifesaving because you wanna sort of inspire the internal workforces and because you want the market to be aware of the impact that you have. There’s a temptation to say that this product alone saves lives and maybe it does, but it made more sense from our perspective and theirs to really nestle into the degree in which we support critical healthcare heroes in saving lives and enhancing outcomes.

Bill: To come to market with confidence and humility simultaneously was the right answer for them. And I think it generally is when it comes to MedTech.

Dan: So, kind of key there it seems like is making your … maybe not your ultimate customer, but your stakeholders the hero of the story, right?

Bill: In many cases, that’s right.

Dan: And your product is often a means of them accomplishing that feat, right?

Bill: And that is a high percentage of the time, a viable and smart, strategic direction.

Dan: Yes. Okay, so that’s kind of a good Segway into another question I have for you, which is, you alluded to, not alluded to, you talked about the importance of understanding the ins and outs of your users and your stakeholders, and the importance of research underlying your branding and your messaging, and your identity.

Bill: Yeah.

Dan: A lot of our listeners are very early on in their process, they might be thinking about what they want their brand ultimately to be or to mean, or how they’re gonna communicate their message, but they don’t have a product yet, let alone customers or these other stakeholder relationships that ultimately they hope will come later.

Dan: What advice can you offer to people in terms of doing that broad research when you don’t have those relationships in place. You can’t call up your customer and say, “Hey, can I come [crosstalk 00:27:28]

Bill: Thankfully, there are many, many different ways today to do or to begin the process of having those types of interactions with folks that in the olden days might’ve necessitated that you pay for it.

Bill: Use social media to network to nurses, for example, in your relationship base. Take people to coffee. I would imagine most of the founders who listen to this have some connection, somewhere in the [inaudible 00:28:00]. They don’t have a customer to survey, perhaps.

Bill: But, they have a concept, then they have a mentor and they have the ability to network their way to have just a couple of really deep conversations, that can be enough.

Bill: Market research so to speak were in this political season, the Midterms just happens everyone was looking at the polls, right? The reasons the polls are accurate sometimes down to a couple of percentage points is because they do them with a statistically significant respondent base. They do them with enough volume that they know.

Dan: But, good luck funding that.

Bill: Yeah, good luck. But I mean in this case, all you need is a directional sense. Plus, if we’re talking about these branding topics, we’re looking for depth and texture. We’re not looking for a margin of error level of statistical validation.

Bill: So, the best way to do this is to have a series of conversations with folks that you network to, take them to coffee, buy them a gift card, whatever, and benefit from the depth and texture of having a palms up, open conversation to understand what their world is like.

Bill: At the same time there are other ways to do this? Yes, social media. But, all of these places have trade organizations. All of these occupations do. They’re often, and depending on where you live, you may have a university nearby that’s offering undergrad or grad level degrees and XYZ. Talk to faculty, talk to grad students who are doing rotations. If you have a little bit of energy, certainly roll up your sleeves and at very minimal cost have conversations of this sort that will be helpful, not necessarily in validating within a two decimal place margin of error that something that you believe in is right or wrong.

Bill: But, in providing the texture and the depth with which to build these maps of experience and build brand content, that has power and meaning, and is directionally valid. So, you don’t need a paralysis by analysis research process that spins the entire angel around that you’ve raised, and exhaust you and now you’ve learned something, but you have nothing else.

Bill: You don’t need to do that anymore.

Dan: Right. And really hopefully, I’ve always sort of felt as a marketer in a lot of ways my job is easy if what I’m marketing has been developed correctly.

Bill: Yes.

Dan: Right. If the team that has developed the product I’m selling, or put together the service package I’m selling has done that with market knowledge. Then, branding and messaging and all that sort of thing should be a natural extension of that, right?

Bill: Sure.

Dan: So, I guess what I’m trying to get at is hopefully those conversations and those interactions are already happening at informing all of what comes prior to hanging your shingle, right?

Bill: Yeah. Totally.

Dan: Yeah so.

Bill: But that said, entrepreneurs have to make calls. Again, there’s zigging and zagging in that process, and there’s probably some choices that you make either at the product level or at the pitch level, or whatever it is.

Bill: That’s based on incomplete information and you do your best to get there and that those hypotheses get refined over time and it certainly makes sense to make this level of exposure to the marketplace a persistent and perpetual component of the growth of a concept and continue to bring ideas and concepts back to this base of folks who can react to them through the lens of their own professional experience and then the needs that they have day in and day out.

Bill: So, I agree with you that these companies are built brick by brick and ideally good choices now result in better outcomes later. But, one shouldn’t fret that every choice they’ve made doesn’t have to be perfect for the company being successful, except to do your best and then continually refine the approach.

Dan: Right. Yeah, I guess what I mean is hopefully you didn’t get to market with a product that you haven’t already really established the need for and the value of within your own process of developing it and funding the development thereof right?

Bill: It’s true, and I mean if you have investors, a lot of people are kicking the tires on this thing, and a lot of people are assessing in addition to their respect for you which is probably palpable and important to this. They’re assessing what the market opportunity is and whether it clicks or connects for them. And so, by virtue of building a company, even in the very early stage, there are people who have been put in a position to evaluate whether they think you’re on the right track. So, I guess there’s perhaps wisdom which each incremental opportunity that you have to put this in front of somebody who has good judgment and some level of experience. You know, the closer you come to know that you’re on to something.

Dan: Sure.

Bill: Forgive the emergency vehicles in the background. It’s not for us.

Dan: It’s part of life in the big city, if you can hear the emergency vehicles in the background. We’re recording from Finch’s  s today.

Bill: I hope everybody is okay.

Dan: And there’s some city noises.

Dan: Let’s talk briefly about the process of naming, both company naming and product naming.

Bill: Yes.

Dan: That’s a really painful process in my experience.

Bill: Can be, yeah.

Dan: And the larger the group is that’s making this decision, the more painful the process may be though. I guess on the other hand the more input and reactions you get.

Dan: What’s the right way for a startup to go about the naming process. Say just naming their company, or maybe naming their product that is the name of their company or vice versa.

Bill: Right. Many are, yeah.

Dan: Is it the two founders sitting in a room alone? Or, when’s the right time to have that conversation? When should you reevaluate … when should you be willing to reevaluate your working title?

Bill: Yeah, I think the second question is a little easier than the first, but I’ll try to address them both.

Bill: Everybody works differently and has different rhythms and for example, even at Finch, and we do a lot of naming and my own personal naming history goes back to the late ’90s. My first real job out of college what at a firm that adjusted naming, and so I have a passion for it, it’s my favorite thing to do. It’s hard, to your point, and it’s always a mix of hope and fear. I mean the hope is that you come at something that really effectively encapsulates the energy and the positioning, and you can get it and go to market with it, and it helps.

Bill: The fear is legal availability and linguistic appropriateness, and just the overall challenge of a process like this. So, anyway, suffice it to say my scars are still fresh and have been for 20 years from naming.

Bill: But, everybody works differently even within Finch we have some folks who really thrive in group brainstorming sessions. I’m not like that, I personally am somebody who prefers to brainstorm independently and use the output from the group sessions and anyway, too much sausage making. Suffice it to say that there’s no right answer as to who should be in the room and how they should do it.

Bill: What there is a little bit of at least guidance on perhaps is, what makes a successful name? And, to your second question, when to be flexible and reevaluate it?

Bill: There are a couple of different types of names. It’s most simply and this may be overly simple. There are three types and they all have strengths and weaknesses.

Bill: Type one: we would call that neologism, it’s a newly created word. It’s your Verizon. It’s your Exxon. It’s your Texaco. These names may have an obvious derivation, but they are … I used all the petroleum companies, so let’s use Verizon as an example, which is the Latin prefix, the truth, and horizon. So true future, it was GTE and Bell Atlantic merged. There was no chance that either one of those, old wire line companies was gonna really be the right identity to carry forward into even then they knew was a mobile future in the mid to late ’90s.

Bill: So, a new name was developed, Verizon.

Bill: Now, the good thing about it is you can make it mean what you want it to mean. It was an undisturbed landscape and you had an opportunity, Verizon did, to define what they wanted it to be. Of course, day one, everyone said, “How do you pronounce this? Verizzon? Or, What does this even mean? I hate it. It sucks.” Whatever, and then, as is so often in the naming process, naming is not a thunderbolt from [inaudible 00:36:26] and oh, there it is, we got it. There’s one name and it could can only be one name, and it’s the greatest name ever. It’s never like that. What it is, is finding a name candidate that has enough absence of negatives and enough that you can build a brand around it.

Bill: When I was doing naming in the ’90s, clients would come and say, I want the next Amazon, I want the next Windows. So, we understood that. Of course, the response obviously was, you don’t want their names, you want their businesses, right?

Dan: Right.

Bill: So anyway, it’s important to not hold yourself to the standard of the thunderbolt is gonna come and the angels are gonna sing in holy, and holy crap I have my name. Because it doesn’t happen like that. It really doesn’t. The best names are those that have the best business and brands built around them.

Bill: But, back to the point neologisms. The detriment perhaps or the challenge of neologism is that it costs a lot of money to make it mean what you want it to mean.

Bill: In the absence of your ability to educate the marketplace, they’re gonna be forming their own conclusions or more likely confused by it. So, the neologism has strengths and weaknesses.

Bill: The second type that you see that is predominant is a metaphor. It may be a popular word that everybody knows what it means, but you use it out of context to … Amazon, which was the longest river in the world, it’s a conveyed selection. Finch as well, coming from Darwin and the research on finches in the Galapagos. These are metaphors. Jetta is a wind current for Volkswagen. There’s hundreds of examples. But, the benefit of that is you can still make it mean what you want it to mean and it won’t be, “Ugh, I’ve seen it 100 times-

Dan: And nobody asked how to pronounce it-

Bill: But, people know how to pronounce it. So metaphors are interesting. The challenge of them is that you still need to tether it to what you’re doing so that it makes some degree of sense and then the third name can be-

Dan: It may be a lot harder to be found as the first search result, right?

Bill: That true. [crosstalk 00:38:15] it’ll be used out of context or in different context in a bunch of different ways.

Bill: The third, we would say is more of a descriptive name candidate. The name that comes pretty darn close to saying exactly what the product does.

Bill: And then I would say the fourth is more of a proper name. It might be after a place or after a person. So, I guess I’ll amend that and say there’s four.

Bill: Anyway, straight to the weaknesses to each. The right name ultimately is based on situational factors in terms of the category and it needs to have some level of connection. Ideally, it says something and it does a little bit of the work of introducing the company. Ideally, it is easy to spell. Ideally, the domain name is available or a quick work around is available. Obviously, ideally the intellectual property is available and linguistically it needs to not mean something horrible in another language. We’ve all heard those stories.

Dan: Yup.

Bill: And so, these are things that the name needs to do.

Bill: Now, the right name type, or the right specific name for a company is very situational based upon what the company is doing, what the nature of the category is. Are you a first mover with a new innovation? Are you leaning into something different in terms of what you’re providing?

Bill: Long answer to an easy question. The second part of your question of when to reassess is before you go to market and scale. There may be a time where you put a little bit of momentum in a closed community, like the entrepreneurial ecosystem, or among investors, or in an HR sense where you have built a little bit of equity in what it is that you’re trying to do. There may have been a story or two written about it. You may have raised a couple rounds, whatever.

Bill: But, before you really go to market and scale, that’s the time to think differently about it. I don’t like the necessarily, “Hey, my roommate and I had a pet dog and the dog name was Spot, so we’re gonna name our company Spot.” Who knows, you look at the successful companies out there. There’s a lot of random proper names that have stories associated with them that are really personal to the founders.

Bill: Again, for a guy at a firm that does a lot of naming, it maybe strange to say. But, there are certain things the name needs to do, but a lot of the success or failure is way beyond what the name does or doesn’t do.

Dan: You do post naming right?

Bill: Yeah totally. So, I think naming is important, but again, not something to get stuck on or be paralyzed by.

Bill: Another thing that we’ve seen pretty frequently, again, to your point is, often there are what we call brand architectures, which have to do with how different brand equity is within a company fit together.

Bill: Where there’s a corporate name that isn’t the product, the lead product name. Once you go to market, maybe you want the corporate name to exist in your corporation documents, maybe you want the corporate name to exist because there may be future directions that the company would day beyond its maiden product concept. So maybe you want a different corporate name from a different lead product.

Bill: Now, that makes sense in situations where the corporate name isn’t asked to do that much. If the corporate name is asked to do a lot when it comes to HR, when it comes to fundraising, when it comes … then it doesn’t make sense early on to have to build equity in two names simultaneously. That’s a diversion of resources and that’s a confusing waste of times and resources.

Bill: But, if the corporate name is a DBA that’s gonna exist and be held for later as a larger umbrella into which other concepts they fit or sit down the line, then it may make sense for an initial product that has a very specific utilization and it may be a very specific space to have the ability to narrowly tailor its value to the space and the stakeholder type that it exists to impact.

Bill: So those are meandering thoughts about naming. But yes, naming can be hard. Naming is emotional. Part of the reason I think it’s hard, my own hypothesis is that when it comes to the work that designers do, there’s a skill gap. Most people can’t do what they do.

Bill: When it comes to naming, we all know the language.

Dan: Right.

Bill: And we all have opinions about it and that’s good. So, within a process, we’re working with clients, it’s on us to harvest input, to lead but listen, and to understand that great ideas can come from all other the process. It doesn’t make sense for us to discourage. They’ve hired us and they want us to leave, but that doesn’t make sense for us to discourage either candidates that were developed internally or if people are having fun thinking about it, we appreciate those additions to the process and the right answer in a process, I don’t care where it comes from or where it comes from. I mean there’s no pride in authorship. And there shouldn’t be just because we want the best. We want the best outcome.

Bill: So, when founders are brainstorming and they feel really good about something, that in it of itself means something.

Dan: Yeah, great. Well I think you and I can geek out for a while about branding and naming and marketing topics, but one thing I wanted to make sure that we do cover before we wrap up here in a minute is the issue of stakeholders within the healthcare space.

Dan: Many of our listeners are working on products that are gonna have a whole host of stakeholders and ultimately they may even end up inside a patient for the rest of their lives. But, the patient may never even know that brand name, you may not know you have the Metronic hip or a J&J hip.

Dan: How do you decided who the most important stakeholder are? Are they the hospitals, are they the insurers, are they the surgeons or the nurses? And how do you tailor your brand messaging to multiple sets of stakeholders that have their own sets of concerns.

