FountainBlue

FountainBlue's Life Science Entrepreneurs' Forum, on the topic of Robotics in MedTech, featuring:

Facilitator Jack Moorman, LeVaunt, LLC

Presenting Entrepreneur Robert Horst, Ph.D., Vice President of R&D & Cofounder, Tibion

Presenting Entrepreneur Mike Ouren, Clinical Development Manager, Restoration Robotics

Presenting Entrepreneur Bruce Richardson, CEO, Accel Biotech

Presenting Entrepreneur Dr. Ramesh C. Trivedi, President, Calbiomed International, Inc.

Please join us in thanking our speakers for taking the time to share their advice and thoughts. Below are notes from the conversation. 

By definition, Robots are devices that automatically perform complicated, often repetitive, tasks or are a mechanism guided by automatic controls. These tasks are ones where human activities are augmented or replaced by automatic or semi-automatic devices. The robotics field can be broken down into areas of body interaction (which would include surgical robots, prosthetics, end-effect robots) Power Source (which includes luggable and fixed robots), Movement Detection (which includes programmed movement and myoelectric), as well as Patient Benefits (which includes vertical wheelchairs, stance control). 

Tibion offers a wearable robotic device for augmenting muscle and balance functions through sensors and software, and represented the movement detection category on our panel. Restoration Robotics, which is developing and commercializing a state-of-the-art image-guided system (ARTAS System) that enables follicular unit extraction and represents the body interaction space, Accel Biotech, which does product development for medical, diagnostic, biodefense and biotech products and represents products from the movement detection, patient benefits and body interaction space and ISS Robodoc, which allows operators to specify a task and the device performs all the actions necessary to complete the task such as drilling a cavity for an implant from CT data, and represents the body interaction space.

Our panelists spoke eloquently both about how they got into the business, for personal and professional reasons, what their companies are doing, as well as the obstacles and opportunities ahead. Below is a summary of advice and comments about the industry overall.

• With the advancement of technologies in software, hardware, mechanical engineering, databases/business intelligence, networks and integration of all, there are many more MedTech opportunities for successful businesses now than ever before.
• With that said, the aging and more affluent global population/potential customer base, and the demand for more versatile, customizable solutions will dramatically increase to serve an ever-growing global market where there are needs for robots to do everything from body interaction to power sourcing to movement detection to patient benefit.
• Entrepreneurs experienced in this area have withstood the financial/economic ebbs and flows of the valley, particularly over the past decade, and seen the rapid rise and fall of technologies-looking-for-a-market. They are best able to see what's next, based on market needs and customer feedback/ demands and are best positioned to leverage existing technologies to serve these needs, many times integrating proven technologies, or applying them in a new way for a new purpose or market.
• Focus more on incremental improvements on proven technologies, for that's far easily to forecast and plan for than disruptive changes, and you're far more likely to encounter disruptive changes if you focus on the incremental ones. In fact, a disruptive change may involve using existing technology in a new way in a new industry rather than inviting a new technology and solution from scratch, which is much less tested, much harder to get adoption and approval and funding and customers.
• Always start with the market need and consider regulatory and reimbursement factors as well as social and cultural issues rather than focus on building the technology and waiting for the patients and doctors to come.
• Design solutions that make therapists more efficient, one that is easy to understand and adopt, one that makes it easier for them to run their clinic as a business.
• Focus on solutions which make sense, and bring patients to caregivers when the need is to specific, too mission-critical. For example, instead of doing remote surgery at a battle site, invest in quickly getting patients to care centers with far more people and resources for customized treatment.
  

Our panelists agreed that there are tremendous opportunities ahead in this space:

• Integrating software engineering, data analytics, medical device production and pharmaceutical research can help accelerate the development of custom treatments for specific patients and needs. Indeed, it can do much more than that!
• There are huge opportunities in applications of robotics in food production, research (to find a more versatile, nutritious corn for example), distribution, treatment, etc.
• Robotics could enable rapid, customized diagnostics, in the near term in the areas of staph infection,
• Industrial robots did not take off in the US, due more to market/people resistance than technology implementation hurdles. As such, widespread adoption industrial robotics solutions is more prevalent outside the US. If we can change the mindset of the users and adopters, we can welcome and adopt industrial robotics solutions, factory automation at a next level, and once again become more competitive in the manufacturing/operations space. If not, we can design further industrial robot automations for international customers and markets.
• Investigate the convergence of cameras (imaging), networks/mobile, data analytics, etc. as it applies to quickly diagnosing and treating patients in an efficient, customized way.
• Investigate how gaming, sensors and augmentation will intersect with robotics and the opportunities therein.
• See where materials science, medtech, data analytics, and robotics intersect and the implications on how we can better serve our patients.
• To find opportunities to apply robotics, look at what repetitive or dangerous tasks should be done efficiently and precisely and how it can be automated in an efficient (time and money) way to an audience (like patients and doctors) who may not embrace technology. It must be simple to understand and use.
• Each of the robotics categories from body interaction to Power Source to Movement Detection to Patient Benefits may all be applied to how robots can support an aging population to assist movement-impaired patients limited through age-related physical degeneration, diseases or congenital limitations:
  • Surgical robots, prosthetics, end-effect robots
  • Luggable and fixed robots
  • Programmed movement and myoelectric
  • vertical wheelchairs, stance control

In the end, complex automation is the key, leveraging technology (software, devices, databases, networks, etc), but it must be integrated into a simple, sustainable solution, easily managed, to serve complex problems for specific users/customers/needs.

FountainBlue's November 14 Life Science Entrepreneurs' Forum was on the topic of Personalized Medicine, Biomarkers, Invitro Diagnostics: The Science Advances, The Business Opportunities, The Cultural Dilemmas, featuring:

Facilitator Audrey S. Erbes, Ph.D., Principal, Erbes & Associates

Panelist Michael Bates, M.D., Vice President, Oncology Research and Development at Cepheid

Panelist Dean Schorno, Chief Financial Officer, Genomic Health

Presenting Entrepreneur Giacomo Vacca, Ph.D., Founder & CEO, Kinetic River

Please join us in thanking our speakers for taking the time to share their advice and thoughts. Below are notes from the conversation. 

We were fortunate to have a wide range of perspectives and experiences on our panel, representing decades of expertise in personalized medicine, biopharma, oncology, infectious diseases, internal medicine, proteomics, and optics. They each spoke eloquently about the evolution of the personalized medicine industry and the opportunities and challenges ahead.

Our panelists are quite bullish about the opportunities in personalized medicine, remarking on the great progress made over the last decade or two, leveraging revolutionary technologies, research and other innovations and success stories from companies such as Cepheid, Genomic Health, Roche and Gilead. As we move from the first generation of non-specific diagnosis focused on treating symptoms (all typical of health care today), we gravitate toward solutions which require information correlation, providing organized therapies targeting those who would be most responsive to them, based on detailed analysis and research prior to treatment, known as translational medicine. Examples of such include digital imaging, genetic predisposition testing, and clinical genomics. The longer-term objectives for personalized medicine might include disease prevention and effective chronic disease management, and might leverage molecular medicine, CA diagnostics, pre-symptomatic treatment and lifetime treatment. (Source: Richard Bakalar, MD, IBM Healthcare and Life Sciences, November 3, 2004.)

Based on a Bernard Associates October 2003 report published in PharmExec.com, the opportunities in personalized medicine might include the following:

• Addressing patients with adverse event risk
• Serving treatment non-responders
• Serving treatment low-responders
• Introducing solutions to market with faster approvals
• Recruiting patients with less effective, more expensive drugs to new treatment
• Increasing use of drugs for diagnosed patients not treated
• Expanding treatments to new diseases and subgroups
• Diagnosing earlier and leveraging preventive treatments
• Enhancing patient compliance
• Securing better reimbursements for best-in-class drugs

Our panelists made the following comments and advice:

• Because of the nature of the industry, personalized medicine is not a sprint, it's a marathon, with opportunities for success for only the most committed and resilient.
• Segmenting the patient base (high/low responders, high/low likelihood of recurrence for example) will provide better treatment for the patients, better data for the practitioners, better results for the payers and insurers alike.
• Making solutions easy for the physicians to use, for patients to take, will increase the overall effectiveness of the treatment.
• Getting quick test results will help doctors more quickly make diagnosis and recommend treatments, and also increase the likelihood that the patients will begin treatment. An example is TB testing which currently may take a week, but may eventually take an hour or two, while the patient is still in the office.
• Educate physicians about how to fold these easy-to-implement solutions into their day-to-day practice cost-effectively, and within reimbursement requirements and regulations.
• Focus on creating actionable testing to striate the patient base and recommend treatments based on patient-specific data.
• Create more cost-effective, more effective alternatives to current traditional treatments to 1) serve a more niche market, or a larger market, 2) save costs for patients and insurers, 3)
• Collaborate with clinicians to create value-based pricing and a more receptive regulatory environment conducive to more effective translational medicine.
• Leverage experts in databases and automated systems who can analyze data and recommend treatments, help research differences and similarities in patient and disease and further the research and effectiveness of personalized medicine overall.
• Research families/chapters of diseases as well as types of patients and their correlations with disease susceptibility, with an eye to prevention and treatment.
• There are huge opportunities around treatment resistance - whether it's a low-responding patient or a patient which develops resistance to treatment over time.
• If it's delayed resistance, make sure that lab data is current, rather than that taken at the onset of treatment.
• With that said, the difference between samples taken at the beginning of treatment and after the resistance has developed might give insights about the disease, the treatment and/or the patient and classes of each.
• Combination therapies might address the needs of low/non responders, or those who have developed resistance following initial treatment.

As the industry evolves, here are some critical questions to consider:

• Will patients be willing to pay higher prices for treatments more specific to their profile?
• Will diagnostics become more valued and more expensive as people begin to recognize the importance of detailed patient data prior to treatment?
• Will pharma continue to the most influential stakeholder?
• How can patient groups, advocacy groups, clinical collaboration groups, insurers, pharma and other stakeholders better collaborate?
• Will it be cost-effective enough to provide conclusive data which physicians would embrace?
• Will physicians have the time and inclination to embrace new diagnostics and personalized treatments? What are some practical financial incentives for them to do so?
• Will payers band together to insist on better diagnostics and more specialized treatment options based on more sophisticated diagnostics? How will payers work with insurers and physicians and others to make this so?
• What is the most efficient way to measure and communicate ROI and overall savings for diagnosis and treatments?
• Who will fund entrepreneurial innovations in this area, and if it's not funded, how will the industry continue to evolve?
• How will global solutions and markets evolve?

Whatever the opportunities and questions ahead, we're in agreement that personalized medicine is not to be swept aside: it is a business opportunity and there is a real need to deliver optimal treatments for patients, and benefit stakeholders across the value chain.

FountainBlue's October 17 Life Science Entrepreneurs' Forum was on the topic of Drug Delivery Innovations and featured:

Facilitator Robert Mackey, Biopharma Consultant

Panelist Richard Haiduck, Impel NeuroPharma

Panelist Matthew Hogan, CFO, Durect

Panelist Jeffrey Schuster, Triple Ring Technologies

Panelist Eric Sheu, Ph.D., Chief Scientific Officer for Vanton Research Laboratory, LLC

Presenting Entrepreneur Adam Mendelsohn, CEO, Nanoprecision Medical

Presenting Entrepreneur Harm Tenhoff, Bay Link LLC

Please join us in thanking our speakers for taking the time to share their advice and thoughts. Below are notes from the conversation. 

We were fortunate to have a range of perspectives on the panel, with a mix of entrepreneurs, researchers, providers, engineers and executives. Everyone's diverse perspectives, thoughts and experience led to a rich, thought-provoking discussion around drug delivery innovations.

The panel commented on some of the hot areas of innovation in the drug delivery space:

• Delivering drugs to difficulty-to-treat areas, including the eye and the brain
• Consider chronic disease treatments and other illnesses which require frequently injection or medical procedure and the opportunity for delivering regular low-dose medication as an alternate to this more invasive approach.
• Provide less-invasive drug delivery mechanisms for the elderly which are more effectively and more convenient.
• Make implants less invasive, more reversible, easier to use and more effective. Same with inhalable and other methods.
• Consider delivering proteins and peptides in novel ways to address specific patient needs for many potential patients.
• Research existing and expired patent on drugs and consider the opportunities for delivering them in a novel way.

• Visualize and realize success, based on understanding the customer and their needs, and delivering it in a way that is both efficient and effective.
• Always start with the problem, not with the solution looking for the problem. If you start with the problem and work backwards from there, you would be more likely to remain customer-focused, a cornerstone of success for any company, particularly early-stage life science/biopharma companies.
• Consider the end-to-end needs of the solution, from the market, design, delivery and manufacturing/distribution perspectives.
• Be selective about which drug you choose for which drug delivery mechanism, considering factors such as market size, optimal delivery mechanisms (and why), stakeholders currently delivering solution, resistance to use and adoption, addictiveness and side-effects of drugs, and innovative alternative drugs (which may get approval, making your solution moot).
• Partner with large pharma companies, who may have limited budgets for internal R&D, but are chartered with creating new solutions, and finding more solutions for existing drugs. They are now in general interested in renting talent and expertise to solve problems in the market, and generally have a prioritized view of which markets are hottest.
• Partner with research organizations and universities, who may share the R&D costs and burden. There may even be existing solutions you can leverage and integrate into your desired solution. But this is not an easy path, so navigate it gingerly, considering the needs of all throughout the process.
• Focus on creating and leveraging value from the customer perspective, not just creative the latest hot technology.
• Consider leveraging existing delivery mechanisms and existing drugs for new purposes and markets.
• Funding is tight, unless you have a proven solution and are past the R&D phase, so focus on leveraging grants, partnerships, seed funding, etc and live leanly while building momentum.
• Optimize the number of 'shots on goal' by being strategic, recruiting the right team, and executing well.
• Select a drug delivery technology that changes the risk-benefit profile for the better.

Although all the panelists commented on the importance of the technology innovations, they were even more vocal about leveraging that technology to best address the needs of the customer, and working with the system and the stakeholders to bring the solution to market. This is a far greater challenge today than in decades past, when there were fewer patents, fewer and less stringent regulatory hurdles, fewer generic options, and larger R&D budgets.

But in the end, despite these challenges, the panel was bullish about the promise of drug delivery innovations, noting that innovations in the new and even established ways drugs are delivered can impact the efficacy and effectiveness of existing drugs and also provide new ways to deliver new and existing drugs, all with an eye to ease of use, needs of the customer, and optimal treatment for the patient.

FountainBlue's September 19 Life Science Entrepreneurs' Forum was on the topic of Emerging Trends in Medical Devices: Mobile Health, Personalized Medicine and Consumerization, and featured:

Facilitator Gil Peterson, VP of Sales, Triple Ring Technologies

Panelist Geetha Rao, PhD, Springborne Life Sciences, CEO and Founder, MyMedFax; Vice President of Strategy and Risk Management, Triple Ring Technologies

Panelist Frank Ingle, CEO and CTO, Instruments for Science and Medicine

Presenting Entrepreneur Bronislava Belenkaya, President and Founder, 3S Corporation

Presenting Entrepreneur Jay Miller, former President and CEO, Zonare Medical Systems & Vital Images, Inc.

Please join us in thanking our speakers for taking the time to share their advice and thoughts. Below are notes from the conversation. 

Our panelists concurred that it's an exciting time to innovate in the medical device space, because of the advancements in technology, rising consumerization and expansion into global markets, and the growing receptiveness of an industry which has historically been slow-moving.

Technology Advancements Enabling Innovation

They remarked on some trends in the medical device space and their implications for the industry. The overarching themes is the advancement of technology and the transference of technology solutions from traditionally other sectors and impacting the medical device industry.

1. There was much discussion around the miniaturization trend, where products which were the size refrigerators are reduced to the size of a microwave, products the size of a microwave reduced to the size of a hand-held, and products formerly the size of a hand-held are getting really small, even nano size. The implication is that products will be manufactured, tested and delivered more efficiently and more cost-effectively.
2. Sensor technologies are being applied to implantables, therapeutic, diagnostic, and other devices.
3. Database solutions are enabling business analytics solutions which address challenges ranging from IT in healthcare to patient diagnostics to personalized medicine.
4. Cloud storage is an enabling technology for business analytics and other database solutions, making it more cost-effective to manage huge volumes of moving data, and empowering fact-based decision-making which impact patients, providers, care-givers, insurers, etc.
5. Advancements in wireless and mobile devices and software are enabling novel diagnostic, monitoring, enabling and other solutions for patients and their caregivers.
6. Technology advancements in biochemical discovery and genetic markers are enabling additional opportunities for medical devices around diagnostics, monitoring, and other areas.

Consumerization and Expansion in Global Markets

Baby boomers in the US will increasingly demand more consumer solutions to better monitor, enable, and support their personal health and well-being, especially given the rising cost of healthcare, the increased needs of an aging population, and the growing range of options available. This techno-philic demographic group will also be receptive to technology-enabled solutions which would deliver the information they seek in a timely manner.

Emerging countries such as Asia, India and Brazil will have an ever-growing, more financially independent middle class with a similar desire to take more control and responsibility for their own health.

Growing Receptiveness and Collaboration Based on Technology Advancements and Market Trends

With technology advancements and rising global demand, our panelists are hopeful that the industry will see more collaboration and cross-pollination between pharma, medical device and medical imaging companies, leveraging software and technology plus more opportunities for getting solutions developed, tested and into the hands of eager users.

With these overarching trends, our panelists had words of wisdom and caution for those innovating in this space:

• Minimize technology development and regulatory and market adoption risks by being strategic and proactive, so think carefully through your regulatory needs and work early and well with the right regulatory bodies and people to help ensure the approval of your product and think strategically about your customer and your markets.
• Whatever your solution, deliver higher-level care at lower cost.
• Sometimes miniaturization may compromise quality. Sometimes that's OK, sometimes that's not, depending on the needs of the customer.
• Innovation is coming from small companies, and small companies with partnerships with larger corporations may get the market, funding, research and other support they need to continue innovating.
• When consider FDA approval, note that the FDA standards require both safety and efficacy, whereas just safety is required in other regulatory bodies. Remember that the FDA approval team itself encourages your communication and wants to get your products approved, but may be locked into a process which makes it difficult.
• We will come to a crossroads and have to decide do we pay more or get less? We can't have both or it will squeeze innovation.

Specific opportunities around medical devices include:

• Leveraging medical devices as a diagnostic, tracking or monitoring or communicating tool, whether it's related to mobile solutions or web or other platforms (e.g. beimmunized.com)
• Monitoring devices that look and act like medical devices but don't call themselves that and avoid FDA approval needs;
• Gamafication leveraging mobile phones and tablets to monitor, manage, communicate, train, connect, etc.
• Health self-management tools and resources leveraging databases and clouds and even social media;
• Outsourcing of innovation for specific problems

The bottom line that there is a wealth of opportunities ahead and the industry itself is rapidly evolving and growing, and it will look much different in many ways, in the next quarter, in the next year, in the next three-five years.

FountainBlue's August 8 Life Science Entrepreneurs' Forum, on the topic of Software Meets Healthcare, featuring:

Facilitator Dipankar Ganguly, CEO, BioTelligent

Panelist Ted Driscoll, Technology Partner, Claremont Creek, Member, Life Science Angels and Founding Director, Sand Hill Angels

Panelist John Sotir, Senior Manager, Medical & Test Group, Altera

Presenting Entrepreneur Rohan Coelho, CEO, Rexanto

Presenting Entrepreneur Parvati Dev, PhD, FACMI, President, Innovation in Learning Inc., Distinguished Visiting Scholar, Media-X, Stanford University, Former Director, SUMMIT Lab, Stanford University School of Medicine

Presenting Entrepreneur Marco Smit, President, Health 2.0 Advisors

Please join us in thanking our sponsors at KPMG for sponsoring this event and this series. Thank you also to our speakers for taking the time to share their advice and thoughts. Below are notes from the conversation. 

