Episode Transcript
[00:00:00] Speaker A: Hey everyone, this is Tom Salemi of Device Talks. Welcome back to the Device Talks weekly podcast. Got a great episode for you today. As always. A little later in the podcast I've got a conversation I had with Adrian Lamb. He is the new CEO and president of Corvista, which is a very cool AI enabled company that should make it easier to diagnose and identify cardiac problems. So exciting space and Adrian has a great story as to how he found himself as the CEO of an AI MedTech company. And lots of life lessons in there for folks who are building their own careers. Before that, we'll hear from Scott Frazier of Frazier Healthcare. Scott will be on a panel we have at Device Talks Boston looking at the importance of ASCs. He'll be on there with panelists from Medtronic and Olympus, as well as a physician who is now with an asc. And we'll talk about how medical devices are finding their way and need to find their way into the ASC market. It'll be a critical conversation for medtech folks. But before that, Chris Newmarker and I chit chat a bit. It's not an official newsmakers. We just talked about sort of the state of things for a few minutes. How the tariff, whatever we want to call it, is impacting medtech on the markets and elsewhere. What companies have been impacted most, what companies have been more resilient. So we'll kick off the podcast with that conversation. I just concluded my conversation with the fine folks at XCATH to complete our Surgical Robotics, our virtual Surgical Robotics week. We had great presentations from Lupine Dental on Tuesday, from Endoquest on Wednesday, from SSI Innovations on Thursday, and now I'm recording this on Friday afternoon. Again, we just wrapped up with XCath. Thanks to all of our great sponsors who made that possible and of course thanks to everyone who attended. We had well over 1100 people who registered for these conversations and we had great questions as always from our Device Talks audiences. We're going to take a break from Device Talks Tuesdays until after Device Talks Boston. So we'll see you back in May.
And speaking of Device Talks Boston, we'd love to see you there on April 30th and May 1st. Go to boston.devicetalks.com to register. We've got lots of great conversations beyond the impact of ASCs around inventing medical devices, designing medical devices, making medical devices and commercializing medical devices. That's what we love to talk about here at Device Talks and this will be our best year yet. So don't miss out. And of course, we'll be back in the twin cities on June 11th. Just recruited one of our participants from Surgical Robotics Week to sit on a panel at Device Talks Minnesota, where we'll be talking about how AI and robotics will change healthcare. So, looking forward to that discussion. You can go to minnesota.devicetalks.com to register for that. We would certainly love to see you there on June 11th at the McNamara Center. All right, without any further delay, let's kick off this episode of the Device Talks weekly podcast.
All right, you ready for this?
[00:03:23] Speaker B: Ready.
[00:03:45] Speaker A: Chris Newmarker. How are you, sir?
[00:03:47] Speaker B: Doing well, Tom. Doing well. Happy Friday.
[00:03:50] Speaker A: Happy Friday. Yeah, the weeks are feeling longer because we're getting closer toward Device Talks Boston. And this is when all the stuff starts.
All the little boxes need to be checked. That's right.
So it's a rough couple of weeks, but I had a nice message and I think the gentleman from Philips messaged you earlier this week, and he just said that. He's like, oh, thank you so much for putting this together. It's really basically a great event and the highlight of the spring. So it's nice to hear that all this work you're putting in is appreciated by the industry. It's really cool.
[00:04:26] Speaker B: Yeah. I'm amazed at how many messages I get on LinkedIn from people inside the industry who, like, say that, you know, Mass Device is like an awesome news site. And, you know, I love the podcast, love, love the events that, you know, that, that Tom's putting together. So it's, it's fantastic.
[00:04:44] Speaker A: Keep it coming, folks.
[00:04:45] Speaker B: Yeah, keep it coming. I'll.
[00:04:47] Speaker A: We love the encouraging words, especially four more screenshots.
[00:04:50] Speaker B: Over to you, Tom. You know, give you that, give you that little, little happy boost, you know?
You know, it's, it's good to have that in dark times, you know, like.
[00:04:59] Speaker A: Yeah, and the times have been interesting. And actually, it's another reason that I'm happy to be getting together at Device Talks Boston. We're obviously going to be talking about the making of medical devices. We'll get into the nitty and the gritty, but there's some obviously global things that are going on that Medtech's learning to cope with. We're going to talk a bit about that today, but in talking with Ivar Antonos about his discussion, and I talked to him prior to the lifting of the tariffs, so we don't know where things are going and they could be brought back in 90 days. Who knows?
[00:05:33] Speaker B: I mean, we're talking Friday morning, but.
[00:05:35] Speaker A: He rightly, I think compared it and it reminded me of why we started this podcast of COVID Like it was just this singular event that we really don't know how things are going to sort out.
So we started this podcast initially to focus on how the industry's impacting or adjusting to Covid.
And I think we're going to have some similar conversations at Device Talks Boston about how all of this is going to be managed, not in a political way, but honestly just how companies are preparing for uncertainty and crises. And we'll talk with Cecilia Soriano at Baxter about how they dealt with an actual crisis, which was the impact of Hurricane Helene. But I think the lessons from those types of crises can be carried over to non weather related crises and just sort of having a plan B and a plan C. So I suspect there'll be a lot of conversations like that at Device Docs Boston.
[00:06:29] Speaker B: Yeah, yeah, exactly. I mean a crisis is a crisis, whether it's climate change, a hurricane or a accidental or induced economic crisis.
[00:06:45] Speaker A: So I know you've been tracking the stock prices.
[00:06:49] Speaker B: Yes.
[00:06:50] Speaker A: And obviously there's been some fluctuation, I gather. It's, I wonder.
[00:06:55] Speaker B: Just, just a little bit, Tom. Yeah, just a little bit of, I mean it's, yeah, I mean, I mean, I mean unless you're like returning from, you know, well, wellness spa where you had to check in your iPhone for, you know, for a week, you know. You know, yes, you're, you're, you've been, you know, following. There's been a lot in the news and you know, a lot of, you know, mar, you know, market swings going on. You know, it's been, I mean S&P 500 is approaching bear market territory right now.
But yeah, it's been a roller coaster and one of the things I've been doing is rolling out a story on mass device every few days, just kind of like tracking like, okay, how are the stocks of some of the largest, most prominent med tech companies in the US doing amid this? And you know, it isn't, they aren't all in lockstep, you know, like some are, you know, doing better than others depending on the situation. So, and it's been getting some attention on mass Device, you know, so I'm hopeful that's useful for people, people around the industry.
[00:08:06] Speaker A: Are you seeing a larger picture of the, are there types of companies that are holding steadier and types that aren't maybe where their manufacturing is or maybe the types of devices they make or maybe is there any sort of matrix like vision to the code that you're looking at as numbers are going up and down with the public markets, I.
[00:08:25] Speaker B: Mean, as kind of the policy of which countries were being more aggressive with tariffs that kind of affects stocks of different companies based on where their footprint is. For example, Intuitive Surgical was having a rougher time when there was a lot more talk about Mexico because you know, like, like, you know, Intuitive's major surgical tools plant for its robotic systems is in Mexico. So, so they, I mean then they've been, you know, very public, you know, and you know, with analysts and whatnot that, you know, that they're, you know, that this is going to affect them if we end up having like really, really large tariffs with Mexico right now. I mean, the company that's especially being affected is GE Healthcare.
And that's, I mean GE' been in China for decades upon decades. 10% of their revenue last year came from China.
It's a major market for them.