Bill: Right. Most medical devices do not reach the level, nor to they aspire to, nor should they aspire to be an, “I want my MTV” kind of end-user pull.

Bill: Because the budget is required to do that. As well as their very specific categories where a patient or a consumer may even care.

Dan: And may even [crosstalk 00:44:14]

Bill: System or something like that. And they even exercise their own, very few where they would do their own research or exercise their own level of discretion, I mean it has to do with pharmaceuticals yes. But, in the device side, not as much.

Bill: So, I would in most cases not even really worry about end-user adoption unless it’s gonna be there and they’re gonna be able to access it and it has to do with how they think about themselves and their recovery and you don’t wanna … you certainly don’t wanna name a product, cadaver. When you’re trying to have a patient trying to get better and working hard to get better. So you don’t wanna name a product, buzzard, you know that’s geared towards older folks.

Bill: So, those are obvious you don’t wanna step in it.

Bill: Stakeholders we talked about a little bit earlier. It helps initially, you build a map of that chooser and user journey. Who are you selling to? Who’s using it? What are the differences? And then who’s ultimately using it? What are their differences, and needs, and motivations, and pain points?

Bill: If you build a real brand journey map, and you see the world through the lenses of those distinctive stakeholder groups. We go through a process there at Finch called laddering, that is really important from a messaging perspective. You start with those needs.

Bill: And the stakeholders may be different. But, you diagram what their needs are. And then you continually ladder up and I won’t give you the whole thing until you have a sense of the core emotional terrain that you’re occupying.

Bill: So, assessing the stakeholder needs, but then understanding what an umbrella concept that spans them. That’s a mixed metaphor, but umbrella concepts that can encapsulate both of them, or all three of them, or all four of the stakeholder types is likely where you’re gonna find fertile branding territory.

Bill: In terms of finding which stakeholders are important. Again, it’s a situational answer, but the end-consumer, maybe as a “Huh.” Don’t want to offend them, but they’re not actively engaging in a choice. So, that’s something to think about. But, certainly if we’re talking about large hospitals, for example, you’re dealing with a procurement apparatus, you’re dealing with an operation chain of command that has to do with cost savings, and has to do with regulation, and has to do with outcomes. All the things that matter to them from a regulatory and a performance perspective.

Bill: Then, on the medical and clinical side, you’re dealing with doctors, nurses, and everybody in between, and how they treat certain situations. How the actual work gets done, in terms of who does what.

Bill: So, choosers, users, building a map of those stakeholders, diagramming, and documenting their unique needs, and finding terrain where there is both functionally and emotionally those connection points we have found is an effective way to kind of ladder up to a core brand message that’s sound and powerful. That balances the rational with the emotional. And that speaks in the right language simultaneously to the different stakeholders that matter all the way down that path.

Dan: Great. Thank you.

Dan: Well that’s probably as good a note to end on as any. But Bill, I wanna really thank you for your time, it’s been a great conversation, I hope our listeners are enjoying this conversation as much as I am.

Bill: I can go forever on one answer.

Dan: Thanks [crosstalk 00:47:22] you and I can do that separately, we’ll let our listeners off the hook.

Written by Daniel Henrich

Written by Daniel Henrich

Director of Marketing at Archimedic

MedTech Mindset Podcast: Saving Infants in Respiratory Distress

On this episode, we sit down with Stephen and Anna John, a brother-sister team of medical device developers, working to bring life-saving respiratory therapy to the developing world. Their device, NeoVent, is a low-cost, mechanical solution to deliver two levels of air pressure to infants in respiratory distress without the need for continuous electric power.

Stephen and Anna grew up in rural Nepal, where their family worked to meet the medical needs of an undeserved population. Their father, Sunil, is a pediatric cardiologist and continues to split his time between practicing in Kalamazoo, Michigan and Nepal. Sunil is serving as a clinical advisor in the development of NeoVent.

They’re working to bring NeoVent to market through their company, AIM Tech. You can contact them through their website or by sending an email to

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Stephen and Anna demonstrate NeoVent during a visit to the hospital in Nepal in the town where they grew up.

NeoVent began as student project while Stephen and his friend Joseph Barnett were undergraduates at Western Michigan University. NeoVent was a winner of the 2015 Lemelson-MIT National Collegiate Student Prize Competition and has since won several other awards and taken significant steps towards commercialization. 

Episode Transcript

Dan Henrich: Welcome to another episode of Med Tech Mindset. I’m your host, Dan Henrich, and I’m director of marketing here at Smithwise. A few weeks ago, I had the opportunity to take this show on the road to Kalamazoo, Michigan. I met there with Stephen and Anna John. They’re a brother and sister team developing a new medical device called NeoVent. NeoVent is intended to bring ventilator support to infants in respiratory distress in emerging markets.

Stephen is a mechanical engineer, and Anna is a biomedical engineer. Both are currently in medical school, Stephen at University of Michigan, and Anna at Western Michigan University. We’re also joined by their dad, Sunil. Sunil is a pediatric cardiologist, and is serving as one of the clinical advisors on this project. The John family draws their inspiration for NeoVent from their experience living in Nepal, where Sunil worked and Stephen and Anna spent most of their childhoods. Sunil continues to split his time between caring for patients in Michigan and Nepal.

NeoVent is a simple mechanical device that’s added to an existing bubble CPAP machine to deliver two levels of air pressure to the patient at a very low cost and without the need for electric power. You can see a video of NeoVent working if you go to our blog and find the post for this episode.

I sat down with Stephen, Anna, and Sunil at their home to talk about NeoVent and the experiences that led them to this project. So let’s jump into my conversation with Stephen, Anna, and Sunil.

Sunil, I think it’ll be really interesting for our listeners to hear, our families have known each other for a while, but you’re new to all of them. Can you tell us a little bit about how you and your wife ended up in Nepal? You grew up, I think, in this area, but your parents came here from India. Most people who do that do that for the educational and economic opportunities it’ll provide their kids, and yet you took that and went back to a developing world. Can you tell us about that journey?

Sunil John:     Sure. So yeah, my parents came to this country, and I was actually born in Detroit, Michigan. We had a chance to go to India fairly often, and when I was a teenager, actually in college, I was just gripped with the fact that there’s such a disparity in terms of resources in the world. I went to a conference in a place called Urbana, Illinois, and decided at that point in time that I wanted to work in a place that had a much greater need.

When I first met Gina, I suggested this to her, and she said, “What exactly will that mean? Mud house, tin roof?” And I said, “Well, I don’t know. We’ll see.” To make a long story short, one day I got a page at the office saying, “there’s this opportunity for a pediatrician in Nepal. 135 bed hospital in the foothills of the Himalayas, and there’s an e-mail address. What do you think?”

We sent an e-mail and went there for a look-see, and the next thing we knew, we had fallen in love with the place and the people. Where there were 35 pediatricians, two neonatal units and a pediatric intensive care unit in Kalamazoo, there were no pediatricians for a population of several million in the area that we were going to. So we were able to live there for a number of years, for 11 years, actually, from 2000 to 2011. Our youngest son was born there, and Stephen and Anna spent most of their childhood there.

Dan:    Tell me about kind of the typical patients that you see there, how far from there do they come to your place, and what are the closest medical facilities besides yours?

Sunil:  Well, now there are many more medical facilities than there were when we first went. When we first went, people were coming from as far as India, sometimes walking two and three days to get to the hospital. But now, there are many more hospitals, but it’s still a fairly busy place. We see, the pediatric ward, for example, has about 50 beds. We see lots of babies, infants, children, as well as of course the adult portion of the hospital. So a busy place with lots of individuals who often have fairly severe illness that’s finally prompted them to come visit a hospital.

Dan:    Mm-hmm (affirmative). Let’s hear kind of about the problem that you are working to solve in terms of infant respiratory therapies and kind of the state for the device that you’re working to bring to market.

Stephen John:            So, every year, there’s over one million infants that die of severe respiratory illnesses, making it one of the leading causes of under five mortality in the world. And when you look at those deaths, the breakdown, so 99% of those are in low to middle income countries, and kind of shows you that there are good treatments for these conditions, but they’re not reaching most of the world.

So that was really the problem. We sort of experienced it first hand in Nepal, but then we came to realize, “Hey, this isn’t just happening in Nepal, it’s happening all over the world.”

Dan:    Gotcha. And so, when you and I spoke about your project … Why don’t you tell us about the name of your project, the name of your company that you’ve formed around it, and kind of the unique challenges that you have to solve. I think you mentioned three particular areas in our conversation before this.

Anna John:    Yeah, so the device is called the NeoVent, and the company is called Aim Tech, Advanced Innovative Medical Technologies. The three areas that we were targeting were cost, not dependent on continuous electricity, and simplicity of usage.

The first thing is, in many of these areas in these low to middle income countries, they can’t afford the $30,000 to $40,000 ventilators. They just don’t have access to that, that’s just out of their budget and scope. Additionally, even if these ventilators are donated, which in some cases they are, oftentimes the people to manage them, take care of them, maintain them, run them, are not there. They’re complicated, and here in the States, we’d have respiratory therapists who would run that, but in those settings, often, you’re already limited on staff to begin with and you don’t have someone who can necessarily devote the time to take care of those things, so complexity was a big issue.

And finally, electricity there is sporadic. In many areas, Nepal, and around the world, electricity will come and go and that could mean, if an infant is on a ventilator, they could suffocate and die just from electricity going. So those are kind of the three areas that we really wanted to target, to make it low cost, to make it really easy and intuitive to use, so a busy nurse could quickly put it up and set it up so that the child could get the care as soon as possible, and to have it not depend on electricity.

Dan:    When we post this on our blog, at least, we’ll include some links to the videos of your device working, but can you describe it for the people who won’t see it? How your device works and the basic engineering behind it.

Stephen:         Sure. So, we wanted to have a purely mechanical design. As Anna mentioned, it needs to be non-electric. So, we have this little inverted flow valve that basically collects bubbles that are coming from your expiratory tubing. You’ve got your inspiratory tubing, sends air to the patient, the expiratory tubing carries air away from the patient. That’s lowered in a container of water, and so it’s bubbling. So this little float valve collects those bubbles. Once it’s collected enough of them, it becomes light and buoyant and rises. Once it rises, it vents, so it becomes heavy again and it sinks. So you’re using the bubbles to basically have this little valve move up and down. We’ve designed the valve so that as it moves up and down, the pressure is also moving up and down. So the nurse could explain to the patient, “Hey, keep an eye on this little valve. If it stops moving up and down for some reason, call us, we need to check to see if there’s a leak in the circuit or something has happened because it’s not working.”

Stephen:         So yeah, basically just a little mechanical valve that moves up and down.

Dan:    So is it powered, then, entirely by the patient breathing out?

Stephen:         It’s powered off of compressed air. A lot of hospitals will have a big oxygen cylinder, and you can get these little [inaudible 00:09:22] devices that will entrain air, so that you’re delivering air and oxygen. These places have power, and there are places that can compress the gases for these cylinders. The problem is that the power is sporadic, so once you have that oxygen cylinder at the bedside, you’re guaranteed that for the whole duration of that cylinder, you’ve got continuous power. So it’s almost like a battery of sorts.

Dan:    Yeah, yeah. So, your device then, does it rely just on that compressed air being-

Stephen:         That’s it. Yeah, so the particular hospital where we lived actually has an oxygen compressing plant, where they can make their own. A lot of smaller hospitals will just have a Jeep that drives from a nearby city and will have a bunch of these oxygen tanks in the back, and every week they’ll get more tanks. They’ll get the full ones and then they’ll send the empty ones. That’s usually what hospitals will do.

Dan:    Okay. And I think I saw, and I remember a little bit from our conversations previously, there’s sort of a continuous air CPAP technology that has existed for quite some time, but what is new about this is the two different levels of pressure. Is that correct? For breathing in and breathing out.

Stephen:         Exactly. So, bubble CPAP is an intervention that has been used extensively for the last 30, 40 years. It’s kind of recently started to get even more popular, just because it’s so simple, but still very effective. With bubble CPAP, you’ve got your compressed air that comes to the patient, and then again, that expiratory limb is lowered in a container and it bubbles. However deep that’s submerged, so if it’s submerged five centimeters, that’s the pressure in the whole circuit that the kid is experiencing. So it’s very intuitive. The doctor writes seven centimeters, and then somebody just makes sure, “Oh, it’s seven centimeters deep.” And if the kid is not doing well, you can maybe make it a little bit more deep. So that-

Dan:    Mm-hmm (affirmative). Just by adding water to the cylinder.

Stephen:         Exactly. So, that’s used here in Michigan, that’s used in Nepal. It’s used in many places. Here in the States, though, if somebody was too sick and needed additional support, they would take you off of the bubble CPAP and put you on a ventilator in some sort of mode, right? But for most of the rest of the world, that’s all that they have. So our goal was, can we design something to provide additional care, but to do it in the same way as bubble CPAP?

Stephen:         Bubble CPAP is low cost, it’s non-electric, it’s very intuitive. So we need to preserve those attributes if our technology is to actually reach those settings.

Dan:    Okay. Tell me about the cost of your device when you bring it to market versus other ventilators.

Stephen:         Sure. So, we’re hoping to be able to bring it at a price point much less than existing ventilators. Presently, it costs us a couple hundred dollars, just because we are producing it in such small quantities, but we’re hopeful that as we produce it at scale, we can drive that down significantly.

Stephen:         I think the challenge is making sure that where it’s still using very robust materials, particularly given these environments and having a very solid product, while keeping it very affordable. So yeah, hopefully the cost will decrease even further from what it costs us now to make, just because of economies of scale. And molding instead of 3-D printing, for example.

Dan:    Hey listeners, just a quick break to remind you that Med Tech Mindset is a production of Smithwise, a medical device development firm with offices in Boston and Philadelphia. We help innovators accelerate new medical technologies along their path to market, from concept all the way to commercialization. Visit us at to learn more.

Stephen:         Yeah, so we’ve had extensive support from many people. We’ve got a team of engineers at Western who have been helping us develop and validate the product. We’ve got a team of clinicians at University of Michigan who have helped us as we’ve tried to validate the product at each of the different pre-clinical stages. Clinicians from Respiratory Therapists Without Borders, a non-profit that we work very closely with to try and figure out, “Hey, is this something that, what we designed, will it be applicable to other settings beyond the setting that we know?”

