High-Impact &  High Value Medical Innovation Zen Chu CIMIT Forum Harvard Medical School Beth Israel Deaconess Medical Cent...
Discipline of  Clinical Innovation <ul><li>Physician/inventor & role on the team </li></ul><ul><li>Innovation landscape </...
Innovation without Impact is Worthless <ul><li>“ Unmet Clinical Needs” </li></ul><ul><ul><li>Cliché, not useful metric </l...
High Impact Innovation © zen@acmedx.com
Clinician Innovators Critical to Medical Technology <ul><li>22% of surgeons innovate -  von Hippel, 2003 </li></ul><ul><li...
Why MDs Must Innovate <ul><li>False argument that Big Opportunities already identified & tried </li></ul><ul><ul><li>99/10...
Physician’s View of Value © zen@acmedx.com Time   Market Introduction   FDA Approval    Patent grant First in Man Animal t...
Investor’s View of Value © zen@acmedx.com Value Time Milestones   Acquisition/IPO Exit   Reimbursement   Published clinica...
Which Risks to Prioritize? Value Time Market Risk Reimbursement Physician & Patient Adoption Packaged Solutions Regulatory...
Which Risks to Prioritize? Value Time Market Risk Reimbursement Physician & Patient Adoption Packaged Solutions Regulatory...
Myth of the Lone Inventor <ul><li>Initial invention & patent is only 1 st  step </li></ul><ul><li>Value created far beyond...
“ Physicians and engineers often have no sense of the requirements to create a company…In a start up environment, more is ...
Building Teams <ul><li>What’s your desired role? </li></ul><ul><ul><li>Understand own strengths & weaknesses </li></ul></u...
Cultural Barriers to Med Innovation <ul><li>Interdisciplinary collaboration takes extra effort </li></ul><ul><li>Culture o...
Development Best Practice  © zen@acmedx.com Value Time Milestones   Acquisition/IPO Exit   Published clinical results   Ma...
Traction for New Technology <ul><li>Best to start with clinical need, but… </li></ul><ul><li>Many start with new technolog...
Innovation Landscape <ul><li>“ If you don’t know where you are going, you might end up someplace else.” - Yogi Berra - </l...
Innovation Landscape Match Resources to Opportunity Size  <ul><ul><ul><li>Market Size of Opportunity </li></ul></ul></ul>L...
Innovation Landscape Adapt New Info to Larger Opportunities <ul><ul><ul><li>Market Size of Opportunity </li></ul></ul></ul...
Innovation Landscape Match Resources to Opportunity Size  Philanthropy/NIH Basic Research Unknown Mechanisms  Gates Founda...
Incremental vs Breakthrough © zen@acmedx.com METRIC INCREMENTAL BREAKTHROUGH Funding $$ $$$$$$ Market Size Varies dependin...
Valuable Incremental Products <ul><li>Huge companies built on incremental innovations </li></ul><ul><li>Fast followers can...
Time is Life © zen@acmedx.com ACCELERANT DECCELERANT REGULATORY Device 510(k) Predictive animal models New materials & cla...
Accelerants Amplify  Clinical Impact & Return on Investment © zen@acmedx.com Value Cashflow Time Milestones $0 COMPRESS  T...
Techniques to Identify New Opportunities <ul><li>“ To have a great idea, have a lot of them.” </li></ul><ul><ul><ul><ul><l...
Simply put “Interventional”  in the name <ul><li>Apply interventional techniques to a sleepy discipline </li></ul><ul><li>...
© zen@acmedx.com Michael Porter, tiesberg Economics drive innovation to interventions
Opportunities from Wider View Surgical Procedure Example <ul><li>Narrow View </li></ul><ul><li>Implant choice </li></ul><u...
Productize the Procedure <ul><li>Turn medical service/procedure  </li></ul><ul><li>into a repeatable product </li></ul><ul...
Remove Treatment Ambiguity <ul><li>Anticipate or create the Standard of Care </li></ul><ul><li>Definitive diagnostics </li...
Driving Solutions & Costs Down Healthcare Value Chains <ul><li>Point of Care </li></ul><ul><li>General Hospitals </li></ul...
Eliminate A Provider or Facility Heresy! <ul><li>Reduces procedure costs </li></ul><ul><li>Accelerate payor approvals </li...
Compete at the Consumption Void <ul><li>Unique venue   Different </li></ul><ul><li>Unique provider   Design  </li></ul><ul...
Reframe the Need © zen@acmedx.com <ul><li>A better method to  </li></ul><ul><li>revascularize the heart </li></ul><ul><ul>...
Disease has Process & Timeline Different Interventions in Lifecycle <ul><li>Match the clinician intervention to disease st...
Feedback Loop Shortcuts <ul><li>Shorten the time between  </li></ul><ul><li>diagnosis and therapy </li></ul><ul><li>Intrao...
Ride Down the Cost Curve <ul><li>Cheaper, Faster, Single-Use </li></ul><ul><li>Minimum efficient manufacturing scale </li>...
Simplify Unknowns & Process <ul><li>Cell therapies & tissue engineering </li></ul><ul><ul><li>Autologous vs allograft econ...
Import Solutions <ul><li>Find publications & therapies  </li></ul><ul><li>outside USA with rigorous human efficacy data </...
Value =  Efficacy  Invasiveness^2  <ul><li>Win with same efficacy, less invasive </li></ul><ul><li>Natural orifice tranlum...
Identify Opportunity from Off-Label Usage © zen@acmedx.com
Conclusion It’s not brain surgery © zen@acmedx.com
Innovation is Spark… but Development drives Value <ul><li>Approach clinical innovation empirically </li></ul><ul><li>Prior...