Trump earlier this week put a 90 day pause at least some of the tariffs that he was going to be doing, but he amped it up more against China. And so it's affecting Georgia Healthcare stock a lot more than, than other medical device companies. I mean right now as I, as I speak I'm just like looking at their ticker and you know, their, their stock price is down over 27% over the, over the last month.
And, and there's also like some, some concern because the Chinese government started a probe into dumping of lower priced CT Tubes from the US and India onto the Chinese market. And G Healthcare sent me, you know, a statement saying that it's not going to have a mater like or what was the exact phrase, Sorry, I want to, I want to do them right here. I mean they, you know, they were, you know, saying that, you know, like that they didn't think it would be a material risk to their business in China. But it seems like investors at this point seem kind of down on their, on their stock. You know, we've had, we had an analyst note out as well, you know, from, you know, from you know, BTIG in which they were, you know, raising, raising, you know, some questions about this, about the CT tubes probe in China, so. Well, I mean, we'll see. I mean it's definitely a very fluid.
[00:11:04] Speaker A: Situation, but yeah, and it won't be isolated obviously. I mean, I can't imagine there's any med tech company that doesn't have, isn't touched by China in some way. Some part of there, some nuts and.
[00:11:14] Speaker B: Bolts, some medtronics down 12% over the last month. And they have a good chunk of business in China.
If you were a really huge medical device company, it makes sense. It's the largest one. I mean, other than the United States, it's the largest economy in the world. So you want to be in there.
[00:11:36] Speaker A: Where's Stryker at?
[00:11:38] Speaker B: I mean, Stryker's down more than 6% over the past month. So.
[00:11:42] Speaker A: Okay.
[00:11:43] Speaker B: I mean, so less than. Less.
[00:11:45] Speaker A: Yeah, yeah, less than. Less than others. And I'm just raising because I remember talking with Kevin Lobo about that they hadn't really made China priority market for Mako anyway, so I wonder if their exposure is a little less than others. But anyway, a lot going on in the space and we'll be talking about it at device talks Boston for sure.
[00:12:08] Speaker B: You know, and just for perspective, The S&P 500 is over 6% over the past month. So I mean, Stryker is kind of down, you know, about the same level as the overall. Okay, overall market. But then, yeah, you're seeing something like Medtronics over 12% and you know, and you know, GE Healthcare, they, as I said before, they're over 27%, you know, but then, you know, intuitive, which was pretty down over, over the past month.
[00:12:33] Speaker C: Just a few weeks ago.
[00:12:34] Speaker B: Now they're only down like a little over 1% over the past month. You know, and I think that's because Mexico isn't the focus right now of what's being talked about with terrorists. But guess the overall message, it just seems like it's an unpredictable environment and a company needs to be able to say, oh, okay, China, US has a huge trade war with China. Okay, we better really be looking at how we cover our risk more in China. But then what if that completely changes, you know, what if, what if we, you know, all of a sudden are doing something else, you know, you know, what if there's another run on the bond market and, you know, and we give up on, you know, doing things with China?
[00:13:20] Speaker A: I think going forward, the industry and I know advamet working on this aggressively and the other industry groups as well is getting the medical exemption. I think that the med tech, I think if they can secure that. I know, I know they've made direct pleas to President Trump about that maybe in 90 days if something is brought up, it's altered slightly to benefit, to exclude rather the medtech industry.
[00:13:45] Speaker B: And they had it before they had it in the first Trump administration when they were on China Trade War Part 1, the medical device industry had that exemption. So it's something that's been done before with our current president. So, I mean, you know, I mean, it makes a lot of sense. I mean, we don't.
I mean, you know, healthcare is already very, like. Feels really expensive in this country. I mean, we don't need even higher bills, you know, when, you know, we need medical care, so.
[00:14:20] Speaker A: All right, well, we'll continue to track. Of course, we'll be talking at Device Talks Boston about all of this. We hope you'll join us there. We'll be back in Chris's neck of the woods on June 11th. Minnesota, June 11th. Excited about that as well. And we've got some great plans for Device Talks west, which is happening in October that will be rolling out at Device Talks Boston. So that's fantastic. That's going to be an exciting time. So, Chris, I want to try something.
I need you to say something thoughtful. I wanted the daily. Whenever the daily ends, their guest says something thoughtful. And then Michael Balbara waits like five or seven seconds before he says, thanks for joining us. And it really builds up the anticipation. So say something thoughtful, something conclusive, something that ends, that summarizes everything we've said and leaves people with a sense of what's next or what might not be next.
[00:15:16] Speaker B: I'd love to leave people with an optimistic note, but I think that the medtech industry and corporations in general are facing some really unpredictable, challenging times.
[00:15:32] Speaker A: Thank you very much.
How was that? Was that was it?
[00:15:36] Speaker B: That was great.
[00:15:37] Speaker A: The anticipation build, like, I'm like, waiting for Michael Babara to say something, and he just keeps waiting and keeps extending it. I think I jumped in too soon, actually. I think I should have given.
[00:15:45] Speaker B: You should have done a. Mm. You should have, like, when I'm talking, you should start like.
All right, Chris, we should, you know, after this depressing talk. Tom, like maybe, maybe. Why'd you just, like, sag into, like, the, you know, the Torno's interview with some happy. Some peaceful, happy music.
[00:16:04] Speaker A: I'll get some wind chimes or some flutes or something and I'll pet people right up.
[00:16:07] Speaker B: Crank up some Enya. I don't know.
[00:16:09] Speaker A: All right, Chris.
[00:16:10] Speaker B: All right, Tom.
[00:16:12] Speaker A: All right, now we're going to hear from Scott Frazier of Frazier Healthcare. I did this interview when I was at the Mulling studios. We talked with Scott Frazier about the importance of ASCs, and this is a topic we'll be tackling at Device Talks Boston. Scott's put together a panel. We'll review that here. If you want to join us at Device Talks Boston, don't forget, you can use the code DTWeekly25 to save 25% off the price of registration. Now we'll have this conversation with Scott Frazier of Frazier Healthcare.
[00:16:42] Speaker D: Hi everyone, this is Tom Salemi of Device Talks. Once again, we're here previewing Device Talks Boston at the end of day one. We're going to have a great panel that's focused on the importance of ASCs, ambulatory surgery centers in the medtech marketplace. And I am here with Scott Fraser of Fraser Healthcare, who helped me a great deal by assembling this panel. We'll have folks from Olympus and Medtronic and a physician and Scott as well up there talking about this important medtech market. Scott, thanks for taking a few minutes to preview the panel.
[00:17:12] Speaker E: Thanks, Tom. And a special thanks to Device Talks. I'm looking forward to it.
[00:17:16] Speaker D: We are all as well, and I.
[00:17:17] Speaker A: Know it's going to be a very.
[00:17:19] Speaker D: Popular conversation to have. So let's talk a little bit about ASCs, just a bit of background. What are they and what is their penetration in the U.S.
well, ambulatory surgery.
[00:17:30] Speaker E: Centers have been around since the late 1960s, believe it or not, although they've become very in vogue, I would say, over the last few years. As you have higher acuity cases like total joints and cardiocath procedures migrating to to ASCs, the penetration is still somewhat minimal. If you look at the overall procedural volume of elective surgeries in the US and you really have to look at it by subspecialty, you have very mature markets like ophthalmology with cataract surgery and gastroenterology with colonoscopy that are over 50% penetrated. But you have other emerging markets like total joints and total knees that, you know, you're still it's growing quickly, but you might be about 25 to 30% penetrated.