Our panelists shared many different ways of implementing software meets healthcare solutions: from pharmacy prescription management to simulations and training, from development tools to mobile monitors and sensors. Regardless of the application, the focus is on serving the customer, by improving efficiency through software automation, by training and learning new behaviors in a safe environment, by reducing development time, by better monitoring behaviors and symptoms, or by providing more accurate, personalized and timely products and services.

Software meets healthcare offers huge opportunities, but there are also many barriers to entry. Solutions must serve a market and customer need, and meet policy, reimbursement and regulatory requirements which are ever-changing. Some of the advances in the technology world, including business analytics, cloud computing and mobile applications, are being leveraged in the software-meets-healthcare space, in the areas of sensors and monitoring, personal genomics, electronic medical records, and other areas. Indeed, we are moving to a world of intelligent agents, which would assume a more active monitoring role than a typical nurse or doctor, in a much more cost-effective, automated and efficient way. This becomes so much more important as demand increases for a variety of reasons, including the aging of the population in general, the increasing health care costs, and the ever-increasing demand for real-time, inexpensive solutions from patients, hospitals, care-givers, providers and insurers alike.

Below are some examples of upcoming opportunities in the software-meets-healthcare space:

• Intelligent agents will help monitor, track, report on and inform others regarding basic indicators from glucose to heart rate to ocular pressure. There is an opportunity for automating hardware and software agents and generating actionable reports to people who would pay for it, and making it easy to spread the word through social media.
• Training and education which would help people make positive lifestyle changes and creating tightly-knit, easily-expandable communities can not only help raise the overall health and quality of life for all in the community, but also create revenues for those managing and creating those communities.
• Adopting software and database solutions into the healthcare spaces offers opportunities in electronic medical records, diagnostics, genomics, and many other areas which require rapid processing of huge amounts of data, and generating reports that inform, educate, and facilitate decision-making.
• There is a drive from the patient side and the provider side for patients to assume more responsibility for their care, and training and education, automation and monitoring solutions which are easy to manage and easy to use for laypeople will be in high demand.
• Solutions which inform the patient and their select network will empower and inform, and ultimately help patients live more independently for longer period of time, which is less expensive and more satisfying for all.
• Mobile devices and solutions will be in high demand, if they are readily available and easy to use. But to ensure ready adoption, make it easy for customers to leverage social media to spread the word and IT departments to approve and support them.

Below is advice or entrepreneurs innovating in this space:

• Develop a solution which your target customer can easily navigate and utilize with minimal training. Take into account, for example, the dexterity, visual acuity, flexibility, etc. of your customers, particularly if they may be limited by physical ailments/diseases, aging, etc.
• Consider the security and data integrity standards for the industry overall.
• Protect patient-sensitive information as people are as sensitive and protective of that as they are of their personal financial information, where there are high standardized requirements for security.
• Serve an existing and passionate market, dont just create a technology looking for a problem.
• For many reasons, the adoption rate is much slower in the software-meet-healthcare space. Invest time in building relationships with hospitals, insurers, providers, etc.
• Build your credibility by having a great solution for a ready, proven market, having an experienced team, developing a scalable solution, and delivering based on milestones.
• Consider who will ultimately pay for the solution, which may not be the end patient, and build a business case on why it is in the best interest of the payor to do so.

The bottom line is that there are huge opportunities for those who are persistent, work with all the key stakeholders and deliver solutions to an eager customer base willing to pay for it.

FountainBlue's Life Science Entrepreneurs' Forum was on the topic of the Patient Revolution and featured:

Facilitator William Wright, VP Operations/ Business Development, Bay Area, at California MedTech LLC

Panelist Richard Ayllon, Director, Global Business Development, Ventus Medical

Panelist Don Ross, Healthtech Capital

Presenting Entrepreneur Ash Damle, Founder and CEO, Medgle

Presenting Entrepreneur Howard Edelman, President & CEO, VitalWear

Presenting Entrepreneur Oostur Raza, President & CEO, OmegaGenesis

Please join us in thanking our sponsors at KPMG for their ongoing support of the series. Below are notes from the conversation. 

With the aging of the baby boomer generation, and the resultant huge volume of older, more affluent, more empowered consumers, there have been increasing demands for delivering life science solutions, from diagnostics to personalized medicines, from devices to nutragenics. Our panelists agreed that the challenge and the opportunity is to cost-effectively and efficiently create personalized, patient-specific data, services and products which would serve the breadth and depth customers from individual patients to physicians, hospitals and clinics, from payors to small providers to insurers. Indeed, the key is to leverage technology in a way which automates the production and distribution of information and services while minimizing risk and maximizing impact and quality treatment for the patient, benefiting everyone throughout the value chain.

Baby boomers have created a population spike which, like a snake who has swallowed a mouse, has impacted markets and industries throughout their life cycle, from infant to toddler, from teenager to young adult to middle age. As boomers are techno-philic, affluent, health-conscious and influential, their voices have been heard and have impacted market development and direction. So as they age, infirmities and elected treatments of an aging patient, from obesity to diabetes to sleep apnea, from baldness to arthritis, from sports injury treatment to knee replacement, will quickly rise in demand.

So the opportunities are there, but there are also challenges in meeting the opportunity, including reimbursement policies (particularly with Medicare changes), regulatory approval (particularly in the US where the FDA is becoming both more stringent and more unpredictable),

Those who will be able to meet those challenges will be more creative in bringing their products to market. Our panelists' suggestions on how to do so are listed below:

• Put your products in the hands of the patient through channels such as your local drugstore (like Walgreens) or market (like Costco).
• Where possible, avoid the need for FDA approval or seek approval in countries outside the US before bringing it to market in the US.
• Serve a market need and target customers who are willing to pay for it, even if it has to come from their own pockets. Leveraging personal health care savings accounts (an increasingly popular strategy for patients) might help.
• Angels are syndicating and supporting early stage companies with a promising business model and plan and proven technology. Build relationships with angels who might be great mentors and potential funders.
• Help our policy-makers make decisions which would reward physicians to do the right thing for their patients, reward patients for making effective health decisions.
• Leverage social media and the web to grow your customer base, build your brand, create new channels, etc.

Our panelists commented on some hot opportunities for better serving the empowered patient.

• Help providers such as clinics and hospitals better, more efficiently treat and serve their patients leveraging IT offerings from databases to cloud to business analytics.
• The days of the blockbuster drugs are past, so whether you are in pharma or devices or biomed or mHealth, create personalized solutions which serve all stakeholders more cost-effectively.
• Baby boomers have historically adopted wellness and nutragenics solutions throughout their lifetime, and as they age, their preferences and needs will change. Anticipating and addressing this need will help forward-thinking companies succeed.
• Baby boomers love their independence, so products, services, solutions which help them remain independent as they age-in-place will likely be popular.
• Services and solutions which would help baby boomers make good health decisions for diet and exercise, and those that help patients understand their risks and genetic make-up will continue to grow.

The bottom line is that all stakeholders, from patients to providers to clinics, hospitals and insurers and policy-makers, need to forge a convergence between the world of technology, with its access to databases, business analytics, dynamic solutions, etc and the world of patient care, with its combination of pharma, device, medical record and health management solutions. The trick is t do this in a way which helps all parties make the best health decision *and* the most cost-effective solution for all parties, and collaborating to make it work.

FountainBlue's Life Science Entrepreneurs' Forum on the topic of Trends and Opportunities for Medical Imaging, featuring:

Facilitator Dennis F. Falkenstein, President and CEO, iOnTrends LLC

Panelist Tom Thomas, Director of Imaging Systems R&D, Boston Scientific

Panelist Brian Wilfley, Ph.D., Director, Chief Scientist, Triple Ring Technologies

Presenting Entrepreneur Caleb Bell, PhD, CEO, Bell Biosystems

Presenting Entrepreneur Kendall R. Waters, PhD, Manager, Intellectual Property and Technology Development, Silicon Valley Medical Instruments, Inc.

Please join us in thanking our hosts at UCSC Extension and to our sponsors KPMG for sponsoring this event and for their ongoing support of the series. Below are notes from the conversation. 

Our panelists represented the full range of medical imaging innovations, from PET/CT to MR/monoclonal tags to radiation therapy. They also commented on the importance of making cost-effective, easy-to-use solutions that generate quick, easy-to-interpret results, and adding clear value to doctors, patients and providers up-front. Policies and regulations and openness of the medical community will impact whether these solutions get into the hands of physicians who would use them. In fact, sometimes, it's more about incentives and ease-of-use than it is about how sophisticated the technology is.

Below are some of the opportunities they see in this space:

• Adapt a medical device solution for ultrasound rather than MR or CT where possible as it is cheap and readily assessable and much less expensive.
• Consider hybrid solutions which leverage existing and proven technologies and approaches, applied to different patients, locations, conditions, etc.
• Build more reliable hardware and software for existing solutions and markets.
• The market will continue to be driven by reimbursements and policies, so entrepreneurs need to be aware of what these are and how they would impact their business.
• Consider launching outside the US in Europe or Asia for example, as it is less expensive, less time-consuming to do so.
• Solve the problem at hand, rather than filtering the problems you can solve by current financial resources.
• Get your products into the hands of the doctor, and don't overly-prescribed how the doctor should leverage your solution. He or she would best determine how the solution would be helpful to her or his patients. And if you listen to this feedback and shift your messaging and strategy, you may find yourself targeting a slightly different and more tangible and immediate market.
• Offer solutions which doctors would appreciate - see it from their point of view.

Below is advice proposed by our panelists for entrepreneurs innovating in this space:

• Hybrid approaches leveraging different technologies, approaches and modalities.
• Genome-focused imaging.
• Localized imaging.
• Miniaturization, which will help drive down costs.
• Apply medical imaging to regenerative medicine or cancer solutions.
• There is an upcoming trend toward lowering and limiting radiation exposure, especially for children. What are the opportunities to provide similar information with the dangers of xrays?
• There is another movement to limit stents, and to ensure that those inserted are done right the first time. What are the medical imaging opportunities to support this trend?

The bottom line is that no matter what type of medical imaging solution you offer, make sure that you provide physicians with diagnostic confidence so that they feel *better* using your solution as additional data points, as additional background information as they treat their patients, while limiting their risk and exposure.

FountainBlue's May 16 Life Science Entrepreneurs' Forum was on the topic of Technology Acceleration, Globalization Pressures and the Future of Pharma and featured:

Facilitator William Wright, VP of Operations and Business Development - Bay Area, California MedTech LLC

Panelist Diane Oliver, Research Database Strategist at Kaiser Permanente Division of Research

Presenting Entrepreneur Matthew Cooper, Ph.D., Chief Science Officer, Syapse

Presenting Entrepreneur Dave Hodgson, Chief Technology Officer, Tethys

Presenting Entrepreneur Aaron Solomon, Complete Genomics

Presenting Entrepreneur Robert Wotring, Co-founder at Innovative Clinical Financing (ICF) and Program Director and Co-founder at Latin American Clinical Research Sites

The panelists emphasized throughout the discussion that successful pharma solutions will increasingly rely on integrating software and developing personalized solutions for patients cost-effectively. With the advancement of technology and a better understanding of the human genome as well as the decades of data collected from various sources on patient reaction to specific treatments, it is becoming more realistic to integrate software solutions to better research and understand disease progression, mechanisms of action for drugs, and even how specific subsets of a patient population respond to treatments. Whereas there is a long circuitous path in front of us before we can cost-effectively develop customized treatments for specific ailments, the software integration option will become increasingly superior to the more blanket treatment of diseases and trial and error R&D practices which have created the blockbuster drugs of the past, and we will be more computer-driven, than bench-and-lab driven for future innovations in this space.

Another theme emphasized is that generated data is important, but much more important are the implications of the data for serving patient needs. Early genomics projects failed because of the emphasis on understanding and mapping the human genome, rather than focusing on how we can better treat people, how diseases impact people, and how treatments help specific types of patients.

Funding for pharma solutions is an issue for early stage and even large corporate ventures. It takes far too much money, and far too much time to create a pharma solution that is approved, manufactured and brought to market, and the 5-10% success rate in itself, coupled with the large investment dollars required has made investors wary at best. Plus investors today need to both understand the IT/software side of the business *and* the drug/pharma side of the business and have the appetite to invest, a rare combination indeed. And those who *do* understand both side might feel burned by their investment in genomics which focused more than understanding the human genome than on treating patients, and are therefore reticent to invest.

But there is hope for innovating pharma solutions:

• There will always be a market and a need as people will develop diseases and need treatment.
• Many affluent potential investors may be passionate about curing specific diseases overall, or providing treatments for disease victims for personal reasons.
• Patents will expire for many blockbuster drugs, and generics will go on the market.
• Partnerships between entrepreneurs, academics, government and corporates will help accelerate R&D.
• Progressive advancements in technology is better enabling entrepreneurs to succeed.

• Providing outsourced data management solutions will help researchers and entrepreneurs better get access to and understand diseases and patient populations and how specific types of patients will respond to treatments. Similarly, many patients would like to better understand their genome and their health and their risks for specific diseases, so they may pay for personalized reports about their health.
• Gamafication and other educational strategies will become popular as patients and caretakers better understand diseases, treatments, causes and prevention.
• Outsourcing specific elements of the pharma development process, like clinical trials or product development, will help minimize the costs and time needed to develop and test new drugs.
• With the expiration of drugs, there will be opportunities for manufacturing and distributing drugs and even leveraging drugs for similar other purposes or different markets.
• There is a plethora of drugs throughout the drug approval chain which got rejected for various reasons which may be adapted to specific other purposes or to niche patient populations.
  

Additional remarks emphasized the strengths of innovating in the Silicon Valley. With the convergence of software and pharma solutions, the Silicon Valley is well positioned to succeed and lead - because of its dominance in IT, networking and software, because of the entrepreneurial spirit of its diverse people with immense creativity and initiative, because of all the necessary infrastructure of support - from networks to service providers to investors, because of the collaboration between corporations, entrepreneurs, investors and academics, etc. In addition, talented executives and innovators and entrepreneurs are arriving in the valley and choosing to stay because of the weather and the overall climate supporting innovation. To experience and appreciate the Silicon Valley Edge, think about the conversations you might hear at a coffee shop here, as compared to anywhere else in the world, and consider where else in the world you might find attending Little League game a great networking opportunity.

In the end, Pharma 1.0 relied on the old blockbuster model, when the implied one-size-treatment-for-all model is now outdated. Pharma 2.0 will now emphasize more software-driven diversified, cost efficient solutions for specific diseases and niche markets, leveraging outsourcing and reaching beyond patient treatment to address animal health, generics and nutragenics. Successful companies in this sector will emerge with Pharma 3.0 where treatments will be succeeding or failing based on individual, personalized outcomes, ensuring that the drug works - with minimal side effects.

FountainBlue's April 18 Life Science Entrepreneurs' Forum, on the topic of Physician Panel: Partnering with Entrepreneurs to Better Address Patient Needs, featuring:

Facilitator Amish Parashar, Stanford University Trans-Disciplinary Program

Panelist Arthur Douville, Arthur W. Douville, Jr., M.D., Chief Medical Officer, Good Samaritan Hospital

Panelist Guy Miller, M.D., Ph.D., co-founder, Chairman and Chief Executive Officer, Edison Pharmaceuticals

Panelist Peter G. Milner, MD, FACC, Co-Founder and Executive VP Corporate Development Optivia Biotechnology and Co-founder CV Therapeutics, ARYx Therapeutics

Presenting Entrepreneur Subhash Kulkarni, post-doctoral fellow in the Division of Gastroenterology and Hepatology in Stanford University

Presenting Entrepreneur Thomas Ruby, PhD, Postdoc fellow, Microbiology and Immunology, Monack Lab

Please join us in thanking our hosts at UCSC Extension for graciously hosting us at their facilities and to our sponsors at KPMG for their ongoing support of our program and the series. Below are notes from the conversation. 

The panelists concurred that there are many policy, funding, and operational issues which make it difficult to pharma, biotech and device companies to succeed. Even in the best of times, development, approval, reimbursement, time-to-market, financing and other hurdles make it challenging for companies serving patients, but times are even more difficult now. Traditional venture investors are more interested in funding later stage companies with tested technologies. Many early stage and even established companies are confused and frozen by FDA statements that new policies and standards will be in place, but without a timeframe or an idea of what changes are in store, people and companies are electing to take products and services off-shore for easier, less time-consuming, more straight-forward, less expensive approval processes. Thus, US leadership first in medical devices and now in pharma are migrating offshore to Europe, China and other markets which are easier to get funding, approvals and customers.

Although all is not lost, for there are opportunities still in the US, there are many 'ifs' we need to overcome in order to make it so.

• If we could come together as a community, and focus on the health of patients and supporting each other in improving the standard of care with egos aside, with fewer ulterior motives . . .
• If we could focus on patient care, and hospital needs, and change regulatory standards that support both (rather than create unintentional work and problems for both patients, doctors and administrators) . . .
• If we could get predictable standards and policies which protect the patient *and* support innovation and entrepreneurship . . .
• If we could focus on cost-effectiveness and comparative effectiveness without folding in egos and politics . . .
• If we could all be less litigious . . .
• If we could leverage technologies to better understand the vast amounts of information generated, and share standardized information transparently . . .
• If we could share our success rates and stories and collaborate with all stakeholders to better improve how we treat our patients . . .
• If we could incentivize all stakeholders to share information transparently and cooperatively . . .
• If we could entice more customers and funders to be invested in research to heal patients, rather than just making money . . .

Below is advice to entrepreneurs offered by the panelists:

• Partner with corporations who are interested in your space.
• Identify and recruit high-net-worth individuals who would be interested in funding your company for personal reasons, not just business reasons.
• Developing drugs in the life science area in general is not for the faint of heart. You must be persistent, dedicated, hard-working, good at what you do, and very lucky to succeed.
• The difficult policy and funding environment in the US is helping open up markets in Europe and China and other countries.
• Hopefully the US policymakers and funders, including new funders like foundations, will come around and there will be new opportunities here. Tested and approved solutions in European, Chinese and other markets might be more likely approved here if and when that happens.

Below are some opportunities to consider:

• Create solutions and services which enhance patient safety.
• Create solutions which address the connectivity problem - leveraging data analytics to understand data and make decisions.
• There are opportunities around electronic medical records and standardizing data formats, making patient information more easily accessible.
• There are opportunities in predictive analysis, which would be more effective than focus groups on very narrow patient populations.

FountainBlue's March 28 Life Science Entrepreneurs' Forum, on the topic of Maintaining Food Safety and Integrity From Seed to Plate, featuring:

Facilitator Gay Timmons, Oh, Oh Organic, Omica

Panelist Abizer Khairullah, Four Corner Foods

Panelist Yasmin Tyebjee, CEO, Top Nosh Specialty Foods and Top Nosh Cafe

Presenting Entrepreneur Robert Carter, CEO, Nikoya Foods Inc.

Presenting Entrepreneur Brian Witlin, co-Founder and CEO, Shopwell

Please join us in thanking our hosts at UCSC Extension and our sponsors at KPMG for their support of this program and the series. Below are notes from the conversation. 

