Steve Honig reports on the April 10, 2015 MassMEDIC presentation on integrating the “human factor” into medical device design, as well as the March 6, 2015 MassMEDIC presentation on Trends in Med-Tech Device Funding.
Originally posted on the Blog Site of partner Steve Honig, at www.honiglawblog.com
MassMEDIC, the trade association for the Massachusetts medical device industry, hosted a program this morning built around integrating the “human factor” into device design. The FDA’s 2011 draft guidance (promised to be made final this year) includes the usability of medical devices as one criterion in device approval.
The presenters, from the consulting firm Contiuum and the drug company Sanofi, noted that successful devices (including those which deliver medication) must not only satisfy the fundamental standards of safety and efficacy, but also must be sufficiency appealing to the user (whether a member of the public or health care professional) in order to gain traction in a competitive, consumer-marketplace. “The success of a product depends on your users.”
The panel noted anecdotal experiences wherein products which were both safe and efficacious nonetheless failed in the marketplace because they did not address human factors: is the physical design sufficiently appealing to reinforce use, are the cognitive factors so clear that the manner of use is understandable and comfortable, does the device achieve an emotional reaction in the hands of the user.
Techniques for having usability march hand-in-hand with product design include integrating the human factor early in the design process, undertaking biometric and other studies of devices in actual use (even if they are nonfunctional “dummy” devices), and testing, redesigning and testing again.
Certain products, particularly those not analogous to those already in the marketplace, require careful writing of instructions for use. In these cases, the FDA will focus on the instructions both for their own understanding and in order to make sure that the product in the marketplace will perform safely and as the engineers anticipate.
The emphasis on usability and the consideration of human factors in the design of products reflects society’s growing “consumer” emphasis. Products will not be successful unless they are used as intended, notwithstanding their theoretical efficacy; utilization in the hands of the consumer requires consumer buy-in which in turn depends upon both ease of use and a positive human-emotional reaction to the user experience. It is interesting to hear engineers engaged in the “softer side” of product development but, it seems, the blending of human factors into device development is becoming a standard goal, and the only question is: how can you make sure the engineers are sufficiently exposed to that aspect so that the ultimate products are successful in the marketplace.
Trends in Med-Tech Device Funding
Originally posted on the Blog Site of partner Steve Honig, at www.honiglawblog.com
At the March 6th meeting of MassMEDIC, the association of the medical device industry, two expert panels discussed both the key attributes which an early stage company must have to attract financing, and the landscape for obtaining that financing.
Requisite Attributes: A panel including Mass Medical Angels, an institutional investor and a large strategic industry investor shared a fundamental viewpoint: you need an appealing story which is well told and understandable, initially in a brief presentation or slide deck (it need not be a full offering memorandum), describing the problem, the solution and its novelty. Intellectual Property should be identified but need not be dwelled upon. For an emerging company, the core team may be important but it can be reasonably small; successful emerging companies are very parsimonious with money, and many problems (such as regulatory and reimbursement) can be farmed out. Good founders are imaginative and make due with short dollars in early stages.
How important is the team? For the angels and the institutional investor, seemingly quite important. When you get to a strategic acquiror, even one which purports to invest in early stage and no-revenue enterprises, the founders are important but, let’s face it, a strategic is liable to impose its own management team, or integrate a company into its own management structure, pretty quickly.
One interesting side note: general consensus that if there is more than one founder, the back and forth process generally creates a superior company than in a single-founder situation.
Where Is The Money? There is hope for financing life science companies, including medical device companies in Massachusetts. One serial entrepreneur on a second panel noted that money was more easily available on the East Coast than in Silicon Valley in the life science space. The venture fund on this panel, Norwich, noted that about half of their investments are in companies run by first time entrepreneurs, so there is hope for that cohort.
Some other interesting take-aways on finance:
No one was big on crowd funding. It is not intelligent money, and a large number of investors will scare away institutional future rounds.
For the new emerging company, angels can often provide sizable amounts of money. There was also advantage in being in an accelerator, and the Boston Medical Accelerator and M2D2 (the accelerator at University of Massachusetts at Lowell) were mentioned.
SBIR grants, while slow and difficult to get, can fund pure startups with no traction. The phase one disbursement of up to $250,000 is often a stepping stone, if progress is made, to phase two funding of up to $1,500,000, although it was suggested that on a strong showing of prior progress some companies might be able to jump directly into phase two.
Other issues in attracting capital (weighted differently as between angels, venture fund and strategic investor): Is the product buildable? Is the idea proven or is there an understandable road to proof through clinical trial? Have the founders thought about a logical exit (the exit may change over time, but are they sensitive to the fact that there has to be a pay day somewhere down the road)?