There’s probably many more. Oh yeah, collaborating with a respiratory therapist school here in town to do some more advanced lung simulator testing.

Anna:  And we have, in this past year, we had some mentorship from a regulatory consultant as well as another individual who was also doing a medical device start-up. That was very, very helpful, they gave very practical help as we were getting to the specifics of design development.

Dan:    And this project is several years old, so tell me about where you are in terms of the different prototyping rounds you’ve been through. You know, how many iterations have you had, and sort of where do you consider it in the process?

Stephen:         Sure. So, if you count all of the early prototypes, we’ve had hundreds of prototypes. But I think yeah, over the last year or two we’ve definitely gotten much closer to … I think over the last couple of years, we’ve had a design that worked and that we knew that the concept was good, but making a device that’s easier for people to use. I’ll give you an example. Two years ago, when we took devices to Nepal for nurses to use, it took them about two and a half minutes to set up, and we had a couple O rings and some small connectors that they weren’t really big fans of. So over this last year, what we’ve been doing is to try and simplify the design as much as possible.

Stephen:         This last summer, when we took devices there for nurses to use, it was down to under 30 seconds, to go from nothing to whole thing set up, so they were much happier.

Dan:    Yeah.

Stephen:         So, yeah.

Anna:  And additionally with that, in the last year, we’ve been really working to make the device out of materials that can be cleaned and that are patient-safe and all that, so that’s something we’ve particularly focused on this last year as well.

Dan:    I understand you’ve done some bench testing, you’ve done some animal testing. Tell us about that.

Stephen:         Sure. So, we sort of took it in different stages. The first question is, can we deliver the right level of low and high pressure over thousands of cycles? Because it’s not enough to do it once or twice. So on infant mannequins, we set up our device and we had it run over several thousand cycles to see, how reliable is this. Then the second set of validation was to look in an infant lung simulator, where you can actually set the resistance and compliance to match an infant in respiratory distress. What we wanted to see there was, all right, your traditional ventilator in sort of a bi-level mode, and then NeoVent, are we able to deliver the same pressures and volumes. How close are these?

Stephen:         The third set of tests were actually in a living model. In a sedated rabbit model at the University of Michigan, we wanted to see, can we actually generate the same oxygen, carbon dioxide, and pH levels as your traditional ventilator? In a living system, there’s the ventilation, but there’s a whole bunch of other things, because it is a living system. So that was sort of the approach that we used to kind of convince ourselves and also be able to show others that, hey, we’re able to deliver the right pressures each time on a simulated infant lung, and then in a living system. It appears that we’re able to deliver the same ventilation. So I mean, all of that’s really, hopefully building a case that, hey this is something that’s safe to use in trials.

A lot of the work that we’re doing now is to try and get those human studies started. It’s been exciting to kind of go to clinicians, show them all the work that’s happened to date, and sort of brainstorm with them some of the specific details of, “Okay, how do you structure this trial so that it can really show you, with the least amount of effort, but show you, hey, this is helping kids effectively.” So yeah.

Dan:    There’s several awards that your team has won. Can you tell me about those, and any funding that’s come with them that’s helped you in the development process?

Stephen:         Sure. So to date, actually, we’ve exclusively funded the project through those sorts of awards, so that has been a huge bonus. The awards, also in addition to the funding though, helped us … I’ll give you an example. One of the prizes, the Lemelson-MIT prize, having that award then, as we’re going and demonstrating to clinicians in a lot of these settings sort of gives a bit of a stamp of approval that, “Oh, some very smart people have looked at this and they think it’s a legit technology.” They were also able to connect us with many other start-ups, like Anna alluded to, that were a bit farther ahead of us, but that were also developing health care products for emerging markets, but that had already started selling their products. Those connections and being able to talk and ask those people a lot of questions were immensely helpful. I think the competitions were helpful from many different fronts. The funding, the networks and mentorship, and also sort of the third-party validation. Yeah, we’ve been very blessed.

Dan:    Yeah, absolutely. And how about, Anna, I think you mentioned regulatory … You’ve been working with a regulatory consultant, and that’s sort of maybe taking up a lot of the time at this point in the development process. Can you tell me about, what are your regulatory goals? Obviously this is intended for emerging markets. Are you looking to clear it through FDA, through individual regulatory bodies in the countries where you’re working? Tell me about that.

Anna:  Sure, yeah. So the past year, as we’ve been kind of working to get our design controls off the ground, the focus was really first and foremost to make sure we had it, tried to have a good quality system in place, and making sure that we’re analyzing our risks, that we’re understanding our specs, testing them, documenting that testing, and really doing that, so that getting feedback from the regulatory consultant and this other med device start-up was really helpful in the details on how to do that. As we’ve been doing that, the goal is to aim towards, we are looking at getting 510(k) clearance here in the States and additionally, we have to take into account the regulatory boards in the countries themselves, the ministries of health, their process. But I do think that having that 510(k) clearance is definitely a benefit. When they see that it is approved in the States, that that would definitely open doors. And not all countries would require that necessarily, but even if they didn’t, we’d still want to make sure that our device is to a very high-quality standard and is meeting the requirements as much as we can.

Dan:    Yeah. So do you anticipate, then, that the testing you have done up to this point will be sufficient data for your 510(k) process to show safety and efficacy, or do you anticipate you’ll need to do additional testing?

Anna:  I think we’ll have to see. I mean, the data to date has been very good, but from talking to other companies, it seems that the FDA can ask for more, so we’ll just have to be ready to provide more if need be. So it all depends on how they see it and how we can compare it to the predicates. But I think the data to date has been very good, and has clearly demonstrated very good results as well, so I think that we are off to a very good start with that.

Dan:    Have you had any direct interactions with FDA yet? Pre-submission [inaudible 00:20:40] or anything like that? Not yet.

Anna:  No, not yet.

Dan:    So that’s kind of the next great hurdle that’s coming. [crosstalk 00:20:45]. Great, okay. So, we’ve talked about, there’s a bunch of different angles, I think, that our listeners are interested in. Working in the med tech space, there’s of course the engineering angle, the clinical angle, the regulatory angle.

Let’s talk a bit about the business angle. What’s your model, sort of? Your target is to have a very low cost device that is accessible to patients and to health care providers that don’t have a lot of money. What is the model for distributing this device, and who will ultimately pay for it?

Stephen:         Sure. So there’s a couple different groups that will buy it. Ultimately, the baby in respiratory distress is the one benefiting from the treatment, but the question is how do we get it to each of those hospitals. In our markets, it looks like there’s a couple different camps. So first, a lot of these places will have some sort of government health care system. We’ve had the chance to show the product to a couple of ministries of health and their staff to just sort of gauge whether this is something that they could see potentially rolling out in their government facilities. So that’s one angle.

The second angle is sort of relief agencies, groups that support many hospitals, particularly from the equipment side, again, in emerging markets. So in a similar way, we’ve gone to the people heading up those organizations and shown them the product and tried to get a sense of, “All right, is this something that you like and would find helpful?” And as we’ve been discussing it, it’s kind of seemed like it would make sense to basically implement in a couple hospitals, and then if it goes well, then that agency can then look at distributing it to all of their hospitals. So you sort of try it on a small scale, and then [inaudible 00:22:34] deployed everywhere.

The third group is just independent hospitals, so mission hospitals and the like, where they’re not getting equipment from the government, they’re sort of in charge of their own equipment. But they still have sort of their own networks that we can, again, show that the device works in a couple of those hospitals and then spread it to other areas.

It’s been exciting, so we’ve started to meet with some distributors who take care of the in-country distribution, as well as some international med device distributors that will take it from your warehouse in the States or wherever to those local distributors. It seems like there are some players that are now setting that up pretty well, to really reduce costs through economies of scale. It seems like actually getting the device to the customers, whether it be a direct hospital, or whether it be some of these larger governments or organizations, might be less difficult than it would have been ten, 20 years ago.

Dan:    Mm-hmm. And how about funding hurdles? You mentioned that you basically funded this up to this point with prizes from competitions that you’ve entered, and there may be several more of those that you may consider entering. But do you have kind of a, are you in search of investors? Are you working on types of grant applications or anything like that? What’s your plan for kind of the bigger hump that it will take to bring it to production?

Stephen:         Sure. So, we’re always looking for funding from various sources, and you always have a couple of grants that you send out and you see what happens. But yeah, I think we’ve been fortunate, because our product is so simple and there’s so few components, that’s how we’ve been able to get this far just with the prize money sort of here and there. Yeah, it sort of remains to be seen whether we can continue with that route, to reach for sales, and then start to have income, and then sort of organically grow, versus whether it will need either a larger grant or investment or something like that.

Dan:    Sure. Sure. Yeah, I would imagine that in the near future, you’ll get to the point where you need to move from 3-D printing to injection molding, I would imagine, right? And then [crosstalk 00:24:51] once you’re tooling injection molds, then the cost per unit may go way down, but the overall cost may go way up.

Stephen:         It’s difficult markets to reach, for many reasons. So it yet remains to be seen whether this product truly is affordable enough, simple enough, intuitive enough, for people to just pick up and use and be happy with the results that it’s delivering. We definitely have much work yet to do, and there are many risks. I think it’s been very exciting. So, this last summer, as we went throughout some countries in Africa and in southeast Asia, sort of explaining device concept, showing the device, and getting feedback from clinicians, it was very exciting for people to be like, “Okay, how much do they cost? Can I order them now?”

And we had to explain to them, “I’m sorry, we’re not selling this now. We’re trying to get your feedback and understand,” but that was very reassuring. I think if we can get the regulatory clearance and start selling to these people who are interested, I’m hopeful that we’ll be well on our way. So I think regulatory is one of the big pieces we’re working on now.

Dan:    Yeah, great. So, I understand that you have been involved sort of in the clinical testing, or in some respects, in bringing the prototypes into your hospital. Can you tell us a little bit about that process?

Sunil:  So, you know, the reality is, I’ve spent many, many hours with a hand bag just giving manual ventilation because we didn’t have other supportive equipment available. The first time we went back, we came back to the United States, the biggest things in our suitcase on the way back were two ventilators and all the supplies. And then those would run out of battery life, or you would have some part that was missing. Everybody was scared about all the knobs and the buttons and everything. So I spent a lot of time, actually, in the hospital training our nurses, training other staff in how to use these ventilators, only to find that when I was gone or when other people were there that were not comfortable with them, they would just sit in the cupboard. So that was really frustrating.

We had a gentleman visit from Respiratory Therapists Without Borders, and he brought this wonderful, high-tech nasal cannula system, but it required electricity, and the first time we had a power surge, a vital component in that also got fried. So the setting that we were in, if you came to our hospital and looked in the closet, you would find a bunch of used ventilators that really hadn’t solved the problem other than for the isolated patient here or there. Well, this gentleman that came, after he saw that these solutions just weren’t fitting well for our hospital said, “How about bubble CPAP?” And that got us started on this whole bubble CPAP idea. I have to tell you, that was a game changer for our hospital, because little babies who had been really very desperately ill, now with a little bit of support provided by just a tube submerged under some water, were able to get additional strength.

So the first step for any hospital to be able to use a device like what Stephen and Anna are talking about is for them to have really good bubble CPAP, and that’s not as easy as you’d think. So for the past two or three years, we’ve actually been working to get a very good level of bubble CPAP and a good level of monitoring. For example, if there’s not a good seal at the nose, if for whatever reason the bubbling stops, that means that the child is not receiving the ventilation that they should receive. So because the nurses and medical staff have become quite familiar with bubble CPAP, the powerful aspect of the NeoVent device is it’s a single connection switch. So you have a baby who’s on bubble CPAP, you can literally just take it off, put the child on the NeoVent. The whole process takes about five seconds, and now you have two levels of pressure.

So it’s been exciting to work with the staff in the hospital, the nurses and the doctors, who are all very enthusiastic about starting to use this. We’re a little disappointed that they couldn’t just start using it right away, that we needed to go through all of this testing, et cetera, but they are very eager to start putting it into effect for those babies who are a little bit sicker than what bubble CPAP can provide support of.

Dan:    Well, I think we covered a lot of the talking points that we had discussed over e-mail, but anything else you want our listeners to know about the project?

Stephen:         No, always happy to talk about the project, and yeah, I mean, it’s exciting for us as we get closer, hopefully, to bringing this to market, after these years of product development. We’re always looking for additional folk to collaborate with us or for a fundraiser or for anything along those lines, yeah, to keep it going.

Dan:    Great. Great. Well, this is a really inspiring project. I want to thank you all for making the time to talk with me, I’m glad we could do it in person. I want to tell you, I think that I and our listeners and our team at Smithwise really admire the work that you folks are doing.

Sunil:  Thank you so much.

Dan:    Wanted to thank you all for joining me.

Anna:  Thank you.

Stephen: Thank you for having us.

Dan:    And that’s our show for today. If you liked it, please subscribe and leave us a great review on your podcast platform of choice. Med Tech Mindset is produced by Smithwise, right here in our Philadelphia office. Our theme music is composed and personally curated by The Polish Ambassador. Thanks to our guests today, and thank you for listening. We’ll catch you next time on Med Tech Mindset. 

Written by Daniel Henrich

Written by Daniel Henrich

Director of Marketing at Archimedic

MedTech Mindset Podcast: Clinical Evidence Insights with Joe Popowicz

EPISODE 3 – Joe Popowicz and Emergent Clinical Consulting

In this episode, clinical study expert Joe Popowicz, founder of Emergent Clinical Consulting, sits down with Smithwise President Eric Sugalski to talk about clinical evidence strategies surrounding new medtech. 

They cover pre/postmarket data needs, regulatory pathways, Value Analysis Committees, Significant Risk vs. Nonsignificant Risk, Institutional Review Boards, and more. 

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Episode Transcript

Eric Sugalski: Hi Joe. Thanks for joining us this morning. Glad you could be part of this.

Joe Popowicz: Absolutely. Thanks for having me.

Eric:     Yeah. Joe, to kick things off, why don’t you tell us a little bit about Emergent Clinical. When did you start the company? What was the need in the market that drove you to start this business?

Joe:     Sure. Emergent Clinical’s been in business now for coming on six years. The whole focus was to optimize the clinical trial process for diagnostic and device companies. So we started this as a small company to act as an extension to these teams, really helping them guide the clinical pathway.

