This primer will help you understand the type of information we, as investors, look for when evaluating an emerging company or innovation. Please use this primer to prepare materials that explain your innovation and business plan as you get ready to seek formal funding.
As you think about your new venture, you might also find our blog entry, Medical Device Investing: Overturning Assumptions, helpful.
A Convergence of Factors
This primer is organized by the three types of factors we evaluate when looking at a company. Human factors are about the people who will use and buy your product, technology factors are about your core innovation and its potential, and market factors are about the business landscape you face. To achieve success you must have a positive convergence of these three factors: it must be desirable, feasible and viable.
Typical Commercialization Process
The pathway from a compelling innovation to a successful commercial product is well traveled. We have outlined the commercialization process that most medical devices follow below. This process could be as quick as 18 months if you have a technically simple but impactful innovation, or it could take years if a proof-of-concept prototype takes a while to develop and there are many technical challenges during product development.
Phase 1: Concept Development
Timeframe: Highly Variable
Key Activities: Develop proof-of-concept prototype, articulate development and business plans by following the questions asked by this primer
End Point: Investment sought and obtained
Phase 2: Product Development
Timeframe: Typically around six months
Key Activities: Define commercial product that leverages proof-of-concept prototype, iterate design, test product elements
End Point: Design freeze for commercial product
Phase 3: Launch Preparation
Timeframe: Typically about one year
Key Activities: Validation & Verification to support FDA submission, manufacturing process development & validation, prepare design history file, develop commercial plan and marketing assets
End Point: FDA submission
Phase 4: Product Launch
Timeframe: Ongoing once FDA approval granted
Key Activities: Commercial activities to intiate and expand markets, monitor commercial usage for adverse events, iterate product for future launches
End Point: Ideally none
Initial Assessment Questions
Before you go any further in this primer, we recommend making sure you have strong answers to this list of questions. Each of these questions will be fleshed out in detail as we proceed through the primer, but before you put any effort into your idea it's a good idea to gut check whether it's worth continuing. Once you are satisfied, you are ready to continue to the next step.
What is the invention?
What need is it trying to address?
What is the current standard of care?
What is the level of innovation compared to the current standard of care?
What could this complete with? What are the advantages this has over the competition?
What is the potential number of patients this can address?
What is required to show that this concept will work?
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