There are many pieces of the food value chain, and many way to slice it, from seed to plate, from farm to fork. Our panelists talked not just about the process and technology innovations throughout the value chain, and specifically in their specialty area(s), but also about their personal passion for providing more people freer access to safe, high-integrity food options to a hungry and growing market.

The panelists started by covering seed and feed innovations and the opportunities and challenges around that. Whether the panelists were talking about seed diversity, seed development, genetically engineered seeds, or other topics, it was clear not just that we had a knowledgeable panel, but also that seed innovations greatly impact the availability, range, safety and integrity of the food we serve. What might not be clear in Silicon Valley is that our local region has been known for decades for the development of quality seeds which are shipped around the world.

Each of our panelists mentioned the importance of focusing on the needs of the customer, and providing information and products and services which best serve their personalized needs. Sometimes it means leveraging technology - not just the traditional software technology which allows people to customize preferences and make informed their food choices based on those preferences, but also the technology to genetically engineer seeds to diversify a seed gene pool, or to bring manufacturing process improvement practices, processes and principles into the food production and packaging industry. We should also consider that it takes technological advancements to innovate feed and process improvements to help ensure faster, higher quality poultry and livestock overall.

Our panelists are dedicated, passionate, flexible and knowledgeable - essential qualities for success, especially since they have to deal with policies and audits and other regulations which help ensure the food served to consumers. Sometimes these policies change quickly, are vague, or just don't serve the intended purpose. Sometimes the policy is complex, obscure or time-consuming. Clearly it is often a barrier to entrepreneurs and companies, but regulation of some sort is necessary to catch blatant violators who give a bad name to all parties throughout food value chain.

Our panelists also commented that making the right food choices is a matter of education, a matter of habits and practices which lead to better and simpler food choices and better sanitation, a matter of working together to select for quality food options more freely and inexpensively available. They also consistently remarked that it could take twenty years consumers to work together to raise the bar, change policies, influence food offerings, and ultimately have higher-quality, safer food options.

Below is advice offered by our panelists to entrepreneurs seeking to enter this space:

Be Strategic

• Consider outsourcing elements of your business to others who specialize in areas such as R&D and manufacturing and distributing policy adherence and responsibilities to these partners.
• Consider the market size and the best money-making opportunity. The feedstock market might be better than the organic chicken market, and certainly can be less time intensive.
• Consider your market and who you want to serve and keep tailoring your offerings based on the needs of the market. For example, Europeans tend to go shopping every two or three days whereas Americans might shop once a month. Bagged salads with preservatives would better interest one market than the other.
• Design technology and process innovations that minimize risk throughout the value chain, and quantify the savings made, the opportunities provided.
• Innovate based on observed behaviors which are sub-optimal. They don't have to be sophisticated innovations; they just have to make sense. Pelletizing seeds so that chickens can pick it up better is a great innovation which reduces waste, but also makes it easier to add vital nutrients to the feed.
• Seed innovators must be well aware of micro-climates which optimize development of specific seeds, and also be hyper-aware of cross-pollination challenges which might damage and infect their seeds, or that of other seed growers in the area.

• Leveraging technology and business process improvement practices from the semiconductor industry would also benefit the food collection and processing, manufacturing and distribution needs in the food industry.
• Leveraging software and social media will help build an active customer base. Monetize that customer base using the free-mium to premium model, but also charge food manufacturers and others aggregated user data which show them how consumers are making food purchase decisions. 

• Entrepreneurs leveraging databases of food information will need to work with a variety of stakeholders who are not motivated to share their data, or provide it in a standardized, easily-integrated format.

• Note that the ingredient listings for food products are not validated by a third party, but it IS a honor system, which generally works, and is not audited unless problems arise. Is there a technology opportunity in that?
• Europeans are hyper-aware of genetically manufactured seeds and have a list of prohibited ingredients and entrepreneurs following American-centric practices may start finding themselves without access to these markets unless they plan their production and development around these requirements.

The bottom line is that the needs of the consumer are changing. Customers are demanding convenience and nutritious meals. They want objective information about food choices, especially when there isn't an apples-to-apples comparison of food offered. They want simple ingredients, simply manufactured, inexpensively available, and throughout the year. Responding to the needs of the customer, whether it involves quality frozen goods, or plates and dishes served at restaurants; nutritious, vitamin-enhanced, disease-minimizing feed; or personalized reports on food choices, the entrepreneurs who filter their development and choices and continue to innovate to better serve their customers will have the market edge, and will emerge as market leaders in providing safe, high-integrity food to all.

FountainBlue's February 28 Life Science Entrepreneurs' Forum on the topic of Medical Diagnostics: The Advancements and the Opportunities, featuring:

Facilitator Katherine Tynan, Tynan Consulting LLC

Panelist Marijke Annis, CardioDX

Panelist Klaus Hambuechen, The Angels Forum

Panelist Kendall Waters, SVMII

Presenting Entrepreneur Isaac Bright, VP, Molecular Diagnostics & Corporate Development, QuantaLife

Presenting Entrepreneur Matt Mealiffe, M.D., Founder & CEO, Evinome, LLC

Presenting Entrepreneur Jason Springs, Geneweave Bio

Please join us in thanking our hosts at UCSC Extension and our sponsors from KPMG for their support of this program and the series. Below are notes from the conversation. 

The diagnostics market is incredibly varied and ranges from FDA approved IVD product to consumer genetics offerings. Products range in complexity from a simple pregnancy test that you pee on to the most sophisticated imaging platforms. The products can be provided in packages or delivered by expert intermediaries as services. The people who conduct the testing may only read at an 8th grade level or have multiple advanced degrees. What we do know is that diagnostics drive ~70% of the healthcare spend while only capturing a couple of percent in revenues.

Our panelists shared their thoughts about evidence development for key stakeholders including regulators, clinicians and payers, and its role in driving adoption and how successfully making the case for each of these stakeholders is essentially for the success of any medical diagnostics company, whether you're Series C funded or bootstrapping. The panelists started by talking about their vast range of offerings in the medical diagnostic area, and the funding, policy, and development challenges associated with running a medical diagnostics company today. The funding of medical diagnostics companies, always a difficult thing due to long development cycles and large funding needs, has gotten so much more difficult with the changes and threatened changes in policy and regulations and reimbursements. Our panelists are all notable in the way they have navigated this challenge. Their advice is to:

• Navigate the FDA approval process:
• Select a solution that does NOT require FDA approval. 
• Select a solution with a proven predicate device. 
• Offer your solution to international markets and prove your technology/solution and business model before taking it to the FDA for approval for US markets. Japan and other Asian countries and Europe are good options.
• Even CLEA solutions developed in the labs may have more restrictive FDA requirements coming down, a threat that has been made for years by the FDA.
• Find a funding model that works for your company.
• It's hard to get payers to buy a medical diagnostic solution, unless it is for a sick child.
• Insurers will want to know how it better serves their patient population, compared to what they are already using.
• Navigate perverse incentives which encourage physicians, patients and providers to maintain the status quo, even if it's proven that it's not more effective.
• Prove that your solution is more effective and use quantifiable, third party data to do so.
• Work with physicians and providers and get them to select your solution over others.
• This is no easy task. You must prove that it works and that it will work with their existing patient population and it would be painless and seamless to use your solution as an alternative to what they are already doing.
• It's not enough to have the scientific studies. You must also prove to both insurers and physicians that specific individual physicians would change their practice and habits to select your solution over existing and competing ones, and that it generates better results for the patient.
• Find an insurer who would reimburse for your solution.
• There are three elements to getting paid for diagnostics: coding (approval by AMA), coverage (payers willing to cover) and payment (by insurers). Each hurdle must be well navigated to optimize development and operations. Partner with influential others to help navigate these hurdles.
• Get funding for your R&D and for your expansion.
• Bootstrap as long as you can.
• Partner with academics and researchers and others who have existing proven technology.
• Partner with corporate entities who are in your area and interested in expanding their offerings with your solutions.
• Make the case to all stakeholders, from payers to insurers to policy-makers to investors, and prove that customers would pay for your solution and practitioners would use it.
• Build relationships and start communications with potential funders and partners early and often.
• Offer a unique solution that is very necessary for customers who would pay for it and communicate it in a way that others would sign on as staff, board members, seed investors, partners, etc.
• It's difficult to make the case for new medical diagnostics solutions. Seventy percent of healthcare spend, and only 2% of revenues are for diagnostics, and that pie will likely remain the same size. This means that you need to make your case that your solution is better than the status quo, when other more established and perhaps more powerful others are politically and financially charged to prove otherwise.
• Most diagnostic solutions are not standalone, but most work with a full system of offerings. If yours falls into that category, work with an infrastructure that's established and accepted. 
• Communicate the uniqueness of your solution professionally, using unbiased data. 
• Get customer input and feedback on your solution and how it should be priced and delivered.
• As with any business, you must be able to answer three questions: what problem is solved, who benefits from solving that problem, and can we as a society afford to solve the problem?

• Medical imaging and luminescence innovations that will help track, monitor and control cell growth and usage.
• Medical device innovations that will help physicians better diagnosis and treat and manage disease.
• Testing will move closer and more directly to the patient and consumer.
• There are opportunities to improve the point of care system  to  get info faster, make the diagnostic decisions faster.
• Insurers are bullish on molecular diagnostics, and although they do not know this space, they are committed to investing in it as they think that the future lies there.
• There will be ever-more complex interventional diagnostic solutions and they need to be manage and integrated.
• Mobile devices for medical diagnostics solutions will be HOT. And companies who understands both the healthcare side AND the IT side will benefit from this uptick

In conclusion, despite all the barriers for growing a business in the medical diagnostics area, the industry shows promise because population growth, increased affluence globally and aging populations will ensure a growing and stable, with less bubble-like ups-and-downs in this industry as compared to other industries. The bottom line also lies with what we as Americans are willing to commit to for our healthcare system. We don't want to be the guinea pigs, but we don't want a system to be a choking financial burden for ourselves and for generations to come. It will take leadership to find that win-win, so that practical, innovative medical diagnostics tools and solutions come into the hands of patients in need, in a way that makes business sense to entrepreneurs, insurers, providers, patients, and investors alike.

FountainBlue's January 31 Third Annual Life Science Investor's Panel: Life Science Funding Predictions for 2011, and featured:

Facilitator Meredith L. Warshaw, PhD, CSO, Molecular Image, Chairperson Life Sciences, VC Taskforce, Adviser, SPARK Program at Stanford University Medical Center

Panelist Ted Driscoll, Technology Partner, Claremont Creek Ventures and Life Science Angels

Panelist Don Ross, Managing Director/Founder, HealthTech Capital; Board Director and Co-Chair of Didactic Committee, Sand Hill Angels; Member, Life Science Angels

Panelist Kevin Wasserstein, Versant Ventures

Please join us in thanking our hosts at UCSC Extension and our sponsors at KPMG for their support of this program and the series. Below are notes from the conversation. 

The panel commented on the tremendous investment opportunities in the life science sectors, at least for companies who can successfully navigate or circumvent the increasingly complex development and regulatory and reimbursement challenges inherent in the business. In other words, there are trees thriving, but the forest overall, although recovering, is still not looking good.

The panelists remarked that they are optimistic, because people will age, get diseases, seek optimal health and diagnostics, etc. and with the aging baby boomer population and the global need for solutions, the opportunities in the life science sector are tremendous.

However, the barriers are huge, and the percentage of successful companies are in the single digits. The declining volume of dollars going into life science and other deals, the healthcare reform shifts (which although it may be good in the end are currently making investors jittery due to the uncertainty and unreliability), the large dollar amounts necessary for early R&D, the long time horizons associated with the industry in general, and regulatory and policy issues are all contributing to the overwhelming odds against building blockbuster companies.

One of the greatest challenges for the industry is to have favorable, predictable, standardized and communicated policies that are consistently enforced. US entrepreneurs are particularly frustrated with how policies and regulators are making the approval process more complex, expensive and time-consuming. Our panelists are hopeful that healthcare reform will spark sustainable changes in the systems and processes and infrastructure so that more solid companies and ideas can be created, tested and brought to market.

But it's not all doom and gloom. When asked what sets about the funded and successful companies apart from the many more not able to launch, the panelists remarked that hot business opportunities are available in the medical device and software-meets healthcare space and other IT-related solutions that are capital efficiently addressing healthcare challenges from the back-end records management/patient communication solutions to the devices, biotech, diagnostics and even pharma solutions. They also stated that successful companies will have a big game-changing (rather than incremental) idea, viable, scalable business models, FDA pathways outside of the US, and the interest of strategic corporate partnerships.

Below is advice provided by our panelists on how to increase your odds for success as a life science entrepreneur:

• Address a large market and prove that the customers will buy.
• Partner with others for early development challenges.
• Begin with the end in mind - know who might buy you out and work toward milestones and inflection points, understanding and mitigating risks, and keep making your case while working toward that goal.
• Ask for the right amount of money to help you move the needle forward, rather than having pre-conceived notions that certain types of VCs and angels think you should ask for X.
• Build relationships with strategic others, including potential investors, but be respectful of their time, and strategic about when and how you connect with them for what purpose.
• Assume that the FDA will react in the worst possible way, like moving you from 510K to PMA pathway, or keep your company in limbo-land for as many as 2 years. So develop expertise in other markets, develop an international component in Asia or Europe for example. 
• If you must go down the FDA pathway, consider working with clear predicate devices, ones that are already approved for other purposes.
• Investors today are more savvy, and less interested in and less likely to fund a deal unless there is enough data about the market and need, and unless it has a proven, high-integrity, passionate, persistent team with the experience, connections and expertise to make something happen.
• Be audacious and visionary, while being coach-able, flexible and dynamic. Remember that ultimately it's about whether you and your team can generate momentum and results and move the needle.
• Consider how our drugs and services are being charged here in the US and in other countries and how the US can remain competitive pricing-wise, as other countries provide services and provides on par with offerings here.
• When you get a 'no' from an investor, when an experiment doesn't go as planned, when stuff happens, learn from it. In fact, you can learn more from what goes wrong than what goes right, provided that you make corrections and apply the learning and are transparent in communicating the challenges.

The panelists are making these predictions for 2011:

• The Healthcare Act will focus more attention on outcomes and costs for those outcomes, so measurements and data, the IT component, will become increasingly important.
• The aging population will favor offerings that serve them, ones that enable aging, address their techno-philic tendencies, empower their decision-making, quench their thirst for knowledge, leverage health and longevity solutions, etc.
• There will be an increasing demand for efficient cost-effective health care monitoring and records manage solutions which better connect all stakeholders.
• Converting patient data into actionable information will continue to be a growing trend.
• Molecular genomics and other cost-efficient personalized medicine solutions will be another growing trend.
• There will continue to be the haves and have-nots: those who make it and succeed and those who wondered what happened?
• There will be an increasing amount of M&A action for those who can navigate the hurdles.
  

In conclusion, the odds are overwhelming and the hurdles are high and irregular, but because of the nature of the industry, there will always be opportunities to serve people and their health needs, and companies who have the vision to address a real market need, and the ability to execute and deliver quality products and services to hungry users will make all of us winners in the end.

FountainBlue's November 15 Life Science Entrepreneurs' Forum, on the topic of Personalized Medicine, Biomarkers, Invitro Diagnostics: The Science Advances, The Business Opportunities, The Cultural Dilemmas, and featured:

Facilitator Brent Treiger, MD, IRX Therapeutics

Robert Dunkle, President and CEO A.B.E.S, gene expression analysis

Kenneth Fang, MD, Founder, Modus BioMedicine

Brandon Steele, Vice President, Commercial Operations, IncellDx, Inc.

Kamran Tahamtanzadeh, Founder and CEO, PrognosDx Health, Inc.

Please join me in thanking our hosts at UCSC Extension and our sponsors at KPMG for their support for this event, and our ongoing series.

Our panel of experts have a wide range of experience and perspectives with decades of experience in the life science industries, from medical devices to pharma, in a range of roles. They have the medical background and the business acumen and direct experience to share their perspectives on the accelerated pace of technology and science advancements in personalized medicine and the many opportunities and challenges posed by same.

The panel commented on the tremendous opportunities in better understanding diseases and the genetic and environmental causes of the diseases as well as the symptoms expressed, in better understanding how individuals and groups of individuals respond to specific treatment regimens running the gamut from wait-and-see to invasive surgeries and radioactive therapies, and in more effectively providing comprehensive data to patients, regulatory bodies, providers and clinicians alike.

Because we now have the technical capacity and scientific knowledge to understand the genome as well as diseases and how they impact different populations as well as the data to measure and interpret trends and tendencies for specific patient populations, personalized diagnosis and prognosis is within reach for some people, under specific circumstances. But expanding these offerings to an increasingly large audience cost effectively for patients, providers, insurers, corporations, and others is no easy task.

This is particularly true as the science and data is just one element of the solution. Indeed, regulatory, reimbursement, operational, ethical, cultural and other challenges compound the challenges presented by the science and business challenges, making it more difficult for personalized medicine offerings to get into the hands of patients who would benefit, in a way which would be cost-effective for all.

Education of all stakeholders is a key component for navigating these barriers, and collaboration between informed and educated stakeholders is fundamental to success. Mobilizing all stakeholders, and enlisting the cooperation of the regulatory and reimbursement bodies, with the focus on generating the optimal data set (not so little that patient health and safety are at risk, or so much that you're required to measure things that don't matter) and communicating at the patient health level, rather than focusing on egos and politics, would greatly facilitate the R&D and approval process for companies large and small.

The panelists offered the following advice for entrepreneurs in this space:

• Focus on the body of evidence at hand, and how you can leverage that for driving the development, approval and distribution of your solution.
• Build credibility for your solution, enlisting the support of key respected advisers, practitioners, scientific journals, corporate leaders, academic institutions.
• Understand your customers and their needs, and modify your solution and communication based on customer needs.
• When possible, opt for easier, less invasive tests and encourage practitioners to perform these tests to build the patient data set during the approval process.
• It's generally not black and white, but shades of gray when it comes to disease, so have clear, data-based definitions for specific patient data ranges and the treatment recommendations for each set of patients, and the evidence to prove that the specific regimen is most advantageous (and why, if possible).
• FDA policies are continuing to evolve, so be informed and work within their guidelines.
• Be bold, and choose a big market in this space.

In the end, the panelists agreed that personalized diagnostics will more progressively drive treatment recommendations and offerings into the future, and all stakeholders must consider this trend as the industry evolves. Those best able to take the macro, longer-term view and the opportunities which open up when we can cost-effectively offer personalized medicine solutions will have a leg-on from both the commercial and the patient-benefit perspective on those who don't.

FountainBlue's October 18 Life Science Entrepreneurs' Forum was on the topic of Software Meets Healthcare: Forging The Win-For-All! and featured:

Facilitator Soody Tronson, Soody Tronson Law Group

Panelist Melissa Karr, Vice President, Marketing, Brain Resource Ltd.

Panelist Sunil Maulik, Board Adviser, Health 2.0

Panelist John Steuart, Managing Director, Claremont Creek Ventures

Presenting Entrepreneur Ash Damle, Founder and CEO, Medgle

Presenting Entrepreneur Sonia Sousa, Founder and CEO, Spectroscape

Please join me in thanking our sponsors at Soody Tronson Law Group and KPMG as well as our hosts at UCSC Extension. Below are notes from the conversation:

Our panelists have a wide range of professional training, knowledge and expertise with both the software and IT side of the business as well as the device, pharma and healthcare industries. Their offerings range from investing in software-meets healthcare innovations to creating device-plus software, business intelligence and healthcare education and management innovations serving patients and caregivers locally and globally.

