Recent U.S. Bureau of Labor Statistics data shows that 20% of early-stage companies fail in their first year, and up to 65% fail within ten years – more hopeful than the often-cited 90% failure rate. However, for medtech organizations, the outlook is tougher, with around 75% never achieving success. It’s clear that entrepreneurs in the medtech field find the challenges of early-stage company management daunting. However, with the right advice they can beat the odds.
John Ashley is the CEO of Auctus Surgical, Inc., an early-stage company focused on scoliosis correction devices and a board member at LifeAir Corporation – and when it comes to leadership he has a track record of success. With over 30 years in the medical device industry, he exemplifies the role of a serial advisor. He has held CEO and executive positions at several prominent medical device companies, including DurVena, CoAlign Interventions (acquired by Stryker), ANPA Medical, Fox Hollow Technologies (IPO and acquired by EV3), Sapphire Medical (acquired by Tornier), Primaeva Medical (acquired by Syneron), and Oratec Interventions (IPO and acquired by Smith & Nephew).
His vast experience and wealth of knowledge have given John insights that can make a real difference in early-stage medical ventures. According to Ashley, his input and guidance have allowed the organizations he advises to return over $1.25B to investors, and he has distilled the essence of his experience into a blueprint for emerging medical ventures that are willing to go the extra mile to achieve success in a highly competitive environment.
“Success is never assured,” says Ashley, “but early-stage leadership and founders in the medical devices space need to focus with laser-like intensity on the areas that will provide them with a competitive advantage.”
For John research and market analysis are key to the success of any venture. However, according to him, new venture management is often unable to see the wood from the trees.
“Early-stage companies are characterized by innovation. However, founders are often the victims of their own passion, they tend to look at everything through a lens of their own specialty and are hyper-focused on bringing the fruits of their creativity to market. It’s easy to ignore the strategic fundamentals if you’re hunched over a metaphorical workbench peering through a microscope.”
The 12-Point Plan
John Ashley has developed a 12-point plan for medical device venture founders, including several focus areas that are non-negotiable when planning for success. According to John, the focus areas of the plan provide a blueprint for success. As he says, “Unless you focus on foundation issues you’re going to end up with a rudderless ship. Although many of these focus areas are business plan 101, there are complexities in the early-stage medical device innovation venture that need to be addressed before plotting the way toward a successful exit. Successfully navigating these unique challenges requires a detailed approach.”
1. Defining the medical need that is being addressed:
John advises management to begin with an analysis of prevalence rates, patient demographics, and existing solutions to define market needs. A competitor SWOT analysis is essential to identify gaps in current treatments, revealing opportunities for innovation.
2. Do a deep dive into the current gold standard and what improvements to service unmet needs can be made:
Assess the effectiveness and limitations of current treatments, noting specific gaps that impact patient outcomes. Conduct a thorough comparison of where your product can introduce measurable improvements.
3. Talking to medical experts, doctors, nurses, and patients:
Engage stakeholders across the care continuum to gather valuable insights on practical needs and challenges. Use these conversations to identify pain points, refine product development, and align with real-world demands.
4. Articulate how the product is differentiated:
Clearly define and communicate the unique value propositions your product offers over existing solutions. Highlight its advantages in terms of safety, efficacy, cost-efficiency, or ease of use.
5. Identifying risks:
Map out potential obstacles like funding, regulatory approvals, or technical hurdles, and outline a mitigation plan. Prioritize high-impact risks first, setting up checkpoints to adjust strategies as the project progresses.
6. Technology readiness, hurdles, and unknowns:
Evaluate your technology’s maturity and identify the critical path for its development. Assess unknowns and technical challenges, establishing an R&D roadmap with contingency plans.
7. Focus on the regulatory pathway and hurdles:
Research regulatory requirements and identify agencies and timelines for compliance in target markets. Similarly, explore reimbursement models, assessing payer preferences to ensure your product is financially viable for widespread adoption.
8. Identifying the best investors for the enterprise:
Identify investors with experience in the medical technology sector who understand the timelines and risks involved. Prepare targeted pitches that align with each investor’s portfolio interests and strategic objectives.
9. Developing a go-to-market strategy:
Define your launch plan, considering channels, target audiences, and partnerships needed to scale quickly. Set measurable goals for each stage, from pre-launch to growth, to assess and refine your strategy.
10. Collect and develop supporting data:
Design a robust clinical study protocol to collect data on efficacy, safety, and patient outcomes. Use this data to build credibility with regulators, investors, and stakeholders in the healthcare community.
11. Economic impact:
Demonstrate potential cost savings and efficiency gains for healthcare systems, insurers, and patients, emphasizing how your product reduces hospitalization costs, streamlines care, and prevents complications for improved health and financial outcomes.
12. Opinion leader, medical society and patient advocacy endorsements:
Collaborate with key healthcare professionals and advocacy groups to gain credibility, seeking endorsements from respected medical societies to build trust and acceptance in the healthcare community.
John Ashley is focused on providing medtech founders with the tools they need to beat the odds, but he also believes strongly in the power of mentorship and giving back. He is an adviser to the Surgical Innovations program at UCSF, the Biomedical Engineering Department at the University of the Pacific, and a Venture Mentor with the MIT Northern CA Alumni.
To find out more about John Ashley’s unique approach to early-stage medtech success, visit his LinkedIn page or his personal website.