And then areas like cardiac ablation, which is, you know, we're still in the single digits of those cases that have taken place in ambulatory centers. But the writing's kind of on the wall for where they're headed.
[00:18:41] Speaker D: What is standing in the way of faster adoption or what is no longer in the way that might have been in the way before? What kind of changes are we anticipating?
[00:18:48] Speaker E: It's a great question.
It's state by state. So states have what's called con laws, which are certificate of need laws. And these are basically in order to build the freestanding ambulatory center, you need to go in front of the state health board to plead your case for why. And a lot of times you're going up against big hospital lobbying groups. So you have certain states that have been very, very slow and restrictive with ambulatory centers. Massachusetts being, being one of those states, other states, you know, Florida, Texas, what have you. Ambulatory centers are, you know, growing rapidly and heavily penetrated outside of con laws. You have what's called permissible and non permissible states. And this really pertains to cardiac catheterization, ablation, any type of high acuity type cases. And it's very political. So you get to certain states like California where they've been very, very restrictive on allowing higher acuity cases into ambulatory centers. And a lot has to do with, when you look at the state statutes with lobbying efforts by large health systems.
[00:20:08] Speaker D: So who is pushing for the ambulatory surgery centers?
[00:20:12] Speaker E: It's a great question. It's really the trifecta. Who's not pushing for ambulatory center?
It's first and foremost the patient.
If you ask your friends and family, loved ones that have had an elective procedure in an ambulatory center versus a hospital, where would they prefer?
Secondly, and probably the biggest force driving this are the payers led by cms, establishing new codes and coverage. But also self insured employers are playing a significant role in this where they're directing patients behavior or their covered lives behavior based on the co pays and then providers, the physicians. And there's been a lot of research recently by the AMA as well as other medical societies on quite honestly just how fed up physicians are practicing in the hospital. When you talk to an interventional cardiologist or an orthopedic surgeon who is waiting two to three hours for transport in the hospital or waiting for a room to open up in an or, they're frustrated and more importantly they're hearing from their good friends and colleagues that have opened up their ambulatory centers about the quality of life and the increased income that they're in these ambulatory centers. So it's a lot of peer pressure there too. And you know, I think overall on top of that there is this wave of momentum of investment dollars that is fueling the growth from, from private equity as well as hospital systems are fueling the de novo growth of new builds for ambulatory centers. So it's really, it's a combination of forces, but really being led by the patient.
[00:21:53] Speaker D: All the players, all the forces that are pushing for ASCs I think are all critical parts of the medtech market. All important people, important forces for medtech companies. How should medical device companies be looking at this push forward ambulatory surgery centers. And I believe we'll be covering this in your panel.
What are they or should they be doing differently?
[00:22:18] Speaker E: I think the first thing that they need to do, and my firm spends a lot of time working with a variety of clients on this, is recalibrate their commercial teams to what is an ambulatory center? What are the KPIs within an ambulatory center? What's the investment thesis? Believe it or not, 95% of all ambulatory centers are for profit. So you're selling to business owners. You're not just selling to a value analysis committee or a clinical decision board that's, you know, that they're looking at peer review.
They're looking at safety data that is critically important to ambulatory center decision and adoption of new technology. But as is the Performa and what your technology is going to do for that ambulatory Center's EBITDA or KPIs, that will drive that EBITDA.
[00:23:12] Speaker D: So let's talk a bit about the panel you've put together for Boston.
Why don't we talk a bit about.
[00:23:17] Speaker A: Who will be on the panel and.
[00:23:19] Speaker D: What are some of the conversations that you hope we'll have?
[00:23:23] Speaker E: Yeah, we have a great panel constructed because first and foremost we have a physician. And Dr. Ann Marie Joyce is a longtime friend of mine who I've known really throughout her career. And not only is she one of the country's top leading interventional gastroenterologists, she trained at Penn, she was faculty at Penn, and then she was head of Leahy Clinic, the interventional endoscopy group there. Recently she joined private practice and is now working out of an ambulatory center. And this one's very near and dear to my heart because this is where my family members, particularly my mother, are treated.
And it's outside in Metro west in Boston. She's been practicing there for about two years now and has a really neat perspective where she headed up a value analysis committee in a big academic hospital and now works in an ambulatory center. And she'll talk a lot about what's life like on the other side.
Secondly is a longtime friend of mine and colleague Kirk Cannon, who's vice president of Olympus. And Olympus is a dominant market share in GI endoscopy with close to 65, 70% market share, but is being challenged in the ambulatory center and I thought would be give a good perspective there. And last but not least is Julie Cole, who is at Medtronic and heads up their enterprise ASC team across all Medtronic divisions and how Medtronic is looking at ambulatory centers. So it will definitely give a good perspective of the largest med tech company in the world, how they're thinking about ambulatory centers and the growth of ambulatory centers. But I think more importantly down to the physician that shifted out of big academic medicine into a private practice and a private practice ambulatory center that has private equity owned as well as a JV with Amsurg.
[00:25:30] Speaker D: Interesting. So we know Stryker has been taking an aggressive look at ases. We just spoke with Yvonne Tornos, CEO of Zimmer Biomet.
They're taking a stronger focus there as well. You mentioned some of the bigger companies on the panel looking at medtech more broadly. We'll end with this question. I mean do companies of every size, startups, single product companies, does everyone need to be thinking how they fit into an asc? Is this going to be an important part of their market going forward?
[00:25:58] Speaker E: Absolutely. And I think you have to look at different subspecialties. But the areas that I'm most bullish about right now are obviously total joints. You look at orthopedic and spine and rapid migration happening to ambulatory centers and that's what's fueling a lot of Strykers growth if you listen to their earnings calls. But behind that is the cardiocath market. And that market is still emerging with centers being built. These are not multi specialty ambulatory centers. They tend to be dedicated, dedicated focus factories for cardio cath and now also for ablation. And that market is growing rapidly. Another market that is very exciting right now, and I know your team has spent a lot of time focusing on it, is the soft tissue robotics.
If you look at totally cystectomy, hernia repair, some of the basic soft tissue robotic surgeries that are taking place, the new generation or the next generation of surgical robots have the ability to lower the OR staffing requirements or the FTEs within an OR. And that has a very significant impact on an ambulatory center because of the labor shortage. So that's an area that I've been looking at very closely and following.
And you know, if you look at some of the peripheral areas as well, you see migration and ent, you see migration in urology. All the subspecialties are moving and it's because of the factors that I mentioned before. It really is a dynamic space that every year is growing rapidly. From a count standpoint, we have close to 6400 total ambulatory centers that are recognized by CMS OR accredited by CMS. To date, there's probably another 5,000 to 5,500 non CMS accredited ambulatory centers. And those are really your plastic surgery centers that are cash pay type patients.
But we have ambulatory centers, I kind of always joke are on the right side of healthcare reform.
The fact that you're increasing capacity within our system, which in certain cities there's a tremendous backlog to get into hospitals for elective surgeries. You have the same doctor, the same technology, same implant, but being done at anywhere from a half to a third of the cost of the associated cost within a hospital setting.
A lot of positive momentum there. And then the investment dollars are heavily flowing into ambulatory centers from private equity.
[00:28:42] Speaker D: Fantastic. Well, it's an important growing market touching a lot of specialties and a lot of technologies. I appreciate your taking the time to talk to us about it today. But more importantly, to help us put together a really important panel for Device Talks Boston. You'll be closing out day one on April 30th. Scott Fraser, thanks. Thanks for joining us and thanks for being part of Device Talks.
