Entrepreneurs and Industry Veterans Take Part in 2017 Neurotech Leaders Forum
More than 100 neurotechnology industry professionals attended the 17th annual Neurotech Leaders Forum, held in San Francisco earlier this month. On day one, keynote speaker Tom Insel, former NIMH director and president of startup Mindstrong Health, gave attendees an overview of recent efforts to establish objective measures of mental health.
Insel described some of the problems inherent in current methods of assessing mental health. “When you ask someone with a mental illness ‘How do you feel?’ you’re talking to someone who by definition is not an accurate responder,” he said. Insel described his firm’s smartphone-based “digital phenotyping” that capitalizes on 45 measures of keyboard and scroll patterns to create digital markers of mental health. “These digital features are surrogates of mental health,” he said.
A session on funding tools for neurotech vendors included Stephanie Fertig from the NIH, Renee Ryan from Johnson & Johnson Development Corp., and Faz Bashi, an angel investor. Ryan said that neuromodulation is an important area for J&J since it touches all three of the firm’s business areas. JJDC has invested in CVRx, Inspire Medical, and several other neurotech startups. Bashi warned entrepreneurs to stay away from “science projects masquerading as companies.” He said that since many smaller firms have already been acquired by strategics, much of the available capital is not reaching early-stage companies.
A lively session devoted to neurotech M&A activity featured Jeff Erb from Medtronic, Scott Drees from Nuvectra and attorney Mark Lindon, who has represented the Mann Foundation and some of the Mann spinoffs. Erb explained how Medtronic’s new organizational structure—based on indications and not on technologies—impacted the way acquired firms are assimilated. Drees advised neurotech entrepreneurs looking to be acquired by a larger firm to take a long-term view. “Don’t run a company to sell it—run the company to be successful,” he said. Lindon mentioned that mergers are a lot like dating. Some can be love at first sight while others involve longer-term casual dating scenarios. Regardless, the devil is in the details, he advised attendees.
NBR senior consulting editor Jeremy Koff moderated a session called “Supplier-Side Economics” devoted to outsourcing. Contract manufacturing is growing at an 11 percent rate, he said. Finding the right fit with a vendor is important. Really knowing what you have and what you need can make the process much easier. Representatives from Cirtec Medical, Velentium, and Regulatory & Clinical Research Institute each described how their firms could offer valuable services to neurotech startups and established firms alike. All warned to look out for scope creep.
In a session on brain stimulation, Doug Weber, formerly with DARPA and now with University of Pittsburgh and Battelle, highlighted previous work from the Battelle team in BCI-FES. But he would like to see it go one step further. “What we need are more practicable solutions.” He would like to optimize recovery through targeted neuroplasticity. Ian Cook from the Semel Institute for Neuroscience at UCLA summarized some of his commercial and research background in novel forms of brain stimulation.
John Parker, CEO of Saluda Medical, was the keynote speaker on the second day of the conference. Neuromodulation is 50 years old, but he believe that technology development will accelerate in the next five years. The increase in battery capacity and the drop in power consumption in implanted devices allow for more complexity, he said. This opens the door for more sophisticated closed loop systems. The elegant feature of the closed loop system is that the sensing electrode recomputes stimulation parameters to keep dosage within the therapeutic window. In the end, this makes it more comfortable for the end user. Saluda recently implanted their 100th patient, a milestone for a new startup company.
A session devoted to direct-to-consumer neurotech featured executives from Fisher Wallace, NeuroMetrix, and Posit Science. FW offers a tACS system which is FDA cleared for depression, anxiety, and insomnia. Co-founder Kelly Roman believes we are nearing a tipping point in scientific evidence for medical devices. “It all begins and ends with the brain.” FW is launching the Kortex device in November. They raised $200,000 through a crowd-funding site selling the device as a wellness version intended for stress and sleep.
Shai Gozani talked about his experience marketing the Quell wearable TENS device direct to consumer. NeuroMetrix sells it online, through brick and mortar retailers, and cable channels like QVC and HSN. Gozani said that Best Buy has been the best performing retail outlet but they still cut into your margins. The advantages of direct to consumer are the ability to have a direct conversation with the consumer, avoiding reimbursement issues, and the ability to offer diverse promotions and sell through multiple channels. The distinct disadvantages of direct to consumer is that it is difficult to build awareness, and there’s a high acquisition cost per customer. The margins are low and there is a high cost for returns and negative reviews. Henry Mahncke from Posit said he was satisfied with recent FDA announcements regarding regulation of software as a medical device.
In a session devoted to bioelectronic medicine, Daniel Chew from Galvani Bioelectronics said that neuromodulation offers pharma vendors a neural control method to complement existing methods of signaling control and immune control. Galvani’s ultimate vision is devices that are selective, smart, and small, he said.
Kip Ludwig from Mayo Clinic stressed that human data and human biomarkers are very important, pointing out the anatomical difference between rat and canine vagus nerves.
Entrepreneur presenters included Dan Rizzuto from start-up Nia Therapeutics, which is developing a memory restoration therapy for early-stage Alzheimer’s disease. Nia is developing a fully implantable cranial implant. The timing of stimulation is “critical,” he said. Tina Chang from GiMer Medical described her firm’s batteryless ultrahigh frequency SCS system for pain.Tweet