medical device entrepreneurship
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Medical Device EntrepreneurshipWorking in Boston, MA
Charalambos Anastassiou, PhD
University of Cyprus (UCY)
March 23, 2017
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Overview of presentation
My story
Sources of funding
Collaboration with University Lab usage Licensing
Medical Device Registration Quality System. FDA clearance other registrations
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My story starts1992 Univ. of Iowa
Graduate School Princeton University 1996
Entrepreneurship Class 1998
Meanwhile at MIT 1998
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What to do with this discovery?Can you commercialize it? Is it worth it?
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1. Seed Funding 1999
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2. Seed Funding 1999
$40,000 to purchase computers and run simulations for the idea.Rich MIT Alumni
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3. First Round Funding 2000
• Network of Angel Investors• Total $4 Million• Founding of OmniGuide Communications by 3
MIT Engineering professors and one MBA graduate
Create a new type of fiber that would transform telecommunicationsI join 2001
**
OmniGuide One Kendal Sq.
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Technology License Office (MIT)
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• Once it is patented, the founders of the company work with the TLO to get exclusive rights. Inventors have preference
• Patents are never assigned to the company. Just the “exclusive rights” for certain applications
• “Typical” agreement was $10,000 for 2 years plus percentage revenue if used.
Other Benefits to being close to University
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• Had agreement for setting up company’s equipment at MIT. OG provided equipment, MIT the space and co used them.
• Had agreements to use other lab equipment and services (paid)
• Interns and employees from MIT and surrounding University.*Must be very careful not to mix the two. Need clear policies for doing this.
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The Early Years
• 2000-2003. telecommunications not much traction
• 2003-2005. Both telecommunication and Medical and Telecom
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Switching to Medical 2005
• Easier to focus on one.• Medical was getting a lot more attention
Typical of startups. This is what is called in Lean Startup “Pivot”Discussion: Why is the Pivot necessary it seems? Why can’t you get the right idea from the beginning?
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Lessons 1 and 2
1. When the market speaks you listen. Initial assumptions don’t mean anything. Do you know what youtube was originally?How about uber, facebook?
2. Team is more important than the original idea. The talented team will adjust and “pivot” to succeed.
2005 Medical Product Launched
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Lesson 3
3. Early Success is Important
“Early success (no matter how small) in the market boosts morale, validates your
assumptions and gives you momentum. It validates your timing is right and shows you how to break down long term plan into short
term achievable goals”
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What is needed for Medical Device company?
REQUIREMENT USA EUROPE & PARTS OF THE WORL
QUALITY SYSTEM “21 CFR PART 820” QUALITY SYSTEM REGULATION
ISO 13485 CERTIFICATE
SPECIFIC APPROVAL FOR YOUR DEVICE BASED ON INDICATION
FDA CLEARANCE (SUCH AS 510K PREAPPROVAL)
CE MARK
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SMALL DIVERSIONLets talk about QUALITY BEFORE WE GET BACK TO THE REST OF THE PRESENTATION
What is Quality?
Quality is…..•Meeting goals and requirements based on acceptable performance•Assuring the fitness for purpose•Consistent from product to product.•Continuous improvement
Quality is to say what you do and to do what you say
Example: Boxes with pens
1. CAPS
2. PENS
3. BOXES
What are the requirements?
All parts are good (no scratches or blemishes on the box, pen and caps and all pens function)
Each box always contains 20 pens
Each cap is installed exactly the same way onto the pen.
The orientation of the pen/caps with respect to the box is always the same.
Quality ensures requirements are met
Quality Assurance
1.Procedures are written for each step.
2.Forms are created to be filled as the product is made
3.Indicators are kept to trigger improvement actions. Statistical Analysis
Quality Control
1.Final product and forms are inspected.
2.Ensure that each product that leaves the door is according to specifications.
3.Defective product analyzed
Key Performance Indicators (KPI)
Number of boxes shipped per week
Percentage of parts rejected incoming inspection.
Percentage of boxes rejected at the final inspection.
Number of customer complaints per week
Key components of Quality System
Training
Management Review
Document Control
Incident (complaint) management
Internal Audit
Measuring Effectiveness (key indicators)
• 2006: VP of sales hired.• 2006-2013: Another 4 rounds of VC funding
(equity based)• 2013: Non-equity loan from OrbiMed
“Healthcare Fund management”. Loan will be repaid from royalties.
• 2014: 100,000 surgical procedures completed
Back to History of OG
Review key terms
Equity Taking a percentage of the company for the
investment.
Valuation This determines the equity taken for a given
investment size.
Royalties
Another 4 reasons of our success
4. Engineering and Marketing worked together from day one.
5. Key first investor, Ray Stata, mentor to the founders.
6. Prototyped early and often.
7. A “do what you can with what you have” culture coming from founder and CEO.
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Sources of Funding: Summary
1. Competitions, Awards.2. Rich Alumni3. Angel Investor Network.4. Venture Capitalists5. Traditional Banks (once you have assets)6. Specialized Funds (typically pre IPO.
Something between traditional Bank and VC)
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