NTEC Blog

While grants can be cumbersome and slow to disperse, these three are not. Also, grants are non-dilutive funding (translation: " free money"). Don't expect the process to be effortless or the money to show up tomorrow either. However, these three are worth the effort if you qualify.

The first grant is Johnson & Johnson's seed grant program through their Corporate Office of Science and Technology (COSAT). You get up to $250K, no strings attached, with a direct line to J&J's researchers as well as the prestige of being on J&J's A-list of up-and-coming technologies/startups. The objective is to get to a proof-of-concept stage, which is important to J&J (in case they want to collaborate with you), but just as important to you. NTEC recently participated in helping round up entrepreneurs in North Texas, and along with other entrepreneurial organizations we were able to find 96 promising proposals in a little more than a couple of weeks. Seven of these have been selected for follow-up interviews with the J&J scouting crew. More on how things turned out in future blog postings.Next deadline through NTEC will be summer 2012.

The second interesting grant program is NSF's Innovation Corps (I-Corps) Program. It has a few more restrictions but is brand new and very interesting to early stage startups. The objective is to give project teams access to resources to help determine the readiness to transition technology developed by previously-funded or currently-funded NSF projects. In short, this is a grant to get you quickly to a go/no-go decision. Requirements include that an NSF funded researcher is part of the team (funded in the last 5 years by NSF), seserving as an entrepreneur and an advisor. The NSF grant funds a fast track course at Stanford to help develop the right skills to make an informed decision on whether the project could be commercialized and which route to take. Grants are $50K. Rolling deadline.

The third grant program is a North Texas-specific grant opportunity through TEXMED. This Collaborative Research Funding Program in Medical Technologies is a joint program supported by UTA, UTD, UNTHSC, THRE and TI. It is meant to facilitate collaborations in research in order to develop medical technologies in critical healthcare areas. This is more of a classic grant; however, chances of funding should be a lot better. Up to $100K. February 24th, 2012 deadline.

Happy grant hunting. @hubertzajicek

mHealth - mobile health - eHealth - Health IT - Health 2.0 - Telehealth - Telemedicine

Researching the topic of "mobile health' this summer, I ran across a variety of different terms, all of which appeared ill-defined. It appears that mHealth short for mobile health is defined as any practice of medicine or public health, supported by mobile devices. Today, most such mobile devices are the smart phones we carry in our pockets. mHealth is a sub-segment of eHealth which is defined as any use of communications and information technology in the delivery of health care.

In a nutshell, mHealth will most likely be an iphone with some sort of health app. In some cases with certain sensors attached. Of course, any other smartphone is just as eligible.

According to "mobihealthnews", 81% of physicians will be using smart phones in 2012, 13000 health apps* will be available in 2012 for the iphone according to the latest consumer health apps report with an average cost of $3.21 per download. US mHealth market predictions vary widely between singe digit billion dollars into the double digits for 2012. Worldwide the market appears to be poised to reach the triple digit billions in the next few years. Countries like Saudi Arabia, Egypt and Turkey lead mHealth in rural markets as a means to connect their poorly served rural populations with the resources available in their population centers. Even in the US, a market for rural mhealth connectivity is growing rapidly.

At the same time that we observe explosive growth, all players in the healthcare delivery system are plagued with properly regulating access, proper use and defining rules for this new healthcare delivery vehicle. At NTEC's MedVentures 2011 mHealth breakout panel, many of these problems were discussed. The panel featured Debi Stack of Dell, Peter Koo of Ericsson, Mike Bartlett of VAS (a mobile health startup), and Mark Lambright of Healthpoints. AT&T was instrumental in helping to put the panel together and several other prominent players in mHealth in North Texas were in attendance.

Each panelist gave a some insight into the current ongoing collaborations, including Dell's project involving AT&T, THR system and Intuitive Health which showed of their mobile health terminal at the AT&T booth (a Dell tablet).  Healthpoints is a disease management firm, and has a variety of projects in disease management focusing on diabetes and cardiovascular health. These initial rollouts are starting to yield results and show the power of active disease management for high risk populations. With ever more sophisticated mHealth tools, these methods will be able to be enhanced significantly in years to come.