I was doing a lot of speaking at conferences back in 2013, and I realized there was a need for us to start providing some clinical advice to companies because it was one of those areas where they’d spend a lot of time on regulatory feedback or product development, but clinical wasn’t always an area that they were having internal capabilities. Because they would need some trial work or some advice, and then it would go away.

So I gave it a shot in 2013 to start helping clients and six years later we’ve been steadily moving our way through this process.

Eric:     Good for you. Are you working primarily with startup companies or academic centers? What’s the typical profile?

Joe:     Most device and diagnostic companies in the space are small to midsize of less than 50 employees. And that represents about 75% of our business. About a quarter of the business is the larger medical device companies as well that might need some process development work or [inaudible 00:01:30] help so we help them to go through that as well.

Eric:     Okay, great. A lot of our listeners are trying to bring a new medical technology to the market. It might be spinning out of a lab or it might be a spinoff of a larger established company, but there is something new and novel that they’re looking to develop, and the clinical factors are important for them to be thinking about at the beginning stage.

I thought the way that we could structure this conversation is by setting up two examples of different medical devices sort of generically that we could walk through from a clinical study standpoint.

And the first one that I wanted to talk about was a new surgical device. So let’s say that I am with a startup company, and I’m developing a new laparoscopic surgical device that has some improvements over the existing devices in the market. And I’ve gotten some feedback from regulatory consultants that this is a pretty clear 510(K). So in my head, I’m thinking that this product, 510(K), I don’t need any clinical studies, right? It’s just a straight approval process. What’s your take there?

Joe:     It definitely depends. It’s great you’ve mentioned about having good regulatory advice because I think that’s one of the keys for any startup company is to understand what your regulatory pathway is and what’s going to happen moving forward. That said, the market definitely has shifted over the past few years in that you’ll have value analysis committees who wanna look at products that come into ORs, and they wanna know what the clinical benefit is, so in a lot of cases you may have a clear regulatory pathway that says, “No clinical evidence is required,” but that doesn’t necessarily mean that you wouldn’t wanna collect some clinical evidence to differentiate your product from someone else’s.

So in a lot of cases, we look at it from could you develop a postmarket strategy at that early phase to say we’re going to collect some evidence against another product once there’s clearance to then say, “We are better in a certain area or we have an economic benefit,” so we really wanna work with companies to ensure that we have a clear value proposition for them as they get to commercialization.

There are also some though the regulatory guidance may come through and say, “You will need some clinical evidence.” There are 510(K)s with clinical where depending on that product classification, you would have to collect some evidence premarket to then show that this product should be cleared for use.

Eric:     So just to clarify for me. When we’re talking about the regulatory approval process, that 510(K) approval, everything before that, the premarket clinical studies, you’re saying that during those premarket studies there may be cases for a 510(K) when you do need to collect some clinical data before getting that approval.

Joe:     Yes, absolutely.

Eric:     Correct. Okay. But then when you get through that approval, there is very likely the scenario where you would need to be doing some comparative studies to look at how this new surgical device performs with respect to the other, the gold standard or the commonly used surgical devices that are for a similar indication.

Joe:     Exactly. And it may not be for claims purposes, but it may be for publication purposes that you could go to a value analysis committee and say, “Look, here is a level X, 1, 2, 3, trial that has been published,” to say this is a difference for how the modality of care worked for this particular product. There is a benefit in what you would use for commercialization standpoint to collect some evidence for that product.

Eric:     Got it. So the comparative studies are often for business factors. You wanna be showing that there’s a clinical benefit obviously but there’s also hospital economic factors that come into play and other things that are gonna matter to the value analysis committees. Is that-

Joe:     Absolutely. And we work with marketing groups even in the postmarket to say, “What do you want this to be working with the end in mind, working backwards,” to say, let’s develop a trial design that gets you what you need in postmarket so that we can help them get that strategic vision.

Eric:     Right. We talked about value analysis committees. This process of getting a new medical device into the hospital has become fairly complex. Can you help me understand what exactly is a value analysis committee?

Joe:     Each hospital or as this has gone through, more hospitals are relying on an economic assessment of device or diagnostics or products and saying we have limited shelf space, why should we use this product as opposed to the other 15 products that are available in the market? So to that end, they’ve more formalized this where they have scientists, people with a finance background to look at the products and really get a good assessment of does it make sense to bring in this product versus another product, what are the benefits or risks associated with it, and they have a formal assessment. We’ve seen that with some of our clients go through the process of having to get product on market saying if I have this hernia mesh, let’s say, as opposed to other meshes, why would I use this one versus another one when there are 15 options? And that’s where collecting some evidence may differentiate you from some other companies that haven’t collected any evidence for their products.

Eric:     Got it. And so back to this example of I’ve got a surgical device, it’s gotten, let’s say it’s now gotten 510(K) approval, do I just look for the value analysis committee email on the hospital’s website and email them? How do I get into the value analysis committee?

Joe:     In that case, most of the sales reps have some inroads to the hospital administration so they’re working with their doctors and then they find their inroads. We haven’t had a lot of direct experience with going to the hospital administration. We’re more on the supporting side of collecting the evidence and helping them through that. But commercial groups typically have some inroads to that.

Eric:     Got it. So it sounds like the commercial groups, the salespeople, they speak with the clinicians and then the clinicians, one or several, may be a champion for a new product to bring it into the value analysis committee in order to get it evaluated.

Joe:     Yes, absolutely.

Eric:     Okay, great. Let’s go back to this postmarket concept. We have a new surgical device, it’s going up against an existing surgical device. How would you think about the endpoints? What are the endpoints that we would be looking at in that clinical study?

Joe:     So this is where we work with the team as an extension to understand what are the benefits of the product. Why when you started to conceptualize this product did you think this would be better than other ones? And that’s really what formulates our idea of what should be a primary, secondary endpoint, however it works. Because in most cases, the engineers, the medical teams, they really understood … They had a good understanding of why this product was gonna be better than or why we should really commercialize this product. Our job is to kind of translate that portion of what did you envision to what will accentuate that benefit from a clinical standpoint. So primary and secondary endpoints typically revolve around maybe you have less surgical time because it’s easier to use. Maybe there should be better outcomes associated with healing or a quicker implementation. There’s really a number of different ways and it’s really dependent on the product. But we wanna work with the team to understand why did you conceptualize this as a better product, and let’s translate that into an endpoint story within the protocol.

Eric:     Got it. I’m still a little nebulous or confused on primary versus secondary endpoints. Back to this surgical device example, give me an example of what you think a primary endpoint would be for this.

Joe:     A primary endpoint for that may be the efficacy of the product. Think of it as primary endpoints are usually built to say we wanna have a claim, and that usually is more in the premarket side than the postmarket side, but each will have an endpoint.

Eric:     Well, let’s say that it’s a surgical closure device. It’s used for closing tissue after say an organ has been removed from a particular area. What would be a primary endpoint in that case?

Joe:     Speed to closure, ease of use. You could see that a surgeon’s application, they may have an assessment of it to say how easy was it to use this product. You can have very strict guidances like quality of life assessments but to more qualitative responses to how easy was it easy for me to close as opposed to what I’ve experienced in the past.

Eric:     Got it. So the primary endpoints are directly related to the output of the surgery. You mentioned some of the human factors issues. Does the device result in intuitive use? But then also does it result in a very robust closure or seal if that’s what the device is looking to do. Is that an accurate depiction of what common primary endpoints might be?

Joe:     It can. And it can shift. An endpoint is an outcome for the trial, whether it’s a primary or a secondary endpoint. It’s really a decision by the company of is this trial’s focus X. And that’s where your primary endpoints would be where you would still look at secondary or tertiary endpoints to say these are other things that are of interest that we would wanna publish on or we would wanna present from a regulatory standpoint. We’re also gonna look at this as well.

In the premarket and especially depending on if you need this data associated with a project, there’s very clear guidance by products of what you need to show because other devices have done that in the past. In more new devices, let’s say De Novo, it may not be as clear and you’d have to have some discussions with FDA potentially to determine what your endpoints may look like.

Eric:     Got it. Got it. So premarket endpoints are really a negotiation with the regulatory agency, whereas postmarket, those endpoints are determined by the company to figure out what is going to be really important for the clinicians that are using the product and the hospitals that are ultimately going to be evaluating the product with respect to other devices that are on the market.

Joe:     Yes.

Eric:     Okay. That’s helpful. Let’s talk about the size of a trial. Let’s stay with the postmarket theme. We have a new surgical device, it’s going up against something that’s competitive. We believe that this new surgical device can result in a more robust closure process. What does a study look like for that in terms of proving at a postmarket level that we can produce more reliable closures and say reduce infections related to those closures?

Joe:     You hit a nice topic about infections or reduction. Everything is driven based on a success criteria. You’d say our expectation is that this percentage will be successful. In a case of trying to reduce infections, there typically small percentage numbers, single digits, so to show statistically significance in that case you’re gonna use thousands and thousands of patients to be able to say we reduced infection rate by 50% from two percent to one percent.

Eric:     Because the infection rate is already so low. If you had a really low incidence rate, that’s gonna obviously result in a pretty massive clinical?

Joe:     Yeah. And this is where it’s really good to have a great statistician that can work with you on a power analysis because things like that you can see how it’ll inflate and adding other criteria might change your success rates. But the important part is to understand what the end game is, so what your endpoint is and the success rate of that to be able to build a good power analysis.

Eric:     Got it. This is I think a really important point because when you’re picking your endpoint, you need to also look at what the incidence rate is that you’re trying to affect. Because if you’re looking at a multi-thousand patient study, that could be beyond what is reasonable from an investment perspective, right?

Joe:     Absolutely.

Eric:     It sounds like when you’re looking at your clinical study design, you really need to be trying to identify some endpoints that you can really influence at a significant scale with a relatively small patient population.

Joe:     That’s absolutely right. But the one interesting part of it in the post market, you may not be building a study to show statistical significance. You may be showing it to show trending. So in a case like that, you may have hundreds of patients to be able to show we’re trending towards that, but we would never be able to run the trial to that magnitude. So we collected evidence to see where did the data trends, not necessary [crosstalk 00:14:25].

Eric:     So when you say trending, what does that mean? Like you haven’t hit statistical significance but you’re sort of going in that direction?

Joe:     Exactly.

Eric:     Okay.

Joe:     So data trends towards a certain end point, that it’s in a positive way or negative way, depending on how the end point is created. But it won’t show for a P value or .05. Or it’s trended towards that but we would have to power the study to a larger degree.

Eric:     Got it. Great. Okay. That’s really helpful. Let’s say that we brought the statistician into the process, and she has informed us that the trial should be 200 patients in order to really show significant statistical significance of the study. How do we understand, as an early-stage company, what the magnitude of that cost is going to be from a clinical study at some point?

Joe:     Yeah. There’s a number of different ways to look at that. And you can look at just the budget because there’s a budget of cost per patient, which is important. That definitely varies depending on the surgical application or the therapeutic application of the trial, certain cost per patients may be as low as $1,500 a patient. There’s other applications where surgery and long-term follow up, you could be in the 20 to 30 thousand dollar cost per patient. So it really is dependent on your therapeutic application there. But you can also look at it as how do we play with the levels of number of investigators in the trial and we make it more efficient. So we typically work with clients to say, “Let’s do an enrollment projection to see how many sites, doctors’ offices you would need to participate in the trial to then get a study done in a certain time frame, to understand the costs of how long a trial would take, how much would it be per patient,” things like that so that they have a very clear understanding and can communicate that to investors, management, boards. So they have a really good control of what that clinical cost would really be.

Eric:     Got it. Got it. Okay. So is it fair to say that clinical study that is sponsored by a device company needs to finance the surgical procedure as well as a series of follow-up visits with the patient, typically?

Joe:     So things that are outside of standard of care are definitely part of the trial. So if you have a vote on what would be standard practice … So let’s say I’m adding another product into a surgical procedure, we want to try to stay as close to standard care because the doctors are going to be comfortable with that. We want to ensure that they are comfortable so that there aren’t protocol deviations, things of that nature. But costs for the device or diagnostic company are really the things, in addition to what standards of care are. So, typically, our team will work with that group to help them build a site budget. So what will be the costs for the implementation for that patient and really add that into it. So it may be things like data entry because they wouldn’t typically enter that data into a database. They would enter it into their electronic health system and that would be the extent of it. Or follow up because it’s maybe different than what standard practice is. Anything like that would be a cost to the device of diagnostic company. And you would have to incur that for a trial.

Eric:     Okay. Okay. That’s helpful to clarify. So it’s not if you’re running a clinical study, you’re paying for the entire clinical procedure, the entire surgery. It’s really just the incremental costs based on the device that you are now introducing into this existing process.

Joe:     Absolutely. That’s the ideal situation.

Eric:     Okay. Great, great. Let’s talk a little bit about US versus outside US Clinicals. Why would a company want to consider going outside of the US for a clinical study?

Joe:     Historically, speed to market has been one of the areas that device or diagnostic companies have really focused on why they’d go outside of the US for the regulatory pathway.

Eric:     So in that case, the regulatory agencies that are not FDA might have a lower bar, allowing you to perform a clinical procedure earlier. Is that accurate?

Joe:     That’s been the perception. I have to say in the recent past, our interactions with FDA, they’re interested in making sure innovations come to market first in the US. So the pathways, they’ve been quicker to review. They’ve been more collaborative in the process. So that perception should definitely be tested with the FDA. I think if you have good regulatory guidance, they would head you down that direction to say, “Have the discussion early with FDA. Explain the clinical utility of this product, and see if it makes sense to be here domestically,” because I think FDA’s interested in ensuring more innovation comes to market first in US. So they’ve really worked with industry to ensure that happens.

Eric:     Got it. Got it. Okay. What about the costs? So we talked about the timing, but is there a significant cost savings to going to South America for a clinical study versus the US?

Joe:     The perception has definitely been there as well, the per patient cost. I think if you look at it in just direct costs, you can make the argument that maybe the cost of the patient in South America might be less than of the cost per patient in the US. But I don’t think we’re looking at it holistically because there’s service costs. There’s transport costs.

Eric:     Travel. Right.

Joe:     There’s a lot that goes into play. A lot of the companies, especially that we see, the device and diagnostic companies, they’re hands on. They want to be there for surgical procedures if that’s their type of product. So they’re there all the time. They are ensuring that the product is going well. In that case, there’s a cost associated with that and having to find a vendor in South American that could execute the trial. It’s cost associated. So you have to look at it holistically and then weigh does it make sense. I would argue it’s becoming more competitive to be in the US, as a whole, just to ensure that the product comes through. But you have to weigh it out an see what makes sense for your device or [crosstalk 00:20:36].

