Defining your technology’s value proposition is pivotal for successful commercialisation. It’s the promise of value and the belief that value will be delivered and experienced by the end users of your technology. In the case of medical devices and biotechnology, value may extend further into national and international benefits, solving problems that can have a positive impact globally. Investors want a defined value proposition before backing you and Government grant programs always ask for companies to define their value proposition in applications.

The most important step to defining value proposition is defining the problem that your technology is intended to fix. Consider the following in determining whether your target problem is worth solving:

• Need: Is there a lack of solutions to the problem or a lack of competitors in the field? Is your target market dissatisfied with current alternatives?
• Target: Who is your target market?
• Opportunity: Is there an area of opportunity for you to exploit?
• Unworkable: Does your technology fix a problem that is currently unworkable or creating negative implications?
• Features: What is the key problem-solving capability of your technology?

Finally, evaluate whether technology is unique and compelling. Does your technology reflect the following:

• Discontinuous innovation: offer a benefit that is superior to the current status quo by looking at a problem differently, e.g. a catheter that results in superior fluid flow and reduced blockages compared to existing catheters
• Defensible technology: offers intellectual property that can be protected to create a barrier of entry to others
• Disruptive business models: yields value and cost rewards that help catalyse business growth

Once you have thought of these elements, you can start building your value proposition. At Inner Maven, we have assisted many entrepreneurs in the medical space to define their value proposition.

A generic drug is considered identical or bioequivalent to its branded cousin. Upon patent expiry of the branded version (generally 20 years), other pharmaceutical companies jump on the opportunity to create a cheaper, generic version. As the drug is not developed from scratch, the cost of commercialisation is significantly reduced. As such, generic drugs are typically sold at a discounted price, saving consumers billions of dollars a year at retail pharmacies. An example of a branded drug would be Panadol by GlaxoSmithKline. Generic versions exist as a generic paracetamol.

In many countries, pharmaceutical companies seeking approval for generic versions of approved drugs need to demonstrate that their drug is equivalent to the branded version. Product quality and bioequivalence data are required before a generic product can be registered in Australia or listed on the Pharmaceutical Benefits Scheme (PBS).

Substantial equivalence needs to be demonstrated with:

• Active ingredients
• Strength
• Dosage form
• Route of administration
• Label
• Bioequivalence – i.e. the generic is absorbed and distributed to the part of the body in a similar manner to the branded drug

Similar to all drugs, generics must also be manufactured under strict, controlled conditions that assure product quality. Drug companies must submit an abbreviated new drug application (ANDA) for approval to market a generic product.

Regulatory agencies internationally protect consumers by ensuring that they are receiving the same benefits from a generic as they do from branded versions.

A clinical trial is a scientific study involving medicines, new treatments and new medical devices involving patient and non-patient human volunteers. They are necessary for collecting clinical data to demonstrate the safety and effectiveness of a new therapeutic, an existing therapeutic or a medical device.

Before commencing clinical trials on human subjects, extensive pre-clinical testing is performed on non-human subjects such as animals. This is necessary to determine whether the therapeutic has any merit as an investigational new drug and to obtain preliminary efficacy, toxicity, and pharmacokinetic information.

There are four different phases of clinical trials that a therapeutic can progress through during its development.

• Phase I: Involves testing on healthy volunteers for dose ranging purposes. These clinical trials also identify preferred routes of administration – eg. tablet, injection, liquid, etc.
• Phase II: This is the first stage that involves testing on patients to assess efficacy and safety. These clinical trials involve a smaller group of patients that are closely supervised.
• Phase III: This involves testing on larger groups of patients. The purpose is to determine whether the therapeutic confers clinical benefit. A trial will only proceed onto Phase III, if Phase II demonstrated benefits that outweigh the risks. Potential side effects are also identified during this phase.
• Phase IV: Gathers data for post-market surveillance. These trials are undertaken to further investigate the use of the medicine in a normal clinical setting and may involve comparisons with existing medicines.

Medical Devices

Medical devices are not classified via phase but involve similar concepts in demonstrating safety and efficacy. Pre-clinical testing may involve bench testing, biomaterial testing, immunogenicity and carcinogenicity testing. The new device may also be tested in animals. Initial clinical testing involve pilot studies on small groups of patients before commencing onto larger studies. Studies may also be performed to confirm the performance and safety of changes in design, materials or components of the device.