It has become clear that North Texas has a lot of traction in the mHealth field. Enough to set aside some time to talk about the various issues in an mHealth series of events throughout the year. The questions many of the startups and entrepreneurs are trying to define are extremely basic, but vitally important to encourage more budding entrepreneurs to participate in mHealth related ventures.

Questions start with legal descriptions of mobile health devices, how such devices will be regulated, what role the FDA will play in that (hint: a big role), what is the market size, how does the market need to be defined, who are the enablers, what rules apply to data security on such devices and so on.

We are looking forward to explore these exciting topics in mHealth in the coming months.

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PS: Here an article in the Dallas Business Journal that Bill Hethcock put together after MedVentures 2011.

MedVentures 2011 saw a record number of applications from startups to present, record number of sponsors, a record number of speakers and individual sessions and got us the best reviews we have ever received for an event we have put on. We had over 350 attendees which a record for a fall event for us as well.
This year MedVentures featured an angel investor panel, a venture capital panel and 20 presenting startup companies. The "Top 10" startups and the 10 Quickpitch startups were carefully selected by our advisory board, as we have done in the past, with an objective measuring system that allows us to pick the companies with the highest likelihood of commercial success. NTEC received 70 applications to present at MedVentures 2011. the geographical distribution of applicant is as follows.

The majority of applicant companies were from Texas:

Within Texas the majority came from the DFW area:

Out of the top 10, we had four DFW startups, another two from Houston and Austin each. Rounding out the Top 10 were startups from Ohio and Georgia.

New this year, was that we also had 4 breakout sessions on hot topics like neurostimulation, mobile health, regulatory news and alternative financing pathways.
The session on mobile health was such a great success that NTEC is planning a Mobile Health series at NTEC's new conference center, here in Frisco.

The MedVentures 2010 top 10 presenting companies collectively raised over $15M in the year following the 201 conference. We wish the 2011 participants similar success and will report at MedVentures 2012 how they have done. Meanwhile, if you are interested to attend, sponsor or present in 2012, contact us and connect through linkedin, twitter & facebook.

Click here to see a slideshow of the event

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Our 5th Annual MedTech investment conference, MedVentures 2011 will take place on October 6^th, 2011. This event would be nothing without the stars of the show, the presenting startups. NTEC received a record 70 applications and our 30 volunteer reviewers from our scientific and business advisory boards picked the Top 10 companies.  We had a strong showing from healthcare software firms and have three represented among the Top 10 presenters. Of the Top 10 presenters, eight are from Texas. We have four DFW startups, another two from Houston and two from Austin. Rounding out the Top 10 are startups from Ohio and Georgia.

In alphabetical order, here are the MedVentures 2011 "Top 10" presenting companies:

Arcos,Inc is a Houston startup that has developed a unique software protocol for sepsis management. In initial trials on over 200 patients, the mortality rates dropped from 34% to 14%.

Coltrix Biomedical, Inc has developed CollaPatchTM, which prevents the formation of post-surgery adhesions.

DxUpClose, Inc has invented a point of care medical device capable of performing antibiotic sensitivity tests.

Endosphere, Inc has invented the SatiSphere insert, a small, non-invasive device that uses the body's natural physiology to reduce appetite.

Genome Analytics, Inc's proprietary analysis system is capable of providing analysis of large genome, transcriptome and methylome sequencing studies.

Lumamed, Inc's device provides revolutionary "real time" visualization of cancer margins during surgery.

Macuclear, Inc has developed a treatment for Age Related Macular Degeneration, the world's leading cause for blindness in people over the age of 50, affecting over 50 million people.

NRG-Unlimited, Inc designs, manufacturers and markets the FDA-approved InterX, a high-density, interactive neurostimulation device for the management of pain.

OxySure Systems, Inc developed the OxySure Model 615, a revolutionary emergency oxygen device that received FDA clearance.