Eric:     Great. Okay. Excellent. So let’s switch gears now. We talked about this surgical device that was a 510(k). I think everything there is pretty clear to me. Let’s change over to a different application. Say we have a new diagnostic system. It is a non-invasive diagnostic. It’s reading certain health data through the skin. And there’s no inherent risk with using the device. There may be some risk with the data that the device is generating, but this is a diagnostic device that is likely, based on regulatory expertise we’ve received, going to be a De Novo pathway. And we’ve been talking with some investors about this device, and there’s a lot of excitement around it, but there’s also a bit of skepticism around the sort of clinical merit, clinical validation. Is this really going to be useful in providing clinicians the data that they need? So in that case, how do you get a study going as early as possible so that you can prove that you’ve achieved this clinical milestone, you can get the data that you really need?

Joe:     So I’d start with, as we talked about, getting involved early and often. It’s the same situation from the regulatory side because there may be the determination of significant risk versus nonsignificant risk. I’d have the conversation, from a regulatory standpoint, to get an understanding of what is this pathway. So whether it’s you go the formal regulatory pathway and get a designation through FDA, as an example.

Eric:     So time out for one quick second. Significant versus nonsignificant risk. Are these just interpretations? Are these defined terms? Help me understand a little bit more. What does that mean when a device is classified as significant risk versus nonsignificant.

Joe:     So FDA has a guidance document. I definitely recommend, if you’re in that device or diagnostic that could fall into significant risk versus nonsignificant risk, start there. But it’s a question of whether there would be some detrimental impact in the long haul from a safety standpoint if something failed for the device. So even if it was maybe not a safety risk from an implant standpoint, but in this case, a diagnostic, if there was a failure for the data to be accurately analyzed, it may be that there is a detriment to the patient because we didn’t see some health issue that would have come up earlier than how we’d normally treat or diagnose that case. So there is a pathway that has to be assessed to say there might not be inherent safety risk immediately, but data interpretation may be an issue in the future.

Eric:     Great. This is helpful. So let’s say this diagnostic device, it has a number of different sensors on it, but all of these different sensors independently exist. And the clinical can be such that you’re using the diagnostic device in a hospital environment, but it’s redundant with other data that is being collected with this other instrumentation that already exists. So does that mean that the device is going to be significant risk or nonsignificant risk?

Joe:     So you have to go down the pathway to ensure, and that’s where, from a regulatory standpoint, I may not be the best person to go through. However, that seems like the study design that I would implement, saying “We have some data that’s collected in this novel way. And we have redundancies in place to make sure that these data match what our standard of care.” So you’ve just basically developed what the design of the trial may look like to ensure the safety in the future from a commercial standpoint.

Eric:     Got it. Got it. Okay. So in that case where you have some redundant devices that are being used, the data that’s coming off this novel diagnostic device, the data may not be as likely to be interpreted or relied upon by a physician because there’s other sources of data that are being captured simultaneously.

Joe:     Correct.

Eric:     So that is likely to push it into the nonsignificant risk category versus significant risk, with the caveat that there’s guidance and regulatory process that needs to be followed here.

Joe:     Absolutely.

Eric:     Okay. Great. So what about significant risk? Let’s say that we need to show that this device is going to identify a novel set of health data that does not exist and clinicians are going to be relying on this data. What does that path look like for getting approval to use this device clinically?

Joe:     Yeah. Most devices will fall into a significant risk device, so it sounds scarier than it is. It’s more that there is a potential risk associated with patient, so we need to ensure that it is safe and effective. So this is, essentially, an IDE or an investigational device exemption. So that is something that prior to a clearance or approval, depending on the classification of the device, you have assurance from FDA that you can use this device in the premarket to collect the evidence, to prove it’s safe and effective for a ultimate commercialization when you send in your application. So that’s where a significant risk device, you would be running the trial under an IDE, and then, ultimately, collecting data to get a regulatory approval or appointments.

Eric:     Got it. Okay. So if I’m this startup that is building this new diagnostic device and I know that this is going to be a significant risk trial, do I just go straight to FDA, or what does that process look like for getting that significant risk status and the IDE application rolling?

Joe:     So, typically, you’re in that pre-submission process at that point with FDA. And you’ll have to have a sense of what the trial would look like and things like that, so they can weigh in on, “Does this application fit?” so that you can be granted the IDE.

As you’re going through the process of developing the trial, that’s where you would get some sense of, “We have a trial design. Here’s what our pre-clinical package looks like. Here’s what we’ve done in the past. And here’s how we execute.”

Eric:     So IDE. I want to dive into this a little bit more. So Investigational Device Exemption. Is this for significant risk devices only, or is this also for nonsignificant risk devices that label?

Joe:     An investigational device exemption is basically saying, “Because this is not commercially available, we’re allowing you to transport this device to different locations because it shouldn’t be used in commercial or clinical applications.” So it’s basically FDA’s blessing to move forward.

Eric:     Okay. I want to make sure I’m clear here. So we’ve got this diagnostic device and we want to do a clinical study. I say that it is nonsignificant risk. That’s what I believe. That’s what maybe some of the regulatory guidance that we’ve received believes. So we go to an institutional review board, an IRB, and that’s at a hospital, an academic hospital that has an IRB. What happens there? What are the scenarios for the IRBs? Do they basically just pass through the study or, tell me about their decision process.

Joe:     So at that point, you’d ask an IRB to designate if they believe that it is a nonsignificant risk. So if you believe that you have a nonsignificant risk device, you would go to the institutional review board and say, “We believe that there is a pathway for this to be reviewed through your governing body. Please let us know if you agree that there is no risk associated with the patient, that you can allow this trial to go on without a formal designation from a regulatory panel.” So at that point, the IRB will review what the protocol is and the consent documents, things that would be the trial-related materials so that designate, yes, you can move forward with this trial or no, this is significant risk. You need to do this under an IDE. So go back to your regulatory authority and get granted that to move forward with the project.

Eric:     Okay. That’s helpful. So what about the level of information that is needed for each of those pathway? And this may be more of a regulatory question, but there’s … If you’re going the IDE route with the significant risk status, my understanding is that you need to do a much deeper level of testing, verification work, documentation, versus the amount of testing that you would need to do for a nonsignificant risk device. Is that true? Can you talk about the pros and cons of each of those scenarios?

Joe:     In our experience, whether it’s the nonsignificant risk or the significant risk device, both are going to require a fairly large set of data. So in either case, you’re still using it on a patient. There’s still some application associated with it. So you’d have to ensure that there is no safety issue that it does work to some degree, whether it’s NSR or significant risk. So that and it’s more about the product class and what level of evidence you would collect, whether it’s preclinically or clinically to determine this is a useful product to be available on the market.

Eric:     Okay. Okay, great. Now, one of the key pieces of information that needs to be provided to either the IRB or the regulatory authority is the clinical protocol, right?

Joe:     Yes.

Eric:     Who’s writing that clinical protocol? Is that me? One of the engineers on the team or do we need to get Emergent Clinical to help with the clinical protocol? Who exactly is responsible for that?

Joe:     So we typically help clients write the protocol. The way we envision it is it’s a two-fold process. There’s a medical application to it, as well as the operational aspect. So we typically work interchangeably with the device company because they have a great understanding of the medical application, but we understand the clinical ops portion, so together we’ll help build the framework, all the required elements for it, the things that will help them get to the finish line sooner without multiple iterations with the institutional review board or the regulatory authority, things that would be expected to be seen in that process, but we rely heavily, because it has to be a collaborative effort.

Eric:     Got it. So in a realistic scenario though, when should that clinical protocol start? Does drafting that clinical protocol begin after the design is complete? Should it happen before the design is complete? What’s the timeline look like there?

Joe:     We’ve worked with clients very early on to build synopses. So a very simple outline of what the inclusion, exclusion criteria would be for patient selection. So the things that you would want someone to have or not to have in the trial, the endpoints that we discussed before, a simple power analysis, things like that that give a sense that you have an understanding of what the trial will look like. That happens very early in some cases and that’s important whether it’s you’re raising capital, you’re having conversations from a regulatory standpoint, you’re looking for strategic partners, it really conveys that you have an understanding of what the pathway looks like and what you’re going to do to execute a trial. The more formal protocol should be closer to execution because things will change, you’ll learn more things as you go through, you don’t need the 70-page, full protocol early on. But to have a handle on the synopsis as early as you can I think is valuable to companies.

Eric:     Got it. Okay. That’s great. So I’ve heard of some companies taking the route of an IRB within an academic institution and then other companies taking more of the for-profit IRB pathway, like a Western IRB or one of those for-profit IRBs. Talk a little bit about the differences, the trade-offs associated with both of those pathways.

Joe:     Sure. Institutions select what IRB they will have review their products, or projects, excuse me. So in a case of a large academic institution, historically they have their own institutional review boards and the institutional review boards processes to ensure that this is an ethically sound protocol, the patient’s rights and safety are maintained in the project through informed consent process, there’s no issues with the design of the trial scientifically, so it’s important that they’re really the patient’s advocate in ensuring that this project is worthwhile and ethically sound. So larger institutions historically utilize their own boards. Lately, they’ve been more inclined to work with commercial institutional review boards like Western IRB and their multitude out there. The pros and cons typically, an institutional review board that has a commercial application tends to be faster to review and give some process associated with it. So you’ll have a Western IRB that will provide a review cycle within a week in some cases and give you a decision where, historically, some of the larger academic institutional review boards have taken months. They don’t meet as often, they are trying. So I think things are changing. You have to assess on a case by case basis, what the institution you’re working with, what their IRB looks like from a review cycle, how quickly they turn it around, things like that, because it will play into the ultimate timeline of the application.

Eric:     Got it. So a commercial or a for-profit IRB, do they have specific clinical sites that they use? Or is that up to the sponsor of the trial to determine where the sites are?

Joe:     So the sponsor decides which institutions they’re going to use for the trial and then the institutions decide which IRB that they would do or contract, things like that. So it’s one of the things we assess as part of our feasibility assessment in who should you work with to execute a trial. It’s one of a number of things of how do they review budgets, contracts. There’s a whole startup criteria that you have to understand so that you select the right institutions to ultimately execute a project.

Eric:     Okay. But say we went to a Western IRB or a group like that, and is there … If there’s an existing IRB at one of the sites that we would like to use, is there going to be any conflict between the in-house IRB at a large academic institution that is receiving the IRB approval from a group like a for-profit IRB?

Joe:     So the for-profit would review the study as a whole, let’s say, and then anybody who subscribes to Western would then allow them to be listed under that approval.

Eric:     Got it.

Joe:     Separately, the local IRBs can run other institutions. Let’s say you have five institutions, three can be under Western, two can have their own institutional review boards do the review. So it’s a bit of both you can have, and it’s dependent on them to decide, do they allow for the Western approval to apply for their institution or do they require that their own local institutional review board is the one that governs the protocol review?

Eric:     Okay, okay. So could be a combination. But what I heard is that sometimes, if you’re using a commercial or for-profit IRB, it can be a faster process than going through a large academic IRB?

Joe:     Absolutely.

Eric:     If you’re looking to get a trial going very quickly. Are there any downsides to using a for-profit IRB? Is the data not respected as highly or are there other factors that might be considerations?

Joe:     No, I think they just formalize their processes differently than other local institutional review boards. So because it’s a commercial entity, they’ve learned how to … A customer service group and routing, scheduling technology, so it’s more about efficiency as opposed to the quality. The quality is good whether it’s the centralized Western IRB or a commercial IRB versus the local IRBs, I think that it’s essentially the same quality you’ll get, it’s just a question of speed.

Eric:     Got it. Okay, great. So we’ve hit on a lot of topics here. We’ve gone down the 510(k) path with a surgical device. We’ve talked about endpoints, primary, secondary, quantified the size of trials, and then we looked at the diagnostic application, more of the De Novo, the premarket process of getting early clinical data. We talked about significant versus nonsignificant risk. This has been great. I’ve learned a lot here. I have one last question for you. Advice that you have for early stage companies or companies that have new technologies. What advice do you have on how they can get into their clinical study design most efficiently?

Joe:     So we always recommend come early and come often. So the earlier the better. It’s great to have conversations with early stage companies, maybe that haven’t gotten their round of financing secured at this point, but they have a great idea. We’ve started conversations four or five yeas ago with companies that are still not to the clinical phase because they are still working with a group like yours to help them with product development and ensuring they have the right application. But there is still value in us having the conversation, because they may get utility out of understanding what the clinical pathway would look like. And I think that goes for most in our industry. I think you have to build a really strong team around you, whether it’s product development, regulatory, clinical, to ensure that you have that right structure moving forward, even if it’s early, because then you have an understanding of what you need to do, what that pathway looks like, and it will be easier for you to communicate to investors, strategic partners, things like that, as you develop the project. So come early, happy to have the conversation. We love to see technology. We got into this space to ensure that we saw all this cool medical technology come to market. So we love the early stage conversations.

Eric:     Yeah, this is great. So it’s a reminder for me, being an engineer and often looking at problems through the lens of an engineering sort of technical side, that when you’re bringing a new medical device to the market, it’s not all about just “Does the design work? Can we engineer this product really, really well” but there’s all these other factors, and I think what you’re representing here today, the clinical side is so important to be thinking about really early on in the process. Looking at those endpoints, where exactly are we going, what are we trying to achieve? There’s a number of other factors that we’re going to get into during other sessions, but this has been really very helpful. We really appreciate you taking the time to chat with us. One last thing, if companies want to find out more about your company or reach out to you directly, how would they go about doing that?

Joe:     Come to our website, There’s an information section there, you can reach us, there’s all our contact information. I can put my email address in the show notes. We’d be happy to reach out and hear from anybody out there, questions about clinical and just in general. Again, I love to hear about the medical technology that’s coming through, so feel free to reach out and we’ll start a discussion.

Eric:     Okay. Thanks again, Joe. Really appreciate it.

Joe:     Thank you.

Written by Daniel Henrich

Written by Daniel Henrich

Director of Marketing at Archimedic

Podcast Launch: A Medtech Mindset with Eric Sugalski

Launch Episode

This episode is a great way to tell if this podcast is for you.