At Inner Maven we have assisted in the drafting of study protocols, determining ethical and regulatory requirements and in the general management of clinical studies in hospital, research institutions and independent laboratories.

For three years running, Australia has ranked in the top 5 in biotechnology in the world with 140 ASX- listed biotechnology companies with a market capitalisation of $50 billion (Ausbiotech, 2017). CSL remains the largest biotechnology company in Australia with Medical Technology and devices also surging forward. The big guns in this area include Cochlear and Respiri with their ear apparatus and breathing tracking devices. Biotechnology and Medical Devices certainly remain promising areas for commercialisation. But what are the critical factors for their success? Every company starts small, but with proper leadership to direct company management and translation of Research & Development into commercial products, your company can grow.

Amgen was a struggling company in the 1980s suffering in an era where biotechnology was a relatively unknown industry. Here are five critical success factors that contributed to Amgen’s success in translating drug development on a small scale to the mass market.

1. Early Financing: M. Bowes was the founding shareholder of Amgen, hiring Winston Salsa, a UCLA scientist, to collaborate with him. Together they recruited a formidable scientific advisory board and raised $200,000 in venture capital. With this funding, Amgen recruited George Rathmann, the former chief of Abbott Laboratories, who then set out to raise large rounds of private equity funding. Early financing allowed Amgen to retain most of the marketing rights to Epogen and to survive the development and commercialisation process. It also meant that Amgen didn’t have to license away their rights to their best products.

2. The Right People: Poor management can destroy a good company. With the right people, both with technical and commercial abilities, Amgen was able to raise the necessary funding to commence operation.

3. Focused R&D: Amgen’s CEO insisted that the R&D strategy was to focus on a small number of high-potential projects. The strategic focus combined with effective R&D management allowed the company to successfully commercialise breakthroughs.

4. Strategic Partnerships: Not every company or team is perfect. Amgen was able to recognize that it lacked manufacturing expertise. Establishing a joint venture with Kirin Brewery proved invaluable to both companies. Amgen was able to gain access to critical manufacturing technology, in exchange for some international marketing rights.

5. First Entry: The early bird gets the worm indeed. Amgen invested heavily in marketing and manufacturing during the early days, positioning them as market leaders in an uncontested market for EPO based products.

From a little company in the LA, Amgen became one of the leaders in biotechnology.

At InnerMaven, we can help in the critical early stages to raise early financing and to provide commercial expertise.

By now, you would have heard of the show Shark Tank. This television series based on hopeful entrepreneurs, pitching their idea to a group of millionaire investors, is an inspiring watch. The panelists on the show are an impressive line: Naomi Simson, founder of Red Balloon, John McGrath of McGrath Partners Real Estate, Andrew Banks from the recruiter Morgan & Banks, Janine Allis founder of Boost Juice and Steve Baxter, IT entrepreneur. Funding is a big hurdle for successful commercialisation. Considering investors and venture capital firms are common sources of capital, presenting a good pitch is pivotal for communicating the benefits of your medical device and ultimately convincing an investor to take a risk on you. Consider these points when putting together a pitch:

Less is More

Keep your Powerpoint deck simple. Do not overload it with slides, then run out of time to speak through it all. Present your business in a manner that’s succinct and to the point. If an investor is interested, you can always provide additional information later.

Provide realistic projections

Base your projections on fact. Do not show the investor unrealistic projections, particularly when your company is at $0 revenue. You need to be able to justify your projections and assumptions. Refrain from saying unrealistic statements such as ‘we have no competition’ or overestimating the size of your market. Most investors are seeking a low-risk business that solves an existing problem. An experienced team, real world experience and cash flow are more enticing than an overblown forecast.

Do a Demo

If you can, demonstrate your medical device. A demo is worth a thousand words. But make sure it works well and looks good.

Research, Research, Research

Perform some due diligence before the meeting. Research the investor, his portfolio and his investment interests. There’s no point pitching a medical device to somebody that does not have an interest in the area.

Understand your Product & Business

An investor wants to know that you understand your product, your business and the market that you’re launching into. Be prepared for questions. A good entrepreneur should be able to explain how their medical device is differentiated from competitors, understand the risks of the business and be able to communicate a coherent business strategy in all aspects including marketing, customer acquisition, sales strategy, etc.

How will the investor’s funds be used?