Waldo Networks, Inc has developed and launched a unique Remote Patient Monitor service (RPM) that delivers a telehealth solution used in the growing field of chronic disease care management.

All these companies are meeting with NTEC's managment team and select advisory board members for a complimentary pitch review session before MedVentures 2011 on October 6th, 2011.

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Three new venture funds have just gotten off their feet in Dallas in the last few months. Does this signify a positive new trend in D/FW?

As we are approaching MedVentures 2011, Dallas' and the Southwest's premier healthcare investment conference on October 6th, the focus turns to funding for these (mostly pre-revenue) startups who have been selected to present that day. The appearance of Orix Texas Technology & Infrastructure Fund, Remeditex Ventures and Dallas Venture Partners (DVP) on the Dallas scene is not a coincidence to me. Lead by Felipe Mendoza, Dennis Stone and Matt Himelfarb, respectively, these three funds have each come about differently, but share a common goal: To pursue great opportunities in an underserved market. Dallas, and Texas for that matter, offers some really good investment opportunities and exciting startups in software and healthcare. Some of the best in healthcare will get to present at MedVentures 2011 in October.

Orix Texas Technology & Infrastructure Fund is backed by the publically traded firm Orix and dedicated to pursuing Texas Technology deals, beginning with good investment opportunities in startups which have previously received Texas Emerging Technology Fund (ETF) money. Remeditex Ventures is the newest fund and is pursuing very early life science and medical device deals, primarily with IP coming out of Texas universities. Remeditex co-invested this month in an $18M Series A round for Peloton Therapeutics, a venture based on IP developed by Steven McKnight. Matt Himelfarb and partners' DVP is looking for software, gaming and cleantech deals. Remeditex and DVP are both privately backed venture funds.

The jury is out, but with the paucity of activity from Dallas-led venture capital in the last few years, it is hard not to be excited about the addition of these three new funds.

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As the second half of 2011 has begun, I take a look back at some of the trends that started to emerge or continue to grow strong this year. I also asked around amongst our medical advisors and in some of NTEC's online groups. Here are 3 areas in medical technology that I believe are poised for growth in 2011 and beyond based on many conversations and my own observations:

1)      Electronic Healthcare Continuum - as EHR's and all things medical go online, there are many opportunities, including EMR's but also "mobile health" (FDA directive just issued on standards) for patients and healthcare providers, telemedicine, and connected healthcare devices and diagnostics. These are driven by desires to improve healthcare, manage chronic diseases, keep patients out of hospitals and reduce costs, while at the same time shifting decision making and information-sharing to patients and other healthcare delivery team-members (not just doctors).

2)      Personalized Medicine: This may include specialty drug development, genetic testing, specific cancer typing, autologous tissue-derived treatments, tissue regeneration or organ reconstruction/growing organs. This trend is supported by our increasing desire to tailor treatments to the individuals instead of using the shotgun approach and accepting treatment failure. With improved computing power, diagnostic testing and individualized treatments available this now is becoming a reality.

3)      Neurostimulation: Whether it is neurostimulation with electrodes, surface stimulation or other methods, the market is huge and full of new innovative ideas. There are lots of implantable electronic stimulators to help with organ function like stimulating non-functioning muscles, interfering with pain signals or treating migraines, depression and epilepsy.


There are many more important trends and innovations, superb ideas and devices that we get to see on a daily basis. These 3 are some of the bigger themes that I see more business plans for. In some cases, as in the "Electronic Healthcare Continuum", the trend feeds the growth of other non-electronic home health devices, many of which are designed to allow seniors more independence and keep them in their own homes longer. Post your top 3 trends below.

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Applications Deadline for 2011 Conference Approaching

Since 2009 the top MedVentures finalists have raised more than $30 million. MedVentures is an early-stage investment conference which showcases medical technology companies. This is a remarkable amount of money considering all but one top presenter were pre-revenue companies. To have a group with such collective success demonstrates the caliber of companies chosen to present at MedVentures.