We live in a remarkable time where there are both innovations in multiple industries, and also a convergence of industries to create hybrid solutions addressing the personalized demands of individual people with a wide range of needs. Software-meets-healthcare is just one example of this exciting new trend in business. We are leveraging robust databases of knowledge and information about diseases, diagnosis, treatments and care, and leveraging this information to create actionable knowledge for both patients and caregivers, and also connecting them to each other and their institutions to better serve the patient with both higher efficacy and greater efficiency.

The panelists spoke about the challenges inherent in starting and growing a software-meets-healthcare organization, and provided some advice about how to take advantage of the great opportunities ahead in this space:

• Ensure the validity and integrity of the data, for everything relies on that. Validate data through large volumes of information and research, and their endorsements and accreditations from outside neutral and/or government and scientific bodies, and keep updating the validating the data. Be careful how you frame what you do with the data, if possible avoiding any mention of the word 'diagnosis', unless you're willing to address regulatory issues and requirements.
  
• Once you have the data, decide on how you will leverage that data by providing information and value.
• Focusing on the IT and software service and other parts of the value chain not related to diagnosis as that would require FDA approval and ongoing monitoring.
• Create an intuitive interface which works for the individual customers, and make it easy for them both to come back and use the service for other means, but also easy for them to refer it to others.
• Understand who is or will be using your service, how they will be using it, how much they are willing to pay, etc. Be willing also to reconsider who your target customer is, and change your company strategy based on who is willing to buy, and even what they are willing to buy. Be open to offering other options and revenue tracks for leveraging that same data.
• Consider the freemium-to-premium model and give away a subset of the data to increase exposure, support deal flow, increase data set, and give back to the communities you serve.
• Make your solution appearing and engaging, and the results measurable.
• One way to address reimbursement issues is to work first with countries with single-payer systems.
• Partner with corporate/strategic partners to best support your strategic and market research needs, with academic and research institutions to support your development needs, and local and international investments funds and governments for your funding needs.

Our panelists also commented on the opportunities ahead. They highlighted the tremendous advances in medical device technologies which can take bodily samples and send information to mobile devices or laptops for quick reports, and the trends will not only continue but accelerate. Another trend might be toward leveraging software solutions to develop the brain and body, and help make healthier choices for yourself and others who are in your care. This may prove especially relevant with the aging of the baby boomer population and their technophilic tendencies, and responsibilities to aging parents. Their comment on social media, however, was to consider it with caution, as privacy issues may interfere with its usage.

The panelists all remarked about the challenges with working with the policy and reimbursement challenges in the US. It's unclear, ever-changing, moves slowly, and requires a LOT of trials, research and information. So, many of them are choosing international markets, notably China, India, Brazil and Europe. One reason is that innovation works through iteration, and having standards of expectations for policies, reimbursements, technology development, protocols etc. would make it much easier for entrepreneurs in this space to more quickly fail and/or succeed. Currently, countries outside the US are offering more predictable support in terms of fundings, subsidies, and policy stability. However, they also agreed that Silicon Valley is known for its innovation and for the brilliant people it attracts, including people from nations around the world who build the technology development and management experience as well as the networks of relationships critical for any venture, and can provide leadership in reaching out to markets in and funding from other countries. But it will take leadership to maintain this edge for both Silicon Valley and the US - the type of leadership that has both the political will and means to change the way things are currently done, when there are powerful entities with much to lose if we change our ways and would block such efforts, even if they acknowledged that it's what's best for everyone in the long term.

In the end, the panelists concluded that it's always about the people: the experienced entrepreneurs with the great ideas for solving immediate, pressing problems for patients, providers and caregivers willing to pay for them, and it's up to the rest of the stakeholders to help them make it so, despite the challenges!

FountainBlue's September 27 Life Science Entrepreneurs' Forum on the topic of Emerging Trends in Medical Devices - Mobile Health, Personalized Medicine and Consumerization and featured:

Facilitator Geetha Rao, PhD, Springborne Life Sciences

Panelist Anne DeGheest, Managing Director and Founder, HealthTech Capital, Managing Partner and Founder

MedStars

Panelist Dave Scott, Director, Imaging Systems, Intuitive Surgical, Inc

Panelist Clarence Wilhelm, Director of Software Product Management, Digital Solutions Group, LifeScan

Presenting Entrepreneur Marc Bandt, CEO, Pelesend

Presenting Entrepreneur Paul To, CEO & Founder, Emota

Please join me in thanking UCSC Extension for graciously hosting us for this event, and to KPMG for their ongoing sponsorship of the series. Below are notes from the conversation:     

Our annual state of the medical device industry event focused on some of the hottest areas in medical devices today: from mobile health solutions to personalized medicine and consumer devices. Our panel spoke on a range of solutions from social media applications that bring connectivity and meaning in support of patients, to medical record tracking devices leveraging mobile technologies to robotic instrumentation and tools, networked together to glucose monitoring devices and software and beyond.

Gone are the days where a device stands alone. We are looking at a future where devices are integrated with software to better serve the patient, to better facilitate communication between practitioners and patients and providers and caregivers.

But with progress can come complications. The conservative bent of the FDA and their new, more stringent regulatory paradigm, particularly the 510 requirement, making it difficult for large corporations and almost impossible for small entrepreneurs to get approval. In addition, even the integration of simple and know software and protocols, working in conjunction with previously-approved devices can cause delays and hurdles from the regulatory side, as well as the reimbursement side.

So today's entrepreneurs and intrapreneurs must be clear on the revenue model, and the impact that approvals and reimbursements might have to a revenue path. In fact, some funds will have a requirement that portfolio companies DON'T requirement approvals in order to be considered for funding. So solutions which are more 'health and fitness' or 'information' based, without a tie to diagnosis or prognosis might be more attractive.

There is a movement to digitize health records to facilitate interoperability and connectedness, with 17 billion dollars to back it up. But the US is so behind in doing this, and the many stakeholders have been less than cooperative on agreeing on standards for doing this that it may take quite some time and money to happen.

Because of the regulatory, reimbursement, patient record challenges and the astronomical rise in health care costs in the US, many entrepreneurs are looking outside the country to build products and perform initial clinical trials. It still holds much more credibility to have FDA approval, so entrepreneurs are in general electing to return to the US with preliminary data which would make it more likely to be approved in the US. However, time and cost challenges are frustrating and thwarting entrepreneurs, corporations and investors alike, and the trend is not sustainable.

A second unsustainable trend is related to the health insurance reform, which has put 20 million new people into the system. Caregivers need to find way to bend the cost curve and serve these additional patients.

Given the trying circumstances above, the panelists remain bullish about the opportunities ahead. So, where is the money?

1. What are the opportunities for empowering patient by providing them with their medical records, and training them on self-care, and enabling their caregivers to assist with the care?
2. How can health care processes become more efficient - treat more people more effectively?
3. How can we build communities of 'Patients Like Me' and monetize it?
4. What are the opportunities for skilled practitioners to train the next generation, and for them to train nurses and for nurses to train at-home caregivers and for caregivers to train patients?
5. How can volumes of data regarding procedures and patients better inform practitioners and patients so that the can better address symptoms?
6. How can health care systems like Safeway's spread beyond the company and encourage and incentivize its employees to better take care of themselves and better manage chronic disease?
7. What are some systems and solutions and tools that encourage self-management of chronic diseases, with a built-in support system connecting patients to caregivers with each other?
8. How do we make the volumes of data available about patients into formats which would provide value to patients, insurers and providers, and what is the revenue model for that?
9. What behavioral drivers will lead to better health, and how can you incentivize patients to adopt these habits, and share process on these measures?
10. Focus not necessarily on what's new, but how something already proven can be leveraged in a new way, perhaps a mobile solution applied to healthcare.

So parting words of wisdom for you from the panelists: Go after wellness and consumer devices, and don't make any claims on disease diagnosis and treatment. Develop a consumer mobile game-changer application which add value, perhaps answering some of the questions above, partnering with universities and corporations along the way.

FountainBlue's August 16 Life Science Entrepreneurs' Forum was on the topic of Navigating the FDA Approval Process, and featured our esteemed panel of speakers:

Facilitator Susan Rowinski, Sue Rowinski Group, Reimbursement & Marketing Consulting for the Life Sciences

Panelist Madhuri Bhat, Vice-President, Clinical & Regulatory Affairs, Corventis

Panelist Brent Blackburn, President and CEO, Rpaidscan Pharma Solutions, Inc,

Panelist David Lustig, VP of Business Development, Optivia Biotechnology Inc.

Panelist Melanie Sit, Business Strategist, Optovue

Panelist Alice Varga, VP of Regulatory Affairs and Quality Systems, Geron

Please join me in thanking UCSC for graciously hosting us for this event, and to KPMG for sponsoring this event. Below are notes from the conversation:    

The panelists concurred that entrepreneurs and execs need to be strategic about how and when to navigate the FDA approval process, devoted to building relationships with the decision-makers  throughout the process, and creative, persistent and flexible during the process, particularly now when there is so much transition on policies and standards and even the FDA approval team.

With recent scares and developments in the life science space, and the rapid advancements in technologies in all life science sub-industries, the FDA approval process is emphasizing the safety side rather than the efficacy side, and there is strong emphasis on the need for predicate devices already approved and used successfully. The FDA approval team needs to get up to speed with the advancements in technology throughout all life science sub-sectors, from biomedical to medical device to personalized medicine to pharma, but take into account companies who are leveraging software, devices, pharma and biomedical in combination.

But there are companies which are successfully navigating the process, and the panelists shared their words of wisdom to help you ensure that yours does.

Be Strategic

• When strategizing for the FDA approval process, consider also the overall company strategy from development to marketing to channels and partnerships. Consider also the reimbursement strategy as that can help you make your case for approval, and better position you for reimbursements following the approval. For example, embedding a reimbursement study into a clinical trial might take nominal amount, and bring extraordinary ROI potential.    
• Create a solution which is unique and in need, but communicate on how the known parts of your solution have precedence, and others in your field are successfully getting approvals. Also consider breaking down your solution into a known, safe part, with a smaller add-on solution which is more unique, but only a small part of the overall solution.
• When possible, make a case for simpler approvals, for 510s rather than the da novos or PMAs, seeking relevant recent precedent from companies in a similar space.
• It can be quite expensive in both time and money to undergo an FDA approval process, particularly for an early stage company, so strategize and plan accordingly. So find the right balance between getting enough detailed responses and information, as requested and not over-doing and over-spending, even going so far as to make a case for why a requested report might be too taxing, too onerous, in terms of time and resources.
• Seeking FDA approval is a different process in a small company than a large. The up-sides of being in a large company is the influence, the resources, the market and the past precedents. The up-sides of being in a small company is less bureaucracy, more flexibility and creativity. Companies big and small are getting approvals, so choose the experience that would work best for your skills and style.
• There's a difference between the CEBR and CEDR approval teams - the CEDR team has more time to conduct these types of meetings, but it's worth the effort to the team most relevant for you and your company.
• Pay particular attention to labeling before, during and after the FDA approval process. Be specific about your claims; have the data to support them; and ensure that you are approved to make the claims as your solution evolves after the approval itself has been done.

The Approval Process Is Continually Changing, So Accept This

• There has been a lot of transitioning within the FDA itself, with many people leaving, and many new people joining. This means that people won’t have as many knowledge and experience with products previously approved in your category, and also that the new people may not only be new to the FDA, but also new to business. Work with the team who is assigned to your case, and educate them to get them up to speed on your solution.
• The FDA offers different levels of requirements, from the full must-do to the recommended but not required tasks which is part of the process (but you better have a data-driven reason if you're not going to do it), to the articles in journals which suggests actions and measures to take when undergoing the approval process. Being aware of all these requirements and how they may be constantly changing, and working with them will greatly increase your likelihood of getting an approval.
• FDA requirements are rapidly changing and becoming more safety-oriented and efficacy, with a lot riding on precedent, pre-approved technologies.

Be Persistent, Thorough, Engaged and Responsive

• It takes a long time and it's a long process to get FDA approval. From the pre-meetings to the phase one through phase four and pre-IND, be clear and up-front in communications, continue to build relationships with your reviewers and build momentum for the company overall, and remain persistent and dedicated to the cause, while being responsive and respective to the changing requests and requirements of the FDA approval team, and providing information and assurances throughout the process.
• Engage in pre-meetings with the FDA approval team when you are fully prepared to do so. Knowing enough about what you're doing and the general direction and getting the advice of the FDA approval team can be really beneficial, and in fact, they can make suggestions which can help you change your strategy and accelerate the approval. Don't be afraid to ask the hard questions which you may not want to hear the answer to, but definitely don't ask questions you could answer by doing the research yourself. In short, be prepared enough to tell the right story, provide the right data, know your agenda, and communicate your expected strategy, open enough to respond to feedback, and provide constant communications before, during and after the pre-meeting.
• FDA approval team is currently full of young, smart, dedicated and passionate people, who may be new to industry, but definitely know their science. Some are more thorough and detail-oriented than others, but the one you're assigned to will have a great deal of influence, so work with what you have.
• If you are in the review process, your FDA agent is more trained, and more empowered to review all aspects of the drug or device under consideration, not necessarily just one aspect of it, which was the previous trend.
• Work with your team and company to develop a reputation for navigating the FDA approval process successfully and collaboratively, educating the FDA approval team and making them successful too. It will make it easier for you, your team and your company to succeed with the next submission.

Seeking Approvals Outside the US

• In working with approvals outside and within the US, recognize that most countries want clinical trials with natives from their country, not just immigrants of that ancestry. This may add time and money to an already tight budget, but it's generally a necessary part of the approval process, and would open up new markets and opportunities should you get that approval.
• Other countries have requirements and questions about manufacturing and operations of your product, and may look favorably on your company if you are considering local options for doing so.
• If you are working with Europe, note that there are 27 member states, so you will be dealing with 27 representatives. The questions will be written, detailed and straightforward.
• Regardless of which country (ies) you’re working with, develop a marketing strategy which works in concert with your approval strategy, to ensure that you get the volume of sales you’re expecting from that market. Your investors and approvers may not be happy if your product is approved, but there's no market for it.
  

In summary, the panel encouraged everyone to know your science and have answers to questions based on data; to be strategic and relationship-driven throughout the approval process and beyond, and to be flexible yet persistent, and work with others to evolve the FDA approval process which supports safety, rewards efficacy, and is based on data and precedence.

FountainBlue's June 14 Life Science Entrepreneurs' Forum was on the topic of The Opportunities and Challenges with Medical Imaging and featured:

Facilitator Mark Foster, General Counsel and Secretary, Volumetrics

Panelist Tobias Funk, PhD, Principal Physicist, Triple Ring Technologies

Panelist Dave Scott, Director, Imaging Systems, Intuitive Surgical

Presenting Entrepreneur Kirk Knight, COO, SurgOptix

Presenting Entrepreneur Tom Moore, Founder and CEO, SVMII

Presenting Entrepreneur James Peacock, Founder; CEO; Managing Member (Chairman), NociMed

Please join me in thanking our speakers above, as well as our hosts at UCSC Extension and our sponsors at KPMG, all of whom make our work possible.

Below are notes from the conversation:

The panelists agreed that medical imaging is a hot new opportunity for several reasons: X-ray imaging is safe, cheap and fast, real-time diagnostic imaging is necessary for the next level of surgical innovation as it provides more information for surgeons to effectively do their job, and new collaborations between big companies such as GE, Phillips, and Siemens, early-stage entrepreneurs innovating in this space, academics researching in this space, and other stakeholders are indicative of the tremendous opportunities ahead.

Indeed, advanced and specialized medical imaging solutions are providing new opportunities for physicians and surgeons to better serve patients from a diagnostic and treatment perspective. Imaging can for example illuminate different kinds of tissues in different ways, making it easier for practitioners to diagnose and treat patients more efficiently and effectively, with less pain, better chances of recovery, and faster recovery periods.

There is a wide range of available imaging solutions. Just on the panel itself, there is a solution which illuminates cancer cells, making it easier for surgeons to see and remove them; a solution which provides cardiologists and other physicians with the best image quality, highest image resolution, and greatest ease of use, making it easier to treat patients more effectively; and a solution that enhances the utility of MR exams as a reliable, non-invasive, non-painful, objective alternative to replace provocative discography for diagnosing discogenic (lower lumbar) pain. Each solution leverages medical imaging to generate information for practitioners to more effectively diagnose and/or treat patients real-time.

The panelists concurred that it is a tough funding environment, particularly for life science entrepreneurs and had the following advice for entrepreneurs regarding funding:

• Consider corporate partnerships, but be selective about who you approach and why and be especially strategic around timing.
• Strategically consider European and Asian markets and collaborations on a case-by-case basis, focusing on serving these huge markets, and leveraging the differences in policy and approval to escalate approvals in the US market. Go after the largest international market where reimbursements are higher, approvals are easier.
• Be flexible about what your product or service does and for whom, and be persistent about getting it out into the market.
• Develop partnerships with universities and research organizations to bring existing technologies out of the labs while leveraging their name and credibility, but be strategic about forging these partnerships, particularly around IP issues.
• Accept grant funding where strategic as these non-diluted investments can help build technologies. But don't be too reliant on grand funds to grow your company and commercialize your technology.
• Stay focused on creating clinical value. Communicate this value to patients and practitioners that through white papers, testimonials, articles, etc.
• Focus on what will save hospitals and practitioners money, with shorter hospital stays, better efficacy and effectiveness.

In conclusion, the panelists concurred that there are huge opportunities for medical imaging. The savvy entrepreneur will identify a hot new technology, plan strategically on how to bring that product to market in a tough funding environment, working in collaboration with key stakeholders from corporates to academics to hospitals and patients and funders.

FountainBlue's May 17 Life Science Entrepreneurs' Forum was on the topic of Technology Acceleration, Globalization Pressures and the Future of Pharma and featured:

Facilitator Laurie Allen, Attorney and Director of Southern California Practice, Royse Law Firm PC

Panelist Andrei Blasko, Director of Analytical Method Development, Pain Therapeutics

Panelist Bill Goure, President and CEO, Acumen Pharmaceuticals

Panelist David Lustig, VP of Business Development, Optivia Biotechnology Inc.

Panelist Ronald Rawson, Managing Partner, R&R Ventures

Presenting Entrepreneur Julia O'Connor, CEO, Accelalox

Below are notes from the conversation.

The acceleration of technology development and the up-sides of globalization can help both large pharma and small start-ups, and all the value chain of stakeholders in between, address the overwhelming time and financial hurdles inherent in building a new drug for the market.  

Indeed, it will take a collaboration between stakeholders to successfully bring a drug to market, with each stakeholder assuming the optimal role:

• University professors, researchers and scientists in the labs discovering new compounds, reagents, etc.
• Early stage entrepreneurs partnering with universities to begin taking these drugs out of the market.
• CRO leaders partnering with entrepreneurs to further advance the development and testing of the drugs.
• Government officials awarding grants for early stage development efforts.
• Large pharma execs supporting R&D efforts, and leveraging their channels for marketing, branding, manufacturing and distribution, and their financial backing for clinical trials.
• Insurance company policymakers rewarding patients and hospitals for using newer, more cost-effective, drugs which show high efficacy.

As an entrepreneur and a single stakeholder in the chain, it is often an overwhelming task to forge partnerships with other stakeholders, yet this is what it might take to succeed. Identifying a relevant drug with a huge market, having an experienced team with proven effectiveness in meeting early milestones through friends, family, angel funding, and building relationships across the value chain are all critical components to the success of a small pharma company.