See One, Do One, Teach One <ul><li>Entrepreneurship can be learned </li></ul><ul><li>Innovation Grand Rounds needed </li><...
Panel Discussion <ul><li>Richard Anders </li></ul><ul><ul><li>Cofounder - LaunchPad, Still River Fund  </li></ul></ul><ul>...
Backup Materials
Helpful Reading & Resources <ul><li>MEDICAL INNOVATION: </li></ul><ul><li>Ferrari, Richard.  Keys to Creating Value for Ea...
Accelerated Medical Ventures  Lean Team, Focused Process, Alignment of Purpose © zen@acmedx.com <ul><li>Rational Device De...
Accelerated Med Venture Process <ul><li>Market & Clinical Drivers </li></ul><ul><li>Market opportunities, driving trends <...
Clinical Opportunity Evaluation <ul><li>Clinical Merit & Adoption </li></ul><ul><ul><li>Current therapies </li></ul></ul><...
Typical Early-Stage Medical Failure Non-optimal Design Process, Clinical Focus <ul><li>Technology-focused origin => Soluti...
Zen Chu <ul><li>Founder, Accelerated Medical Ventures </li></ul><ul><ul><li>Early-stage medical investor & accelerator </l...
High Impact Clinical Innovation Course © zen@acmedx.com
High Impact Clinical Innovations Course <ul><li>Landscape of Medical Innovation </li></ul><ul><ul><li>How clinicians, gran...
Efficiently Training MD/VCs Key to Identifying & Scaling Innovation <ul><li>Creating MD/VCs: 3 Apprentice-based Groups Mus...
Why Now, Why Boston? <ul><li>Fantastic Boston Medical Resources </li></ul><ul><li>Huge denominators in most metrics </li><...
Sources of Critical Feedback <ul><li>BOSTON INSTITUTIONS </li></ul><ul><li>Center for the Integration of Medicine & Innova...
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CIMIT High Impact Innovations 2008

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CIMIT High Impact Innovations 2008

  1. 1. High-Impact & High Value Medical Innovation Zen Chu CIMIT Forum Harvard Medical School Beth Israel Deaconess Medical Center © zen@acmedx.com
  2. 2. Discipline of Clinical Innovation <ul><li>Physician/inventor & role on the team </li></ul><ul><li>Innovation landscape </li></ul><ul><li>High-impact innovation </li></ul><ul><li>Matching opportunity to funding and teams </li></ul><ul><li>Disciplined development process </li></ul><ul><li>Techniques for clinical innovation </li></ul><ul><li>Panel discussion & examples </li></ul>© zen@acmedx.com
  3. 3. Innovation without Impact is Worthless <ul><li>“ Unmet Clinical Needs” </li></ul><ul><ul><li>Cliché, not useful metric </li></ul></ul><ul><li>“ Translational Medicine” must </li></ul><ul><li>strive to become Standard of Care </li></ul>© zen@acmedx.com
  4. 4. High Impact Innovation © zen@acmedx.com
  5. 5. Clinician Innovators Critical to Medical Technology <ul><li>22% of surgeons innovate - von Hippel, 2003 </li></ul><ul><li>Physician-invented = higher impact - Chatterji, 2008 </li></ul><ul><li>99/100 top Medtronic products originated by MDs </li></ul>© zen@acmedx.com Anticipate Path Standard of Care
  6. 6. Why MDs Must Innovate <ul><li>False argument that Big Opportunities already identified & tried </li></ul><ul><ul><li>99/100 Top medical products invented by practicing physicians (Medtronic) </li></ul></ul><ul><ul><li>Think of big companies as funders of large clinical studies, tech integrators, manufacturers, regulatory & sales machines </li></ul></ul><ul><ul><li>Not efficient at identifying and testing clinical gaps </li></ul></ul><ul><ul><li>Very high market opportunity thresholds of $100+MM </li></ul></ul><ul><li>Need for Clinician Innovators </li></ul><ul><ul><li>Evidence: Invent most important new products </li></ul></ul><ul><ul><li>Understand clinician frustrations, untreatable segments, adoption </li></ul></ul><ul><ul><li>Largest cost component of Healthcare = Physician & Facilities </li></ul></ul><ul><ul><li>Critical User & Recommender, under pressure to solve quickly </li></ul></ul><ul><ul><li>Efficacy and patient care paramount </li></ul></ul><ul><ul><li>Invention includes reapplying existing therapies in new ways </li></ul></ul>© zen@acmedx.com
  7. 7. Physician’s View of Value © zen@acmedx.com Time Market Introduction FDA Approval Patent grant First in Man Animal testing Patent disclosure Prototype/Reduction to Practice Idea Milestones Value Conflicts of Interest perceived & real Hand off to Licensing office
  8. 8. Investor’s View of Value © zen@acmedx.com Value Time Milestones Acquisition/IPO Exit Reimbursement Published clinical results Market Introduction Salesforce hired Europe & Japan distribution FDA Approval Manufacturing ramp Human pivotal study Corporate partnership First human data First Hiccup & Danger of Momentum Loss Management team hired Pilot manufacturing Patent grant First FDA meeting Regulatory opinions CEO hired Animal testing Clinician feedback Patent disclosure Prototype/Reduction to Practice Market Analysis Idea Anticipate Potential Exits
  9. 9. Which Risks to Prioritize? Value Time Market Risk Reimbursement Physician & Patient Adoption Packaged Solutions Regulatory Risk Safety & Efficacy Management Risk Technology Risk © zen@acmedx.com
