What all medtech founders should know: with Duane Mancini, CEO of Project Medtech

Today we're welcoming Duane Mancini. He's the CEO and managing partner of Project Medtech, and proud to be a nerd of the medtech industry. Yay, nerds! Duane has extensive experience in go-to-market strategy, including regulatory reimbursement, biocompatibility, preclinical efficacy testing and clinical trial design and execution.

With all of the complexities of running a medtech company and taking a product to market, Duane partners with start-ups to develop strategies and milestones.

 

He runs the Project Medtech podcast series, which has over 120 episodes of which I've gotten to participate. Thank you for that. We're excited to jump more into the medtech world and what companies need to think about from inception to markets.

Duane, thanks for joining me today. 

Duane

 

Thanks for having me. This is exciting. Switching roles! 

Kelly

 

It's great to be talking to someone who also runs a podcast.  Fun, right? 

Duane

 

Yeah, it is.  

Kelly

 

It's something I was a little intimidated by at first, but now I'm having so much fun talking to all these people.

I can't imagine not doing this. 

Duane

 

Yeah. That's a weird feeling for sure. Especially as you build that number of episodes up, you're just like, what did I do before?  

Kelly

 

I was just talking to someone who's using computer generated personality technology, like he used to work for EA Games and he's  using this to improve the clinical trial space, like the applications are so incredible.  So knowing all of that, tell us a little bit about how Project Medtech got started. 

Duane

 

Project Medtech was founded in 2020.

I was leaving a company called NAMSA. They're a CRO in the medical device space. And I was heading over to a a company called Covance at the time that had been acquired by LabCorp. And, I  this idea for where I thought there were gaps in start-up companies.

And it was too early to do anything about it. So I said, let me launch a podcast and see if maybe just talking about some of these issues would've been helpful. So that's how we got our start. We started in 2020, April of 2020 to be exact. Started the podcast and then over the next year and a half, added a couple of co-founders and launched our consulting advisory practice and expanded our podcast into another podcast called MedTech Money.

And then also ran some events. Fun.

Kelly

 

It's good to see the organic growth around helping companies get to market too. I feel like there's so many great ideas out there, but people have no idea. Okay, I have this idea for a med device. How do I get it into a patient's hands?  

Duane

 

Yeah it's a difficult thing. And resources are generally... you're strapped for cash and then therefore resources. And so you need to come up with innovative ideas to help get that product through some of that de-risking process. And that's where we started to form Project Medtech.

Kelly

 

Nice. So one of your specialties is evaluating how early decisions in a company may impact other aspects in the future. This perspective is critical for med device companies. What are some of the best or worst stories you've got or you've seen of having or not having this perspective as they try to navigate?

Duane

 

Yeah, so I'll start with the really early one that we see happen a lot. And that's  going to the FDA in some format, whether it be a pre-submission meeting or through the 513(g) process, right? The 513(g) for pretty obvious reasons can be very detrimental to a company.

Cuz once you go through that process that's how the FDA is going to classify your product. And so it could be a hard procedure, especially if you're very new and you're looking for that first thing to go, "well, I'm moving the needle." A lot of times people start in the regulatory area, right?

And they'll go, "I'll do this 513(g)". So we've seen one that teetered on the line of a drug versus a device. They were definitely a device, but they wrote their 513(g) like a research dissertation. Oh no! They got classified as a drug. And so once that happens, that's the nail in the coffin for you in the US, right?

That goes from like a 5-year process to a 20-year process. That one stings. Also companies going to pre- sub meetings before they really are... they go by themselves without a regulatory consultant or a quality consultant. And that could be hard too because those meetings are very strategic.

I think any good regulatory consultant would tell you that. And so from a regulatory quality side, that's the one that I wanted to bring up. The other one that really comes to mind,  is keeping commercialization in mind at all times. Even through regulatory, what claims do you wanna make?

Why do you wanna make them, what's your reimbursement pathway look like? The hardest thing you will do as a medtech company is sell your product. Absolutely. Yeah. So that's my big thing there.

 

I've seen that fail over and over again in my time in the start-up space as well. I'm not a regulatory expert, I'm a quality expert, and so I'm always looking at scalable quality systems.