One of the 2010 MedVentures top companies, Adapta Medical, Inc., made exceptional strides with the help of investors. The developer of several disposable medical devices received investment capital while executing on significant milestones like receiving FDA clearance and submitting additional patents.  Additionally, a significant cash infusion helped OrthoKinematics, Inc. with preparing to launch products early next year. The staple of success for most of the presenting companies was private capital through angel and venture capital sources.
However, the fundraising success for some was a bit non-traditional. Natural-Dental-Implant AG is a German company with a U.S. subsidiary. The organization raised funds here for a company proposing to do the development in Europe. Those dollars came with German government matching funds, a nice sweetener for the company's investors. Grants, SBA loans and partnerships with strategic investors also played a role in the fundraising successes.
Medventures 2011 is now accepting applications to present. Deadline is 7/31/2011. No cost to apply or present if chosen.

•    Application Guidelines
•    MedVentures 2011 Information
•    MedVentures 2010 recap

Here are the 2010 top ten companies in alphabetic order:

Adapta Medical, Inc. has developed several innovative disposable urological medical devices for inpatient and outpatient applications reducing catheterization time and infection rates.

Aequorea Vision Medical, Inc. has developed technology which will allow for the identification of cervical cancers caused by HPV and other cancers in real time.

Heart Test Laboratories Inc. has developed a proprietary patent pending device to identify myocardial abnormalities-ischemia, which is reduced blood flow to the heart muscle. This product can help in the early detection of heart attacks.

Kewl Innovations, Inc.'s small, lightweight Kewl device offers users an untethered and rechargeable device which controls and monitors the temperature of insulin on a single charge for up to three days in various environments.

Magaw Medical, LLC created the "CoPilot", a cost-effective and improved video laryngoscope that will raise the airway management standard of care.

Nanospectra Biosciences, Inc. has developed "AuroLase Therapy", which may allow the focal treatment of prostate cancer, treating only the tumor affected areas and reducing the side effects associated with current therapies

Natural Dental Implants, AG has developed a non‐surgical tooth replacement system that enables general dentists to replace teeth non‐surgically in a single appointment, thus reducing the time, cost and inconvenience associated with current techniques.

NetMed Care, Inc. is creating NetMed Care eClinics, a branded service that will change the way healthcare is delivered by creating access to quality health care, at reduced costs, for multiple market segments through a unique telemedicine solution.

OrthoKinematics, Inc. has launched the "KineGraph VMA", a new functional test for the spine that helps spine surgeons make better decisions to improve their surgical outcomes.

Palmaz Scientific, Inc. has developed proprietary nanotechnology based methods that are providing a potential game changing technology platform for the future of implantable medical devices.

Apply Now to present at the MedVentures 2011 conference on October 6th 2011

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An interesting Wall Street Journal blog post draws a connection to the strenuous federal government's regulatory process and failure among medical device companies. The article describes a report by the Medical Device Venture Council. The 35 page document cites concrete cases in which uncertainty in the government's system caused medical device companies to collapse or endure needless holdups and cost.
No company at NTEC, that I am aware of, recounts a particularly unfair Food and Drug Administration experience. However, the general sentiment of uncertainty concerning the FDA among medical device entrepreneurs is hard to ignore. The consensus seems to be the regulatory pathway has become extremely cumbersome, especially when compared to the European CE mark process. Several regulatory firms supporting the CE mark process are recognizing this significant opportunity and are prepared to leverage the inefficiencies in the U.S. to open the European and other CE-mark regulated markets.
What this means for American entrepreneurialism in medical devices is simple to deduce. The US market is no longer the obvious first choice for startup medical device companies. Europe is emerging as an affordable reasonable solution for medical device manufacturers who balance risk and reward in an economy that has a grip on our wallets.
The CE mark process is enticing because it is predictable - not less stringent. No one at home or abroad wants to sell or promote unsafe devices. What we strive for is a process that is transparent, reasonable, affordable and safe for all. U.S. entrepreneurs miss out on the largest single market in medical devices when they take their innovations to other countries. Additionally, Americans don't benefit from new innovations that save lives and are cost efficient. The next threat is when companies receive CE marks in Europe, the expectation is the products will be manufactured there, too.
Let's remove the unreasonable regulatory risk. This does not mean we should approve everything, but it does mean we have to re-introduce a reasonable, predictable process. Ultimately, we have to bear the costs for these uncertainties in the regulatory pathway. Instilling confidence in entrepreneurs that they will be treated fairly by the system will take concrete steps to ensure credible change.