[00:29:03] Speaker E: Thanks, Tom. Look forward to seeing you and the team in Boston.
[00:29:05] Speaker D: Same here.
[00:29:08] Speaker A: Well, Adrian Lam, welcome to the podcast.
[00:29:10] Speaker C: Thank you. Thank you very much.
[00:29:12] Speaker A: Pleasure to have you here. And we're going to talk about Core Vista Health. As again Ty talked about before I push record. We're getting a lot of pitches from AI enabled technology companies in medtech. So sometimes it's hard to separate the wheat from the chaff.
But yours was particularly appealing partly because of your background, which we'll unpack in a moment, partly because of the Area 10, which is a huge problem.
Cardiac health, cardiovascular health. And I want to understand how AI can help battle that disease. But first let's find out a bit about you, Adrian. How did you find your way into the medtech industry?
[00:29:51] Speaker C: Yeah, so I think a lot of, like a lot of our peers, you sort of shoot for the stars and you of medicine and becoming a medical doctor and then you end up being a biomedical engineer.
Partially joking. My grades didn't fit the bill, but.
[00:30:09] Speaker A: Organic chemistry did that. Do you.
[00:30:11] Speaker C: Oh my gosh, that was a bane of my existence. Yeah, no, but jokes aside, I grew up with a lot of, I really enjoyed building cars and toys from scratch.
[00:30:24] Speaker A: Oh, interesting.
[00:30:24] Speaker C: And so I had a bit of an engineering bug since a young age and I think that's kind of what, what pushed me towards biomedical engineering. So I Kind of liked medicine, but I also liked making things and tinkering and so biomedical engineering was just a. Was like the perfect fit. And you know, coming from a conservative family, you have to go for a top school otherwise your parents will not be as proud of you.
[00:30:52] Speaker A: But.
[00:30:55] Speaker C: So I was choosing between Hopkins and Duke actually. Both, of course, excellent programs, both in biomedical engineering and also in economics, which ended up being my second degree.
[00:31:09] Speaker A: Did you have a sense that you were going to be an engineer or did the economics degree indicate that you had an interest in sort of the business side of it as well?
[00:31:20] Speaker C: I think a little bit of both. I did start with the intention of going into the business of science. You know, that kind of fascinated me how scientific inventions could actually end up impacting lives and in the marketplace. So that was always the thesis and the impetus. But when I graduated, you didn't have all these interdisciplinary fields. It was, you know, you did biology, you go and be a molecular biologist at a big pharma, you know, you're an engineer, you go to the big med techs or you go to an engineering company. There wasn't so much data science or at least as a specialization. And so BME was actually already quite novel then. Yeah. And it was a top program at my school. I went to Duke and it ended up being extremely interesting. And so I kind of stuck through it and then also did economics to kind of tick the other box, so to speak.
[00:32:19] Speaker A: That's great.
[00:32:20] Speaker C: Yeah, so through that I came out and I applied to a bunch of the big companies.
I also tried my hand at investment banking and all the cool careers of that heyday, private equity and all that.
But actually it was a small startup company.
[00:32:41] Speaker A: I wanted to unpack your first job, started looking at your LinkedIn Interpels. I hadn't heard that company name in probably 20 years or so.
[00:32:50] Speaker C: You've heard of that name? Amazing.
[00:32:51] Speaker A: Yeah, well, I covered venture capital back in from 1998 through whatever, and I remember Interpulse greatly. Yeah, I remember the RCT companies. There are a lot of them coming out of that area. So what drew you to the startup space? I mean, that's. It kind of brings all those worlds together perfectly, I imagine.
[00:33:10] Speaker C: Yeah, I mean, at the time I wanted to do something a little bit more. I wanted to continue my education and I had heard that at big companies you get pretty.
You might get hired into one department and just work there for a bit.
In a startup you do everything. And that kind of interested me. And also I think it really comes down to People. My manager, who hired me into the company, or rather gave me the internship. He was just a wonderful individual by the name of Terry Ransbury. And he really spent the time to teach me sort of the philosophy of device development. Not just the how, but the why and the what. So, you know, he spent a lot of time teaching me about design control and the importance of that, you know, the philosophy behind designing a test, linking the technology to an intended use population, which is something that is still relevant to me today, you know. And so it was really just observing them meeting that team, I was like, wow, these guys are amazing. And they were. I didn't know how amazing they were back then, it turns out. Right, yeah, exactly. At the time they were, you know, I later found out that they were one of the top funded startups, I think, in the cardiology space back in the early 2000s. You know, Frazier Healthcare, a bunch of strategics, but I didn't know none the better.
[00:34:39] Speaker A: So you're bringing me back. Frazier Healthcare is another great name that I. A firm I really enjoyed covering. So you moved from there to Stryker a year later or so.
What brought you to Stryker?
[00:34:54] Speaker C: Actually a fortuitous turn of events again, which was I'm a British citizen, I hold a British passport. And so back then I needed a visa to work in the States.
And actually Stryker, I wanted to work for a large company because they could sponsor me or rather have a lot of global sites that could, you know, potentially where I could potentially work. And I actually called a, you know, I called someone on my alumni network. It was an early days of the university, career portals and some early, you know, really, really nice people put their names down, I'll put it that way. There was this one gentleman who I'm still in touch with today, a wonderful gentleman by the name Jamie Kemmler. And he's a dookie. And he put his name in there. And at the time I didn't know he was a divisional head and actually on the board of Stryker, but he didn't put his titles.
So I buzzed him and I was like, you know, looking for career advice. Yeah, hey, Jimmy boy. Exactly. Yeah, I didn't call him that.
And I was like, Mr. Kemmler, the Rev. Mr. Kemmler. And he made a few phone calls in and he was like, yeah, sure, I love your passion. And then within about a week or so, I had interviews at five different divisions in Stryker.
[00:36:16] Speaker A: That's amazing.
[00:36:17] Speaker C: And then I later found out who he was. And then. And then, yeah, that's how that story Started and I just spoke to him two months ago, actually, so I'm still in touch with him, which is great.
[00:36:29] Speaker A: What was the Stryker experiences like as an engineer? I hear a lot about their sales teams, and it's a very.
The term I hear all the time is Alpha. They sort of want to be the primary. What is R and D like at Stryker? What is life for an engineer, at least back then. What was life like for an engineer back in Stryker? And it was a different management, different ownership. So I shouldn't really contrast today's culture to back then.
[00:36:53] Speaker C: But, yeah, I actually think that despite management and teams changing and all that, I think the culture states.
And actually that's a factor of a strong culture.
Some people have said that Striker seems almost a bit cultish in terms of its focus on talent management, talent acquisition, what they call strengths finding and all that. And you kind of go in not knowing what it's all about, but actually you realize that that really pervades throughout the whole organization, and that is what stays and is sort of everlasting.
So I would say that my experience was. Well, first of all, it was one of the best experiences I've ever had working for that company.
I'll give you an example. Actually, there was a. This is actually a very, very good anecdote. So I made a. You know, it was my first year in Stryker. I had been transferred to Ireland, actually. So I lived in Ireland for about four years.
I was meant to only go over for a year and come back to Michigan, but I ended up getting a promotion there. But I was over there for a project for a year and I actually made a bit of a mistake in terms of an approval.