Though the odds seem overwhelming, identifying the path to short term revenues and a business model for longer term profits can help separate the fundable company from the also-ran. In addition, earning an SBIR, Fast Track or other grant is additional validation for the science and the business of early stage drug ideas, and delivering on the grant milestones is critical for obtaining further investment and support.

It is also critical to run lean as an early stage pharma, and even consider being a virtual company. Hiring out consultants and specialists, wherever they are located around the globe, for each phase of the company development, from R&D to trials to manufacturing and support, will ensure that you have the right people for the right projects, without maintaining a huge overhead of staff which nimble companies can't afford. With that said, it is essential that the core management team has the knowledge, competence and abilities to manage the outsourced team, to ensure that milestones are met and momentum keeps moving forward.

There are huge opportunities in repurposing existing drugs and compounds, and also developing new drugs which have high efficacy without known side effects. Leveraging naturally-occurring compounds is another strategy for accelerating the time to bring a drug to market, particularly if the compound has been used for centuries effectively. But regardless of how you identify a drug, make sure that you are finding a drug that will serve a large market. Consider the aging baby boomers and the types of ailments they may experience: from CNS related issues that are stress related to cancer, diabetes and other ailments for older people in general, to the solutions offered by personalized medicine, from diagnostic to treatment, to software solutions for health care management around pharma, to medical devices, nutritional supplements, lifestyle choices, etc., all targeting an aging population.

Once a drug has been identified, note that technology innovation is becoming very global, and leverage this fact to outsource development to the right people and companies, focusing on meeting milestones and objectives. With that said, innovation in the US for technology, for discovery, for business process, for manufacturing, etc. is a core US value-add, and innovations in each of these areas will likely continue.

The panelists concurred that the pharma industry is maturing, and therefore the low-hanging fruit has been picked, drugs which have high efficacy, low manufacturing costs, few side effects. Remaining diseases are more complex, from diabetes to cancer to neurological disorders and personalized medicine. Therefore, it takes more time and money to bring solutions for these ailments to the market. In addition, the FDA's role is to serve patients and ensure their safety, not necessarily to grow the industry, and can be a barrier to progress for early stage pharma companies. Plus reforms in the health care industry from insurance to reimbursements to policies are imminent, but nobody is certain what will happen or what it would mean for their solution and market. This makes entrepreneurs, investors, researchers, and everyone in between uncertain about how to move forward.

In summary, taking measures to de-risk your company and its technology, whether you're running leaning, leveraging an existing or natural compound, recruiting the right team, earning grants and approvals, etc., coupled with proven milestones and strategic partnerships across the value chain are key to the success of an early stage pharma company, particularly in this market. 

Facilitator Roger Royse, Royse Law Group

Panelist D. Christopher Chung, M.D., Vice President, Medical Affairs, R&D, and Engineering, Natus Medical

Panelist Dr. Arthur Douville, MD, Chair, Advisory Board, Clinsensus, Chair of the Department of Neurology at Good Samaritan Hospital in San Jose

Panelist Gary Heit, former Stanford Professor, Staff Neurosurgeon, Dept of Neurosurgery, Kaiser Permanente Hospital, Redwood City

Panelist Michael Leong M.D., Interim Executive Director, Pain Center Stanford

Panelist Brian Wilfley, Chief Scientist and co-Founder, Triple Ring Technologies

Below are notes from the conversation.

Our panelists concurred that regardless of the range of solutions offered to physicians from pharma to software solutions for physicians or patients, to devices and imaging and diagnostics, the successful life science entrepreneur must address a clear and present need, meet all safety and regulatory requirements, be cost effective, AND work collaboratively with the range of stakeholders to ensure the adoption of the solution: from patients to doctors to administrators to regulatory and compliance officials, but especially with customers.

In selling to physicians, keep in mind that there is a lot of collaboration and coordination involved between all the stakeholders as mentioned above, and the burden of responsibility is on the entrepreneur to drive the conversation forward.

Choosing the status quo is a valid option for many solutions, so the entrepreneur must identify an area of real pain, of pressing clinical need, and deliver it to patients cost-effectively and safely. Building and selling such a solution is the challenge

The savvy entrepreneur effectively manages relationships and communications between all these stakeholders, and proactively drives the forward momentum in the development, testing, and adoption of solutions. This is generally a long process, one that many investors are reticent to fund in today’s climate.

Unfortunately, in life science industry, innovation does not necessarily drive down costs, and higher costs are barriers to rapid adoption and higher returns. The costs is what the market will bear, and blockbuster drugs, for example, are what large companies were banking on to recoup costs for other business expenditures. However, trends such as the adoption of generics, the continued rapid advancement of technologies, and the push for personalized solutions are pressuring companies large and small to offer highly effective, customized solutions to niche markets at reasonable costs.

Another unfortunate fact about innovations in the life science industry is that physicians are not necessarily encouraged to be early adopters of technology innovations, unless they are fully vetted and approved and in use successfully elsewhere. But even then, it takes a persistent physician champion to make the case to hospital administrators that a new product or service or process or infrastructure solution should be adopted across the institution. It takes time and persistence and patience, but it can be done as hospitals are continually challenged to deliver services more effectively and efficiently to their patients.

The panel covered some audience questions around hospital acquired conditions and processes and policies around hygiene, security, prevention, and standard procedures were discussed as options for mitigating the onset and spread of hospital acquired conditions, but the consensus is that although we can never reach 0 occurrences, effective habits and proactive strategies can help reduce these occurrences

So the challenge remains for the entrepreneur to create and drive a disruptive innovation, or even an incremental improvement in efficacy or cost, and secure investors, partners and customers, despite the funding, adoption and coordination challenges inherent in selling products and services to the physician’s market.

The challenge to the physician is to deliver the quality of care and services to patients, leveraging the right balance of offerings, while remaining a healer rather than an automated caretaker.

Resources:

• Redefining Health Care by Michael Porter http://www.amazon.com/Redefining-Health-Care-Value-Based-Competition/dp/1591397782
• The Innovator’s Prescription: A Disruptive Solution for Health Care by Clayton Christensen and Jerome Grossman http://www.amazon.com/Innovators-Prescription-Disruptive-Solution-Health/dp/0071592083/ref=sr_1_fkmr2_1?ie=UTF8&qid=1271799388&sr=1-1-fkmr2
• Building a Better Delivery System: A New Engineering/Health Care Partnership by Committee on Engineering and the Health Care System http://www.amazon.com/Building-Better-Delivery-System-Engineering/dp/030909643X/ref=sr_1_fkmr0_1?ie=UTF8&qid=1271799514&sr=1-1-fkmr0
• Performance Measurement Initiatives including Core Measure http://www.jointcommission.org/PerformanceMeasurement/PerformanceMeasurement/default.htm

FountainBlue's March 22 Life Science Entrepreneurs' Forum was on the topic of International Challenges and Opportunities for Life Science Companies and featured:

Facilitator John Bashkin, VP of Strategic Business Development, Triple Ring Technologies

Panelist William Goure, President and Chief Executive Officer, Acumen Pharmaceuticals

Panelist Taylor Kilfoil, President and CEO, InClin, Inc.

Panelist Evgeny Zaytsev, General Partner, Helix Ventures

Panelist Key Shin, Of Counsel, Morrison Foerster LLP

Below are notes from the conversation.

Life science leaders are responding to the rapid technology advances and huge markets for solutions across the globe by ensuring that international strategies are in place for everything from R&D to clinical trials to funding and manufacturing and distribution.

Leaders are looking closely at developments in China, South Korea and Japan and Singapore, although partnerships with European companies and markets remain strong. Nations across the globe are expanding both R&D and manufacturing capabilities, making it attractive for life science leaders to partner with companies in other countries to outsource a range of functions, both to increase efficiency of development, testing, approval and delivery, but also to efficiently distribute solutions to local markets across the world.

In addition, with the current conservative outlook of US investors in response to recent dismal returns on investments, entrepreneurs are seeking international sources for investment dollars. Money IS flowing in from international investors, but these investors lack the sophistication and experience of US investors, and entrepreneurs will need to be flexible and cautious in working with inexperienced international investors as cultural and business norms may not be in alignment between investors and investees.

Considering the above information about technology and market and investor trends, the panel advised early stage entrepreneurs to:

• Be as capital efficient as possible and achieve milestones prior to seeking funding.
• Be aware of cultural differences between countries, as it will factor into the business relationship as well as the outreach and distribution strategy.
• Accept that people from other cultures have different ways of doing things and that the focus should be the end result, not HOW things should be done.
• Cultural attitudes to technology will impact how rapidly solutions are adopted. Denmark might be receptive to digitizing records whereas those in Belgian would be more reticent.
• Be clear on objectives and terms for everything from financial arrangements to roles up front, yet flexible about how to resolve differences should you and your investor have differences in opinion and intent during execution, and be willing to make contractual changes as the relationship and needs develop.
• There might be updates of initial contract development and commercialization terms for example.
• Anticipate that interpretations of contractual language may cause confusion and misalignment even early on. If/when you see a dis-connect, proactively address the conflict and take action to resolve it.
• Pay attention to IP issues, especially with international entities involved.
• Note that many companies are electing to be based in the US trusting US IP policies over those of other nations.
• Advance your technology and solution and provide data that will support its usage.
• Be transparent about the technologies and the testing and R&D. Don’t try to bury data or silence investigators.
• Understand and work with the idiosyncrasies of each international market and channel.
• Relationships with the right people and agencies can make the difference in whether your product can be developed, manufactured and distributed in another country.
• Consider in-licensing agreements with the right international strategic partner who is fully integrated into the culture.
• Standards in developing countries may fluctuate between being very rigid and cautious and more flexible as markets evolve, much like US standards have.
• Reimbursement standards vary across nations, and should be factored in as you strategize which markets to target, how much you would have to charge patients in different markets as well as the overall ability of customers to pay for products and services.
• Technology infrastructure will impact the pace of adoption in different countries and should be factored in when considering international partnership and outreach strategies.
• Consider escalating the development and approval of your life science product or service by outsourcing specific aspects of your business.
• Launch product outside the US where regulatory standards are not as high. Data on successful offerings offered outside the US will increase the likelihood that your solution will gain approval to US markets.
• Consider performing clinical trials outside the US both to save money, and also to get a large volume of test subjects more quickly. With that said, be strategic about where clinical trials are performed so that they reflect the needs of your target audience (for example hepatitis testing in Asia) and increase the likelihood that the solution will receive US approval.
• Consider partnering with nations who are proactively encouraging life science solutions like in South Korea or Singapore or India or Australia, particularly if there is a large potential market for your solution.
• Have internal project management expertise to proactively manage international partners.
• Consider opportunities for research collaborations with research and academic institutions.
• The bottom line is the life science entrepreneurs, intrapreneurs and investors must be aware of international challenges and opportunities, and strategically integrate this knowledge as they grow their organization. However, the US remains an attractive location with its top flight universities, culture of innovation and risk tolerance, huge markets, protective IP laws, infrastructure for supporting entrepreneurs, including knowledgeable investors, experienced executives and seasoned service providers.

FountainBlue's February 22 Life Science Entrepreneurs' Forum was on the topic of Show Me the Money: Resourceful Ways to Secure Funding for YOUR Life Science Company in THIS Economy and featured:

Facilitator Maria Walker, Senior Director, KPMG

Panelist Zachary Antovich, President and CEO, Linkage Biosciences Inc

Panelist Howard Edelman, President & CEO, VitalWear

Panelist Oostur Raza, President and CEO, OmegaGenesis

Below are notes from our conversation.

Historically known as a slow-moving industry, the life science industry has also been more resilient and less impacted by the recent economic challenges. Our panel of seasoned entrepreneurs leveraged their connections, their experience, their successes, and their creativity to successfully secure both traditional and non-traditional funding. The entrepreneurs were generally self-funded to build initial prototypes prior to securing outside funding in the form of seed and angel investment dollars.

The following is advice from our entrepreneurial panel on how to secure funding in this difficult environment.

Have a clear solution for a large market:

• Have a clear vision and focus for your company, and adhere always to the values you hold dear, even during the stress and demands of growing an early stage company.

Have a leader and team that is experienced and passionate:

• Be driven and passionate about what you do, but also be willing to fail quickly if you run into hurdles. There’s also an option to change course, to a corollary path for example, rather than fail altogether, always considering the needs of the market and customers.
• As a leader, know what you know and are good at and recruit a team to fill the gaps of your expertise and experience.

Execute:

• Establish criteria for mitigating risk throughout the company development process, from R&D to sales to capital raising to FDA approval etc.
• Work yourself to profitable using specific milestones. Sell your execution successes to secure the next level of funding to further grow your company.
• Be realistic about the role of venture investment for your company. Not everyone needs it or should have it. It’s about growing the value of your company for your customers and growing the bottom line, not about whether a VC will invest multiple millions in your company.
• You don’t have to focus on just one solution, but may have different offerings with different objectives – one might have nonprofit uses, and the other might be a pure revenue generator for a  huge market. Both would fit the overall company model.
• Find the shortest, lowest-risk, creative path to building traction for your company.
• Work toward clear strategic objectives. Have an exit in mind, and build partnerships and relationships that would lead you in that direction.

Be Nimble and Flexible

• Keep networking and learning, but apply your learnings to your own unique circumstances. There is no panacea, but relentless, passionate, driven enthusiasm can build forward momentum for your company, drawing in the people and money you need to grow it.
• Learn and grow from your mistakes. In fact, there are more opportunities to learn from mistakes than there are for your successes.

Build Relationships with Key Partners:

• Partner with research institutions to manage resources, build partnerships, and gain credibility on your research.
• If you are seeking an investor, do your research in terms of whom to partner with and what you would like them to bring to the table besides money. It could be connections and introductions or strategic support, for example. Whoever you decide to partner with for funding, make sure that they are 1) good strategic investors; 2) actively investing; and 3) select someone you want to work with, for you will be working together closely for a long time, and things will not always go well!

The bottom line is that it’s tough out there to build momentum, but entrepreneurs on our panel were resourceful enough to build and fund their companies, providing quality services to their customers. The difference is dynamic leadership, serving expanding markets, leveraging creative solutions to ensure effective execution of a clear vision.

FountainBlue's January 25 Life Science Entrepreneurs’ Forum featured an angel panel speaking on Trends for 2010:

Facilitator Conor Moore, Partner, KPMG

Anne DeGheest, Founder and Managing Director, MedStars, Strategic Advisor at PolyRemedy, Inc

Stuart Eckmann, Keiretsu Forum and Life Science Angels

Don Ross, Member, Life Science Angels and Sand Hill Angels

Michael Weickert, President and CEO, S.E.A. Medical Systems, Inc., Member, Life Science Angels, Venture Partner, Kranenburg Fund 

Below are notes from our conversation.

Our panelists started by remarking on both the fact that there were 40% fewer dollars AND 30% fewer deals than in 2009, the lowest level of activity since 1997, however, they remarked that angel investing is still very active with smaller amounts for more deals. But as 10% of the deals have paid 75% of the total returns, many investors, particularly early stage investors who are more likely to get diluted in future rounds, and who might have incurred huge losses, are much more cautious. VCs are actually even more cautious, waiting for angels to vet and fund early stage companies. As one investor put it, ‘there is no money on the sidelines’ - investors are already “all-in”.  There is also unlikely to be additional money as we are all “exit challenged”, with the disappearance of the IPOs. 

Angels today are much more discerning about WHICH deals and HOW MANY deals to invest in (they may be exposed to as many as 400-500 a year, and only invest in 10 or so), they make smaller investments, and they focus on deals with an early exit strategy. 

Angels and all investors and partners are even more hesitant and discerning as there are too many policy and reimbursement unknowns. It is difficult to plan for customer and market needs while there are FDA, reimbursement, and other major policy decisions being made.

With that said, if YOUR company is one of the companies selected by an angel investor, you will receive much more attention, support, advice and introductions. In YOUR company had ALREADY secured funding recently, angels might be more apt to contribute another round of funding, depending on how you are doing meeting milestones. In fact, each panelist remarked that some of the best investment opportunities happen during a downturn!

So what’s an entrepreneur to do? VCs are shying away from early stage investments, and angels are more cautious than ever, although funded companies are more likely to secure more funding. Below is some advice from our angel investors:

• Secure non-diluted funding such as government grants: it provides both validity for the scientific concept, but also for the persistence, hard work and know-how and connections for its founders – a very good thing.
  Partner with big pharma companies and academia and hospitals and even the military to build traction for your technology and move your company forward with little resources.
• Do the market research and find customers who are willing to pay for your solution. Partner with them to define your product and solution. In other words, serve the customer and market, don’t be a technology looking for a market.
• Recruit great employees willing to work for sweat equity or low salary.
• The market might be permanently re-set to focus on the markets rather than on the science. Your long-term company strategy, and your career decisions should reflect that fact.
• Be the type of entrepreneur who can respond quickly to changing market needs, and more stability with policy, reimbursement, etc.
• Understand clearly how investment dollars can help move your company forward and be able to articulate it to strategic outside investors, including angels.
• Create a connected, experienced advisory board who can help you focus on meeting milestones and moving your business forward.
• Manage limited resources well, and prove that you can do a lot with a little. Virtual companies will become more popular.
• The expectation for 2010 is that investments will be flat to slightly higher, with modest increases until more money appears in the system through exits.

Below are specific challenges and opportunities for life science sub-industries:

Biopharma does not make sense at the angel level because of the amount of the time and investment dollars to an exit, the technical and commercial risk, and the money required to achieve an exit event. In fact, as there are so many more un-knowns than knowns in biopharma, even with its astronomical advancements over the past decade, pharma companies can require 7-8 rounds of financing, increasing the risk of diluting early investors to a “wipe-out”.  This is not good for angel investors, friends and families, as they are more likely to lose a lot of many, or reserve very diluted returns.

Our panelists recommend that biopharma entrepreneurs partner with academia and Big Pharma to find support (money, services).  Suggestions for biopharma entrepreneurs include finding novel mechanisms of action, finding a new more efficient business model to reduce cost and risk, providing cross-disciplinary integration, and encourage more risk adversity even in academia.

Entrepreneurs, intrapreneurs and investors alike recognize that when there is a ‘win’, the return is substantial. The challenge is to see past the science, focus on the product and the market need. Consider cross-disciplinary solutions – e.g. systems biology and develop a better understanding of disease states and complexity. There are still significant unmet medical needs, and huge interest and markets in 3rd world diseases/cures and other global market opportunities, as well as genomics and patient selection. In addition, specialty companies need new products, and there are opportunities in biosimilars and generics. The convergence of biology and biopharma and computers will also prove interesting.

Personalized Medicine solutions provides opportunities to customize solutions so that they are more effective for individuals, while better understanding genomics. In partnering of therapeutics and diagnostics and academia, we may be able to better educate consumers and doctors and insurers and policymakers and others, and encourage early partnering of these stakeholders.

Systemic change is needed to make the economics for personalized medicine work out, for, by definition, each solution should only serve a small segment of a market, and customized solutions must be efficiently produced and distributed. There are additional challenges around reimbursement models and ROI for investors who are looking for large markets to serve. In addition, in the current health care system, doctors get paid when they prescribe general prescriptions when you are sick, not to prevent sickness or to create a custom prescription to better cure you if you get sick.

Medical Devices from products for the aging, to monitoring and drug delivery and other devices sold directly to patients, to wellness products leveraging technology advancements have become more available, more technology-integrated, and more patient-driven. Challenges for the medical device sub-industry include a proposed Medical device tax, reimbursement ambiguity and trends, technology standards, data-over-abundance, and sometimes too much competition in the marketplace. Despite these challenges, many devices are going mainstream, helping more people, and with our global and aging markets, the opportunities are huge.

