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Her presentation entitled “Homeward Bound: Medical Devices as Home Appliances” summarized some of the trends and design challenges related to the movement of medical devices from the hospital and central lab to the home.  The talk drew the largest audience that the university has experienced for the series, and the audience was very engaged and asked great questions.

One Section of the Audience

A video broadcast of the lecture in its hour-long entirety can be viewed here.  There are about 40 minutes of presentation and 20 minutes of Q&A.  You’ll need to download Silverlight Player, but this only takes a few minutes.

Jenny Addressing Questions

Market consolidation in the clinical testing instrument business was evident on the show floor, with many exhibitors displaying families of instruments recently acquired from other smaller businesses.  From the looks of it there is more consolidation in store; the lure of the personalized medicine business has generated a large number of new companion diagnostics instruments and assays, and it appears the number of PCR instruments far exceeds what the market could demand.

Also evident on a walk-around is the increasing trend away from large central lab instruments and toward smaller footprint satellite lab and portable instruments.  This trend is likely fueled by increasing interest in lower cost and quicker turnaround point-of-care diagnostics coupled with ready mini-electronics and battery design arising from the consumer electronics industry.

Another trend shown in recently years is the influx of new players from emerging markets such as Latin America and Asia Pacific.  The IVD market is expecting a compound annual growth rate of 6.6% for the next 5 years with the Asia Pacific and Latin America regions leading the way, according to the expo issue of the Clinical Laboratory News July 2011.  Not only are the demands from these markets are growing, confirmed by the number of international participants walking the floor, but also the technology innovation from these regions is forecast to surpass the U.S in the coming decade.  This year, there were 55 Chinese biotech companies and manufacturers showcasing lab devices, assays, manufacturing components, and even a CAP-accredited clinical lab network.  The fact that most manufacturers claim ISO 13485 certificate and CE mark shows the sophistication and competitiveness of the Asia Pacific biotech sector.  The shifting landscape of both major market places and innovation drivers will be interesting and a challenge for U.S. companies in the coming decade.

Design engineering is a “tool” every medical device venture should take seriously.  Before searching for funding or lining up office space, your design must be thoroughly evaluated in its intended use.  Key Tech is the perfect partner for this, having spent the last 13+ years developing medical products.

Brian Lipford, VP of Strategic Development at Key Technologies kicked off the Tool Box Day by presenting an introduction to Key Tech.  His presentation is below:

After the presentations, we met with medical students, residents, researchers and some early-stage start ups.  Our advice to each of these entrepreneurs was the same:  Prior to engaging with Key Tech, you need to do your homework!

1. IP – Take a look at the patent landscape to see if your idea is unique.  At the very least, spend some time on Google poking around; it could save a lot of time and heartache.  It’s no surprise that without solid IP coverage, the deck is stacked against you.
2. Risks – What are the technical risks associated with your product?  What are the risks to the patient?  Medical device development is a risk-based business, so be comfortable with discussing this.
3. Funding - How will you obtain funding?  Key Tech may be interested in a joint venture arrangement with the right companies who are well funded.  If your idea has enough merit, Key Tech may be open to pursuing an SBIR grant.
4. Regulatory - What is your FDA regulatory strategy?  Does your technology fall into the streamlined 510k process, or is it going to be a more lengthy PMA application?  What are your potential reimbursement codes, because without them, you have no market!
5. Competition - Scope out your competitors.  Is it possible that they could be developing similar technology to yours?  Are you willing to compete with them?

Key Tech enjoys attending events like these because it gives us a chance to interact with researchers and professionals on the front lines of medicine.  Without their expertise, we are often times left doing needs assessments in a box, which isn’t very effective.  We love solving problems, but it takes partnerships with the right people to identify those problems.

Aris Melissaratos, Senior Advisor to the President of Johns Hopkins, spoke at the event about the $1.4 billion research budget at Hopkins.  He mentioned they are looking to improve their “return on investment” by spinning out more companies and ideas from the university stemming from their research.  We see this as a perfect opportunity for Johns Hopkins to reach out to the business community, and for the community to do the same to bring product innovation up to par with research at the university.

Dr. Favardin, a strong proponent of entrepreneurship and an advocate for technology commercialization, talked about the various programs the university currently offers that help drive economic growth in the state of Maryland.  The Maryland Technology Enterprise Institute (Mtech) supports the state’s technology economy by educating the next generation of technology entrepreneurs, creating successful technology ventures, and connecting Maryland businesses with university resources.  Mtech has had a $22.5 billion economic impact within the state since 1983.  Specifically, some high profile products such as MedImmune’s Synagis and Hughes Communications’ HughesNet, and billion dollar companies such as Martek Biosciences, and Digene Corporation all found its start from the university programs.  Recently, the entrepreneurship programs offered by the university were ranked 11^th nationwide by the U.S. News and World Report.

Key Tech already has strong ties with the academic powerhouse.  Two out of the four founders graduated from Maryland, and Key Tech currently employs seven Maryland alumni from the Clark School of Engineering, which accounts for roughly 30% of the staff.  In addition, Key Tech CEO Jenny Regan currently serves as the chair for the Women in Engineering (WIE) Advisor board at the university.

Besides the existing relationship, Key Tech looks forward to an array of future collaboration opportunities with the school, and welcomes any suggestions on how to facilitate tech commercialization between the university and small businesses like Key Tech.

A special thank you to the event planners on the UMD side: Asante, Ted & Jess!

It’s true that engineers have a particularly packed class-schedule, thus squeezing in classes outside their major seems superfluous. My undergraduate engineering program at UMCP required about 15 more credits than other curricula, so I, like other engineers, spent many evenings stressing over classes that I didn’t think were needed for my future in engineering.