I was a project leader. I had approved a batch to kind of be released, not to the public and not outside, but at least from the factory to the warehouse, you know, and. And it was a big sort of no, no. And the manager, the head of quality and my Irish bosses kind of called me in on a Monday morning and. And, you know, I was expecting to be fired. I was expecting to be let go or something, right? And they said nothing like that happened. But they said that, you know, Adrian, do you know what. What happened and do you know what went wrong? And I said, yes. And I explained to them what went wrong and they said, okay, seems like you understand. And they said that we are now going to do a special approval to train you and to give you that approval authority to do what you actually just did.
[00:39:09] Speaker A: Oh, wow.
[00:39:09] Speaker C: Because we know you will never do it again. And because we know you'll learn from your mistakes.
So walking into a company, talk about motivation, talk about empowerment, talk about empathy. You know, I didn't do it on purpose, of course, but that really sort of, you know, exemplifies some of the management philosophy of Stryker. And so I had, you know, a lot of what I know today is from, is from my earlier managers and I still learn from them till now and I'm still very good friends with them.
[00:39:45] Speaker A: It's amazing how those early experiences in our careers can really be the ones that set the tone and really cast the die.
So you moved on from Stryker to. And we don't need to go through all of the individual posts, but it seems like you were investor and then VP of operations at Nova Hart, so you had moved on from engineering to sort of operations and financial side of things.
[00:40:13] Speaker C: So I mean, with, with, as you may recall, my original desire to be at the intersection of science and business. And so having spent a good couple of years in engineering, I had actually already started sort of keeping my eye out for business opportunities. And actually I had started working, or not working for, but really consulting for a few hedge funds, actually alternative asset managers, both in Hong Kong and America. And it's like they would just pick my brain on medtech and the market.
And through that I kind of got exposed to a few of these financial managers and a spot opened up in 2010, 2011 or so. They were like, we can teach you what a PE ratio is and you can teach us what a medical device and medical technology is. And the FDA and all that seemed like a fair trade. And actually while I was at Stryker, I had already started studying for this thing called the cfa. It's the Chartered Financial Analyst designation. It's something that financial analysts tend to use or tend to get. And so I had already kind of started my journey to the dark side of finance. And then an opportunity arose about a year later and so I jumped on it and so I came back to Hong Kong and I was in, I was in finance for a while in the buy side. So asset management first for a regional hedge fund and then later for a Montreal based, Canadian based healthcare specialist fund called Sectoral. And Sectoral is a healthcare specialist. They, I believe, actually co led the Series B for Shockwave way back when.
[00:41:59] Speaker A: Not bad.
[00:41:59] Speaker C: Yeah, not bad. Yeah.
And amongst another couple of very good assets. But that's where I really cut my chops in global biotech, global healthcare and medtech all over the globe. So I was covering companies like Edwards, so One of my first ever ideas was when Edwards was developing the TAVR for the high risk.
I think that was one of my first investment ideas.
Wow. Gilead Sovaldi, I believe, and the hepatitis C drugs that came out then, I think that was another one.
Yeah. So I've been covering the space a little bit of biotech. I'm a bit of a jack of all trades and actually that's my philosophy on healthcare development because I think it's such a complex field, but you really got to know a little bit about everything and navigate it.
And even people say that genetics and epigenetics, which is the translation of the genes, is like two sides of the same coin. I kind of think of medtech and biotech like that. There's a lot of things that started as surgical interventions. Say diabetes actually started off as a surgical intervention and of course became, you know, the pharmacological side of things, took over and then now you're talking about, what is it? Fractal health, you know, duodenal, mucosal, resurfacing, you know, so you're kind of flip flopping between surgical and pharmacological. Yeah. And of course in the marketplace you also got to weigh up, you know, weigh up the balance between med tech and biotech, drug therapeutics. So I think understanding all of that is quite relevant to what we do in this day and age.
[00:43:46] Speaker A: Does the financial engineering of being an investor in operations, does it feed that part of your brain that used to get lit up by your fixing cars and doing things that engineers are known to do? Is it just different parts that you're assembling or is it a completely different brain process?
[00:44:06] Speaker C: For me, not so much, because for me it was really about using your hands to make things, you know, whereas financial engineering, you're using your finger to click Excel spreadsheets. That's the extent of your physical activity. But I suppose the whole looking for solutions with a problem and with no obvious solution is an interesting challenge. And that's why we do what we do here with Venture, because there's no playbook. You know, generally everything is quite new. But I like that because having worked for larger companies, or rather observed larger companies, it's not perfect. And you have a chance if you work with a small company that it's going to become a big one to leave your mark and kind of set things off on the right foot. And so that's what I really like about Venture. And it's also very much to do with personal impact. It's very hard for an individual or a small team to impact a public company. But you can do a lot of damage in a good way to a small company for sure.
[00:45:14] Speaker A: I'm enjoying this conversation because it is a reminder of how young our industry really is. You're right about biomedical engineering. I started covering it about the time that I think Stanford's program got together and things started to take off. And I just always had. They had the feeling that it's been part of this culture in this ecosystem for so long, but it's really not. And it's really evolving. And I think there's more positions, more programs out there now that are really combining biomedical engineering with business to kind of build what you have created for, with your career.
So a young person listening to this who wants to do what you're doing, would you advise them to go into a program that allows them to touch all parts of that world, both financial and engineering, or would you say really get to know X first and then move into Y with your career? Any advice?
[00:46:04] Speaker C: Yeah, I think that's a really good question. I actually give a lot of career advice to young kids because I got that. So it's my version of paying it backward or paying it forward, whatever you call it.
I think on one hand you want to be very broad actually, and those are book that exemplifies this philosophy really well, is written by a guy called David Epstein and it's called Range. And he, if I remember correctly, he was actually a sports writer. And he looked at that question of is it better to specialize late or specialize early. And so he looked at Roger Federer versus Tiger Woods.
[00:46:44] Speaker A: Interesting.
[00:46:46] Speaker C: Yeah, so Tiger woods basically knew how to hold a putter before he could speak. Whereas Roger Federer specialized very late, I think in his early teens he was playing football or soccer, a bit of volleyball, I think, and then specialized in tennis later. So he was looking at that and then he expanded that investigation into other fields, science, business, academia. And then he found a lot of patterns which showed that you want to be very broad based, especially in this day and age where everything is very interdisciplinary. Now, now, right, you look at the early days of venture capital, the Mike Moritz's, the Dick Kramlich, which unfortunately he passed away recently of nea.
And a few of those guys were not necessarily scientists.
But then come the last decade or so, the advent of Andreessen Horowitz and these very technological investors, you start being very narrow in their knowledge, but you've still got to understand everything else. And so that's why I think that broad based exposure is very important and it's really helped me big time with everything that I do. Like I'm able to. I'm just as comfortable on a trading floor as I am in a clean room and that allows me to speak the language of everyone that I'm talking to, you know, and that's a skill set that I didn't appreciate when I was younger. But apparently the reason why I got promoted is I talk to the finance guys and keep them happy. Same as with the shop floor guys, same as with my quality head and same with the business leads. That's great. That is a skill that I practice today.
[00:48:30] Speaker A: That's great advice. Well, let's move into where you are today. Kurvista Health. How did you happen upon this opportunity? Just talk, we'll end your career, the career part of this discussion there and then we can talk about the company, about corevista.
[00:48:44] Speaker C: Yeah, well there's a very natural segue which is, you know, my last employment was actually last full time employment was actually for this, you know, one of the sexy venture funded startups called Genesis MedTech.
It was a Sequoia GIC and a general Atlantic funded startup and they raised a lot of money. I'm not sure it's completely public but we're talking upper decile kind of amounts.