  10. 10. Which Risks to Prioritize? Value Time Market Risk Reimbursement Physician & Patient Adoption Packaged Solutions Regulatory Risk Safety & Efficacy Management Risk Technology Risk Largest Risks Must Be Addressed & De-Risked Up Front Before Funding Team, VCs & Partners Manage These Risks © zen@acmedx.com
  11. 11. Myth of the Lone Inventor <ul><li>Initial invention & patent is only 1 st step </li></ul><ul><li>Value created far beyond lab or operating room </li></ul><ul><li>Success takes Team, Experience, Focus </li></ul><ul><ul><li>Partnership toward common goals </li></ul></ul><ul><ul><li>10,000 ways to fail if mismatched </li></ul></ul><ul><li>“ I have not failed. I've just found 10,000 ways that won't work.” - Thomas Edison </li></ul>© zen@acmedx.com
  12. 12. “ Physicians and engineers often have no sense of the requirements to create a company…In a start up environment, more is not always better. Hiring the appropriate people at the right time can determine success or failure.” - Thomas Fogarty, MD – Founder & investor in over 30 medical companies Professor of Surgery, Stanford University © zen@acmedx.com
  13. 13. Building Teams <ul><li>What’s your desired role? </li></ul><ul><ul><li>Understand own strengths & weaknesses </li></ul></ul><ul><li>Match milestones to right people & skills </li></ul><ul><li>Choose & pay for the best people </li></ul><ul><ul><li>Analytical, revisit assumptions </li></ul></ul><ul><ul><li>Honesty amid new information </li></ul></ul><ul><ul><li>Agile of mind & adaptable </li></ul></ul><ul><li>View Board & Investors as Partners </li></ul><ul><li>Maintain focus </li></ul>© zen@acmedx.com
  14. 14. Cultural Barriers to Med Innovation <ul><li>Interdisciplinary collaboration takes extra effort </li></ul><ul><li>Culture of Academic & Clinical Research </li></ul><ul><ul><li>Grant treadmill and publishing mentality </li></ul></ul><ul><ul><li>Leads to secrecy, slow progress </li></ul></ul><ul><ul><li>Defining Conflicts of Interest too broadly (Stossel, NEJM 2005) </li></ul></ul><ul><li>Fear of Failure </li></ul><ul><ul><li>Better to fail quickly and learn faster </li></ul></ul><ul><li>Experimental Model Bias </li></ul><ul><ul><li>Human data of efficacy paramount </li></ul></ul><ul><ul><li>Only use predictive animal models that FDA accepts </li></ul></ul><ul><li>Physician’s acceptance of current Standards of Care </li></ul><ul><li>Overvaluing initial Intellectual Property & Patents </li></ul>© zen@acmedx.com
  15. 15. Development Best Practice © zen@acmedx.com Value Time Milestones Acquisition/IPO Exit Published clinical results Market Introduction Salesforce hired Europe & Japan distribution FDA Approval Manufacturing ramp Human pivotal study Corporate partnership First Hiccup & Momentum Loss Management team hired Pilot manufacturing Patent grant First FDA meeting Regulatory opinions CEO hired Animal testing Clinician feedback Patent disclosure Prototype/Reduction to Practice Market Analysis Idea 2) Hire team & Execute 1) Plan in Reverse
  16. 16. Traction for New Technology <ul><li>Best to start with clinical need, but… </li></ul><ul><li>Many start with new technology and look for applications </li></ul><ul><li>Beware of inventor bias and blinders </li></ul><ul><li>Map tech advantages to clinical apps </li></ul><ul><ul><li>Key sustainable advantages </li></ul></ul><ul><ul><li>Clinical trends that will drive adoption </li></ul></ul><ul><ul><li>Beware learning curves, adoption barriers </li></ul></ul>© zen@acmedx.com
  17. 17. Innovation Landscape <ul><li>“ If you don’t know where you are going, you might end up someplace else.” - Yogi Berra - </li></ul>© zen@acmedx.com
  18. 18. Innovation Landscape Match Resources to Opportunity Size <ul><ul><ul><li>Market Size of Opportunity </li></ul></ul></ul>Low Capital Required High Big Opportunities Complex Solutions, Fragmented Services Philanthropy/NIH Basic Research Unknown Mechanisms $100MM $500MM © zen@acmedx.com Large Established Companies Venture-Backed Companies Focused Teams to Prioritize, Execute Equity Discrete Product Product-Line Extensions License or Product Acq Royalties
  19. 19. Innovation Landscape Adapt New Info to Larger Opportunities <ul><ul><ul><li>Market Size of Opportunity </li></ul></ul></ul>Low Capital Required High Big Opportunities Complex Solutions, Fragmented Services Philanthropy/NIH Basic Research Unknown Mechanisms $100MM $500MM © zen@acmedx.com Large Established Companies May Discover New Applications & Technologies Venture-Backed Companies Focused Teams to Prioritize, Execute Equity Discrete Product Product-Line Extensions License or Product Acq Royalties May Discover New Larger Opportunities
  20. 20. Innovation Landscape Match Resources to Opportunity Size Philanthropy/NIH Basic Research Unknown Mechanisms Gates Foundation Off-Label Uses Ortho Lumbar Disc <ul><ul><ul><li>Market Size of Opportunity </li></ul></ul></ul>Low Capital Required High Big Opportunities Complex Solutions, Fragmented Services $100MM $500MM © zen@acmedx.com Stem Cells RNAi for AMD Cystic Fibrosis Ischemic Stroke Gastric Bypass Unfocused & Requires Segmentation Aortic Abdominal Aneurysm