And one of the things that drives me nuts whenever I deliver a design control process to a company, usually it's to an innovator who maybe has somebody on the clinical regulatory side who's thinking about those things, but not really. And one of the requirements I always put in there is, "what is your reimbursement pathway?"

And they're like, what is your market share? What does that landscape look like?" And they're like, "why do I need to think about that right now?" And I'm like, "you could have the coolest product in the whole wide world, and it's different because of X, Y, and Z, and it's amazing and you believe in it, and I love that for you.

But the reality is that in the hospital space, you're one of 30 on the shelf and they're all charging. They're not even reimbursable because they're billed as part of a package. They're not even an individual unit. And you think people are gonna pay you $300 for this?" Yeah. Isn't it mindblowing?

Duane

 

It's spot on. And this is such a mess. This is what we try to educate them on is we'll see people go, "yeah, I figured out reimbursement. I have a CPT code, or I have a HCPCS code, or all other stuff". And it's no: who is paying for your product, right?

Yeah. That's the simple part of reimbursement. I heard this from a guy named Nick Anderson. He was on one of our virtual events we did, he did a thing on reimbursement and he gave you the rundown of: look at the simplest level, the US healthcare system is this, and it's a little cynical, but you need to figure out where you fit in.

From a business perspective, it's: we all pay money into a bunch of piles of money, which is insurance and the healthcare groups across the country, their only mission is to extract as much money from those piles as possible. So if you don't help a healthcare system extract money or keep more money over here, you really don't have a business model.

Yeah so that's a pretty basic way of looking at it. 

Kelly

 

Yeah. And then all ties back into your design process and your cost of goods sold, and all of those kinds of things that people are like, "why do I need to think about that right now?" I'm like, oh, because! You can go get a clearance, that's great, yay! You met your milestone and you can't sell a unit. And I have seen that.  I'm sure you have too.  It's so unfortunate. Yeah.

 

As long as we're riffing on what things medtech founders need to know, besides the reimbursement pathways, what else would you add to that conversation?

Duane

 

Yeah, so I would say, for what founders need to know, as the founder if you're in this CEO role, just be prepared. It's lonely and it's a long process. And not all founders are going to assume that role, but if you find yourself in that chair, you just have to be prepared for the fact that it's stressful and most people aren't going to understand the level of stress that you are going through and the level of weight that is on your shoulders, right?

And we talk to all of our entrepreneurs about this. It's just difficult. And to tie into that piece, find yourself co-founders to complement your skillsets. We see a lot of entrepreneurs who try to be everything, try to go at this alone and it takes a village to build a successful medtech company. And so we encourage entrepreneurs to think about that. Especially as they grow: who should be on your team? What are you really good at? What do you need to mix in? And that's really where that conversation comes in of: as a founder, are you becoming a CTO, are you becoming the COO, or are you becoming the CEO?

Where's your role in this team based on your skillset and what you wanna do? 

Kelly

 

Yeah, absolutely. I think I would add to that, a real honest assessment of your strengths and weaknesses so that you can make sure your team compliments you. I've worked with a lot of those where it's: "I'm the founder. I wanna be the CEO". And it's: eh.  

 

Are you CEO material? Or the CTO, right? With  the same one where I was talking about the whole Medicare reimbursement situation, our CTO was the innovator and he was a lovely gentleman in his seventies who just wanted to retire, but he wouldn't let go of the control, and it just was like that constant back and forth and struggle with him to let go so that we could actually innovate the thing in order to be manufacturable.

 

Because he had this amazing idea and it was a great product and it was definitely an improvement from... in its space, as far as, how it worked and all those kinds of things.

But same story, it was a liquid product, so it was like, is it a drug? Is it a device? We had to have that conversation with the FDA and then it wasn't manufacturable and he wouldn't let the very intelligent chemist we hired who was trying to figure out how to engineer this thing in a way that: same end result, but we could actually make it.

And yeah, that was a struggle. 

Duane

 

Yeah, and I think to your point of letting go is once you get this super talented team around you, that's the kind of culture you have to build of: let them own the things they're good at, let them do the things that you brought them in to do, to compliment your skillset.

We see a ton of them have this like inability to... this is my baby, this is my baby. And it's: oh it was your baby, now it's everybody's baby, so you gotta let them do what they need to do. But that comes down to culture big time.