And it was there that I actually, I joined that company very early. They raised a couple of hundred million Series A and B and I joined as an early head of R and D and then I later went into bd. I helped them build the venture fund but and actually this company is famous because they were the Chinese partner for Shockwave, Penumbra and Silk Road. Wow. So I was actually then also exposed to those companies through that. So MedTech is super small. I keep on bumping against the same companies and the same people and it's great.
But through that I actually left that company back in 2022 I think. And then I actually started my own little shop called Bioworld Ventures.
It was nothing more than an angel investment club and it was just looking at cool projects. I think the first one was just a friend, a smart friend of mine that I wanted to invest in. But my 10k ticket is meaningless. So I called some friends up for more firepower and that's what Firewall Ventures was. And every time we saw a new deal or a new investment opportunity, I would call the real experts, my ex colleagues, my ex, my ex mentors. We'd look at stuff together and there's no money involved with just investing I don't charge fees. And what I realized was I have a bunch of people that are extreme experts in this space. And as I got more and more involved with ecosystem building where I live right now, Hong Kong, but also in other geographies like Singapore and just other more nascent ecosystems, I just got my hands sort of wet and really started to be involved in building up that ecosystem and structure. And what I realized was that there was.
As the economy is, the venture capital economy has definitely not been as strong as it was in 21, in 2020. Right. And what you'll notice is that there's actually a huge concentration of the capital.
There's a bit of a haves and a have nots going on and the number of transactions has gone down. And so anyway, the bigs are getting bigger in terms of the funds and so there's deployment pressure and then at the same time there's a million and one venture babies. And so I see it as primarily a bridging problem. And these VCs are so large they can't possibly help. They don't have the bandwidth to help all these venture babies. And so these venture babies don't actually grow up to be investable assets from.
[00:51:56] Speaker A: I love the term venture babies.
[00:51:58] Speaker C: The funds that need to deploy more and more capital. And so that's what's happening. And so we thought this is great.
Having a call with a board member every now and then is not really going to cut it.
We think that these early ventures need more handholding and need more expertise and advice. And so we thought VCs deploy capital. BioWare Ventures will deploy ourselves into these projects. So we work for them for a very short period of time and we actually build out their strategy.
If they're an early stage company, we are almost their executive team. If they are a foreign company, sort of, or not a foreign company, but a US company and a European company wanting to go to Asia, then we can be their sort of rental China team. And we don't carve anything, we don't take anything, we just work for them and we kind of give them a lot of information so that then they can make a decision about strategy. The boards and management teams love us because we're super non threatening. And that's actually what we did. We started with three projects in hand and two were earlier stage companies.
One was from France, one was from China and then the third one was Corvista Health which was a late stage company. So we built out their entire, we planned out their entire China plan. We Interviewed a whole bunch of physicians. We did pathway analysis, we looked at essential requirements and regulations. We even identified principal investigators. You know, like real engineering development work, like a vc. We even designed a clinical trial protocol for them. And so in BioWorld, one of my last, one of my partners was actually the exact chief medical officer of Boston Scientific China.
And then there was another one who used to run, I think Vision Care or Consumer Vision for J and J. So these are very senior executives. And so we banded together and we kind of helped corevista map out the plan. Ironically, we decided we need to focus on the US and we're going to push that can down the road in terms of China, but it's still on the horizon. So that's how I got to know corevista. I actually worked. I assigned eight people on this project. So it was clinical to clinical, engineering to engineering, CEO to CEO. So I got to know the company really well, and the board got to see me in action, and the management team got to see me in action. And actually, that's probably the reason why I got hired, because they actually saw me and I was validated. Whereas on paper, I'm not a PhD, I'm not a, you know, I'm not Godfrey. I didn't lead Shockwave to a massive exit and build something from scratch. But actually, they realized that my skill set, knowing a lot of the context of capital markets, as well as the technology and talent markets, this is what corevista needs. We need to kind of debutante ourselves almost.
The development abyss is behind us. The challenge is all behind us now. It's about showing the world what we have, and that's something that hopefully I can bring to the table and supplement the team with.
[00:55:04] Speaker A: Was being a CEO a box that you wanted to check?
[00:55:09] Speaker C: Honestly? Not really. Okay, not really.
I've never been really about, say, the glamorous titles. I just really care about learning. And so even when I jumped into finance, I went down to the bottom rung. I didn't really. I was managing a team of 14 people when I left Stryker, and I just went to be an analyst. So that has never really been my driver. But rather, I saw I've been invested in Core Vista for six years, and when you invest, sometimes you get mixed up in the capital markets and the bad mood you and things like that, and you forget how impactful some of this science can be. And actually, when I saw some of the patients that were saved by corevista, I was like, wow, if I can do anything to help this. And I Think I can. I need to do it.
[00:56:00] Speaker A: It's fantastic.
[00:56:01] Speaker C: It's almost inethical to not.
[00:56:03] Speaker A: Well, let's introduce folks to corevista, talk a bit about what its approach is. As I mentioned at the top, you know, it has an AI component. A lot of companies do now, and I'm sure you saw a lot of them as well. So the fact that you would not only choose to work with them, but choose to lead them, I think sort of speaks to validate certainly their approach or its approach. So talk a bit about Crevista Health.
[00:56:28] Speaker C: Yeah, sure, I would love to.
This is a very exciting strategy in AI and healthcare. And the reason is because a lot of the investment and focus right now is on applying AI to existing signals or existing complex and advanced imaging signals. Right? You hear about heartflow and clearly and AI, MRI and AICT and all that, and that's really, really good science. But if you think about it, that is downstream to where care is actually needed. Care, we believe care is actually needed upstream at that first initial point of care. So the thesis, the original thesis of corevista is that there is more information in these simple signals than people were using.
And simple signals by default are the ones that can be measured at the point of care. You're not going to have a CT scanner in some rural clinic in some remote area, you know, so AI and CT is not going to help there. And actually there's a lot of research and publication to show that it's a problem of physical access. Something like 25 to 50% of people who are diagnosed with, who present with symptoms actually don't go and get the recommended test. So we talk about standard of care like it is actually standard across all populations. It's not only some people get the standard of care. And so we really want to nip the issue at the bud. We want to nip the issue in the bud. And so what we do is we apply AI to simple signals. Simple signals, because they are the ones that can be acquired at the point of care.
And we use advanced mathematics and machine learning, data science, but more importantly, knowledge of disease biology. And we mix all of that together to apply this to that point of care. And so we are one of. I think we are the only company at least identified by the FDA that applies this type of technology to that outpatient setting.
And so that's what made it interesting for me.
[00:58:57] Speaker A: I love the thesis and I love where you're doing the treatment. What are the signals? What are simple signals? And what kind of data can you get, I assume, from a primary care. Is this a primary care setting that you're getting, or is it sort of the first. Okay, so what can you get from a primary care examination that can help you diagnose what you're able to do?
[00:59:19] Speaker C: Yeah, so simple signals would be what you would typically see in a primary care setting. So the most common one is electrocardiogram, ekg, ecg, ekg, a stethoscope. I suppose it's a simple signal or a simple device. And then sometimes you have cardiac echo or echocardiography, but not everywhere has that.
So generally I would say ECG is probably the simple signal. You could argue that pulse oximetry, you know, measure the red light, finger clip, that would be another. That would be, you know, that's a simple waveform and a simple signal, simple sensor. And so these would be simple signals. So something that doesn't require a radiating source or anything nuclear, any large capital equipment, you know, that would be more complex. So that's how we kind of define it. And so the crux of the issue is one of overlapping symptoms. So if you imagine a patient shows up, and these are very common symptoms. So a patient shows up with chest pain, palpitations, shortness of breath, tightness of chest.