  21. 21. Incremental vs Breakthrough © zen@acmedx.com METRIC INCREMENTAL BREAKTHROUGH Funding $$ $$$$$$ Market Size Varies depending on funding needed >$500MM No current therapies Time Needed Adoption & Exit Shorter Match opportunity to strategy Longer Regulatory path dependent Value @ Exit Less More Major Risks Window of opportunity Execution quality & critical path Competition Technical/Clinical unknowns Market adoption hurdles Reimbursement Success Factors Focused execution Management experience Manufacturing economics Patents, Franchise Value Market adoption, Std of Care Investor expectations Patent Protection Less More Competition More Less
  22. 22. Valuable Incremental Products <ul><li>Huge companies built on incremental innovations </li></ul><ul><li>Fast followers can succeed </li></ul><ul><li>Fill existing company’s product line in </li></ul><ul><li>hot strategic areas </li></ul><ul><li>Match best mode, milestones & resources </li></ul><ul><li>Creating a company may doom product </li></ul>© zen@acmedx.com
  23. 23. Time is Life © zen@acmedx.com ACCELERANT DECCELERANT REGULATORY Device 510(k) Predictive animal models New materials & claims Unclear endpoints CLINICAL Existing human data Reproducible published studies Non-superiority Entrenched behavior No practice benefit REIMBURSEMENT Existing Codes DRGs Private-pay, consumer Cost-Benefit Studies MARKET Reduce skills needed Physician buying power Unambiguous diagnostic Capital equipment purchase SALES Focused physician popul. Existing distribution Learning curves Entrenched behavior
  24. 24. Accelerants Amplify Clinical Impact & Return on Investment © zen@acmedx.com Value Cashflow Time Milestones $0 COMPRESS TIME TO MARKET FASTER CURES
  25. 25. Techniques to Identify New Opportunities <ul><li>“ To have a great idea, have a lot of them.” </li></ul><ul><ul><ul><ul><li>Thomas Edison </li></ul></ul></ul></ul>© zen@acmedx.com
  26. 26. Simply put “Interventional” in the name <ul><li>Apply interventional techniques to a sleepy discipline </li></ul><ul><li>Empower an aggressive specialty to disrupt another specialty </li></ul><ul><li>Interventional pulmonology </li></ul><ul><li>Interventional podiatry? </li></ul>© zen@acmedx.com
  27. 27. © zen@acmedx.com Michael Porter, tiesberg Economics drive innovation to interventions
  28. 28. Opportunities from Wider View Surgical Procedure Example <ul><li>Narrow View </li></ul><ul><li>Implant choice </li></ul><ul><li>Surgical prep </li></ul><ul><li>Access </li></ul><ul><li>Fixation </li></ul><ul><li>Closure </li></ul><ul><li>Broader Analysis </li></ul><ul><li>Diagnostic </li></ul><ul><li>Procedure venue </li></ul><ul><li>Surgical tool or implant </li></ul><ul><li>Easier customization </li></ul><ul><li>Intraoperative feedback </li></ul><ul><ul><li>Confirmation of efficacy </li></ul></ul><ul><li>Easier revision, tuning </li></ul><ul><li>Re-use service </li></ul>© zen@acmedx.com
  29. 29. Productize the Procedure <ul><li>Turn medical service/procedure </li></ul><ul><li>into a repeatable product </li></ul><ul><li>Efficacious, simpler, quicker, less skill </li></ul><ul><li>Stomach stapling to Lap-Band </li></ul>© zen@acmedx.com
  30. 30. Remove Treatment Ambiguity <ul><li>Anticipate or create the Standard of Care </li></ul><ul><li>Definitive diagnostics </li></ul><ul><li>Procedure choice </li></ul><ul><li>Implant & tool choice </li></ul><ul><li>Quicker learning curves </li></ul><ul><li>Effectiveness of intervention </li></ul><ul><li>Recovery and maintenance </li></ul><ul><li>Surgical revision rates </li></ul>© zen@acmedx.com
  31. 31. Driving Solutions & Costs Down Healthcare Value Chains <ul><li>Point of Care </li></ul><ul><li>General Hospitals </li></ul><ul><li>Out-Patient Facilities </li></ul><ul><li>In-Office Care </li></ul><ul><li>In-Home Care </li></ul><ul><li>Provider </li></ul><ul><li>Specialists </li></ul><ul><li>General Physician </li></ul><ul><li>Nurse Practitioners </li></ul><ul><li>Self-Care </li></ul>© zen@acmedx.com Improves reimbursement economics Convenience, simpler use Complexity of diagnosis & Treatment Christensen Seeing What’s Next, 2004
  32. 32. Eliminate A Provider or Facility Heresy! <ul><li>Reduces procedure costs </li></ul><ul><li>Accelerate payor approvals </li></ul><ul><li>Creates economic headroom </li></ul><ul><li>Examples </li></ul><ul><ul><li>Office procedure no anesthesiologist </li></ul></ul><ul><ul><li>no operating room, quicker </li></ul></ul><ul><ul><li>Posterior lumbar no vascular access surgeon </li></ul></ul>© zen@acmedx.com Facility Fee Device Cost
  33. 33. Compete at the Consumption Void <ul><li>Unique venue Different </li></ul><ul><li>Unique provider Design </li></ul><ul><li>Requirements </li></ul><ul><li>Cleveland Clinic satellite cardio centers </li></ul><ul><li>Spa/Cosmetic centers </li></ul><ul><li>Condom catheter for home/self care </li></ul><ul><li>Diagnostic nutritionists as referral channel </li></ul>© zen@acmedx.com