Eric Sugalski and Dan Henrich sit down to discuss the big picture of bringing a new piece of medical technology to market. We touch on product development and design, regulatory pathways, clinical evidence, go-to-market strategy, intellectual property, and other important topics.

In coming episodes, we’ll explore these topics in more detail with guests who are experts in these areas and guests who have recently been through the process. 

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Episode Transcript

Dan Henrich: Hello and welcome to the very first episode of Medtech Mindset. I’m Dan Henrich your host, and I’m director of marketing at Smithwise, a medical device product development firm.

I’m gonna use this first session to kick things off, and let you know what to expect from this show. We’re gonna be talking with guests who are experts in different areas of medtech. Including product design, clinical trials, regulatory, market strategy, funding, things like that. We’ll also bring guests onto the show who have had recent experiences commercializing new medical technologies. Some of these might be Smithwise clients. And others are just gonna be friends and colleagues we’ve met working in the industry. We wanna hear about their ups and downs, and try to draw out some lessons from their practical experiences for you our listeners.

For this first installment, I sat down with the president of Smithwise, Eric Sugalski, and we talked about the big picture of bringing a new piece of medical technology to market. Our conversation touched on a lot of themes that we’re gonna develop more fully throughout the show. So I think it’s a great introduction to help you decide whether or not this podcast is for you.

Now, just so you know a little bit more about him, and why I think he’s worth listening to. Eric is an entrepreneur and a mechanical engineer by training. He’s got extensive experience working in the medtech arena. He’s held engineering and leadership roles with IBO and Insight product development. And he’s even lectured in the mechanical engineering program at Massachusets Institute of Technology. He holds a bachelor’s degree in mechanical engineering from University of Colorado Boulder, and an MBA from MIT. Eric founded Smithwise in 2009, and he continues to lead our Boston and Philly teams. So let’s get started on Medtech Mindset by jumping into my conversation with Eric.

Eric Sugalski: Hey, what’s up Dan?

Dan: Hey Eric, how are you today?

Eric: Good, good. So, what are we doing here?

Dan: This is our very first episode of Medtech Mindset. So this is our chance to kick off and grab everybody’s attention. Explain to them why we are launching this podcast.

Eric:    Okay, okay. Sounds interesting.

Dan:    So I thought you’d be a good first guest. Because we are often approached by a prospective client or a new project, and the first words out of their mouths are usually, “I have this idea, but I need a prototype.”

Eric:    Yep, all the time.

Dan:    And so I thought it would be good to begin with that idea, because it’s probably the idea in the mind of some of our listeners. And we wanted to talk about the different phases of things that they need to think through before they get to the stage where they need to build a prototype.

Eric:    Got it, got it. So, you’re right. We hear 95% of the time, when companies come to us, usually at the early stage. They have in idea, the see an opportunity to make a difference with a new medical technology, and right off the bat they jump towards, “How do we build this prototype to really demonstrate the idea.”

Dan:    Right, so I thought it would be good to use this first chat as a chance to take a step back, and talk about the things … Where do prototypes come into play, but more importantly, the process of bringing a new piece of medtech to market. What are the steps that you rally go through? And I think it would be good to take a step back and talk about defining the bigger picture of the need. Where does your idea fit in, and what’s the real value that you see if everything goes right throughout the building process.

Eric:    Yeah, yeah. I think that that’s a part that a lot of times gets glossed over. There’s an awareness to a particular medical need initially, and that leads to a quick idea session. And then people become fairly focused on that idea. And that makes sense because that’s where the commercial opportunity is, that’s where the creative process starts to kick in. But, in our point of view, we think that there’s a lot of benefit in going back to the need, to really make sure that the solutions that we’re building off of are really founded in … They’re grounded in a very strong need.

And we follow a process that is advocated and spelled out pretty well in the BioDesign book that coursework at Stanford. And really coming up with the need, it comes to three components, there’s three parts to it. The first is really looking at who specifically is the patient population that you are targeting, right? So, in many cases a common mistake for startup companies is that they try to address too large of a patient population. They try to say, “This product is going to be for everyone.” But realistically in medical device development, it is much more effective to be laser focused on a very specific patient population first. And then if you’re successful there, then you can expand into other markets. So we think that that is the first part. Who exactly is your user? Who is the patient?

From there, it’s looking at what is the problem? What’s really going on with the patient that deserves an additional solution? And how is this problem being addressed by other solutions? Whether those are products, whether those are services, whether it’s a workaround that a patient is implementing themselves. There are often a variety of ways of solving a problem. And so, developing a landscape or understanding what all of those problems are, or what are those ways of addressing a problem, that’s an important part of the process.

Dan:    Yeah, so it’s not really just, “Has this technology been commercialized before?” Right? It’s, “How is this problem currently being solved? And is it a problem that’s appreciated by the market already?”

Eric:    Right, right. Yeah, absolutely, absolutely. And then the third piece is, what’s happening right now, what is the outcome of this problem? Right? So how are you going to quantify this outcome in such a way that allows you to determine if your solution is really addressing that problem that you spelled out, with the specific patient population?

So it’s those three components. It’s the patient population, the problem that’s facing the patient, and then the outcome that is really worthy of solving, [crosstalk 00:07:28] solving that problem.

Dan:    And ideally, you should be able to tie all of those things into a very succinct needs statement right? That contains each of those three elements.

Eric:    Yeah, absolutely.

Dan:    And if you can’t do that, then it’s probably a sign that you haven’t really dialed into the problem that you’re solving.

Eric:    Right, right, yeah, yeah. And it’s very, very common. All too often, we see pitched [inaudible 00:07:53] from startup companies that spend a ton of time talking about their technology or their solution, and they have not even clearly spelled out the needs statement. So it’s a really foundational part of the process, and in many cases, companies should really be spending more time refining and spelling out that need to make sure that they’re solving a real problem that needs to be solved.

Dan:    Yeah, I think that’s something that struck me a couple of weeks ago. You and I were down at UPenn for that biomedical engineering student pitch meeting. And there were groups of some really talented and bright engineering students who were pitching health related technologies for their project that they’re working on. And in many of the cases it kind of seemed like there was a technology in search of a problem, rather than the other way round. That’s sort of what you might expect to see from an undergraduate student, but it doesn’t end with graduation. That’s something that people are not necessarily appreciating throughout the normal course of study to become and engineer or a business person or whatever. We still often see, even funded medtech companies, who haven’t really dialed into their proper needs statement and the problem that they’re solving there.

Eric:    Yeah, I think that what you mentioned about the engineering students, that happens everywhere, at all universities. The schooling of engineers is very solution oriented, right? You get your problem sets, those are given to you. And the job or the responsibility of the engineers is to really create the solutions that satisfy those problems, right? So, there’s very, very few parts of the engineer’s curriculum that’s focused on identification of the problem, right? So this is something that’s very, very common, it’s not intuitive to engineers or people that have a technical focus, to really be thinking more about that need and the problem and the patients. But it’s a super important part of this process.

Dan:    So, I guess then it becomes really important for, particularly if someone with an engineering background has an idea that they think might have a great application in healthcare, it’s really important to get clinical input early in the process, right? And understand how things are done now, and get some honest reactions to your potential new way of solving this problem.

Eric:    Yeah, so there’s a lot … One of the challenging things about medtech is that, the people that are buying the product are not the people who are using the product. So, the clinicians who are going to be using the product, a surgical device or a diagnostic system, they’re certainly going to have influence into the utility of the product, and how it’s going to compare to the other products or services that are currently being used. But they’re one of many, many stakeholders in this medical device procurement system. There are hospital administrators who need to really crunch the numbers to understand, does this make financial sense? There are regulatory bodies who might get in the way of this product from ever seeing the light of day. There’s the end patients who need to be adherent with certain technologies in order for them to be utilized.

Dan:    And there’s the payers right? Either the public or private payers, Medicare, Medicaid, or a private insurer, and you need to prove to them that the overall cost using your solution is going to be less in the big picture.

Eric:    Yeah.

Dan:    Than whatever the standard of care is.

Eric:    Absolutely. And that could be possibly the most critical aspect to really understand. What is going to drive change from a payer’s perspective? Whether that’s CMS or whether that’s private insurance. So yeah, these are all key things. But to your earlier point, it is definitely important as engineers are coming up with these ideas, to vet these concepts with clinicians. But they’re not the only stakeholders that matter in this really complex industry that we’re in.

Dan:    Right, right. So let’s talk about … Say you have an idea, you have a technology. You think you have an application for it in the healthcare space. And you’ve done all that leg work. You’ve got your needs statement, you’ve got some at least preliminary feedback, at least neutral feedback from clinicians or from people who are going to be working with the products itself to say, “yeah, this is a real potential solution to an existing problem.”

Dan:    You have your idea, and you want to start developing that. Let’s move into this talk about, “Now am I ready for a prototype?” IS that when I start building my first … Ordering parts and soldering things together, or are there more things that need to come into it prior to jumping into that process?

Eric:    Yeah, sure, Great question and a common question that a lot of early stage companies have is, “What should be my next, most logical step that’s gonna help me build value in the company?” And the way that I think about this is, when a company or new idea’s just getting off the ground, the inventors of this new technology, they have this very optimistic mindset. They are imagining what the world could be with this new solution that they are creating. And that leads into new concepts, and eventually this concept for a product that could result on a medical technology or medical device. So, it starts with optimism. And you need to have that optimism and opportunism to get to that point, where you have something on the table that you can evaluate.

But now when you’re looking at what’s the next step in product development, you need to kind of flip a switch. And you need to go from being an optimist and an opportunist, to being a skeptic. And being a skeptic changes your thinking a lot. I makes an individual think not about why the product will work, but more of a why the product is not gonna work. What are the reasons why this product could fail? Premarket, postmarket, whatever may happen, whatever the case may be. What are all of those factors? Then … So there’s a number of these factors, there’s regulatory risks, there’s clinical risks, does the product work in humans or with humans? There’s IQ risk, is there other technology that’s going to block this from ever coming out? There’s the payer risk that we talked about, there’s user compliance or adherence risk. There’s market risk, is the market going to be big enough to drive the investment that’s needed to move this technology along? So there’s all of these different risk factors. And so founders of new companies, inventors of new technologies, they need to get into this skeptics mindset, and they need to think about why might this product fail?

Dan:    Right. So, is that maybe … Something that is occurring to me as you’re talking about this is, is that maybe why we see so many new startups that are two person operation, right? And there’s very different personalities sometimes when you meet with a team. It’s a tow person team, and one of them really seems to be just boundless energy and ideas, and everything is kind of like roses and sunshine. And the other person is kind of a Debbie downer.

Eric:    Yeah.

Dan:    Is one way you could interpret it. You need both sides of those ways of thinking. And it can be difficult to combine that into one personality.

Eric:    Yeah, absolutely. I think the way that you put it is right. You need to have that optimist, the energy to move things over, but then you also needs to have the critical eye that’s questioning things.

Dan:    Yeah. Yeah. You know, my dad’s a mechanical engineer, and it always seemed to me when I was a kid, he was just such a downer on things. And one day he turned to me, and he said, “You know it’s my job to think of everything that could possibly go wrong, right?”

Eric:    Yeah.

Dan:    And when he explained it to me like that, it really put thing into perspective. He’s derisking all day everyday.

Eric:    Yeah.

Dan:    Basically is how he has to think.

Eric:    Yeah, very true.

Dan:    So, I think that concept of risk is interesting. Particularly in the medical device, medtech arena. I guess because people often talk about risk related to medical devices, but they mean it in a very particular area of risk. Which is basically what’s the risk to the patient if this device fails, right? So then, you were talking about other areas of risk. Regulatory risk, market risk, right? So talk to me about how you move through each of those areas, and go about trying to reduce your risk in each of those different sectors.

Eric:    Yeah, yeah, sure. So, as we started out, there’s also technical risk, and that’s probably the easiest one to tackle first. There’s a question about viability. Is this idea going to really work? And so the natural way to approach that is to come up with bread boards or test beds that allow a team to understand what the technical limits are of an idea. And so, one of the ways that as an engineering firm, here at Smithwise, one of the ways that we tackle that is, we try to simplify and isolate the key technical risk areas. So if there’s a core mechanism that really needs to fit within a certain size in order for a product to be viable, then we will just isolate that one mechanism and we will focus on iterating that in a very, very rapid way. If it’s an electrical subsystem that needs to be developed so that it can be managed, it can provide all of the functionality in a very low power environment, then we might isolate that electrical subsystem so that we can iterate that technology.

I think one of the approaches that does not work when you’re at the very early stages of looking at technical risk, is to try and merge all of these different things together, and create a single cohesive prototype. The reason being is that when you put all of these things together into a holistic prototype, the challenge is that, number one, it’s gonna take you a really long time to get there. And then number two is, when something goes wrong, you’re not gonna exactly know why or where it went wrong. It’s going to be a little bit nebulous, right?

Eric:    And then I guess the last reason is that development of technology, product development is a lot about iterations. And you wanna be able to reduce the size, the length of an iteration cycle as much as you can.

Dan:    And the expense, right?

Eric:    Yeah. Money is short for a lot of companies that are developing new medical technologies. So if you isolate that technology into a core area, it allows you to iterate that one specific subsystem much more quickly. And then once you get all of the performance of those subsystems the way that you want them to be, then you pull them together into that cohesive working model that demonstrates the overall system level functionality you’re looking to achieve.

Dan:    Right. So you can have a prototype that maybe is your electrical components prototype, your mechanical components prototype, your human factor prototype, right, that is, does this feel natural for the user? You might never tie these things together during the first prototyping phases right? That might be the next thing down the line after you’ve isolated each of those systems.

Eric:    Yeah, absolutely. And so I’m glad you brought up the human factor and usability type of prototyping. If I have a new medical technology, let’s say it’s a wearable. And it needs to be used by a person at home, and they need to be wearing this product for ten hours a day, hypothetically. If I’m testing out an idea, do I really need to have that mock up or that prototype fully functional in order for a user to give me feedback on it? Probably not. I can come up with a mock up that is very simplistic that just focuses on the key usability attributes that are gonna matter to that individual. So this could be a non-functional mock up that you take out to users, get their feedback on it, and better yet, it’s multiple mock ups. Because you’re simplifying things, it’s really just a dummy shell of a product, you can come up with six or eight different versions of this, and test of these versions with potential users. It’s a great way to get a lot of that longer term user usability and concept preference feedback to help you steer that direction.