Software Solutions are favored by angels who are interested see the interface of IT and devices as the lowest risk, fastest exit segment of the life science industry. Factors such as the human genome project and  our ability to understand, study, predict and treat genome-related conductions, the huge market with many needs at the intersection of biology and technology, from healthcare and prescription management to medical device diagnostics to personalized medicine and medical imaging solutions, etc. make this sub-industry an interesting one for entrepreneurs and investors.

One of the challenges of delivering products and services in this sub-industry is the challenge of silos: organizations and groups who are working individually to solve a problem rather than working with peers and cohorts across companies and roles and industries. Indeed, if the large technology companies could work collaboratively with large academic institutions and hospitals and government and patients, we could work together to create a ‘Salesforce.com’ solution managing huge volumes of data, with cloud computing aspects including interconnectivity, large computing power, and work together to find ways to monetize solutions which benefit people.

Medical Imaging Challenges for medical imaging include declining reimbursement, the high cost of new equipment and relative effectiveness of old equipment deter innovation, and even the current administration's HealthCare IT policy, which would distribute dollars to IT taking priority over the adoption of new equipment. Opportunities include interventional cardiology as specific market, smaller, less expensive imaging opportunity in small practices (primary care physicians) vs. hospital and other opportunity supported by forward-thinking companies such as Japan and Germany.

The bottom line is that we should all partner to create an ecosystem ripe for innovation in all life science sub-industries, with the funding, technology advancement, and risk-tolerant culture needed to address the huge market opportunities ahead.

FountainBlue’s November 19 Life Science Entrepreneurs’ Forum was on the topic of Personalized Medicine, Biomarkers, Invitro Diagnostics: The Science Advances, The Business Opportunities, The Cultural Dilemmas and featured:

• Facilitator Linda K. Molnar, LKM Strategic Consulting
• Panelist Doug Dolginow, MD, BOD and Founder CSO/CMO, Veracyte, Inc and Adviser to Personalized Medicine Start-ups
• Panelist Kimberlee Caple, Vice President, Genetic Systems Division, Applied Biosystems, part of Life Technologies Corporation
• Panelist Ted Driscoll, Venture Partner, Claremont Ventures; Active Member, Life Science Angels; Founding Director, Sand Hill Angels
• Panelist Dick Haiduck, Partner to the CEO, Implicit Bioscience and Compugen, advisor to the Queensland Australia government
• Panelist Kendall Wu, Product Manager, Cytogenetics Portfolio, Affymetrix
• Presenting Entrepreneur Richard A. Goozh, Sr. VP, Strategy & Finance, Wave 80 Biosciences; Managing Director, Cambrian Partners
• Presenting Entrepreneur Massimo Bocchi, Chief Technology Officer, MindSeeds Laboratories s.r.l. and Fulbright scholar

Below are notes from our conversation.

Personalized medicine was broadly defined by our panelists, ranging from isolation of genomes for customized therapies and/or magnifying pools of similar customers to create viable markets for therapy monitoring and diagnostics. Personalized medicine goes beyond the patient in that it’s about the whole person through a whole life cycle, from the importance of genome mapping for children to prevention strategies for teens, and early detection and treatments for adults. There is the issue of personalization, or finding the right treatment for the right person at the right time, cost-effectively. There’s a whole separate element of prediction, which studies and tracks risk factors on who would get what disease when, and a third piece on prevention, based on information gained from personalization and prediction.

There are many opportunities in the area of personalized, where patients would get custom recommendations, diagnostics and therapies which would greatly increase the efficacy of treatment programs. With the challenges of aging demographics, the advancements in biometric and technologies in general, and the relative affluence of the patient population in need of therapies, the international market potential is huge, and large pharma companies, small start-ups, academic institutes, insurance companies, government agencies and other stakeholders are looking at the opportunities with great interest.

However, the very nature of personalized medicine brings the challenge of cost-effectively providing customized care quickly. There are so many constituencies involved in getting it right, from the FDA to the physician, from the patient to the reimbursement parties, from manufacturing to pharma to diagnostics, etc. Any one stakeholder not fully engaged and committed to a solution may doom its success.

In addition, with the longer development cycles and larger, more capital-efficient funding needs, coupled with the need to work with government regulatory agencies, investors are shying away from investing in this promising space, perhaps electing for later-stage companies or personalized medicine companies relying more on computational/IT solutions.

The panel offered sage advice for start-ups for will be tackling this market:

·         Identify a 500 million to multi-billion dollar market for the personalized medicine solution.

·         Find the market first, don’t develop a technology and then identify the market.

·         Find ways to develop personalized therapies working with existing healthcare system.

·         Consider reimbursement and regulatory issues when strategizing how you will serve your market.

·         Start-ups today are asked to be more resourceful, coming up with a prototype and defining the market even before they can secure outside funding.

·         Focus on the size of the market and what you can do to serve that market and how you will make money on it.

·         Understand from the insurer’s perspective where there are risk and how YOUR solution can address that risk cost-effectively and efficiently.

·         A coordinated effort between all parties is required to reform the current system, and everyone from patients to doctors to regulators to pharma and investors and particularly insurers must play a role. Understanding the need for reform, and a commitment to working collaboratively on the reform will help ensure its success.

The panel next highlighted some hot areas of interest in personalized medicine:

·         Diagnostics is involved in 80% of all treatments, yet it is only 2% of healthcare cost. It will take a long time to address this discrepancy, working within the system, but resourceful start-ups, working in partnership with insurers, patients, corporations, etc. and play a role in changing this, and opening up the market for personalized diagnostics and therapies.

·         There are tremendous IT and software opportunities for personalized medicine ranging from monitoring and sensoring and diagnostics to genome exploration and disease risk analysis.

·         There are niche opportunities for small personalized devices to diagnosis, monitor, or track.

The panel concluded with the need for all parties to be educated about the opportunities around personalized medicine, so that everyone can work in collaboration to better serves all constituents. Information is just once piece of the education puzzle – all parties need to know how to apply the information, working in collaboration to solve problems and create personalized medicine opportunities.

Resource:

·         The November 18 issue of the Personalized Medicine journal has a special issue on the topic of Delving into Personal Genomics, assembled by Elaine Mardis and Jeantine Lunshof, with some free and intriguing content. In their introduction, they say that "genome-based personalized medicine is no longer a thought experiment and the course of both disease research and medical practice will be substantially altered as a result" and that "the ethical, legal and societal implications of the developments in the genomic sciences cannot be ignored and require ongoing assessment." http://www.genomeweb.com/blog/delving-personal-genomics

FountainBlue’s October 19 Life Science Entrepreneurs’ Forum was on the topic of Software Meets Healthcare Services: Health IT Platforms, Pharmaceutical Tracking, Remote Monitoring and Beyond and featured:

• Facilitator Russell Singleton, President and CEO, Molecular Image
• Panelist Shannon Kelley, Director of Marketing, Intuitive Surgical
• Panelist John Steuart, Claremont Ventures
• Panelist Evgeny Zaytsev, Helix Ventures
• Panelist Steve Douglas, CEO, Data Physics Research
• Presenting Entrepreneur Rohan G.F. Coelho, CEO, Rexanto
• Presenting Entrepreneur Anthony Gioeli, CEO, MedAttune

Below are notes from our conversation.

Software Meets Healthcare Services highlights the convergence of technology and health care, and is a tremendously broad and promising area, which includes:

• Healthcare Infrastructure and IT Platforms,
• Software Diagnostics
• Imaging Solutions from Diagnostics to Prototyping  
• Biomarker and Genomics Businesses
• Remote Monitoring and Management of Patients and Drugs and Relationships
• Software Leveraged for Pharmaceutical Development 
• Medical Device and Diagnostics Solutions with Software Components
• Education and Social Networking Solutions connecting users of medical technologies and
• Many other areas.

Software Meets Healthcare solutions benefit health service professionals, from doctors to nurses, as well as insurers, hospitals, and patients. Other stakeholders include policy-makers who are leading the drive to reduce expenditures, corporations challenged by meeting skyrocketing insurance premiums and demanding patients who are more educated, more proactive than ever before. There are partly so many passionate stakeholders as the opportunity is HUGE – 2.4 trillion dollars, accelerating to 3 trillion dollars in the next decade. In addition, with an established infrastructure and rapid technology advances, coupled with an aging, affluent generation, this industry is positioned to grow exponentially. Indeed, many are claiming that the software meets healthcare area will be the next big technology wave.

Below are some questions which may help you hone in on excellent business opportunities in the software meets healthcare area:

• With the current administration’s emphasis on reducing the cost of healthcare:
• What software solutions will help manage the issuance, monitoring, distribution and review of prescribed medicines?
• What software solutions will help all stakeholders (from care-givers to insurers to payees to patients) better collaborate in delivering quality care for the patient?
• What software solutions can provide training to professionals, and build communities of support following or in combination with training?
• What are the opportunities if there were mandates for electronic medical records? How can historical patient record information be integrated into these comprehensive medical records, and what business opportunity is there in this area?
• With the rapid advancements in technologies:
• How can new processing capabilities assist in the review, design, planning, etc. of new products and services, from medical device to pharma to personalized medicine?
• What technology advancements will facilitate getting patients in and out of hospitals most efficiently and effectively?
• What technology advancements will better support outpatient care, while also ensuring optimal caregiver involvement?
• What technology advancements will help mitigate the expenses around the last-year-of-life, still by far the most costly health care expenditure for the system?
• What opportunities will the push for software standardization and interoperability open up?
• Consider the successes of other countries in their proactive management of healthcare services and what role software plays in these successes.
• With the patient empowerment movement, where patients are more tech-savvy, more demanding:
• What personalized information would patients demand to proactively manage their health and how can software solutions address this need?
• What free-mium and other business models can follow from this growing need?
• What web/mobile/GUI opportunities will arise with the patient demand for easily-accessed and easily-read personalized information?
• Personalized medicine is requiring exponential increases in use of data creating huge needs in bioinformatics. What opportunity opens up because of this?
• With the push-pull balance between collaboration/standards and the need for privacy:
• How can software help all parties have their cake and eat it too?
• What does mobile to mobile technology advances make possible for communication and collaboration between stakeholders?

With the immense opportunities ahead, the panelists also mentioned obstacles to adoption of software meets healthcare solutions. Adoption of software or any new solutions in the healthcare industry has historically taken longer as there are more mandates, procedures and requirements involved in the life science industry overall.

A specific challenge for those working on a software SAAS solution involving the collection and management of patient records, there are so many different standards across hospitals, states, nations, etc. and so much information about each patient that it would be difficult to input all the data into a single, standard format, and get all parties to agree on the process to update that common medical record. But while this would be a challenge, the financial opportunities and benefits would be huge.

Another challenge for those in the medical device industry is the challenge of integration and interoperability with federal and insurer mandates and standards, including EMR, EHR, PHR, and provide outcome data to prove they are effective or providers will not be able to be reimbursed for using them. 

There are several cultural challenges also worth noting. The issue of privacy and having a standard for privacy needs to be resolved to facilitate the mass adoption of patient record solutions acceptable to caregivers, insurers, payees and patients. Another cultural challenge is to get hospitals, insurers, caregivers, policy-makers and patients to work together in alignment to serve the needs of all.

The panel added the following advice to entrepreneurs:

• Build traction in product development, in partnerships, in revenues, in team, etc. with minimal funding.
• Build partnerships deep and early.
• Understand the idiosyncrasies of the industry – software professionals may not be used to the pace or culture of hospital and medical professionals, for example, but fitting in and being accepted by these people are a requirement for building a company serving them.
• Go after markets which the CVSs, Walmarts, Oracles, IBMs, Intels, etc. out there would think were too small.
• Focus on the customers you are serving and their pain points, and continue to efficiency and effectively serve that customer and market.
• Healthcare issues are huge. You don’t need to solve the whole problem. A piece of it would be huge. You don’t have to solve it overnight either.

The panel concluded by applauding the successes and investments of Kaiser Permanente, an insurer and a provider who has invested 10 billion dollars in IT and software solutions. Kaiser’s investment will be providing an infrastructure which would better support patients, better communicate between physicians and insurers, and better coordinate between all stakeholders. What lessons can we learn from this proactive investment, and how will it better position Kaiser to serve its members, who stay an average of 17 years with them?

FountainBlue’s September 21 Life Science Entrepreneurs’ Forum was on the topic of Medical Device Advances: From Implantables to Surgical Tools, From Diagnostics to Therapeutics and was generously hosted and sponsored by LifeScan. Please join me in thanking our sponsors at LifeScan and our dynamic panels who so generously shared their thoughts and advice on the state of the medical device industry.

• Facilitator Geetha Rao, Springborne Life Sciences
• Panelist Joseph Heanue PhD, President, Triple Ring Technologies
• Panelist Frank Ingle, Senior Research Fellow, Electrophysiology Division, Boston Scientific
• Panelist Sharbel Noujaim, VP of Product Engineering, LifeScan
• Presenting Evelyn Hu, Chief Marketing Officer and Director of Product Development, iShoe
• Presenting Tom Moore, President and CEO, Silicon Valley Medical Instruments
• Presenting Michael Weickert, President and CEO at SEA Medical Systems, Inc

Below are notes from our conversation. 

Trends of the Medical Device Industry

Today’s business and economic challenges in the medical device industry range from a skittish investor community with new, much higher milestone requirements for portfolio companies, to a conservative corporate investments and partnerships spurred by increasing demands from corporate shareholders, to international pressure to efficiently deliver products and services, to changing policies for regulatory and reimbursement standards and requirements.

Resourceful and resilient entrepreneurs can still succeed despite and even because of these challenges. To do so, entrepreneurs must:

• Creatively leverage the available funding options (from grants to friends and family etc.), talent pool (senior people are available as staff or consultants really cheap right now), and development/services discounts and deferred compensation options for consultants and staff, available because of the challenging business climate.
• Produce milestone-based results as you leverage these resources.
• Closely manage cash flow; do more with less.
• Focus on market needs now and in the near future, as we slowly recover from these challenges.
• Temporarily (or permanently) downgrade vision so that you can quickly generate early products and results. It can bring in revenues, get feedback from early customers for future products and solutions, while also making you a more viable investment and strategic partner. It would also be a smaller risk if the product doesn’t build traction in the market, and provide valuable feedback on who will buy what for what cost.
• Focus on clinical outcomes and pristine data that proves that outcome.
• Build relationships with everyone – from staff to partners to investors to consultants. Know who will come through for you under what circumstances and work collaboratively to build your business and support them in building theirs.
• With the virtual disappearance of IPOs as exits, interesting strategic partners in the device space might include Boston Scientific, LifeScan, as well as Medtronic, St. Jude’s, Siemens and Philips and even new players in the space including GE and Toshiba.
• With that said, be trustworthy, and work with those who are worthy of your trust.

The panel continued on with a discussion on hot new medical device trends. There are opportunities with imaging technology for a whole range of products and solutions, particularly with the aging population. There are also immense opportunities with combining technology solutions in the device world and beyond. For example, combining imaging with instruments, or software with instruments, or imaging with monitoring might be interesting.

With the aging population and the pervasiveness of cell phone/mobile technologies, other opportunities might include a range of solutions in the device diagnostics, from cardiological to biomarkers. Neuro-modulation diagnostics and diabetes diagnostic devices might also prove interesting.

There was a final word of advice to the Obama administration on how to best support innovation and entrepreneurship in the medical device industry:

• The challenge grants are great, but the majority of the grants went to academic institutions who might not have the skills, connections or ability to bring research projects to market.
• Involving experienced medical device professionals in the decision process for grants might ensure that the most promising companies and technologies will get the financial support necessary to bring products to market and produce jobs.
• Establishing a policy to encourage R&D expenditure, like the .40/$1.00 reimbursement currently in Canada, might help entrepreneurs traverse that first chasm – creatively developing a prototype/proof of concept without the benefit of angel/venture/corporate/customer funding.
• Balance FDA requirements for safety with having such stringent requirements that it’s too daunting an undertaking for entrepreneurs to develop and sell to the US markets, which would make other international markets more attractive.

Any way you look at it, forging progress in innovation and entrepreneurship takes a partnership of entrepreneurs, intrapreneurs, investors and government stakeholders, to serve the real needs of a growing customer market worldwide. Perhaps this is more true during unstable economic times.

• Facilitator Peter Berger II, CEO, Alitora
• Panelist Ian Irwin, Director of Drug Discovery, Parkinson’s Institute
• Panelist Michael O’Donnell, Partner, Wilson Sonsini
• Panelist Ted Spack, Managing Director, Fast Forward LLC
• Panelist Craig Taylor, Co-Founder and General Partner, Alloy Ventures
• Presenting Entrepreneur: Yadon Arad, Tiara Pharmaceuticals
• Presenting Entrepreneur: Julia O’Connor, CEO, Accelalox Inc.
• Presenting Entrepreneur: David Zarling, CEO, Colby Pharmaceuticals

• Start relationship-building early; Keep building relationships with partners and customers.
• Project-manage effectively as a team to drive deliverables and ensure smooth transition between groups, phases, organizations, countries.
• Manage your resources tightly to make a good impression.
• Keep making the case that safety needs to be balanced with efficacy, and encouraging forward momentum.
• Manage risks. Raise safety concerns in a timely manner.
• Move your concept and organization as far as you can with as few resources as possible. Make a convincing case that additional partnership and support would build measurable and specific traction toward pre-defined milestones.
• Be flexible and creative in securing funding, utilize all sources of funding to move forward with early development, including private foundation, angel investment, SBIR/STTR. Government and foundation grants might be good resource during early development phases, They require forming solid partnerships, AND can be time-consuming AND they can’t provide the kind of investment dollars necessary to grow the company beyond early development, but are still worth investigating.
• Accept where your sphere of influence is with your partners in corporate, government, investment, etc. and leverage where you will have the best payoff, while also growing your influence.
• Leverage outsourcing where practical, but manage the outsourcing projects closely.
• Enlist the support of entrepreneurial industry experts with complementary skills.

• ·    India and China will play an increasingly important role in accelerating drug development, not only as CRO/CMO service providers, but also drive for technology innovation and represent great market. As such, there will be more opportunities and larger markets as countries such as India and China become active in this space.
• ·    Changes to reimbursement policies will make it more practical for existing and new solutions to go to market.
• ·    There are many early-stage concepts which could not navigate all the hurdles of the development process, yet the thousands and millions of dollars already expended has produced science and technologies, even prototypes and studies which may be cost-effectively leveraged into new solutions, if the hurdles can be overcome.
• ·    Advancements in personalized medicine will not only provide custom solutions for patients, but it may also explain why some drugs did not pass regulations. These drugs might then be brought to market, targeting a more specific, more responsive patient population.
• ·    In general, with the advancements in technologies, there is more likely to be knowledge-driven understanding about what went wrong with drugs that could not complete the approval process and how to bring them to market cost-effectively.
• ·    There are opportunities in diagnostic tools, in genomics, imaging, informatics and other scientific areas which could lead to new drugs.

FountainBlue’s June 15 Life Science Entrepreneurs’ Forum was on the topic of Life Science Leaders: From Strategy to Execution and featured:

• Facilitator Dick Haiduck, Partner to the CEO, Haiduck Consulting
• Panelist Rich Ferrari, Partner, De Novo Ventures
• Panelist Stevan Jovanovich, PhD., CEO, Microchip Biotech
• Panelist Yvonne Linney, VP, Strategy, Marketing and Business Development, Life Sciences Solutions Unit, Agilent
• Panelist Glen Sato, Partner, Cooley Godward Kronish, LLP
• Panelist Charles Versaggi, CEO, OsteoCorp

Below are notes from the conversation.