  34. 34. Reframe the Need © zen@acmedx.com <ul><li>A better method to </li></ul><ul><li>revascularize the heart </li></ul><ul><ul><li>- Thomas Krummel, MD </li></ul></ul><ul><ul><li> Chief of Surgery, Stanford Medical Center </li></ul></ul>
  35. 35. Disease has Process & Timeline Different Interventions in Lifecycle <ul><li>Match the clinician intervention to disease state at that particular stage </li></ul><ul><ul><li>Prevention </li></ul></ul><ul><ul><li>Early Presentation & definitive diagnosis </li></ul></ul><ul><ul><li>Full-blown disease & active intervention </li></ul></ul>© zen@acmedx.com
  36. 36. Feedback Loop Shortcuts <ul><li>Shorten the time between </li></ul><ul><li>diagnosis and therapy </li></ul><ul><li>Intraoperative imaging </li></ul><ul><li>Rapid diagnostics </li></ul><ul><li>Customizable implants </li></ul>© zen@acmedx.com
  37. 37. Ride Down the Cost Curve <ul><li>Cheaper, Faster, Single-Use </li></ul><ul><li>Minimum efficient manufacturing scale </li></ul><ul><ul><li>Modify outside technologies to jump onto another cost curve </li></ul></ul><ul><ul><li>Leverage Moore’s Law for software/hardware performance </li></ul></ul>© zen@acmedx.com
  38. 38. Simplify Unknowns & Process <ul><li>Cell therapies & tissue engineering </li></ul><ul><ul><li>Autologous vs allograft economics </li></ul></ul><ul><ul><li>Complex & unknown mechanisms </li></ul></ul><ul><ul><li>Host tissue integration </li></ul></ul><ul><ul><li>Genzyme Carticel economic failure </li></ul></ul><ul><li>Reframe: View cells as biologic depots </li></ul><ul><ul><li>JNJ Growth factor concentrator </li></ul></ul><ul><ul><li>Bedside autologous therapy via Device Model </li></ul></ul>© zen@acmedx.com
  39. 39. Import Solutions <ul><li>Find publications & therapies </li></ul><ul><li>outside USA with rigorous human efficacy data </li></ul><ul><li>Ortho implants from Eastern Europe </li></ul><ul><li>Embolic protection studies in EU </li></ul>© zen@acmedx.com
  40. 40. Value = Efficacy Invasiveness^2 <ul><li>Win with same efficacy, less invasive </li></ul><ul><li>Natural orifice tranluminal endoscopic surgery (NOTES) </li></ul><ul><li>Intuitive Surgical, robotic surgical tools </li></ul><ul><li>Lithotripsy obviate kidney stone surgery </li></ul>© zen@acmedx.com
  41. 41. Identify Opportunity from Off-Label Usage © zen@acmedx.com
  42. 42. Conclusion It’s not brain surgery © zen@acmedx.com
  43. 43. Innovation is Spark… but Development drives Value <ul><li>Approach clinical innovation empirically </li></ul><ul><li>Prioritize efforts in the landscape </li></ul><ul><ul><li>Map entire value chain & risks </li></ul></ul><ul><ul><li>Align opportunity to funding and teams </li></ul></ul><ul><ul><li>Analyze the economics to </li></ul></ul><ul><ul><li>optimize impact & value </li></ul></ul>© zen@acmedx.com
  44. 44. See One, Do One, Teach One <ul><li>Entrepreneurship can be learned </li></ul><ul><li>Innovation Grand Rounds needed </li></ul><ul><ul><li>Identify & train MDs to think like VCs </li></ul></ul><ul><ul><li>MIT $100K Competition Medical Track </li></ul></ul>Zen @ acmedx.com
  45. 45. Panel Discussion <ul><li>Richard Anders </li></ul><ul><ul><li>Cofounder - LaunchPad, Still River Fund </li></ul></ul><ul><li>Zen Chu </li></ul><ul><ul><li>Cofounder - 3DM Inc, AcMedX </li></ul></ul><ul><li>Robert Creeden </li></ul><ul><ul><li>Managing Director, Partners Healthcare Center for Innovative Ventures </li></ul></ul><ul><li>David Milne </li></ul><ul><ul><li>General Partner, SV Life Science Advisors </li></ul></ul><ul><ul><li>Former VP, Corp Business Dev, Boston Scientific </li></ul></ul><ul><li>Thomas Stossel, MD </li></ul><ul><ul><li>Harvard Medical School Professor </li></ul></ul><ul><ul><li>Co-Director, Hematology, BWH </li></ul></ul>
  46. 46. Backup Materials
  47. 47. Helpful Reading & Resources <ul><li>MEDICAL INNOVATION: </li></ul><ul><li>Ferrari, Richard. Keys to Creating Value for Early-Stage Medical Device Companies . In Vivo: The Business & Medicine Report, 2005. 20 (10) </li></ul><ul><li>Pisano, Gary. Science Business: The Promise, The Reality, and The Future of Biotech. 2006, Harvard Business Review Press. </li></ul><ul><li>Stossel, Thomas. Regulating Academic–Industrial Research Relationships — Solving Problems or Stifling Progress? New England Journal of Medicine, 2005. 353: 1060-65. </li></ul><ul><li>Center for Accelerating Medical Solutions. Investing in Innovation: Accelerating Disease Research Through Philanthropy and Business. www.fastercures.org , 2005. </li></ul><ul><li>Community Wealth Partners. Venture Philanthropy 2002: Advancing Nonprofit Performance Through High-Engagement Grantmaking. www.vppartners.org , 2002. </li></ul><ul><li>GENERAL HIGH TECH STRATEGY: </li></ul><ul><li>Chesbrough, Henry. Open Business Models . 2006, Harvard Business School Press. </li></ul><ul><li>Christensen, Clayton. The Innovator’s Dilemma . 1997, Harvard Business School Press. </li></ul><ul><li>Christensen, Clayton, et al . Seeing What’s Next . 2004, Harvard Business School Press. </li></ul><ul><li>Megantz, Robert. How to License Technology . 1996, John Wiley & Sons. </li></ul><ul><li>Moore, Geoffrey. Crossing the Chasm . 1991, HarperCollins. </li></ul><ul><li>Porter, M. and Teisberg, E. Redefining Healthcare: Creating Value-Based Competition on Results . 2006, Harvard Business School Press. </li></ul>© zen@acmedx.com