These could mean a plethora of stuff. It could be a lot of different diseases. And unfortunately, the primary care physician in that setting just doesn't have the toolbox to analyze all the diseases.
So he usually runs an ekg, ecg, and that generally rules out rhythm disorders only it is being investigated in other things. But right now it's generally ruling out rhythm, AF, and that kind of thing, and atrial fibrillation and faulty rhythms, arrhythmias. And short of that, basically patients have to get referred away to radiology or a specialist, basically somewhere far away. And herein lies. The problem is that those who get referred away, up to 25, 50% of them actually don't go and get that test. And then even when they do go and get that test, it's usually a singleplex, meaning they're checking one thing, they're checking out one thing, and they're rooting that out. And then they're moving to, oh, it could be something else. Is it coronary artery disease, blocked arteries? It's not that. Maybe it's heart failure. It's not that. Maybe it's something else. Right. And it's kind of a sequential thing. And think about at each time, at each time point, when there's a next test to do, there's a drop off. So that's why cardiovascular disease is growing. It's actually a physical access problem, actually. You know, and there's a lot of people who, you know, culturally just don't want to go and drive 50 miles to a center to go get that scan that he may or may not need. Right. And he's wasted the whole day.
So that's the problem.
And so what we do is we use the system and we acquire these simple signals. So we do what we call voltage gradients, or in a 3D manner. So this is just electrical activity sensors that are similar to ECGs. They measure the electrical activity in the chest cavity in a 3D manner. And at the same time, we measure what we call hemodynamics, or basically the behavior of the blood flow in the peripheries. So we clip the finger and we measure these two things at the same time. And this is key because this is what makes us, we believe, more accurate than a lot of our competitors. Using that multimode gives you that extra diagnostic accuracy. And so when I explain it to my mom, I tell her that it's kind of like you're measuring the pump simultaneously with the pipes.
And in a healthy or not seriously diseased population, that's one signature.
In a severely diseased population, that's an altered signature. For instance, there might be a time delay in the blood flow, the pump, and then there's a delay in the pipes. Right. And we are able to measure these sort of mathematical features and link them to disease biology. That's actually our special sauce. And we are able to tease apart what is a sick population versus what is not. And so, yeah, so that is why we think that this is the better approach. We are really capturing the top of the funnel.
[01:03:54] Speaker A: So what does your device look like? What does your test look like? Is it a large piece of equipment? Is it a handheld product? What are you physically giving or making available?
[01:04:06] Speaker C: Yeah, it is actually. The form factor of the device is not so much larger than an iPad. Actually. It's completely portable. It's an iPad and a couple of leads that come out from it. And so it is extremely mobile. All it needs is an Internet connection or wi fi to connect. It captures the signal over three and a half minutes. So it's a workflow very similar to other workflows that are very, very common and pervasive. So you stick these patches on the chest and one in the back, you clip the finger, and then the patient lies there for three and a half minutes. And then you're done with the signal. Acquiring that signal is then sent up to the cloud. And that's where our technology lies, that's where our IP lies as well. The algorithms, the data science, all of that is in the cloud and we own all of that. And none of that is on the device. So you could actually take the device and you wouldn't be able to reverse engineer all of this. That signal sent to the cloud is then processed in about 10 to 12 minutes and then sent as a report to the physician's computer or the provider's computer. And so all of that from start to finish is less than half an hour. So the idea is that you could show up and know definitively whether you have serious cardiac disease, cardiovascular disease, before you leave the doctor's office. You don't even need to get referred away. And what we do is that one scan can actually rule out multiple diseases. So currently we are approved for coronary artery disease and pulmonary hypertension, which is high blood pressure in the lungs. We're developing a third one, which is heart failure via what we call pulmonary capillary wedge pressure. So we can just call it heart failure. That is actually all done with that one scan.
So it's actually a multiplex test, which is actually rarely done in medtech diagnostics. It's done in molecular diagnostics a lot, but actually rarely. So in medtech, where you acquire one signal and you can rule out several diseases at the same time. But as we layer on more and more indications to this, this test becomes extremely and disproportionately invaluable. Imagine one test that can rule out a whole bunch of things at the same time. That's quite amazing. And so that's also the value is the market for.
[01:06:44] Speaker A: I said primary care offices before then I wondered if I meant ER, or if that would be the more appropriate setting. But as you're describing it now, I could see this being a test that's done at the same time I'm having my blood drawn for my cholesterol tests and everything else that goes on in a physical. When is the appropriate place or the best place for Corevista's test to be given?
[01:07:05] Speaker C: Yeah. So this test theoretically can be used in a lot of settings. So, for instance, emergency departments really like us because they're like, you can help us triage out a lot of the low risk patients that are clogging up the er. Right. And they're all waiting for a nuclear stress or some sort of scanner. Right. So we could be used there too. But Honestly, the TAM is so large, the burden unmet need is so large. We really need to focus.
What we have decided to focus on are places that just don't have any alternatives. So we call this the rural and remote populations, or what we call the underserved urban. So these are places that don't have physical access to some of this advanced equipment and actually also where the disease burden is very high. So we've ended up focusing on the deep side.
[01:08:03] Speaker A: How do you build a sales strategy to go into places that are hard to reach? It seems you're starting at the top of the fruit tree, going for the fruit that's most difficult to reach.
How are you approaching that market?
[01:08:18] Speaker C: Yeah, we are taking really. That's a great question. We really take two different approaches to how we kind of triangulate customers.
It's hard for us to completely cover, say, independent single practices.
There's just so many of them. So what we do is we try to target practices that are maybe multiple specialty, multiple specialists, multiple physicians with some volume of patients, but they don't have that advanced equipment in near reach.
We are also focused on targeting locations or geographies that actually have the same payers. So we can be sort of more intense and increase that billing cadence and the volumes with those. We really want to work with the same parties and just get that right.
At the same time, we are talking to a lot of the cardiologists, the cardiologist groups that get the referrals, and we say, where are you getting the most referrals from? So they are helping us and they are incentivized to help us because their problem is that they're seeing a lot of blanks, a lot of false positives. They seem to be positive. They get referred over and turns out they were fine. And they could have probably been treated in that outpatient, that initial setting. So that's clogging up their practices too. So they are quite incentivized to help us triage that. And so they are really helping us identify where those top referrals are coming from. So we're taking both approaches.
[01:09:57] Speaker A: So is your intent to be primarily the filter? I was going to say traffic cop, but you're not replacing any existing test. Your role is to just find those people who do need to go further on and get additional care or give peace of mind to those people who don't.
[01:10:19] Speaker C: It's all the above. So if you look at all the different stakeholders. Right. Which is, I think, what you need to do, when you look at a Business model. So our stakeholders are the patient, the physician, or maybe the provider, the healthcare institution, I suppose, and the payer. Right. So there's four parties, the patient, there's no doubt that there's benefit. So first of all, it's accessible right there in your doctor's office. Locally, there's no radiation because we measure just energy coming out. We don't put any energy into the body like other sources, like other equipment. So we're just measuring electrical signals and the red light. Finger clip. Right.
And so it's super safe for the patient, super fast, and it's simple for the physician. This is an extra tool in this toolbox right now they only have a couple of things to use. Ecg, stethoscope, maybe some blood work, and as I said, sometimes cardiac echo, but that's it. Everything else they have to refer away. And they don't, you know, they don't, they don't, they lose the patient. They don't actually make that money. They also, you know, they also just lose that patient and they can't really take care of that patient in the way that they desire. Right. So this is good for them. And also because we use simple, pervasive and ubiquitous sensors, our capital equipment is actually extremely cost effective. And so we essentially place these systems for no cost and we actually charge per scan. So there's no upfront investment for these physicians and they get to use this.
