5 Horsemen of the Apocalypse the Healthtech Entrepreneur Faces

The last book of the New Testament of the Christian Bible identifies the four horsemen of the apocalypse as plague, war, famine, and death and points out that their presence will affect humanity, leading the latter to its disappearance.  When undertaking health technology, it is also possible to find factors whose negative effect can be devastating.

In our 12-year history at Pragmatec, as a technology transfer office, we have conducted multiple interactions with technology-focused entrepreneurs, mainly in the health sector, who continually face their own “horsemen of the apocalypse,” thus putting at risk their technological progress or their recognition in the market.  In this article, we will address five different negative factors, highlighting some important questions to consider, describing them, and providing general recommendations that can help entrepreneurs partaking in this sector.  We have concentrated these “kill-entrepreneurship” problems in five horsemen of the apocalypse of technological entrepreneurship in health.

Innovation

Is my technology different? Is it useful for your goal?

“There is no technology equal to mine” is a claim that is frequently heard in the Technology Transfer World.  We are not (yet) able to analyze all the existing information in our environment, which limits the identification and analysis of all the technologies that address the same problem. Some technological developments are based on partial analysis of the environment, or based mainly on the researcher's knowledge.

It is important to broaden the scope of technological surveillance: carrying out a broad review of scientific articles, performing a patent analysis, and conducting a benchmark of technological products on the market are some basic actions to compare a technological project in development with other incipient or mature projects in the local, national, or international environment. This activity is recommended to begin at Technology Readiness Level (TRL)*1 and carry on throughout the project.

Intellectual property

Can I build a technological barrier in my market?

The development of a health-related technology will require, in most projects, a significant amount of two resources: time and money.  This investment requires acquiring insurance that allows the developer to obtain the right to commercially exploit her technology in the market to recover the resources spent and to obtain additional benefits.

In the initial stages of technological development, when the research hypotheses or proof of concept begin to be validated, it is advisable to approach an intellectual property expert to get advice during this phase or, whether appropriate, start with a patentability study to evaluate the possibility of protecting the invention.  This information will be useful for defining an intellectual property protection strategy.  This recommended activity could start at TRL3 and continue as new applications are obtained in the project or seek to expand the geographical scope of intellectual property.

Regulation

Does my technological development comply with health regulations to reach the market?

On many occasions, the developers of the technology did not perform a deep analysis and, as a result, fundamental peripheral elements to reach the market are lacking (for example,  the regulation of technology by specialized government agencies).  Believing that this phase should start when the technology is ready is a mistake that is typically observed in technological entrepreneurship.

This horseman of the apocalypse, like the previous one, can begin to be analyzed in the proof of concept.  Initially identifying the existing regulations in the target market and what requirements will be necessary to obtain approval for commercialization is key.  Due to their complexity, some technologies will require more time to comply with regulations or good manufacturing practices.  There are regulatory experts and specialized organizations that can provide advice in early stages, including the design of the technology.  This activity is recommended to be carried out from TRL3 to TRL8.

Investment

How much investment will my project require? Who are my best allies in financial resources?

The high-tech health venture will require more resources (from diverse origins) at each new stage of the technological development for validation, prototyping, scaling, and first commercialization batches stages.  This continuous and growing demand for capital resources adds potential distress to most technological development projects.  The lack of investment instruments specialized in simulation stages and real environments adds a new layer of stress.

It is recommended in this challenge to identify which organizations finance the various stages of technological development.  Many times, it is the entrepreneurial team that allocates its own resources complemented with some government funding directed to advancing science.  These resources are typically used during the laboratory stage (TRL 1-3).  For the following simulation/validation phases (TRL 4-6) it will be important to identify resources in incubators, accelerators, angel investors, corporate ventures, or crowdfunding.  Finally, for technologies that are already in the final stage (TRL 7-9), sources such as venture capital, public resources focused on entrepreneurship, and some corporate venture initiatives can be useful to bringing the technology to market.

Market

What is the best way to commercialize the technology?

I remember a talk with Dr. Emilio Sacristan Rock on this topic; he is one of the most experienced and successful technology entrepreneurs in Mexico in medical devices:  B2C, B2B, and the business model canvas find limitations in the health sector due to the complexity among the purchasing process, the prescribing expert, and the end user.  The individual who pays is not the one who recommends, and the one who uses the technology is the one who follows a recipe on many occasions.

Not understanding this market of many players and diverse processes risks the implementation of a good technology in the market, even with regulatory approval.  The iCorps recommend, for example, carrying out 100 interviews in the initial phase to learn about the problem in detail, as well as the integration of technology into the real environment.  These organizations claim that the information obtained will facilitate the design of technologies that are easy to use, recommended by experts, and accessible to public and private health systems.  In addition, this feedback will allow the identification of  various exit strategies for the developer such as licensing or the sale of the technology in real environment phases.

The development of technologies requires planning, as well as emerging decision-making due to the new scenarios that are presented in the process.  However, at the risk management level, an innovation process that incorporates an analysis of these 5 factors (innovation, intellectual property, regulation, investment, and market) and determination of specific lines of action will provide technological development with greater certainty, better use of limited resources, and strength of the technology, thus increasing its economic and social value.

Technology transfer offices can provide relevant information to address all, or some of these, 5 horsemen of the apocalypse of technological entrepreneurship.  Therefore, when approaching any expert on these issues, it is recommended to reach other entrepreneurs to learn about the expert and its competencies.

*TRL or Technology Readiness Level is a structured measure created by NASA to evaluate the maturity of a specific technology. It has  nine different levels from research to innovation.