The panel agreed that an organization’s strategy must focus on the needs of the customer and be more market driven than technology driven. In other words, from its inception, and throughout a company’s life span, the focus should be on understanding and delivering the clinical value of the solution on the specific target market that they are serving, thereby focusing on delivering the company’s unfair advantage. This necessitates an alignment between the goals of the management team, the organization, and all its staff and partners to plan for, communicate and execute on delivering that value, and remaining fluid on HOW the organization will continue to serve its customers. Therefore, there must be utter clarity on who the target customers are, what value is provided through which project, and how the experienced team will execute to milestones based on this clarity of vision, communicated well.

The current economic conditions amplify the importance of both thinking and acting strategically. With resources so tight, it is even more important to ensure that the strategy is customer focused, targeting a specific unmet need and that execution is measurable and milestone driven, with the necessary adjustments in both strategy and execution along the way. There is an overwhelming emphasis on doing more with less, stretching precious dollars to meet milestones, and focusing on providing the core value to customers, making every decision, every action, count.

During these challenging times, when considering a company’s strategy, think about which elements of strategy you’re considering – from business to financial to clinical to positioning – as well as the timing for the strategy and how it is integrated with other strategies. Successful entrepreneurs ensure an alignment between overall company goals and implementing strategies to achieve those goals, even if it means changing the overall corporate objectives along the way. The most experienced entrepreneurs see strategy as a process, not a destination, and are adept at proactively managing the direction of the company, erring on the side of action/decisiveness, and hiring a management team with a similar mindset.

Based on questions from the audience on how to best focus on select projects when resources on tight, the panel recommended that entrepreneurs periodically evaluate individual projects to ensure that they are delivering anticipated value, both in terms of meeting the needs of customers and in financial returns, using the anticipated amount of financial and staff resources. The panel even went so far as to encourage a culture where everyone is rewarded both for originating projects, AND for disproving projects, so that resources may be allocated to other more promising projects. Making these types of business decisions objectively based on fact, rather than on popularity, emotions and opinions, will help organizations develop a more resilient, practical strategy that meets the needs of its customers.

In conclusion, the panel noted that start-ups are prized for their innovation and their nimbleness, and in these economic conditions, the stakes are higher, and so are the opportunities for those proven entrepreneurs who can survive the storm, executing on milestones for a vibrant, flexible strategy that serves customers well and brings rich financial returns.

FountainBlue’s May 18 Life Science Entrepreneurs’ Forum was on the topic of How Regulatory and Reimbursement Changes Impact Today's Life Science Businesses and featured:

• Facilitator Joyce Chiarenza, Chiarenza Consulting, L.L.C., Certified Clinical Compliance Professional, and Instructor, UCSC Extension
• Panelist Walt Cecka, Senior Director, Program Management, Triple Ring Technologies
• Panelist Krishna Ghosh, VP of Quality and Compliance, Arbor Vita Corporation
• Panelist Jacques Ginestet, Director, Sustaining Engineering, LifeScan
• Panelist Chris Panarties, Sr. Director, Reimbursement, Health Economics and Pricing, NeurogesX
• Panelist Susan Rowinski, Sue Rowinski Group LLC, Reimbursement & Marketing Consulting

Below are notes from the conversation:

Reforms in the regulatory and reimbursement landscapes are driven by several major drivers. First, policy changes led by the new administration, with an emphasis on measurable differences and outcomes, is impacting life science companies, providers, payers and patients alike. In addition, cost pressures from payers – both the 50 million Medicare and Medicaid customers, as well as private insurers – are impacting how they are interacting with providers and patients. And lastly, demographics of patients are changing as an affluent, techno-philic, educated baby boomer population ages.

These confluence of factors are forcing life science companies to 1) closely monitor policies around regulations, with new FDA standards to be reinforced as early as next March, 2) evaluate and revise business, market, and development strategies based on changing reimbursement policies of buyers and 3) more broadly consider their market, perhaps targeting individuals more. 

Reforms in the reimbursement process are designed to foster collaboration from all the providers, and facilitate more efficient payment distribution to the patient. One specific change is payers migrating to a single lump sum payment, rather than billing hospitals and physicians and post-care facilities separately. This change is forcing physicians and hospitals to be in closer alignment between them, as physicians must take expense into account when prescribing treatments, as their personal reimbursement will be directly impacted by these decisions.

Another change in reimbursement is to offer a single lump sum for standard procedures such as orthopedic, cardiac, delivery, prenatal care, etc., with a global payment for a specific, pre-defined set of issues. The overall reimbursement dollars may be a bit higher, and it forces everyone working on a procedure, from all the physicians involved to the hospital to the pharmacy to the post-procedure care and skilled nursing services, to collaborate and coordinate payment formulas.

The panel had the following advice for life science companies around the reimbursement and regulation area:

• Have a really good product, not just a me-too or nice to have, but something game changing that people need.
• Integrate the regulatory and reimbursement strategy with the marketing, development and business plan for the company.
• More stringent regulatory standards, ICD9 in US, will impact existing and new products and payers will start questioning procedures which had previously been automatically approved. How will that impact your business and your partners?
• Segmenting the patient market will help make payers and policy-makers better understand how to most effectively and efficiently treat patients. What are the implications for your business?
• To be considered a viable M&A acquisition target have a real/clear solution, have a clear reimbursement strategy, and get the product into the market. If a life science corporation decides to purchase your company, they will then leverage their marketing power and distribution channels for an existing, viable product.
• Have a small footprint for your company – operate leanly so that you can have beter returns, be a better investment opportunity, and a better acquisition target.

Resources:

• 5/18/09 - Will Comparative Effectiveness in the U.S. Be Like NICE? http://www.pharmacychoice.com/News/article.cfm?Article_ID=400040
• HHS Names Federal Coordinating Council for Comparative Effectiveness Research, Recovery Act Allocates $1.1 Billion for Comparative Effectiveness Research http://www.hhs.gov/news/press/2009pres/03/20090319a.html

FountainBlue’s April 20 Life Science Entrepreneurs’ Forum was on the topic of Physician's Panel: Serving Patients, Keeping Advised on Trends, Reimbursement Challenges and featured:

• Facilitator Myriam Curet, MD, Stanford University, Chief Medical Advisor, Intuitive Surgical
• Panelist Shahram S. Gholami, M.D., Urological Surgeon
• Panelist Gary Heit, PhD, MD, former Assistant Professor, Director of Functional Neurosurgery, Dept of Neurosurgery, Kaiser Redwood City
• Panelist Frank Lai, MD, Department of Urology, El Camino Hospital
• Panelist Michael Leong, MD, Anesthesiologist
• Panelist James Lilja, PhD, OBGYN

Below are note from the conversation:

One of the greatest challenges physicians face today are around reimbursements policies, which are regulated by insurance companies and at times federal and state policies. In fact, reimbursement changes are severely impacting the decisions how physicians are treating patients. Because the overall amount of procedures has declined, and the procedures approved by insurance companies tend to be more outpatient services, physicians are factoring in economics when advising patients on what’s best for their health. Indeed, with policy makers and insurance companies leaning more toward ‘evidence-based medicine’ for political or economic gain, there is a focus on approving procedures which display measurable results – metrics defined not by doctors or patients, but by policy-makers, administrators and insurance companies. Therefore, important, but difficult-to-measure factors such as quality-of-life and patient satisfaction are not as important as number of prescriptions or procedures per patient and time and cost for conducting procedures.

Entrepreneurs should consider the following opportunities for serving physicians and hospitals:

• Diagnosing medical problems which are difficult to reach and difficult to see like cancer, through advanced medical imaging or drug marker technologies;
• Advancing interventional radiology in outpatient centers which make it easy to treat patients with minimal side effects;
• Biopharma solutions which would limit the toxicity of cancers;
• Devices, biopharma and other solutions targeting an aging population;
• Technology and device solutions which work with robotics to shorter procedures and increase their efficacy.

Our panel of physicians remains positive and optimistic that changes in the health care system can lead to a better balance between the needs of the patient, the art of being a physician, and the science of developing sustainable business models for insurance companies and fostering good will for the administrators and politicians engaged in making a system that works. Below are some keys to shifting that balance to a more patient-centric system:

• Empower the patient to own medical information, which is currently only available in fragments by individual practitioners and not shared across physicians or hospitals.
• Create a standard for medical record keeping which would make it easier for physicians and hospitals to share information about patients, and work together to view the whole patient and develop comprehensive treatment plans based on an understanding of the whole patient.
• Consider allowing patients to pay more for additional services which are by choice, rather than by medical need.
• Encourage doctors to adopt new technologies like robotics, rather than penalize them for adopting new technologies which take less patient time, reducing the reimbursement dollars.

In the end, entrepreneurs should keep thinking about the IT, device, pharma and other solutions and products which would help ensure a better quality of life for patients and how can we help physicians and hospitals to deliver this.

FountainBlue’s March 16 Life Science Entrepreneurs’ Forum was on the topic of Corporate Strategies for Partnering with Entrepreneurs and featured:

•  Facilitator John Bashkin, Triple Ring Technologies

• Panelist Rob Abrams, Operating Partner, Sanderling Ventures, Former Head of Business Development, Boston Scientific
• Panelist Dave Scott, Senior Product Manager, Vision Systems, Intuitive Surgical
• Panelist Niamh Pellegrini, General Manager, LifeScan, a J&J Company

Below are notes from the conversation at the event, and from the prep call prior to the event.

It’s difficult to get ideas off the ground, financings, especially now. As private venture capital is pulling back, corporate partnerships become more important. In a down market, everyone conserves cash, and plans for the future. Experienced executives and entrepreneurs find resourceful ways to continue their R&D, especially during a downturn when there are so many cost-effective resources and opportunities for new products and markets with the return to economic stability.

There are tougher constraints, and it is much more difficult to get ideas adopted early, and given the opportunity a chance to grow. Corporate partners and investors might require that you analyze and refine an idea much more, instead of adopting a concept or technology early, giving it room to grow. You have to get it right from day one. With financial pressures of stockholders, Corporates are more likely to minimize risk and go after the blockbusters that are in their proven areas of expertise and executives are more likely to make the same types of decisions, going with the tried and true.

With that said, some of the best companies have generated in worst of times.

• Investments ARE still made, and co-developments, licensing deals and M&As are taking place for early stage entrepreneurs who see the future, strategic select partners, and navigate the process from r&d to approvals and commercialization.
• The nature of corporate P&Ls are changing, and innovative new business models for tried technologies and solutions are seriously considered.
• The regulatory environment is changing and that is impacting how corporates do R&D and clinical trials, for example. It’s becoming increasingly expensive to do all R&D in-house, so corporates must strategically seek partnership with entrepreneurs to support their R&D efforts.
• VCs and corporate partners alike need to appreciate and understand what’s coming up, and hearing the latest entrepreneurial ideas will help them get a feel for the evolving market and industry.

To increase your chances of success, consider doing the following:

• Understand the business of the strategic partner, what drives a particular procedure – what technology/process would drive patient/customer value? The champions in the company will find them.
• Recruit a strong and vocal advocate/champion as absolutely nothing will get through without one. Recruit a champion with influence across the company and P&L responsibility, one who is willing to make a bet, have enough technical background to understand the solution, yet also understand how it will drive the business. Although product managers, business development folks and line engineers have some influence, the commercial voice with P&L responsibilities will make a decision on whether your project is worth investing in over another project.
• Don’t go in asking for money before the technology and concept have been fleshed out. Ask for advice and input and listen to the needs of the customers.
• Put together mid, moderate and best case scenarios for a solution that serves a real need. Understand and proactively mitigate and manage the risks and communicate how and why you are doing that.
• Consider adopting tried technologies into new areas. For example, what opportunities will advanced medical imaging provide in terms of surgical robotic tools?
• Whether you’re working with investors, advisers or teams, build deep, broad relationships early and continue to build on them. It’s about who you know. The right champion will help you do what you need to grow the organization, from recruiting a team mentors, investors, executives, etc., who have done it before and are willing to help out.
• Create incremental clinical/economic patient value – not just a different spin to the same thing. Find something that takes it to the next level.
• Whether you’re a small start-up or a multi-billion dollar company, take the time and resources to quickly understand the real needs of the patient and how your product and service would serve those needs. Get involved in the communities that you’re trying to serve, get to know the patient.
• Don’t develop your product in a vacuum – understand the market, customers and technology landscape.
• Be persistent and find a way to get around the NOs, if you’re sure that you’re working on the right technology, the right partnership, the right strategy.
• Strategy is a choice. Be flexible and open to other ways your product or service might fit the needs of the strategy partner you’ve selected. With that said, make sure you remain true to the mission of your company, and don’t just adopt someone else’s cause.
• Think creatively about how you can meet the needs of strategics.
• Be realistic about what you’re asking for and your own valuation and potential.
• When negotiating with strategic partners, it’s OK to start conversations with multiple target companies, but be transparent about what you’re doing and make a commitment to work with one of them in the end.

Thoughts on other financing options:

• Securing SBIR grants and other grants which might come with the stimulus package are viewed as a positive. They are difficult to get, and it’s time intensive to go through the grant-writing process. Securing a grant adds credibility for an organization and is a good thing, provided that the focus is on growing the business with the grant dollars, not just going from grant to grant to finance the company.
• Fellowship program for surgeons and hospitals may be helpful, although it doesn’t necessarily lead to new products, but it does build identity and gain traction in new procedures. It is a resource for going into a clinical setting. It can also let companies test out new products in a validated and credible fashion while allowing you to stay close to the clinician and patient.

• Facilitator Steven Cui, Of Counsel, Jones Day
• Panelist Bonnie Anderson, CEO, Veracyte, Inc.
• Panelist Deborah Kilpatrick, Vice President, Market Development, CardioDx, Inc.
• Panelist Geetha Rao, Springborne and Molecular Image
• Panelist Mike Richey, Chief Business Officer, Tethys Bioscience
• Panelist David Rollo, President, Cell Point LLC

• Here’s one way of thinking of molecular medicine. It is comprised of molecular diagnostics – identifying biomarkers for diseases, molecular imaging – targeting location and extent of a disease, molecular therapy – targeting treatment for the diseased cells/areas. Investing in personalized medicine will help providers better diagnose, identify and treat patients more effectively and with less expense.
• Personalized medicine helps people understand their genome and what they are pre-disposed to, based on genetics or environment. Knowing this information will help patients, providers and payers alike better understand, diagnose and treat health challenges, even in the early stages.
• Personalized medicine has the potential to positively impact the regulatory, clinical trials, reimbursement and other challenges which have historically been barriers to delivering medication to patients.
• Some claim that some current medical solutions only treat as little as 20% of the affected population. Personalized medicine has the ability to identify a wider range of solutions for a larger percentage of the affected population. This would impact payers, physicians, providers, patients and investors alike, creating a tremendous business opportunity while also better serving everyone.

• This economic downturn makes it challenging for the funding of even the most promising technologies. Be conservative about cash management, keep developing a business worthy of funding (people, products, market, risk management), build relationships with key stakeholders, and manage your fundraising needs to fit the times.
• If stakeholders move from a philosophy of treating the symptoms to understanding pre-dispositions to disease and providing targeted treatments early on, it may increase the effectiveness of the treatment while lowering the risks and the costs.
• We must prove through clinical trials that personalized medicine can safely and effectively live up to that potential of providing customized medical solutions to patients while still supporting solid business practices and satisfying all stakeholders.
• We must enlist the support of providers and educate them on developing use cases and advocating for the adoption of personalized medical options.
• We must work with the FDA to create new standards for clinical trial approval which are more appropriate for personalized medicine solutions. Current standards are more effective for pharma and device solutions, so while we’re advocating for a new standard, we must find a way to work within the current standards.
• There are political and societal barriers we must overcome in order to develop critical mass for the adoption of personalized medicine. This takes time and must be done through passionate education and advocacy from engaged stakeholders.
• Later, we must empower patients to take charge of their own health.

FountainBlue’s January 26 Life Science Entrepreneurs’ Forum featured a Life Science Angel Investor's Panel speaking on Trends for 2009:

Facilitator: Rahul Pathak, Partner, Jones Day

Angel Panelists:

• Stuart Eckmann, Keiretsu Forum and Life Science Angels (Bio and Device Committees)
• Elaine Heron, Life Science Angels and LabCyte
• Anne DeGheest, MedStars
• Don Ross, Life Science Angels and Sand Hill Angel

• Mitchell Mutz, CSO, Amplyx Pharmaceuticals

• Michelle Stecklein Call, CEO, Lypro BioScience

Below are notes from the conversation which also includes notes from our preparatory conference calls.

Life Science Trends for 2009

• Pharmaceutical solutions for Medicare and insurance companies will be more stable than consumer deals right now, especially if they add functionality to an existing drug.
• Application of life science technologies to energy fields.
• Consider where there will be a shortages, where there will be a large market, how demographics will impact the market size and need, etc.,  

Advice for Life Science Entrepreneurs Seeking Funding:

• Position yourself for successful partnerships and fundings.
• Before you seek outside funding, consider strategic partnering and securing government grants to better position yourself for angel and VC funding.
• No matter where you are getting the funding, identify measurable objectives and timelines and deliver on them, which will better position you for additional funding.
• Investors are facing down-rounds, and ailing portfolio companies. They are investing more in existing portfolio companies for longer, plus they are trying to help struggling portfolio companies. Because of this, they are less likely to consider new deals, so time your fundraising for when the economy recovers, hopefully in six months or a year or so.
• Speak more about the business – your market, your revenue model, your experienced team – than the technology. Many founders are so enamored with the technology that they focus too much on explaining that, and many investors may not understand enough about the technology to understand why it is unique. But most investors WOULD understand markets and business models.
• Investors are in the business of risk management. Understand the risks which are inherent in the business you’re running and have a plan on how to mitigate those risks.
• With that said, investors by nature are risk tolerant, and they know that investing in early stage companies, particularly in tough markets, will lead to the highest earnings, assuming the company is successful.
• Practice your pitch, drawing feedback from experienced entrepreneurs, investors, and others.
• Strategically plan your business based on evolving market needs.
• Identify a large market with a must-have (pain) rather than a nice-to-have solution.
• Have a strong, defensible IP.
• Offer a unique for a large market and prove that it can be delivered cost-effectively to paying customers.
• Build a strong team with experienced technical and business professionals who are the best people for the stage of the company. This will vary as the company grows.
• The team must be receptive to feedback, and the chemistry between team members, and between the team and the investors must be good.
• The team must be passionate, and have the stomach to put up with the uncertainties and stresses and changes that are inherent with early stage start-ups.
• The team must be willing and able to execute and perform on incomplete information, another element of being in a start-up whose goal is to be early to market.
• The leadership team must be willing and able to step down or step up based on the growth needs of the company.
• The team leaders must communicate with transparency and integrity.
• Team leaders must let go of the idea of control.
• The team must enjoy working with each other, and find a way to have fun, despite the challenges!
• Always consider if your current team, technology, market options would be attractive to other investors.
• Know your exit strategy – who will pay for your company by when if you achieve what?
• Identify funding organizations (angels, VCs) which have historically funded something similar to what your company is offering. Then identify who is a leader within that organization and research how to get introduced to these leaders so that you can strategically introduce your organization to them.
• Tightly manage cash flow.
• With the difficult economic climate, it is more important than ever to manage your cash and deliver on commitments.
• Build strategic alliances with larger organizations, angels, research organizations, and other key stakeholders.
• Mentor capital is more effective in some ways than dollars.
• Partner with corporations who may help fund R&D, understand market, build relationships and channels.
• Partner with academic institutions, where technologies might be developed and need to be taken ‘out of the labs, and into the market’.
• Partner with government agencies who may be able to give equity-free grant dollars.
• Remember that it is easier to ask for money from people you have already made money for!