And so that's really, really beneficial for their practice too. For the payers, this is nipping the problem in the bud. Right? Catching disease earlier is always going to help with healthcare spending and healthcare cost. And then for the hospitals, it initially might seem that we are filtering out patients for them, but what we are doing is we are enriching for sick patients. We are actually enriching that population, removing and filtering out those low risk, non problematic patients. And we are putting the actual sick patients that need that acute and tertiary care into the hospital.
And of course with hospitals, anytime they treat any blanks or patients that didn't need an intervention, it's actually not as cost effective for them. Right. They're renting all the or space and the nurses and the time. And then turns out they couldn't, they didn't need to put an interventional device, you know, a stent or a balloon or, you know, and so that's. We are enriching their population too.
[01:13:18] Speaker A: Amazing.
And Adrian, real quick, what is the origin of corevista Health's technology? Is this a newer startup? Has it been a company that's been around a while.
[01:13:29] Speaker C: Yeah. So this company has actually been around for close to 12 to 13 years actually. And it originally spun out from two employees of IBM. So these are guys who were somewhat close to the early sort of machine learning and artificial intelligence mecca back in the day and in Canada.
But what's really interesting about this technology for me personally is the first boss that I ever had, Terry Ransberry. As I mentioned at Interpulse, it so happened that he is actually the guy who designed version one of the corevista capture device. And I only found out it is a tiny world, absolutely tiny. And so my first boss is now was the designer of the device of the company that I run now. So it's just. Yeah. So fortuitous and just funny.
[01:14:36] Speaker A: Have you had conversations with him about it at some point with that knowledge?
[01:14:40] Speaker C: I haven't, I haven't yet, but I will need to soon.
It's just a funny thing.
[01:14:49] Speaker A: So if we can just sort of check a few of the final boxes, talk a bit, if you would, about your approvals from the fda and if we would in mind just again, what are the financials of this? Do you need codes from medical societies?
Is there another financing mechanism behind this that through which you get paid? What does that part of the model look like?
[01:15:14] Speaker C: Yeah, so we are very much targeting cardiovascular disease and the big indications within cardiovascular disease. So we are approved for coronary artery disease and pulmonary hypertension.
We received the approvals for CAD in 2023 and then PH about eight months ago, I believe.
And we plan to file for a third indication for use, which is heart failure this year. So those are cleared. We are commercial stage now. We are selling basically the test for CAD and ph and we actually, with any novel cardiovascular, with any novel device, you, you can either sort of piggyback off of an existing code or you have to, you know, there's no way around it really. You have to go for your own code. And that takes some time. Now unfortunately, or maybe fortunately, we won't know till later. We can't piggyback off existing codes. We're just too different, our approach is just too different to what's existing out there.
And you know, we were given a breakthrough designation and PH for that reason. We're just quite different.
But what we have found is that there are some codes for what we call novel and innovative cardiovascular devices.
It's an appeals process. So there is a code, but there's no price associated with it. So we actually currently use that code which allows us to Charge private payers, but we have to appeal. And so that's a bit of a, bit of a back and forth process, but we use a third party billing provider to help us with that. And that has been. It started off slow, but that's actually already accelerating month by month like that appeals, length of time is shortening and so that's a good sign. We intend to sort of build this, what we call billing history. It's great that we have any code to leverage off of and we're getting a healthy reimbursement amount.
But the idea is that we would need to submit for our own code and you do need to apply via the ama, the American Medical association with some, I suppose, support from the disease societies. So the acc, perhaps Atlantic, sorry, the American College of Cardiology. I was about to say Atlantic Post conference.
[01:17:51] Speaker A: It's March.
[01:17:52] Speaker C: It is March madness after all. Yeah, exactly. I'm just automatically tuned to say ACC in March, coming from Duke. Right.
But yeah, so it is sort of the standard process. But what we have is we have very, very strong clinical evidence. We're very well published.
Our abstracts and our research has been published and accepted at the aha, the ACC before.
We have a lot of manuscripts published, so you can read those.
So we add that clinical evidence and the value proposition and we have actually successful claims now from a lot of the big private payers. And so we kind of know that we have something, we have something that these patients need.
The next step is just to build up that charge history and so we can show that this device is actually well used, needed to be used, and that will be the catalyst for negotiating.
[01:18:53] Speaker A: All right, Adrian, well, going forward, last question, just about financing. Where are you with the money you have and the money you need? What are your plans?
[01:19:03] Speaker C: Yeah, so you know, we've, as a company, we've raised about 120 million I believe, to date. We are gearing up for a series date this year.
It is going to be a more substantial raise to get us to profitability and also to potentially expand on our indications for use.
So we're actually quite, we're actually quite a lean company. So we think we're not a capital sink.
We're much closer to profitability than a lot of our competitors are that require large language models and huge compute costs and, and large clinical trials. We're actually kind of a small data company.
We require very, very small populations relative to the large language models or the convolutional neural networks in order to lock down our algorithms. So we see ourselves breaking even pretty soon, probably with this next round of financing. And also we have a lot of patent coverage in a lot of other disease areas. So this approach of sort of measuring the organ, the organ function and then looking at the functional output, this approach is actually very applicable to a lot of different organs and anatomies and disease pathologies. And so we have over 90 patents covered, issued rather across machine learning algorithms, the signal capture, and what we call the clinical and sort of the disease indicators.
We have coverage in neurology, we have coverage in other indications in the heart, we even have metabolic and endocrine coverage. So we have a huge roadmap that we are now trying to prioritize, and we would love to get some of those funded.
And as I mentioned, every single indication for use we can layer on onto this single captured signal makes that captured signal so much more powerful in an exponential way. So we are very excited to.
In fact, we want to do more, actually. We can do more. And so that is our financing situation. We have a convertible note open, which actually is close to being filled by current investors and some sort of new investors. And we recently brought in a listed cardiology company to invest in our note, actually, which is nice.
So we have high confidence that we'll actually even exceed the cap for that note, which will then give us some nice breathing room to start focusing on our series D, which will be for the latter half of this year.
[01:21:49] Speaker A: All right, well, it's an exciting story and I really appreciate your being generous with your own story and your path to where you are today. Adrian, thanks for joining us on the podcast.
[01:22:01] Speaker C: Thank you very much, Tom. It was a huge pleasure.
[01:22:08] Speaker A: All right, well, that is a wrap. Thanks so much for joining us on this episode of the Device Talks weekly podcast. Once again, join us at Device Talks Boston on April 30th and May 1st and or Device Talks Minnesota on June 11th. You can go to DeviceTalks.com to find the events pages and register for both. Thanks again to everyone who sponsored and participated in our Device Talks Surgical Robotics Week this week. If you want to watch those episodes, if you missed it, you can watch them on demand. Go to device talks.com to register for those other than that, please follow, like and subscribe to the Device Talks podcast network. Please like Device Talks on LinkedIn and please connect with me on LinkedIn. Connect with Chris Newmarker on LinkedIn, and of course, connect with our managing editor, Kayleen Brown on LinkedIn. I would love to be part of your future Medtech conversations. All right, that is a wrap, folks. Thanks again for being part of Device Talks and for listening to this here episode of the Device Talks weekly podcast.