  48. 48. Accelerated Medical Ventures Lean Team, Focused Process, Alignment of Purpose © zen@acmedx.com <ul><li>Rational Device Design Process </li></ul><ul><li>Market opportunities, driving trends </li></ul><ul><li>Clinical needs, gaps, undertreated </li></ul><ul><li>Favor Accelerated Regulatory Path </li></ul><ul><ul><li>Actively engage FDA feedback early </li></ul></ul><ul><ul><li>Clinical endpoints, clear & quick, for downstream claims and sales support </li></ul></ul><ul><ul><li>Human clinical data ASAP if needed </li></ul></ul><ul><li>File & Source Intellectual Property </li></ul><ul><ul><li>Sophisticated mapping & filing of IP </li></ul></ul><ul><li>Choose technology & engineers later </li></ul><ul><ul><li>Only after clinical needs, approach, predicates specified </li></ul></ul><ul><li>Prototypes for quick feedback & testing </li></ul><ul><li>Design for manufacturing & scale issues </li></ul><ul><li>Right Team, Properly Aligned, Working Quickly </li></ul><ul><li>Rational Portfolio Approach </li></ul><ul><ul><li>Products vs. Company analysis </li></ul></ul><ul><ul><li>Spin out companies with plan, early data, clinical plans, rapid funding, ramp team </li></ul></ul><ul><li>Driven by entrepreneurs & VCs </li></ul><ul><ul><li>Closely participating VC, early alignment </li></ul></ul><ul><ul><li>Large funds avoid EIR costs from mgmnt fees </li></ul></ul><ul><ul><li>Deep pockets to fund, build team quickly, but only when & where appropriate </li></ul></ul><ul><li>Multidimensional MDVC Clinician Advisors </li></ul><ul><ul><li>10+ MDs specific to Project/Company/Domain </li></ul></ul><ul><ul><li>Recruit multiple clinical design perspectives </li></ul></ul><ul><ul><li>Meaningful early-stage feedback </li></ul></ul><ul><li>Virtual Organizations For Each Project </li></ul><ul><ul><li>Anti-Incubator - Not a real estate play! </li></ul></ul><ul><ul><li>Co-locate with VCs for ideaflow, alignment </li></ul></ul><ul><ul><li>Outsource labs, testing, prototyping, regulatory </li></ul></ul><ul><ul><li>No obligation/mis-incentive to create companies </li></ul></ul>
  49. 49. Accelerated Med Venture Process <ul><li>Market & Clinical Drivers </li></ul><ul><li>Market opportunities, driving trends </li></ul><ul><ul><li>Existing solutions & problems </li></ul></ul><ul><ul><li>Physician and patient critical needs </li></ul></ul><ul><ul><li>Initial sub-segments to drive adoption </li></ul></ul><ul><ul><li>Map competitors & potential exits </li></ul></ul><ul><ul><li>Critical development & distribution partners </li></ul></ul><ul><li>Maximum clinical impact & use scenarios </li></ul><ul><ul><li>Clinical frustrations with std of care </li></ul></ul><ul><ul><li>Faster/Better/Cheaper metrics </li></ul></ul><ul><ul><li>Segmentation of undertreated/Inability to treat </li></ul></ul><ul><ul><li>Source clinical advisors & indep. champions </li></ul></ul><ul><ul><li>Sales model and doctor/patient targets </li></ul></ul><ul><ul><li>Clinical trials endpoints to drive adoption </li></ul></ul><ul><ul><li>Patient recruitment issues </li></ul></ul><ul><li>Initial Regulatory Path </li></ul><ul><ul><li>Existing safety & efficacy data </li></ul></ul><ul><ul><li>Clinical endpoints, clear & quick, for downstream claims and sales support </li></ul></ul><ul><ul><li>Clear predicates </li></ul></ul><ul><ul><li>FDA feedback & path to human clinical data </li></ul></ul><ul><li>Patents & Reduction to Practice </li></ul><ul><li>Whole solution mapping </li></ul><ul><ul><li>Tools, implants, techniques, materials </li></ul></ul><ul><ul><li>Critical 3 rd parties & existing products </li></ul></ul><ul><ul><li>Blank sheet design inputs </li></ul></ul><ul><ul><li>Essential new IP, in-licensing </li></ul></ul><ul><ul><li>Platform & franchise value of this idea </li></ul></ul><ul><li>Prototypes for quick feedback & testing </li></ul><ul><ul><li>Existing primary human & animal data </li></ul></ul><ul><ul><li>Predictive & accepted animal models </li></ul></ul><ul><ul><li>Existing papers identifying design requirements </li></ul></ul><ul><li>File & Source Intellectual Property </li></ul><ul><ul><li>Sophisticated mapping & filing of IP </li></ul></ul><ul><ul><li>Prior art and FTO search </li></ul></ul><ul><ul><li>Plug holes </li></ul></ul><ul><li>Design for manufacturing & scale issues </li></ul>© zen@acmedx.com