It’s likely this student couldn’t relate macroeconomics to his own life (this was Summer 2008). However, since then, we’ve watched the failures of a few huge businesses send economic waves throughout the world. Companies, cities, states, and countries have gone bankrupt. Inflation and deflation are both serious worries. It’s a good time to understand a little about macroeconomics.

Engineers are notorious for falling somewhere between “a little nerdy” and “socially awkward”. A look around Key Tech does nothing to dispel that stereotype. But, it’s a fun crowd with interests in theoretical physics (admittedly, still nerdy), business, photography, nature, travel, cooking, brewing, farming, athletics, web development, and more. These interests developed when we were exposed to something  beyond the world of engineering.

Something that starts out as a chore might turn into a hobby or even shape a career path. It’s too early to discount the impact of a well rounded education on the rest of your life.

On Wednesday, Maryland Governor Martin O’Malley was awarded BIO’s “Biotech Governor of the Year” and used his acceptance speech to point out some of the reasons why.  Last year, the Governor launched BioMaryland 2020, a 10-year, $1.3 billion strategy for moving Maryland’s bioscience industry forward.

Maryland has always been a powerhouse of basic scientific research, home to global leaders like the NIH, Johns Hopkins University, the University of Maryland, and more.  Driving this tremendous amount of basic research to commercial success has historically been a challenge in Maryland, but that’s beginning to change.  Maryland has a growing commercial biotech industry and the BioMaryland 2020 program has already infused the industry with $100 million.

Much of this funding is going to research and academic institutions, but one of the effective industry infusions has been the Biotechnology Investor Tax Credit.  By offering a credit for qualified investors in biotech businesses, this program has already enabled dozens of Maryland start-up biotechnology companies to raise nearly $50 million from investors.

The state’s biotechnology sector is growing at a rate more than 10% per year, more than twice the national average, and Maryland is already home to more than 500 bioscience companies and employs the highest concentrations of PhD’s in the US.  Key Tech is seeing this growth and is already participating in the translational research and product development that will catalyze more commercial success.

Go Maryland!

Photo Credit: Thadz

Excise Tax

The excise tax has been a hot topic of conversation ever since it was proposed. It did make it into the bill as a tax of 2.3% of the price of the device. It will go into effect for the 2013 tax year, but unlike most excise taxes, it appears to be deductible. New companies that have yet to make a profit will be at more of a disadvantage with the excise tax since it taxes revenue from any sales, not just profitable ones.

Reference: Foley Hoag, LLP

Research Tax Credit

The Healthcare Bill also has a provision, referred to as the Therapeutic Discovery Project credit, that will likely offset that disadvantage to new companies. This is a 50% credit for qualified expenses related to projects designed to

“treat or prevent diseases or conditions by conducting pre-clinical activities, clinical trials, and clinical studies, or carrying out research projects, for the purpose of securing approval of a product under section 505(b) of the Federal Food, Drug, and Cosmetic Act or section 351(a) of the Public Health Service Act.” – Section 9023 of HR 3590 EAS/PP, pg 2019.

The credit is limited to ventures with less than 250 employees, and it will be disbursed in a grant-like structure. There is $1B in the pot and an application process. Once the funds are gone, they’re gone, and the credit can be taken starting with the 2009 tax year, so get your pencils ready. Once the regulations come out in a month or two, you’ll want to submit your application right away. Dean Zerbe at Forbes.com has a much better, and much more detailed, analysis of the Therapeutic Discovery Project credit.

Disclaimer: I am not providing tax advice. I’m just pointing these issues out so you can discuss them with your own professional tax advisors.

Key Tech outsources for prototype components and then assembles, details, and tests in-house. Prototyping capabilities are full service, including SLA, SLS, thermoforming, urethane, epoxy and silicone casting, polyjet, CNC machined parts, full electrical prototyping including microprocessor selection (in-house), board design (in-house), population and testing, user interface screen mock-ups with display software, and more.

In the vast majority of businesses, the best way to sell more widgets, expand your client sales, or just move up at your company is to exceed expectations. As an auto mechanic, you can comp one of your regular customers coming in to get a used car checked out. After all, you’ll probably be servicing that car for years. If you’re a mortgage agent, you can treat your customers with respect instead of assuming they’re trying to somehow run off to Fiji with your money. If you’re an engineer, you can forego the shortcut and wow them with a creative solution that took a little more mental effort to design but saved a bunch of money. Can you make every customer feel special?

Making customers feel special isn’t always about reducing the price or cutting into the bottom line. That’s subtraction. What can you do to please your customers by addition? You can add value – add responsiveness, add quality, add caring and concern. The more you care about your customers and help them solve their problems, the more they will come back to you.

What we want, what we need, what we must have are indispensable human beings. We need original thinkers, provocateurs, and people who care. We need marketers who can lead, salespeople able to risk making a human connection, passionate change makers willing to be shunned if it is necessary for them to make a point. Every organization needs a linchpin, the one person who can bring it together and make a difference. Some organizations haven’t realized this yet, or haven’t articulated it, but we need artists.

Artists are people with a genius for finding a new answer, a new connection, a new way of getting things done.

That would be you.

Seth Godin, “Linchpin”

In his new book, Seth Godin has articulated what it means to be the “linchpin” of an organization. It’s inspiring, and perhaps his best work to date.

Maybe you’ve never thought about the value you bring to your office when you figure out how to replace the fax toner or help a client translate a CAD model when their project manager is on vacation. Maybe you’ll see those small tasks as opportunities instead of wasted time. Maybe you’ll make yourself indispensable.