Dan:    And that might really impact your design process very significantly, right? If you’re deciding where to place a sensor, and you think it’s gonna be going on someone’s wrist, but it ends up whatever, going around them in some way, or hanging from their neck or whatever the case may be. That will very much impact the rest of your design process with how all of those components function.

Eric:    Absolutely. It’s gonna drive all kinds of requirements, it’s gonna drive the size and the shape of the housing or the package that all of the electronic are gonna be contained within. It’s going to define whether it’s going over garments or under garments, directly on the skin, or hanging off a pocket or a bra strap, you know. It’s all of these architectural requirements from a usability standpoint are going to drive the design. So it’s really important to be thinking about that stuff up front. If you focus on technology too much at the front end, and you ignore a lot of human factors, it could be a rude awakening when you go out and get feedback from customers, and you realize you’ve developed the wrong product. And now you have to go all the way back to the drawing board, and start exploring these new configurations from scratch.

Dan:    I think that maybe some, or a lot of people have in their minds when they say, “I need a prototype” what they really have in their minds is, “I wanna be able to hold something in my hands when I make that Shark Tank like investor pitch. That is gonna look really slick and impress somebody right upfront.” But really, most of the prototyping process is really about clearing what isn’t right about your current design, right?

Eric:    Yeah.

Dan:    And so you can change it the next time round.

Eric:    Right, right. Prototyping is really in my perspective, it’s a learning methodology. It’s a way of thinking to test out your ideas in a very rapid way. So, yes, everyone’s goal is to have that cohesive prototype that demonstrates the full functionality, and it’s the right form factor, and it’s the right cost structure, and it has all the embedded functionality. That’s where everyone wants to go. But the way to get there is by taking this isolated approach, right? Isolating your risk factors, iterating those risk factors individually, and then merging them afterward. So, it’s a different approach than most start up companies take, but we believe it’s the one that results in the most efficient process.

Dan:    Hey listeners, if you have a great medtech story to tell, or maybe a suggested guest we should have on the show, or a topic in medtech you think we should cover, send me an email at Or use the contact us form on our website.

So one other area that I wanna make sure we touch on is the regulatory approach. I think often people think of regulatory approval as kind of like once they get that stamp of approval from FDA, they’re home. They’re free and clear and now they can bring the product to market. But all that means, is that the FDA’s not gonna stop you from marketing your product, right? So, let’s talk about the different approaches to overcoming that regulatory hurdle, and then what comes after it.

Eric:    Yeah, yeah sure, it’s another factor that needs to be considered very early on in the process. For some products, like you mentioned, if it’s a consumer wellness device, a wellness device, maybe you do have the option of it could be marketed as an unregulated consumer product. Or, it could also be marketed as a regulated medical device. And it’s a really important topic for companies to consider at the very early stage, there’s implications to either one of those [inaudible 00:25:34].

Dan:    Sure. And that decision will really totally determine your whole go to market strategy, right?

Eric:    Exactly.

Dan:    Are you marketing it to consumers? Or are you marketing it to payers?

Eric:    Yep, yeah, yeah, yeah. Absolutely. And it will also drive certain design elements. So the design of the product, it may be of a different cost structure if you’re marketing it to consumers, rather than trying to get a product to be purchased by hospitals, right? So, these decisions that companies make at the very early stage, they have longer terms consequences that people need to be aware of.

But back to, there’s a number of other ways that you can get regulatory insights. For the longest time, people were fearful of getting together with FDA. They were fearful [crosstalk 00:26:23].

Dan:    You don’t want to be on the radar.

Eric:    Yeah. That they were gonna give you the black mark, and you were never going to be approved once you got that black mark. So FDA has evolved immensely int he last decade. They have programs now for doing informational sessions where you can collect feedback in an informal manner with FDA officials. There’s pre submission meetings where you can present the endpoints that you’re looking to achieve, an animal model that you’re looking to support. An IDE application, and collect formal feedback from FDA. So there are some really great ways to collect feedback from FDA, and it’s an important part of the process. Companies should not be avoiding FDA no until it’s too late.

Because again, if you wait too long and you get a response that, after you’ve invested an enormous amount in product development and clinical affairs, then you’re going to have to spend a lot of time and a lot of money redoing all of that front end effort. So, again, it’s about thinking about those longer term consequences, those longer term decisions, and trying to figure out how can I get some feedback as early on in the development process as possible.

Dan:    Right, and that maybe ties into another sort of premarket thing you need to worry about, which is intellectual property and patents, right? So, we talked about what are the other solutions to this problem? The fact they might not be just a similar piece of technology, right?

Eric:    Right.

Dan:    But when it comes to exploring existing or prior art, right? How do you go about that process?

Eric:    Yeah, so there’s a few key pieces there. There’s first looking at what is out there, what does the current patent landscape look like? And oftentimes the way that this is started is individuals, engineers, or people that are founders of the companies will hop on Google patents or the USPTO website, and start to do [inaudible 00:28:34] style searches. Looking at typing in key words and finding the patents that are most relevant. Once they find those initial patents, then following the references and citations that link to the most relevant patents, that’s a great way to get an initial pass of the overall patent landscape.

So, understanding that patent landscape at the front end is pretty critical. A lot of times investors want to know, have you got a formal legal opinion of freedom to operate? That’s different level of patent scrutiny, and it’s usually a pretty costly undertaking. So in most cases, startup companies that are resource constrained do not invest in that until a little bit further along in the process, unless their investors are insisting on it.

Eric:    But you at least need to do preliminary due diligence to understand what IP is out there, right? And what IP is protected. Because just because there’s no product on the market that utilizes this technology, doesn’t mean that somebody doesn’t hold the patent to it, right?

Dan:    Right, I mean, that’s a great point. There’s a lot of patents for technologies that are not on the market. And so you do have to be looking at the patent database to see if you’re stepping on another company’s patent.

Eric:    Another good source of looking at products or products that have become commercial or were commercial at one time, is in looking at FDA’s [510(k) 00:30:15] database. So this is of course limited to products that are 510(k)s, but this allows you to type in a certain classification code, and identify all of the products that have been cleared for 510(k). So that’s another good way to get a basic understanding of what products have historically received FDA clearance, and maybe what products are still on the market in a particular category.

So, all of these things that we’re talking about are strategies that you need to begin defining very early on in the process.

Dan:    What about your go to markets? How do all of those tie in to your go to market strategy? And making that ultimate go, no go decision that your investor is going to have to make of, does this market opportunity justify the amount of investment that you think is needed upfront?

Eric:    Yeah, yeah. So, one thing that we didn’t talk much about yet, but it’s a really key aspect of go to market strategy for medical devices, is the clinical risk. So how do you, how does a new company prove that their technology is superior from a clinical perspective than the standard of care? And this is interwoven with the market strategy, right? There might be some clinical work that is needed for regulatory clearance, but there’s another level of clinical work that is often needed to prove the value of a product related to the competition, right?

Eric:    So that type of clinical study might be looking at reduction in readmissions. Or it might be looking at reduction in a certain cost element. Or hospital stay time. Whatever those end points are, you need to identify how am I going to prove to the medical community that this technology is superior? And so, whether it’s a 510(k), or whether it’s a PMA, you really have to be thinking about that clinical strategy. How am I going to prove that this is better?

And so that often feeds the go to market strategy. If you can conduct that clinical study in a really efficient way, and present the data such that it is a cost savings to a hospital, then maybe the hospital is the payer. If instead, you are looking at providing a product that’s falling under an existing reimbursement code, and you’re looking to do this more cost effectively than competing technology, then that’s another way to get hospitals to consider your product or technology.

In certain cases, there is no code. For a lot of [inaudible 00:33:06] devices that are being developed and new PMAs, there may not be a new code, or code that’s available. And so this can be a much more lengthy process. But it’s one that needs to be considered really early. What does that clinical study need to look like in order to compel CMS to set up a new code, and to provide the coverage that’s going to be needed to justify this new medical technology down the road?

Dan:    Right. So that’s an example I guess of how your regulatory pathway is going to very much spell out or help define your business plan. Because if you’re going to market via a 510(k) pathway, versus a [inaudible 00:33:50] pathway, that makes a huge difference in your time to market, right? Which translates into overall cost of bringing the product to market.

Eric:    Right, right. Yeah, so that’s a good point. If you’re looking at the [inaudible 00:34:05] 510(k) pathway, then you may need to run some additional clinicals. And there may be uncertainty about the coverage, or the coding that’s going to be available to that product longer term. So again, looking at that regulatory pathway very early and using that as a key point to make your architectural decisions about the product development, that’s a really important consideration at the front end.

Dan:    One of the things I wanna make sure our listeners understand in this first episode it that, we’re trying to set the stage here for what it takes to bring a new medical product to market. Whether it’s a medical device that’s regulated, or whether it’s a consumer wellness product. There are all of these different areas that come into play. We’re going to be, in the coming episodes, sitting down with both experts in these particular areas, because you should always have expert opinions as you get further down the track. And we’re also going to be sitting down with folk who have been through this process recently in maybe a new medtech start up. So, I think you and I are both really looking forward to those conversations. So we have a great slate of folks who are signed up to come and have those conversations about clinicals, and what do investors look at when they’re deciding whether or not to fund a new company? And what’s the process for determining what the existing IP is? And how do you approach the FDA and inform your regulatory strategy and all that.

So, I think this is gonna be a really great series, especially for people who are early on thinking about how to begin that process.

Eric:    Yeah. I think that’s dead on. So we are, at Smithwise, we’re focused on product development, right? We’re focused on a lot of the engineering. The design, the manufacturing of new medical products, but one of the things that I realized throughout my career is that the product development of medical technology is complex. And you really need to be considering all of these different factors that we just discussed. If you try to develop a product in a vacuum, then you’re gonna have some big nightmares to address later on. And so bringing in these experts to talk about all of these areas is going to help us better understand how to integrate those aspects into product development, and it’s hopefully gonna allow our listeners to get the insights that are needed to shape their product development strategies as well.

Dan:    Yeah, I think what we’re really talking about is going in to the product development and the design and engineering phases of your project with your eyes open to the different hurdles that you need to get over in these various areas. It’s a little bit like that Gilligan’s Island special, where the Professor gets back from the island and he’s been inventing in a vacuum for the past 10 years, right? Nd he’s got all these great ideas, but then he brings them back to civilization to find that they already exist.

Eric:    Yeah, right.

Dan:    So, I think a real theme that’s gonna come out here is, the earlier the intervention you can get, the better input you can get from people who have experience in these different areas. Whether it’s clinical, or legal, or regulatory, right? The better off you’re gonna be throughout your product development process. The faster you can iterate and bring your device to market, and the lower you can keep your costs. So I think that’s part of what we’re hoping this podcast series really helps people think through.

Eric:    Absolutely. Well said.

Dan:    Well Eric, thanks for sitting down today, I’m very excited about kicking this off, and I think you are too, and we’ve got a very good slate of people who are ready to talk about these issues with us.

Eric:    Yeah, Dan, should be pretty exciting. Looking forward to it.

Written by Daniel Henrich

Written by Daniel Henrich

Director of Marketing at Archimedic

MedTech Mindset Podcast: Actively Protecting Seniors with Wamis Singhatat

EPISODE 2 – Wamis Singhatat and Active Protective

We’re joined this episode by Wamis Singhatat, VP of Product Development and CTO of Active Protective, a medtech company working to bring a really cool new piece of technology to market. Their product is a smart belt that can detect a fall in progress and deploy airbags to cushion the hips of the wearer. You can see a video of the deployment in action below. 

Wamis sat down with Smithwise President Eric Sugalski to discuss their strategies for bringing this product to market. 

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Episode Transcript

Dan Henrich: Welcome to Medtech Mindset. I’m your host Dan Henrich and I’m Director of Marketing at Smithwise. Recently one of our Smithwise clients and friends from the industry, Wamis Singhatat stopped by our office to be a guest on this show. Wamis is VP of Product Development and CTO of Active Protective, a Philly area medtech company working to bring a really cool product to market. A smart belt that can sense a fall in progress and deploy airbags to shield the hips of the wearer. Our team at Smithwise has had the opportunity to be part of this development process and it’s been fantastic to be along for that journey. You can see a video of the deployment in action by visiting our blog and finding the post for this episode.

I’ll mention before we jump into the conversation that we had a problem with our original audio recording file. So we had to fall back on the audio from a video camera we had running. It’s a bit echoey. We’ll get right back to better audio quality with real mics next episode.

Wamis sat down with our president, Eric Sugalski to talk about the Active Protective product journey and some of the issues they thought through as they planned their path to market.

Eric Sugalski: So first of all, Wamis, thanks so much for taking time to be part of this podcast. Really appreciate it.

Wamis Singhatat:      Yeah, happy to be here. Thanks for inviting me.

Eric:    So I wanted to start with … you had a really interesting career at J&J in the orthopedics space and you decided to move on from J&J, which probably had a lot of benefits, a lot of great things about it, and move into this startup, that had a certain amount of risk. Take us back to that place where you were, tell us a little bit about what was happening at J&J and how you made this decision to join Active Protective.

Wamis:           So it was probably the scariest decision I’ve ever made in my professional life. And maybe twice as scary to my wife when I went home and told her that I’d be leaving J&J, because people just don’t do that. It’s a great company.

I was actually with a company that J&J acquired, Synthes. Synthes was a major orthopedic player and once J&J acquired us, I had landed in the trauma business unit. So trauma meaning orthopedic trauma, so broken bones and I was on the franchise marketing team. I actually ran the portfolio that was responsible for knee and paraprosthetics … fractures. So implants that would go to fix knee and fractures that were happening around, like a total hip, for example.

Interestingly, as we were looking at portfolio opportunities, I came across Active Protective. Active Protective was not in the business of, obviously fixing fractures, they were in the business of preventing fractures, but it was an interesting sort of rehab play for us. The more I learned about Active Protective … it was super early stage at that time, there was only just the CEO working with some external development partners, Smithwise being one of them. But the more I learned about them, the more I realized that I had to come and help them make this a reality. And it was probably the toughest decision that I’ve made … one of the toughest conversations I’ve had with my wife.

Eric:    So let’s talk a little bit about Active Protective. Super compelling opportunity for you to convince you to leave J&J. What exactly is Active Protective doing?