  50. 50. Clinical Opportunity Evaluation <ul><li>Clinical Merit & Adoption </li></ul><ul><ul><li>Current therapies </li></ul></ul><ul><ul><li>Untreatable problems & populations, sub-segments </li></ul></ul><ul><ul><li>Prevalence vs. incidence & other objective metrics of clinical need </li></ul></ul><ul><ul><li>Independent clinical champions </li></ul></ul><ul><li>Stage of Development </li></ul><ul><ul><li>Reduced to practice </li></ul></ul><ul><ul><li>Prototypes, animal data </li></ul></ul><ul><ul><li>Human data </li></ul></ul><ul><ul><li>Manufacturing feasibility and economics </li></ul></ul><ul><li>Commercial Potential </li></ul><ul><ul><li>Defined product, market size, procedures </li></ul></ul><ul><ul><li>Time to market, regulatory pathway, reimbursement </li></ul></ul><ul><ul><li>Interim milestones and risks </li></ul></ul><ul><li>Protection & Competition </li></ul><ul><ul><li>Patent & prior art search </li></ul></ul><ul><ul><li>Public disclosure, scope of protection, FTO </li></ul></ul><ul><ul><li>Natural product line extensions, product/procedure cannibalization </li></ul></ul>© zen@acmedx.com
  51. 51. Typical Early-Stage Medical Failure Non-optimal Design Process, Clinical Focus <ul><li>Technology-focused origin => Solution looking for a clinical problem </li></ul><ul><ul><li>Wedded to technology, scientific & engineering bias among founders </li></ul></ul><ul><li>Initial patents filed prematurely </li></ul><ul><ul><li>Tech focused rather than clinical approach </li></ul></ul><ul><ul><li>Prior art poorly mapped & early IP overvalued </li></ul></ul><ul><li>Funding raised, paths & milestones committed, expectations set </li></ul><ul><li>Regulatory path not mapped </li></ul><ul><ul><li>Consultant opinion, but little FDA feedback </li></ul></ul><ul><ul><li>Clinical endpoints and patient recruitment either too slow or not clear </li></ul></ul><ul><ul><li>Lack of predictive & robust animal models </li></ul></ul><ul><li>Clinical feedback not complete </li></ul><ul><ul><li>Clinical need, economics, practice implications, design prototypes </li></ul></ul><ul><ul><li>Solution not matched to expedited proof and approval paths </li></ul></ul><ul><li>Clinical Advisors not matched with staged milestones </li></ul><ul><ul><li>Too late to give meaningful feedback on chosen roadmap </li></ul></ul><ul><ul><li>Feedback doesn’t impact design modifications </li></ul></ul><ul><ul><li>Respected names promoted, but feedback mismatched to stage </li></ul></ul><ul><ul><li>Advisors used in early development dropped later for clinical phases </li></ul></ul>© zen@acmedx.com
  52. 52. Zen Chu <ul><li>Founder, Accelerated Medical Ventures </li></ul><ul><ul><li>Early-stage medical investor & accelerator </li></ul></ul><ul><li>CEO & Co-founder, 3DM Synthetic Regenerative Biomaterials </li></ul><ul><ul><li>Equal co-founder with MIT Faculty Shuguang Zhang, Alex Rich, Bob Langer, Alan Grodzinsky </li></ul></ul><ul><ul><li>Bootstrapped business, licensed IP portfolio from MIT, drove pre-clin data, FDA feedback </li></ul></ul><ul><ul><li>Raised venture capital from Bain Capital Angels, Monitor Ventures </li></ul></ul><ul><ul><li>Collaborations with Boston Scientific, Medtronic, J&J/DePuy, Genzyme, among others </li></ul></ul><ul><ul><li>Worldwide license & partnership with Becton Dickinson for cell culture reagent </li></ul></ul><ul><ul><li>Acquired 11/2007 by NMJ Capital (Japan) to fund human clinical trials (2008), licensing </li></ul></ul><ul><li>Partner, NetVentures </li></ul><ul><ul><li>Early-stage firm founded by Adam Kirsch, co-founder of Bain Capital </li></ul></ul><ul><ul><li>Seed funded 3DM and a number of early-stage technology companies </li></ul></ul><ul><li>Founder & Director, HPGarage, Hewlett Packard </li></ul><ul><ul><li>HP’s new technology ventures group across business units and HP Labs </li></ul></ul><ul><ul><li>Venture capital partnerships to quickly add value to portfolio companies </li></ul></ul><ul><ul><li>Increased sensitivity to investment trends, new technologies, internal metrics </li></ul></ul><ul><ul><li>Participated in 1st ever spinout from HP, TimesTen Software </li></ul></ul><ul><li>Biomedical Analyst, MD Buyline </li></ul><ul><ul><li>Largest subscription service for quality & service ratings of medical device manufacturers </li></ul></ul><ul><li>Education </li></ul><ul><ul><li>MBA, Yale University School of Management </li></ul></ul><ul><ul><li>BS Biomedical/Electrical Engineering, Southern Methodist University </li></ul></ul><ul><ul><li>NVCA / Kauffman Venture Capital Institute </li></ul></ul>© zen@acmedx.com
  53. 53. High Impact Clinical Innovation Course © zen@acmedx.com
  54. 54. High Impact Clinical Innovations Course <ul><li>Landscape of Medical Innovation </li></ul><ul><ul><li>How clinicians, grant research, philanthropy, start-ups, venture capital, large med-tech & pharma companies prioritize innovation differently </li></ul></ul><ul><ul><li>Matching invention to appropriate funding source </li></ul></ul><ul><li>Patterns of the Highest Impact Clinical Innovations </li></ul><ul><ul><li>Common attributes and best practices for proving efficacy & accelerating adoption </li></ul></ul><ul><ul><li>Segmenting & Prioritizing Patients & Providers </li></ul></ul><ul><ul><li>Example inventions, retooling techniques </li></ul></ul><ul><li>Transitioning from Research to Development </li></ul><ul><ul><li>Team-building & roles for inventors, clinicians, entrepreneurs </li></ul></ul><ul><ul><li>Identifying and Solving Conflicts of Interest </li></ul></ul><ul><ul><li>Milestones & common pitfalls on the roadmap to patient treatment </li></ul></ul><ul><li>Toolbox for Innovation & Accelerating Clinical Adoption </li></ul><ul><ul><li>Techniques for analyzing current care, care gaps & business models </li></ul></ul><ul><ul><li>Tailoring venture models, Christensen, Porter, Moore’s Chasm and other techniques to medical innovation and clinical adoption </li></ul></ul><ul><li>Team sessions & case studies </li></ul>Strategies for clinicians and medical inventors to maximize adoption and clinical impact of new products & services © zen@acmedx.com