• Ideas for funding product development and navigating government regulations:
  • SBIR, small business innovation research grants, up to 100K for phase 1, more for phase 2 http://www.sbirworld.com
    • Must have less than 500 people in the company to qualify
    • Principle investigator must be an employee
    • Non-diluted funding, but government owns the research and may ask you to share the results
    • This would impact likelihood of getting institutional funding
• Drug vs. Biologic approval process
  • Drugs: approvals focused on clinical effects rather than the process
  • Biologics: Pay attention to the process/the process may be the product - vaccines, blood products, etc.,
• Advice for navigating government regulations
  • Find out who will be evaluating your product/process and build a relationship with them first.
  • Agree on protocols and end points up front, the earlier the better
  • Stick to what you agreed to do. Communicate your progress.
  • Label your product and process with care. The regulatory officials will evaluate your product or process based on the labels you agree on.
  • When looking for an approval for a medical device, consider the class of the device and work with standards organizations (ISO, IEC) standards.
  • Show proof that your product has less risk than currently accepted products.
  • For combination devices, consider the best category of fit. Try to categorize it as a medical device if appropriate.
  • Plan during and following the approval process. Document before, during and after the process.

• Reasons for outsourcing:
  • Cost reduction
  • Specialized Expertise
  • Avoid delays
  • Insufficient infrastructure or resources to do something internally
  • Maintain focus on core functions
• Outsourcing Examples
  • Back-office functions such as HR and IT
  • Employee leasing
  • IP-related contract R&D
  • Regulatory
  • Legal
  • Other
• Advantages
  • Access to specialized, highly-trained work force
  • Lower costs
  • Avoid or defer investments in infrastructure and personnel
  • Maintain focus on core functionality
• Disadvantages
  • Unfamiliar legal regime, particularly when working with other countries
  • IP enforcement, particularly when working with other countries
  • Language and cultural barriers
  • Time zone challenges
  • Expense of travel and communication
  • Additional project management resources

• Be strategic about your outsourcing needs. Understand first why you need to outsource, what will be outsourced, how outsourcing fits into the overall company plans, etc.,
• Create a detailed and specific project plan based on your identified needs
  • Define service provider obligations, milestones and deliverables based on your needs
  • Insist in quality results, don't just choose the most cost-effective option
  • Proactively manage the outside vendor - Garbage In Is Garbage Out (If you don't proactively manage the process, you cannot expect great results)
  • Specify client responsibilities
  • Identify fees and terms
  • Define ownership and rights issues with new, pre-existing, IP
  • Identify processes and mechanisms to manage problems and scope changes
  • Understand legal implications about independent contractor vs. employee
• Do you due diligence in evaluating providers. Have a thorough process for evaluation. Find someone you would enjoy working with, is thorough, detail-oriented and flexible.
• Relationships matter. Develop relationships with vendors and make sure chemistry is there, and track record is solid.
• Manage your risk with employment law, IP law, etc., by planning ahead, seeking legal counsel
• Have a thorough plan and manage it tightly, but also be flexible. Choose vendors who have the same mindset. (When doing early stage R&D for example, your initial plan may not work, but the process may need to another opportunity or option which would work better than the initial plan.)
• Experienced consultants help you identify issues to focus on and proactively communicate with you, collaborate with you. They are also entrepreneurial and proactive.
• Working with universities may be difficult when time is of the essence.

• Read the Nearsoft article in the Red Herring on Outsourcing in Local Time.
• Dr. Dobb's Portal, August 2, SCRUM Meets CMMi: Agility and discipline combined

• Facilitator Sharon Lewis, President, Strategic Impact, Inc.
• Panelist – Ruth Cavagnaro, CEO, ChorusWare (Astia Portfolio Company)
• Panelist – Chisato Ishii, Investment Partner, JAIC America, Inc.
• Panelist – Ken Macrae, PhD, MD, EVP and Serial CEO
• Panelist – John Reed, Global Operations, Agilent Technologies
• Panelist - Fred Seddiqui, CEO, Avantis Medical Systems, Inc.

Below are notes from the discussion.

Defining value propositions:

• Exchange (generally cash) for something that will help company produce something better, cheaper, faster
• Jack Welch definition: 'Your competitive advantage' - Don't start a company without understanding that.
• Delivery of product or service achieving measurable results based on predefined customer needs and expectations.
• Understand the customer pain and what specifically a product/service can to do to measurably address that pain.

Advice for creating a value proposition for life science entrepreneurs:

• Start with a problem
  • Articulate the problem from the customer's perspective
  • Quantify the problem and what the product/service can do to address that problem in measurable ways (time and results) for whose benefit
• Understand your market size and customer profile, the people who have the problem
  • Evolve your value proposition based on evolving customer and market needs.
• Have a management team with the passion and experience to lead the company.
  • Management team must be passionate about solving the problem, and the experience to understand the pain customers are experiencing.
  • Management team must know the players in that market and industry, and have the types of relationships which would lead to key customers and partners.
• Communicate your value proposition based on the interest of your stakeholders: customers, investors, staff, channel, etc.,
  • Example: It might make sense to first demonstrate life science products first to doctors, as they would recommend it to their patients.
  • Example: When communicating to internal staff, you might speak about operational issues such as quality, availability, margins and cash flow, which may not be of interest to other stakeholders.
• Creating a value proposition is an ongoing task
  • You should have an idea of your customer need, market size/competitive advantage, but you should also refine it as you get more information and as the market changes.
  • Proactively engage in updating your value proposition with your various stakeholders.
  • When communicating your value to internal staff members, it might make sense to talk about the Mission (overall goal, why company exists), Objectives (what group/company is trying to do), Strategy (how group/company will do it) and Tactics (what your/your group's contribution will be) - acronym of MOST.
  • Put careful thought into the words used to describe your company's value as it can be easily misunderstood/misinterpreted.
  • Value propositions evolve as company and markets change.
• When contemplating the value-add your company provides to its target customers, focus first on profitability (how will your product/service help make that company money), then cost-savings (how will your product/service save that company money) and lastly the big picture (why is it good for that company in the short or long term).
• Protect Your IP
  • Investigate licensing/IP ownership and partnership options prior to making a commitment
  • Conduct due diligence before engaging in a deal, and make the diligence process proportional to the size of the deal.
    

    ---

•  Facilitator Roy Fiebiger, Sanford Rose and Associates
• Panelist Brent Contstantz, Skeletal Kinetics LLC
• Panelist Charlie Wen, Current founder and CTO, Tensegrity, former CEO of OrthoClear, Karegiver, former director of engineering and Align Technology
• Panelist Tony Zhang, PhD President, CEO and Chairman Formurex

• Make sure there's a cultural fit with funders
• Understand the expectations of your funders
• Understand the role of the funders - how much do they want to influence the overall company direction? The day-to-day management?
• Consider other funding choices, such as angels or government grants

• Be clear, thorough and transparent about your communications
• No surprises!
• Raise issues before meetings
• Work with your corporate counsel to manage board, as necessary

• Consider applying for a provisional patent initially
• Work with a good attorney. Sometimes they can do it for equity, even if they can't investing in a few hours of attorney time will strengthen the position of your provisional patent

• Know your role and abilities and that of your team, and work with people who can complement what your team has to offer
• Understand how the funder/others will support the organization - is it just money? will they provide connections? credibility? link to organization/academic institution? subject matter expertise?

• Train them if necessary
• Get respected member of their community to publicly endorse your product
• Show the value proposition of your solution, particularly if it's scalable
• Make solution easy to learn/adapt to
• Enlist patients to request your product/service
  
  

  ---

• Facilitator Roy Fiebiger, Sanford Rose and Associates
• Panelist Andrew Farquharson, InCube Ventures
• Panelist Nina Kjellson, Partner, InterWest Partners
• Panelist John Maroney, General Partner, Delphi Ventures
• Panelist Kevin Wasserstein, Versant Ventures

• Ask yourself if your team fits the organization's opportunity - does everyone have the experience to lead, and to lead for what stage/size of the company? does everyone have the skills and connections to help the organization to succeed? Is the chemistry good between the entrepreneurs and the investors? etc.,

• Focus on the strategic objectives for your organization and make measurable progress on agreed milestones. This is important whether you're getting funding, between rounds, or never planning to receive funding.
• Understand why progress is not being made - is it related to the team? the resources? the market?
• With that understanding, take action to address the problem.
• Avoid the 'lingering failures' or 'walking dead' - companies that are limping along without making progress, showing promise but not delivering. It's important to keep moving forward in specific areas, and to understand up front when to 'pull the plug'.
• Conduct hypothesis-driven experiments which can help drive decisions. Conducting them early and cost-effectively will also help organization to make strategic decisions.

• Articulate the market size, your specific niche, your strategy for addressing that niche, the competitive landscape, etc.,
• Know how you are differentiating yourself and communicate that clearly.
• Consider the immediate likely objections of potential investors and be prepared to address those objections prior to meeting with investors.
• Consider market adoption trends and health care provider practices when you write your executive summary.
• Be flexible about your organization, its goals, its revenue models, etc., It's rare that an early-stage company's business plan endures for the long term.
• Don't have 'founder-itis' - know your skills and your contributions and be willing to hire the right partners and team to address the needs of the organization. Put the organization in front of your own personal needs if necessary.
• Physicians may be good partners in that they may be able to validate a market need.
• Some companies come out of 'near-death' experiences stronger and better for it, and can build credibility based on learnings from those experiences.

• Research which investors are funding in your space. Call the portfolio companies and ask them about their experiences with the funders.
• Identify and make connections with investors who are funding in your market niche and find someone who can make an introduction to them, rather than submitting a business plan without an introduction.
• When you have a conversation with a VC, be likeable and personable and listen thoughtfully rather than spending the whole time selling.
• Don't get discouraged with 'nos'. If you get a rejection from a VC, take the opportunity to ask for feedback and even recommendations and introductions to other VCs who might be more appropriate funders for your opportunity.
• Remember that relationships with investors are two-way relationships. Make sure that the investor fits your expectations on how the monies will be invested (how much for R&D, single product investment? team investment? etc.,)
• Don't be afraid to ask the touch questions.
  

• Facilitator Brian Boyer, Attorney, Perkins Coie LLP
• Panelist Jeff Fairman, founder and senior research director, Juvaris
• Panelist Tom Gutshall, Founder and Former CEO, Current Chairman of Cepheid
• Panelist David Light, Business Builders

Below is a summary of advice on R&D Funding Opportunities for Life Science Companies, also available at http://fountainblue.pbwiki.com/R-D-FundingOpportunities.

• Start with a life science business idea which is interesting to a specific target audience, something you, as a founder are passionate about.
• Create a team to build the organization and strategically identify the best R&D funders, those who would think that you're idea is a good one, in a huge market. Sell the funders on the business idea and on the team.
• Once you are funded, make sure you execute on your business plan, while also staying flexible, based on changing market needs/technology requirements. This will not only help ensure the success of your company, but also to ensure R&D funding for your next venture.
• When you are planning your funding, make sure that others on your team are aware of the level of work and commitment needed to ensure success. Investors will respect your personal financial and personal commitment to your cause.

• Networking with the right people can help get the right doors open for your R&D efforts.
• Continue speaking passionately to all your contacts about your current funding needs and a door may unexpectedly opened for you.
• Be prepared - plan for such an occurrence to happen, so know what you're looking for, what you will do with it, who will do the work, over what time frame with support of which partners.
• Be proactive and speak to program officers of foundations and other funding sources. Ask them for suggestions and feedback. Develop a relationship with them, and they may help you give you the advantage tailoring a grant request specifically to your organization.
• Consider building relationships with VCs for support in filling out your team.

• They may be more likely to partner with you, assuming that another party will fund the more risky R&D efforts.
• They might think that the funding will make it more difficult to influence the direction of your company.
• In some cases, they might be threatened by the grant agreement, if IP and ownership issues are raised for instance.
• Plan your funding strategy, integrating a variety of sources - from corporate investors to foundations and venture firms.

• Facilitator Geetha Rao
• Panelist Brian Boyer, Perkins Coie LLP
• Panelist John Cornwell, Sand Hill Angels, and Life Science Angels
• Panelist Ken Martin, Onset Ventures
• Panelist David Miller Founder, InnoSpine
• Panelist Don Ross, Life Science Angels

• Ensure that there is a big market opportunity, more than 500 million, and have a clear understanding of the market, the competition, your unique value.
• Focus on developing a fully integrated business plan, explaining the business and describing the team, as well as the product/technology. (Many entrepreneurs are so enamored of the technology, they don't explain the business opportunity when many funders look for the business and team information as much as the technology/IP.)
• Build relationships with angels, VCs and other funders as they will be your advocate for funding, and also can coach you, make introductions for you.
• Build relationships with others who could introduce you to funders - like start-up lawyers.
• Network with people who can make the connections for you.
• The angel funding process is similar to the VC funding process, only the due diligence is not as vigorous. The due diligence helps to address the risks investors may face with an investment. Minimizing those risks prior to seeking funding will increase the likelihood of a funding event.
• Adopt the perspective of the funder - does it make sense to fund your company, and if so, why? What is the strength, potential, market opportunity for the company?
• Select a funder you are willing to work closely with as it will be a very close relationship, and not always easy.
• The founder must be prepared to give up leadership of the company as it approaches a later, more advance stage, which may require a different skill set.
• Consider the exit early, as it forces strategic thinking and execution.

• An organization is forced to be more focused. The funded company will be held accountable to more people, who may not be as receptive to their ideas.
• There may be more operational formality, particularly if there are regulatory requirements.
• Funders may now have board members who are more likely to 'hold your feet to the fire'. 
• Management team may change.
• Patent strategies may be more proactive.

Because of the government and other regulatory standards for life science products and services, whether they are pharmaceutical, bio-devices, bio-nano, etc., because of the experience, education and other personal characteristics of the entrepreneurs and executives within the industry, and other factors, the pace, culture, mind-set and expectations for decision-makers in the life science industry are much different than those in the high-tech sector.

However, with the convergence of bio, nano and information technologies, many high-tech corporations are branching into more life science solutions and investing in R&D efforts in the life science space. In addition, many larger life science and high tech are adopting an 'R&D-outsourced model', which helps them partner with VCs and early stage companies in support of their corporate R&D efforts. This month's meeting will feature speakers from both the high-tech and life science industries to investigate corporate R&D strategies and their implications for today's life science entrepreneurs.

• Agilent Technologies

  Proteomics  Agriculture Nucleic Acid Analysis Genomics Pharmaceuticals - Disease Discovery - Drug Discovery - Drug Development - Drug Manufacturing/QA/QC

   
• Applied Biosystems
• Genetic Analysis
• Genomics
• Proteomics
• Cell Biology
• Drug Discovery
• Drug Development
• Testing and Identification
• Information Management
• Ambion RNA Resources
• Experimental Workflows  
•  Genentech
• Strategic Alliances

• They help cover the 'funding gap' between pre-clinical and later stage companies.
• They partner with both entrepreneurs and VCs.
• They invite innovative, entrepreneurial ideas which fit the strategic vision for their organization.
• They offer many opportunities for partnership.

• From a corporation's perspective, research and development can be created organically (in house), through acquisitions, or through partnerships/collaborations. Decide whether to position your company for an acquisition or partnership/collaboration and plan accordingly.
• If you're working on a partnership, consider all types of partnership opportunities (from in-licensing to joint ventures to M&A and equity investments) and be clear what you want from the partnership and clearly communicate that.
• Understand how your company fits the overall corporate strategy and communicate that.
• Larger companies generally realize that it's easier to be innovative in smaller companies with fewer enforced processes and systems. Even if a M&A event occurs, larger companies try to preserve that entrepreneurial culture where possible as it is in their best interest.
• Corporations focus more on the best strategic investment rather than on price. (Strategy first, economics after.)
• It takes time to finalize partnership agreements so plan accordingly. (It may take an average of 9 months to close a licensing agreement for example, as there is much diligence involved.)

• With the aging of the baby boomers, what opportunities will arise and how can entrepreneurs and corporations partner to address the needs of this huge market?
  

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The Monday, November 20 Life Science Entrepreneurs' Forum was on the theme of "Building an A+ Life Science Team".

As life science entrepreneurs, we know the value of an experienced, results-oriented management team, but what can entrepreneurs do to attract the best and the brightest in early stage companies, when cash is tight? How can we retain, inspire and motivate your executive team and staff to work start-up hours and continually go the extra mile? How do you know what type of executive is best for which stage of your company, and how do you retain the right people at the right company stage, while maintaining relationships?

The facilitator is Roy Fiebiger, Managing Partner of Sanford Rose Associates-Silicon Valley, a Life Science Executive search firm. Prior to starting his executive search practice, Roy had served as a CEO and senior executive in several venture-backed medical device companies. Roy brings a unique combination of corporate experience, entrepreneurial wherewithal, vision, and dedication to address soft people issues and other business challenges. He has worked with many early and middle stage companies with their executive hiring process, and is eager to share his knowledge and advice on leadership, management and people issues with life science entrepreneurs. Roy has also assembled a panel to address the questions about and others from the VC, CEO, recruiter and legal perspectives.

- Tom Afzal, CEO of SpinalKinetics, who will share the life science CEO perspective

- Andrew Farquharson, currently with InCube and formerly with The Halo Fund, who will share the life science VC perspective

- Mike Hall, Partner Life Sciences Practice, Latham & Watkins, who will share the legal perspective

Below is a Summary of Notes and Advice for your reference, drawn on the wisdom of our facilitators and each of you as participants.

An effective management team is an essential ingredient for success

• It is necessary both to have the visionary with the innovative ideas and the executive with the experience, connections and resourcefulness to execute and consitently deliver results.
• There are different management needs for different stages of development
• For early stage, resource-constrained start-ups, the founders must passionate communicate the start-up concept and get the right early founders to become engaged and grow the company. (A corollary to that is that if the right people aren't signing up for the company, perhaps the concept is not as exciting as the founder thinks!)
• 'Convenient Hires' - hiring friends, neighbors, family, may be detrimental to the long-term (and short-term) needs for the company, and may in the end strain these relationships, particularly when one party is laid off.

Planning on attracting and retaining an A+ management team will help ensure that it happens

• Know what type of leadership area you need in what area by when, and create a strategic, milestone-related plan to get the right executives in place at the optimal time
• Setting the goals, communicating the vision, attracting and retaining the right talent are all crucial requirements for putting the right management team in place
• Creating and maintaining a positive, motivating and supportive culture will encourage your top talent to stay with the organization. It's not necessarily expensive to do that, and it's very worthwhile.
• In order to hire the right people, you must be thorough and invest the time in the interview and screening process, including conducting behavioral interviews and doing full background checks.

Be careful with the current trend of hiring consultants rather than a full time staff.

• There are a handful of requirements necessary to be considered an independent consultant rather than a staff member.
• If most people in the organization is a consultant:
• You must still have a 'buck-stops-here' decision maker to make pivotal decisions for the organization.
• The business may not be as scalable.
• It may not be as fundable by investors.

When you must lay off people on the team:

• Be direct regarding your concerns and try to come up with a mutually agreeable arrangement to part company gracefully.
• Document your communication - the measures taken to resolve any performance issues in case there is a legal dispute around wrongful termination.
• It is more awkward for investors to part company with the senior executives for portfolio companies, but it can be done with respectful and direct communications, based on measurable, milestone-related performance/progress.