Kelly

 

Definitely. And it starts at the top.

Little bit of a pivot: from the guests you've had on your podcast, I'm curious, what are some of your favorite moments or guests that really surprised you? 

Duane

 

Yeah, so this one... this isn't based on, the most popular episodes that people listen to or anything like that.

But I was thinking more along the lines of: these are the ones where I've taken a snippet from the podcast and used it in multiple conversations. So the one that sticks out the most: Brian Green was episode one of our MedTech Money series. He was the first person on the podcast, kinda caught me off guard.

But he was telling a story and it was a hilarious story around raising money. And so that one we always talk about because it's just it's an epic story. We make him tell it anytime we talks at events too,  that we have. So Brian sticks out. And then there were three other ones that I find myself quoting a lot.

So episode four was Lance Black. And he was talking about understanding the problem that you're trying to solve and not just like understanding the problem and expert in the problem, but actually being a historian of the problem. And what he meant there was understanding how people tried to solve it in the past, when they tried to solve it and why they failed.

Did they fail because of a specific operational problem? Did they fail because their opportunity window closed because of circumstances they couldn't control? And that one I use quite frequently when doing some consulting work. Two other ones. One is Dave Albert.

He is the founder and Chief Medical Officer at AliveCor. Maybe episode 104 or something in that area. He had said be an orthogonal thinker. And that one always rings pretty true, right? So  it wasn't, "hey, if everyone's going this way, you should go in the opposite direction". It was just, "hey, if everyone's thinking like this, just go 90 degrees, right?"

You're not going against the stream, but you're thinking over here. And that one I use quite a bit as well, just actually for a motivational perspective. Thought it was just a really cool... I like that.

Kelly

 

Yeah.  Bring your unique perspective.

Don't just jump in the boat cuz everybody's going that way. I like that. 

Duane

 

And then the last one on fundraising was Renee Ryan. She said this on our podcast and she also said this at our Houston start-up symposium. Someone was asking about fundraising and negotiating with an investors and who gets better deals, investors or entrepreneurs, which way is shifting?

People talk about this all the time. And her whole point was like, "honestly, I don't really care". Cuz no one ever died from dilution. But companies do die from running outta cash. And we use that one quite a bit as well. 

Kelly

 

I love it. Yeah. Awesome.

 If you could go back to the start of your career, what would you tell yourself based on what you know? 

 

 

Patience is key, but don't be too patient. There's a fine line. And then I think the biggest thing is when you're starting your career  and spend more time listening to folks who are experts in this space. And then don't ever stop doing that because I feel like people get caught up in this transition of: now I'm the subject matter expert. You very well could be, but don't stop learning from other people.

 

At least for me, that's how I learned the best. And I think it took me a little bit to figure that out of just being around like-minded individuals who are really intelligent and smart and good at what they do and listening to them and talking so much is beneficial.

Especially, we can talk about how lots of industries are evolving and that sort of thing, but this is an industry for sure that is evolving in leaps and bounds, and so if you're not still talking to people and not still learning, then experience and your knowledge is dated.

Kelly

 

Yeah, very quickly. I run into that every now and then. It's so frustrating. Things have changed. You don't have to do IQ OQ PQ on software anymore, right? Stuff like that, and: come on... you gotta stay current.


Duane

And I think following those thought leaders there is important. Like sometimes we graduate from school or whatever, and then you're done learning somehow. Like the industry's just gonna stay stagnant for the next 30 years.

Yeah. That's not reality.

Kelly

 

Not at all. So a fun question we heard from another guest  a while back on the episode. And so we ask it all the time now: if I walked into Barnes and Noble, where would I find you? What section? 

Duane

 

Oh yeah, this is good. That's right. I saw this one.

So this would be for me, non-fiction. More specifically, I'll just give you a few of my favorite  authors. So anything in  human history or how humans think about things or make decisions, right? So therefore that's my favorite space.

 

Amos Tversky or Danny Kahneman, they were both professors that studied behavioral economics, so how humans make decisions, right? So they wrote a lot of really fascinating books in that space. So I spend a lot of time reading those.