  55. 55. Efficiently Training MD/VCs Key to Identifying & Scaling Innovation <ul><li>Creating MD/VCs: 3 Apprentice-based Groups Must Intersect </li></ul><ul><ul><li>MDs, VCs, med tech entrepreneurs skillsets tough to scale </li></ul></ul><ul><ul><li>Efficient cross-pollination will enable innovation of the correct solutions </li></ul></ul><ul><ul><li>Apprenticeship must address medical & business domains </li></ul></ul><ul><ul><li>Improving interaction & sophistication pays dividends to all involved </li></ul></ul><ul><li>MDs Must Innovate Economically Viable Solutions </li></ul><ul><ul><li>Scalability : Best way to benefit society beyond physician’s own hands </li></ul></ul><ul><ul><li>Economics : Commercial realities must be addressed for wide impact </li></ul></ul><ul><ul><li>De-Risk Ideas Early : MD Adoption, Substitution, Regulatory, Economic, Design </li></ul></ul><ul><ul><li>Timeframe : Simple focused ideas often yield greater impact, both short & long term </li></ul></ul><ul><ul><li>Institutional Benefit : MD staff creates royalty stream for institution </li></ul></ul><ul><li>Focus on Jr. Faculty & Fellows </li></ul><ul><ul><li>Fresh eyes on the problems, right level of experience </li></ul></ul><ul><ul><li>Aspiration as innovators, greatest segment of frustrated young doctors </li></ul></ul><ul><ul><li>Grant treadmill has not completely handicapped them </li></ul></ul><ul><ul><li>Mentorship by top thought leading VCs and MDs </li></ul></ul>© zen@acmedx.com
  56. 56. Why Now, Why Boston? <ul><li>Fantastic Boston Medical Resources </li></ul><ul><li>Huge denominators in most metrics </li></ul><ul><ul><li>Thought leaders, institutions, grant funding, doctors, OR’s, licensing, entrepreneurs, engineers, VCs </li></ul></ul><ul><li>Over 300K active Physicians have come through Boston institutions </li></ul><ul><li>Over 50 hospital networks and 115K active physicians in New England </li></ul><ul><li>New England highest per capita MD pop </li></ul><ul><li>Medical Devices & Services Ascendant </li></ul><ul><li>Devices as best ROI </li></ul><ul><li>Growing VC experience, investment </li></ul><ul><li>Robust non-reimbursed opportunities </li></ul><ul><li>Improved patient outcomes vs pharma </li></ul><ul><li>Mature companies as distribution partners & exits </li></ul><ul><li>Broken Pharma Model driving capital into med device & services investments </li></ul><ul><li>Boston Underproductive Relative to SV </li></ul><ul><li>Less commercialization than Silicon Valley </li></ul><ul><li>Few vehicles to institutionalize early stage device commercialization </li></ul><ul><li>Vacuum mentoring entrepreneurial physicians </li></ul><ul><li>Complex institutional IP sourcing & licensing </li></ul><ul><li>More conservative VCs than Silicon Valley </li></ul><ul><li>Macro Trends Driving Innovation </li></ul><ul><li>Realization that “Translation” means commercialization </li></ul><ul><li>Aspiring Surgeon Innovators </li></ul><ul><li> Top 99% of Medtronic Innovations from MDs </li></ul><ul><li>Consolidation of Device Companies </li></ul><ul><li>Faster Lifecycle & Moore’s Law Impacting Device Performance & Cost </li></ul><ul><li>Aging Boomers & Consumer-Driven Health </li></ul><ul><li>Healthcare crisis & cost pressures </li></ul>© zen@acmedx.com
  57. 57. Sources of Critical Feedback <ul><li>BOSTON INSTITUTIONS </li></ul><ul><li>Center for the Integration of Medicine & Innovative Technology (CIMIT) </li></ul><ul><li>Robert Langer </li></ul><ul><li>Chiefs of Hospital Departments </li></ul><ul><li>Harvard Medical School </li></ul><ul><li>Harvard-MIT Health Science & Technology Faculty & Advisors </li></ul><ul><li>Harvard Business School Faculty </li></ul><ul><li>Partners Healthcare Ventures </li></ul><ul><li>Tech Licensing Offices </li></ul><ul><li>MIT$100K leadership </li></ul><ul><li>MIT Deshpande Center </li></ul><ul><li>VCs & CORP DEVELOPMENT </li></ul><ul><li>Leading East & West coast med tech VCs </li></ul><ul><li>Med Tech Incubators/Acclerators </li></ul><ul><li>Corporate Venturing groups </li></ul><ul><li>Entrepreneurs on both coasts </li></ul><ul><li>Windhover Publications Editor </li></ul><ul><li>MA Governor’s Life Science Initiative </li></ul><ul><li>OTHER INSTITUTIONS </li></ul><ul><li>Gates Foundation </li></ul><ul><li>Milken Foundation & FasterCures </li></ul><ul><li>Stanford Biodesign </li></ul><ul><li>Stanford Medical School </li></ul><ul><li>Biomedical IDEA Competitions </li></ul><ul><li>Yale University Medical School Faculty </li></ul>© zen@acmedx.com

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