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Where there is smoke....Ok, there are definitively many war stories to be told. My fellow startup veterans Alex Muse, Gabriella Draney, Darlene Ryan could give you similar run downs. Most seasoned investors could do it too. It also contributes to why we enjoy what we do. No single entrepreneur, story or pitch are the same.

However first a few problems that are probably hard to fix and that might mean a "no go" for your budding firm:

1)    Wanted: Dead or Alive.

One of my first due diligence targets was an entrepreneur who came to see us. For some reason we were meeting at a restaurant instead at NTEC's HQ. I didn't know how I'd identify him so I googled him. This is several years ago, so maybe I "yahooed" him. OK, I did find a good quality photograph of him. However, it was on a "wanted poster" online. He was wanted for being a "deadbeat dad" on a similarly named website. Clearly I wasn't in a position to figure out whether this was legit or not (website stated a series of requirements that had to be fulfilled for the grieving party to be able to post), but I wasn't feeling so great about meeting him anymore. At the very least it was distracting. After we met, and I determined that he was working on an interesting startup, I asked him if he could do me a favor and google himself. I simply said that whatever the truth in this case, he'll have a hard time fundraising with that kind of publicity. (He later told me that he settled the dispute, and he disappeared from the "wanted" site) Try not to be on wanted posters, no matter what you are wanted for…

2)    Caution, your investor may actually know more.

An interesting conversation ensued after a lengthy presentation that was star studded with claims and "cool invention bells & whistles". The  startup was playing in the bio-photonics world. The entrepreneur was not the technical expert, but sure claimed to be. Problem was that I had spent many years doing research using such technologies. I had even co-authored scientific  papers and book chapters in the field related to the invention and while NOT claiming to be an expert, I had gotten to know many of the limitations of the technologies involved. We're talking hands on, doing experiments that didn't work, because of some very clear limitations of the techniques involved. All that is fine except that this person insisted on being right…I didn't claim to be but I also wasn't about to just let it all go. It became pretty uncomfortable fast and he didn't do himself a service by arguing instead of getting backup data. Maybe I WAS wrong and incredible breakthroughs had happened unbeknownst to me. The attitude of the entrepreneur told me otherwise. Also, the only thing I learned was that this person wasn't going to be easy to live with. Any investor in my place would have walked. Of course, so did I. Because if the investor walks, then I am backing something that cannot be financed. Not my end-game.  Try not to get into an argument on your first visit, the person across from you just might actually know what he/she is talking about.

3)    Patents, it matters what's protected

Patents are great to have and can be a real non-starter if you don't. Not every company needs them because it could be that your intellectual property is protected as a trade secret or handled in some other way. In most cases, however, a patent or a pending patent is the signal that you have something special/unique.
Recently, I spent some time with a company that had a patent but it wasn't immediately clear what the patent was actually protecting/claiming. It turned out that the part of the business that was attached to the patent was rather small, and it would not have been hard at all to do things in a different way circumventing the patent.
Another time a technology simply wasn't going to be protectable. When we conferred with our IP attorney friends, it became clear that the claims weren't going to make it. You can always submit your IP and claim a "pending patent", but expect extra scrutiny because most patents will initially be rejected. We shared the respective feedback with the applicant companies, of course. Good IP counsel is crucial, if your IP is going to be crucial to your business.

On the bright side, there are many things an entrepreneur CAN do to attract interest and make a compelling case. When we vet a company we look for things that cannot be fixed, because we stop right there and don't waste ours or the entrepreneurs' time.
Most things can be fixed and that is where entities like NTEC can make a difference.

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