 

And then my other favorite author would be Michael Lewis, who writes in the non-fiction area as well. He actually wrote a book on Amos Tversky and Danny Kahneman, and called it the  Undoing Project, but he also wrote the Big Short, which was about the financial crisis in '08. Moneyball, which is about a baseball team, the Oakland Athletics, who essentially went to the playoffs and spent zero, like no money compared to everybody else.

 

And then wrote another one called The Blind Side. So those kind of non-fiction true story books and then those like psychological ones about the history of humans and why we make the decisions we make are fascinating.

Kelly

 

Those are interesting. Yeah. The Blind Side, is that the story about the football player?

 

 

That's exactly it. Yeah. 

Kelly

 

God, I love, love, love that story so much.

 

 

Yeah. So Michael Lewis wrote that original book. He wrote one just recently on the pandemic, which I'm sure is controversial because the pandemic somehow became controversial.

But yeah it's a really good book on the decision-making process of how everything came about. So yeah, he writes some really good books I like to read. 

Kelly

 

Nice. Yeah. I'll have to check those out. I've read The Blind Side, but yeah, I have to check out the pandemic one cuz I feel like in this industry, we're at the center of that controversy. I've got friends who are like, ah, the vaccine's terrible and COVID was just a government thing.

 

And I'm like, oh, really? And then you've got the other side of it. And as someone who's in the healthcare industry, you've got both sides trying to validate their position by talking to you, and it's a challenge.

Duane

 

Yeah. Yeah. It's crazy. And also like part of the pandemic piece of it is the pharma industry got so much attention around this.

 

But then you have the medtech industry, the diagnostic industry, which like we did, but also like it was very short-lived compared to the attention the vaccine gets and still gets. But the rapid COVID tests that came out, all the respirators, the other ways to treat the really sick COVID patients, that was all the medtech industry. And sometimes we don't get the attention that maybe we should. 

Kelly

 

No, I totally agree. If they don't have that p name that rhymes with 'izer', they don't make the news.

I love those guys. Don't get me wrong. I think BioNTech and I always feel the need to emphasize BioNTech was the vaccine company working on it? Yeah. Pfizer just made it possible, right? Yeah. That's how and I love that. It  made those pathways more visible, I think to folks, right?

People all of a sudden we had to pull back the curtain and go, why is this taking so long? Why can't we just go back to our lives tomorrow? It's cuz there's a process here. And then of course everybody likes to conspiracy theory the whole process, but yeah. 

Duane

 

And actually Kelly, I remembered one thing that I needed to mention too. For the founders piece. Is while I said it was lonely and you wanted co-founders, the other thing too is if you are going to go down this path, you need to make sure if you have a family, your family is on board.

Because it is a sacrifice for not just you and your decisions, but if you have a family, for me, I have a wife, a daughter and another one on the way.  If they're not on board, that could create some stress too, cuz there are gonna be those stressful situations that they're involved in as well.

I mean from a financial standpoint, but also helping you deal with the stresses and the wild ride of being a founder CEO. 

 

Yeah, definitely. Yeah, because it's your problem. It's not like working for another company where you can leave it at the office at five o'clock, right?

 

I think of the number of those risks that don't make it, there's some definite valley of death situations in the whole industry. The number of things that you try to get through that fail. People don't realize how big that number is. 

Duane

 

Yep, for sure. So definitely I wanted to share that as well. 

Kelly

 

Yeah, important. Absolutely. Yeah. I'm glad you brought that back up cuz I think people just to get well, and there, there's a little bit of a personality type there, I think in my experience.

They're exciting, they're innovators, they're entrepreneurs, they're visionaries. And then, the ones that decide to take that vision forward and actually turn it into operational execution again, those are not always the same personality.  Because we're always still bootstrapped for cash.

And so yeah, I have seen the toll that takes on families. Like I said, I've been supporting those kinds of companies myself for a lot of years and you see that toll, so I'm glad you brought that up.  Excellent. Well, we'll wrap it up here.

Where can folks go to connect with you and follow along on your company's progress? 

Duane

 

www.projectmedtech.com. Pretty straightforward. We're very active on LinkedIn and myself and the Project Medtech page.  And outside of that, you can catch us at industry events. We also host our own events, but that's all on the website.

Kelly

 

Excellent. Thank you so much. It was good to catch up with you again, and we'll have to have another follow up here in the future. 

Duane

 

Sounds great, Kelly. Thank you.