Investors want to know the current stage of development of your technology. They want to know how their capital will be used and whether you have estimated realistic capital requirements.

At Inner Maven we have assisted clients in approaching potential investors, collating pitch decks and have successfully presented pitches to win millions in investor funds.

Planning is always the first step in developing a business. A good business plan will provide direction and foresight as to future barriers that need to be overcome throughout the commercialisation process. A business plan should be a living document which evolves over time as you research your market, your IP position and understand your financial and market entry requirements. Consider the following headings when writing a business plan:

• Background & Introduction: This should be a short overview of the invention highlighting the innovation and providing a brief introduction to the rest of the business plan
• Technology overview: This should be a detailed overview of the medical device and its features.
• Target Milestones: What and when do you want to achieve particular objectives? For a medical device, this may be obtaining TGA approval or securing a certain amount of funding through capital raising
• Timeline & Deliverables: This can be outlined in a table or GANTT chart
• SWOT analysis: Perform an analysis of the strengths, weaknesses, opportunities and threats facing your technology
• Market strategy: This should involve an assessment of the market size, market opportunity, competitive advantages, identified market need, market segmentation and target market applications.
• Distribution strategy: This section should highlight which jurisdictions that you want to target, and any key partners to which discussions have commenced.
• Intellectual Property: This section should highlight any patents, design registrations and trademarks associated with the medical device.
• Manufacturing strategy: Which parties will be involved in manufacturing the medical device and the key stages of the manufacturing process?
• Regulatory strategy: Any key bodies and key certificates that must be obtained before market release
• Risk Analysis: Understanding the risks and showing you are aware of them is an advantage to you and to your potential investors
• Financial Strategy: How much funding do you have and how much more will you need? How do you intend to raise capital?
• Key personnel and organisational chart: Understand how to best play to the strengths and weaknesses of your team (even if its just you) and know when/where you will need help

At Inner Maven, we can assist to compile and present targeted business and marketing packs.

Commercialisation is a long and arduous process. Inventing a medical device or new technology is just the first step. The ultimate goal may be to license your idea to a larger company, sell your company or raise more capital for even more inventions. The journey is a rollercoaster ride, and many inventors fail to persist with commercialisation. It is important to consider whether you are willing to make the sacrifices and to work out how you will balance the long hours with your personal life. These are the top qualities that successful entrepreneurs possess:

1. Passion

Commitment and dedication is pivotal for an entrepreneur. It might sound like a cliché to love what you do, but having passion for your product and idea will definitely help to sustain an inventor through the highs and lows. When your developing yet another prototype or submitting yet another regulatory submission, inventors with passion think about why they started this business, pushing through and refusing to give up.

2. Seeking help when you need it

No one is an expert on everything. Successful entrepreneurs know when to seek assistance and are not afraid to ask for help when they need it. This is particularly true for medical inventors, who may be experts in their technical field, but may have limited experience in the finer details, which may involve intellectual property, financing, finding distributors and general business advice. At Inner Maven, we have assisted countless entrepreneurs with the finer details of the commercialisation process.

3. Strong Leadership Qualities 

A leader has vision and can see the big picture of running a business. They set goals and objectives, whether that is to increase annual sales, develop a product or to solve a particular problem. Not only do they have vision but they also have the drive and skills to see it through. Leaders are known for having a forward-looking approach, rather than dealing with the nitty gritty details of the business.

4. Willingness to fail

As Henry Ford once said, ‘Failure is simply the opportunity to begin again, this time more intelligently’. Entrepreneurs are risk takers; they take action on their ideas and accept that sometimes not everything goes to plan. They are not reckless, but make calculated decisions on the information that is available. Think of the Richard Bransons of the world, they aren’t sitting on their couches thinking ‘what if’.

5. Serial Innovators

A head full of ideas drives entrepreneurs. Having one idea is great, but having a constant flow of ideas inspires further product development and the next steps for the business.

6. Effective Time Management

Running a business is hard work. It can take a toll on your health and personal life if the stress becomes overbearing. Effective time management and a willingness to delegate tasks to others are essential to prevent burnout.

Entrepreneurs may require access to specialist skills, knowledge and resources to develop and take a product to market. These may include challenges with IP, distributors, funding, negotiating agreements and a whole range of issues requiring specialist expertise. Inner Maven specialises in mentoring and guiding entrepreneurs from that one idea, towards a path of successful commercialisation.