Wamis:           So it’s really an amazing technology, the company was founded by Dr. Bob Buckman, former Chief of Trauma from Temple University. He had a long career in the inner city Philadelphia, like knife and gunshot; really bad traumas. And then later in his career, he moved out into the suburbs at St. Mary’s Hospital and he saw a really big shift in his cases. They were all really hip fractures. Little old ladies falling down, breaking their hips and struggling for their lives. He really thought there has to be a different way and after wracking his brain, he came up with a wearable form that actively protected the hips. And that really was the genesis of Active Protective.

So Active Protective, our mission is really to make hip fractures a preventable condition. And it’s through this smart belt that can very accurately monitor a user’s motions and detect when there is a serious hip-impacting fall and then deploy airbags over the hips prior to impact. And it’s also a connected device so it sends caregiver alerts, as well. And it records all the motion data. We, then can analyze that in the cloud. We developed our own cloud application and we can present that motion data and user activity data back to caregivers and therapists, anybody on the care team to really help inform the care that the user is receiving.

Eric:    So who specifically is this product intended to be used for? There’s a lot of, obviously elderly people that might be prone to hip fractures, but there are people in nursing homes, there are people in assisted living facilities, there’s some people that are living independently, where this product might be applicable. Tell us about how you evaluated those different customer segments and if there’s one in particular that you’ve really honed in on.

Wamis:           Yeah, sure. In general, I think the most broadest category would be a high fall risk individual. So an older adult that is predisposed to falling, whether it’s through some gait abnormalities or through sort of balance issues. It’s really just a normal function of aging that your balance degrades to the point where there is a threshold where you’re then a high fall risk.

When we look at high fall risk individuals, the market can be really cut in two halves. One is aging at home and one is what we sort of generically refer to as the supervised care market. The supervised care market, it’s really big. It includes this entire continuum from really the acute setting to post-acute. So if you’re just discharged from the hospital into say, a rehab facility, which is also a skilled nursing facility. The next level of acuity would be assisted living. So that kind of takes you into these retirement communities and there’s this whole world around what’s called, CCRC’s, Continuing Care Retirement Communities that have assisted living, skilled nursing, and then independent living, all on the same campus. That is what we consider the supervised care community, even though you may have very different use settings on the same campus.

So for example, on a CCRC you’ll find one side, like I said, is independent living. It’s essentially like an apartment complex. The residents there can come and go as they please. But on the same campus they do have nursing, they do have medical assistance, if and when they need it. So for us that poses a great opportunity that we can get a belt onto campus like that where we can have the IT department involved to connect all this to wifi. We can have a fall risk assessment done because there’s nursing staff or therapists on sight.

And then transition from that kind of setting all the way to, say like a skilled nursing on the same campus. So as these residents come in they typically come in to independent living and then as their health degrades they transition into these higher acuity care settings on the same campus. So it’s a really nice market for us because you really can capture a wide variety of users.

Eric:    Right and like you said the infrastructure is already in place to facilitate usage of this system. So building on that, when you’re trying to get products into that type of environment, there’s probably a lot of stakeholders, there’s a lot of people that could be influencers in terms of adopting this type of product. Who is the buyer in that case and who are some of the other stakeholders you need to be thinking about in order to get your product into that type of a market?

Wamis:           Yeah, sure. So the buyer is really primarily the facility owners. So the facility owners, they are financially on the hook, so to speak for risk and liability. So, if someone, maybe a resident for example, falls and breaks their hip on their campus, then they’re liable for that. These facilities face enormous lawsuit, liability exposure and it varies by state, depending on the states, whether they have tort reform or not. But for example, in California, the average liability, sort of lawsuit is five to six hundred thousand dollars per infraction. You go to the state of Kentucky, where there is no tort reform, it’s $1.7 million per infraction and everywhere in between.

So they are incredibly interested in pursuing any technologies that can try to minimize that risk, that liability exposure that they have. So they are a very motivated buyer for us. But then we also see that there are, again, like in the CCRC campus because there are these different care settings, there are opportunities to do some cost sharing or pass some of the costs down to, say an independent living resident. Who may not be as high of a fall risk, but they may still be motivated to wear the belt and in that case, a facility may buy the belt from us and then actually pass some of that cost to the resident.

Eric:    You mentioned that these facility administrators, they’re looking at this from the standpoint of reducing their liability. I would assume they’d want some type of evidence that your device, your product is actually going to that before they invest in this new technology. Is that true and if so, how does Active Protective provide that compelling evidence to those buyers.

Wamis:           Yeah, absolutely, they’re looking for evidence. I think the good thing we have going for us is that we are essentially repurposing known technologies. We’ve got automotive grade airbags and automotive grade inflation, inflaters within the belt. Pretty much the population trusts that airbags work. Airbags have saved lives for decades within automotive applications and they’ll save lives in our product as well. So we don’t have to convince them that an airbag will work if deployed properly.

Things we have to convince people around are typically compliance, so will people actually wear the belt. And that’s a big one, right? It’s wearable. Look at the evidence around wearables and how they’ve been adopted into population at large. It’s not great. It’s the worried well and it’s the fitness buffs, right? Going outside of that to an older adult population with a wearable, it’s a very reasonable question to ask. So we get that question. It’s probably the most common question that we get.

Eric:    To that point, is being in a supervised setting, does that make compliance with the product simpler?

Wamis:           It helps. It helps, no question, but the primary way to really promote and enable compliance is really through the design of the product. So you’ve gotta design the product that is highly usable, that blends into the user’s lifestyle and that you’ve got to target the right users as well. So we’re targeting those users that are highly motivated and that’s how we’ll get compliance with sort of this niche or beachhead strategy, in terms of targeting and good design.

Eric:    Got it. So, you said that airbags are a well known technology, but the evidence … these facilities that you’re getting the product into, they’re not looking for clinical studies that are showing that your product is reducing the incidence of the infraction?

Wamis:           Not these facility providers, no. Not all stakeholders are going to have a level, an evidence bar that’s that low. An insurer, for example, or a hospital network, they will probably have a little bit higher bar, in terms of the efficacy, if you will of the technology. And in time we’ll generate that efficacy to show that we are actually protecting the hip, potentially changing the injury rate. That our algorithm is very accurate and it deploys when it should and it doesn’t deploy when it shouldn’t. Those kind of things we’ll actually be able to generate, but it’ll be a longer effort, it’ll be a longer timeframe to get to that.

Eric:    What is the regulatory process look like for this product?

Wamis:           Yeah, there’s so many conversations that we had internally early on of what was the right pathway to go down. Obviously, we could have developed it as a medical device. That’s the world that I came from, as you said. We’ve got some others within the company who have med device backgrounds. Or we could’ve developed it as a just purely consumer electronic device or consumer product, that wasn’t subject to all these additional regulatory hurdles.

We actually at the end, after really looking through the pros and cons of each pathway, we actually chose a sort of hybrid approach. So we’re developing it as a personal safety product … and a personal safety product, it’s not a medical device, but we are of course going to be subjecting it to some standards, if you will, and best practices from, like the automotive industry, for example. We’re pulling the best bits out of the med device space to really result in a better and safer personal safety product.

Eric:    Got it. So with the hybrid approach, when you’re presumably developing a lot of the documentation that’s going to eventually be needed to meet that medical device requirement, why not just take the medical device route right from the get go? What’s the reason to not do that?

Wamis:           There are many examples of companies that have just really faced these shifting and very onerous regulations and have never made it through, across the finish line. We were incredibly conservative in our approach. Like I said, when we really sat down and looked at the best approach, it’s really one where we feel we can make it the safest and the best product. It’s not really encumbered by unnecessary restrictions.

I’ll give you an example, so we decided to develop a quality management system within the company. It’s a quality management system that is essentially a hybrid between a 9001, which would be your typical consumer product company and ISO 13485, which would be your typical med device company’s quality management system. We’ve bolted on the best parts of med device being, for example design control. Design control, really important to making a good product, having good documentation, showing that your product actually meets its requirements. Then, risk management, my time in the med device space … engineers have conflicting views of risk management, but my personal view is that risk management when applied correctly really will result in a better product and a safer product. Obviously being a personal safety product, that’s important to us.

Eric:    So a lot of these things, quality management, design control, risk management they’re required for medical devices, but they could be considered just good engineering practice for all products, regardless of the regulatory pathway.

Wamis:           Absolutely. Yeah, I think quality by design is a really important thing, like you said, could be applied regardless of what category the product falls in.

Eric:    So down the road do you see a reason to become a regulated device for certain indications?

Wamis:           Perhaps. I think perhaps. What we can say as a personal safety product is, for example, we protect the hips in the event of a fall. We have to be careful not to make any medical claims, just like any other nonmedical product. We can’t or wouldn’t say something like, we reduce the incidence of hip fracture by 23%. Those are clearly making some medical claims. At some point down the road, for marketing purposes, we might want to go down that path and if we do, then we’re not starting from scratch, so to speak. We’ve got these parts of the med device regulations already ingrained within our development.

Eric:    It’s already there, okay, that makes sense. So when you have a processor inside of this system that’s collecting all kinds of motion data, potentially fall data, this data’s going up into the cloud, where this could be really valuable data for your company also for other companies. How does this fit into the equation? Are you looking at this as real world evidence that could help you with convincing insurance companies or others that this product is of high value? Or how are you using data with this product?

Wamis:           Absolutely. I think data is playing a more and more important role in the value proposition, our value proposition of what we provide. It’s not that we didn’t really realize that outta the gate. We would sit down with facility owners and they’d bring in their clinical team into meetings and we’d present a product. It’s our mission is to make hip fractures a preventable condition and here’s this amazing technology that will very accurately detect serious hip impacting fall, etc. etc. And then midway through our pitch they’d say, “Okay, that’s great. We get that and that’s amazing. We have needs there, but you know what this really does for us? Is it gives our patients and our residents a sense of confidence that will enable mobility.”

And that’s a whole other piece of our value proposition that’s really become as important almost as the hip fracture prevention or hip protection in the event of a fall. It’s because its what they struggle with on a daily basis. The need to get people up and moving. Especially those are that higher acuity patients. Especially those that are a higher fall risk. There’s this vicious cycle where those residents and patients that are fearful of falling, they move less and when they move less, their strength decreases and their balance gets worse and counterintuitively, they actually fall more.

So there’s this sort of need to short circuit this vicious downward spiral with a product that can sort of inject confidence into these people and get them up and moving. Then hopefully then they get all the health benefits that come from that mobility. So the data … wrapping all of this back to the data piece, the data pieces is really key to providing evidence of that. It’s essentially a very sophisticated activity tracker if you will. We can measure things that a Fitbit or an Apple watch couldn’t measure, such as very accurately measure postural sway.

So if you put a Fitbit … and I’m showing you the one I have … it’s subject to all this artifact from your extremities moving around and I talk with my hands, so I probably look like I’ve taken a hundred steps [crosstalk 00:23:13] in this interview. But our belt, is mounted, the motion sensor is mounted on the user’s lower lumbar spine. So that can very accurately detect these changes in gait and sway and postural control that are very important to a clinical team, a therapist that’s caring for somebody and really wanting to enable their reaching their rehab goals.

Eric:    So we talked a little bit earlier about compliance being an issue. I know a lot of medical devices and consumer wellness products, whether it’s drug delivery devices or diagnostic wearables. There’s this notion of using data to try to improve compliance with new technology. Is that factoring in to how you were looking at things for your user base continuing to use the product?

Wamis:           Yeah, for sure. The belt is a connected device. The nice thing, that we get this daily snapshot of who’s wearing the belt and how long they’re wearing the belt. We have the ability through this connected element to actively target users who should be wearing the belt more. Particularly these high fall risk individuals that facilities have identified should be wearing the belt for protection. So that’s sort of one piece.

The other piece, like I’d said, the data, when presented in the right manner back to a clinical team can really do a lot in terms of informing the care that a person gets or really documenting progress. I know this is a little bit of a tangent, but there is this shift of value base reimbursement, instead fee for service. Value base reimbursement is largely going to be based on outcomes. You’ve gotta show that your actually improving functional outcomes for these patients and there aren’t great ways to do that in many of these care settings. If you can give the clinical team a nice documented record of how a user has, for example, improved their postural sway or their distance over surface or other mobility and activity measures during the length of their stay within the facility. It’s really doing them a great service. It’s allowing them to document the effect of their therapies and how much the patient has improved.

Eric:    So you’re into Active Protective now, three, four years? [crosstalk 00:26:37]

Wamis:           Going on three years and three months.

Eric:    Okay. Great. So knowing what you know now, if you were to think back to when you started, three and a half years ago, is there anything that you would’ve done differently?

Wamis:           Oh man, is there anything that I would’ve done differently? You know, we’ve really taken a very measured, strategic approach to how we’ve developed this product and the company as well. We’ve kept the company very lean. We used development partners, like I need to mention obviously, Smithwise has been great and the partnership that we have with, not only Smithwise, but we’ve got an automotive safety company, Joyson safety systems. We’ve got an algorithm development team.

I would absolutely repeat that time and time again. Its a very, I think, smart approach to keep your internal core team lean until you’ve reach this sort of critical mass. Then once you get the product into the marketplace and then you’ve got things like sustaining engineering and obviously pipeline products that need to be developed, that’s sort of when you start to bolt on some additional capabilities internally and we’ve done just that. So, hard to actually think of big things that we would do differently. I’m sure there’s a bunch of little things here and there, but I think we’ve done a pretty good job so far.

Eric:    Cool. Awesome. So one last question for you. What’s Active Protective look like five years out? Where do you see the future for the company?

Wamis:           Our dream is really that we develop the product that becomes normalized. Any new technology, you invent it and you put it out into the world, it’s different. It really requires … it goes through this process of normalization until it can really get adopted by the masses. So in five years from now, if we are successful, then this is gonna be a product that you will see on your older loved ones. We’re all a very mission driven company. That’s really why we work so hard, is to actually get this product on to as many older adults as we can. Starting in supervised care settings and then moving into aging at home and then expanding outside of the U.S. into global markets.

Pretty exciting time for us and who knows what’s beyond that. There’s a lot of different areas where we can take personal protection, high risk occupation, we can take it into other parts of the body, to protect the head, for example, not just the hip. But really our focus is on hip fractures because it is one of the most, if not the most devastating injuries on an older adult can sustain. We’re gonna start with the big one and address that first.

Eric:    Great. Great mission, great product. Really appreciate you taking the time to chat with us here, Wamis.

Wamis:           It was great. Glad to be here. Thanks, Eric.

Written by Daniel Henrich

Written by Daniel Henrich

Director of Marketing at Archimedic