DIGITAL HEALTHENTREPRENEURSHIP

DIGITAL HEALTH CONFERENCEMIT INDUSTRIAL LIAISON PROGRAM

SEPT 17, 2015

ZEN CHUZENVEN@MIT.EDU

@ACCELMED

NOBLE CHALLENGES OF EARLY STAGE MEDICAL VENTURES

TRUTH IMPACT VALUE…

HEALTHCARE RE-DESIGN

HACKING MEDICINE

PHILOSOPHY

MODEL EARLY STAGE INVESTIGATIONSTHIS COURSE DOES NOT TEACH…

• BASIC SCIENCE

• BASIC ENTREPRENEURSHIP

• GENERAL STARTUP, PATENTS + VC FUNDING

• HOW TO COMMERCIALIZE TECH FROM THE LABS

• FDA REGS + REIMBURSEMENT

• PHARMA DEVELOPMENT, CLINICAL TRIALS PROCESS

IMPOSSIBLE TO COMPRESS THIS INTO A CLASS… WE TEACH A DIFFERENT PHILOSOPHY…

ACTIVE LEARNING LABWITH EARLY CLASS SUCCESSES >$90 MILLION RAISEDFOR WHICH HCV DESERVES NO CREDIT!

PILLPACK.COM TODAY

FROM HACKATHON TO $64M FROM ACCELPITCH TO LIVE IN 45 STATES IN 2 YEARS

HACKMED ECOSYSTEM

HACKATHONS ACCELERATE PROBLEM VALIDATION + TEAM BUILDINGSEPT 25-26 MGH SPAULDING REHAB HACKATHON

HACKINGMEDICINE.MIT.EDU

CARE RE-DESIGN + CO-CREATION PARTNERSHIP WITH

MGH HEALTH TRANSFORMATION LAB

TAKE MIT TEAMS DEEP INTODISEASE TREATMENT WORKFLOWS

HOSPITAL OPERATIONS

www.cocreate.hctransformationlab.org

A TASTE OF

HEALTHCARE TRANSFORMATION

AND ITS COMPLEXITY

HEALTHCARE’S TECTONIC SHIFTSAGILE STARTUPS ADAPT FASTER

USA HEALTHCARE SPENDINGMAPS TO MAJOR PLAYERS… FOLLOW THE MONEY

… NOW PATIENTS AS CONSUMERS

IMPROVING PATIENT EXPERIENCE

SURPRISINGLY LOW EXPECTATIONS!

HEALTHCARE IS MORE COMPLEX

WHO BUYS?

WHO BENEFITS?

WHO PRESCRIBES?

CLASS JOURNEY: NAVIGATE COMPLEXITY

WHO COMPETES?

VALU

E

TIMECRITICAL MILESTONES

Acquisition/IPO Exit Reimbursement Published clinical results Market Introduction

Salesforce hired Europe & Japan distribution

FDA Approval

Manufacturing ramp Human pivotal study Corporate partnership First human data

First Hiccup & Danger of Momentum Loss CEO hired Pilot manufacturing Patent grant First FDA meeting Regulatory opinionsMoney raised & team hired

Animal testing Clinician feedback Patent disclosure Prototype/Reduction to Practice Market AnalysisIdea

TRADITIONAL MEDICAL VENTURESLONG DEVELOPMENT PROCESS

“… MVP is that product which has just those features (and no more) that

allows you to ship a product that resonates with early adopters; some of whom will

pay you money or give you feedback.”

“The MVP is often an ad on Google. Or a PowerPoint slide. Or a dialog box. Or a landing page.

You can often build it in a day or a week.”

— Eric Ries

MINIMUM VIABLE PRODUCT

PILLPACK’S 24 HR PROTOTYPE

OBSERVE

PITCHDESIGN

TEST +

LEARN

PITCH to TEST NEEDS GATHER FEEDBACK DIVERSE CUSTOMERS SUSTAINABLE BIZ MODEL

NEEDS = VALIDATED PROBLEMS = JOBS TO BE DONE= BIG + PAINFUL

MVP DESIGN PROCESS

VALU

E

TIMECRITICAL MILESTONES

Acquisition/IPO Exit Reimbursement Published clinical results Market Introduction

Salesforce hired Europe & Japan distribution

FDA Approval

Manufacturing ramp Human pivotal study Corporate partnership First human data

First Hiccup & Danger of Momentum Loss CEO hired Pilot manufacturing Patent grant First FDA meeting Regulatory opinionsMoney raised & team hired

Animal testing Clinician feedback Patent disclosure Prototype/Reduction to Practice Market AnalysisIdea

FRONT-LOAD USER FEEDBACK BEFORE FUNDING + LAUNCHING A 10 YEAR JOURNEY

FOCUS MVP PRIORITIZE RISKS FASTER LAUNCH, ROI

DE-RISKING VENTURESHOW BEST VC INVESTORS PRIORITIZE RISK

VALU

E

TIME

Market Adoption Risk Reimbursement + Consumer Drivers

Physician & Patient Adoption Distribution

Regulatory Risk Safety & Efficacy

Management RiskTechnology Risk

PRIORITIZE UP FRONT

TECHNIQUES + TECH FOR SCALING MEDICINE

•DE-SKILL COMPLEX DIAGNOSIS + TREATMENT

•CREATE NEW EXPERIENCE + PROCESS

•CREATE NEW PLACE or NEW SERVICE

•FIND NEW PROVIDER + EXTRA CAPACITY

•PATIENT ENGAGEMENT + SELF-SERVICE

•NEW TECH ENABLES SCALABILITY + ACCESS

… START WITH A GIANT PAINFUL PROBLEM

HIGH GROWTH VENTURES SMALL FOCUSED COMPANY IN A LARGE ADDRESSABLE MARKET

TOTAL MARKET

STARTUP

ADAPT BEST PRACTICES TO HEALTHCARE COMPLEXITY

MARKET = PRODUCT * CUSTOMERS

VENTURE = MARKET*ADOPTION*SHARE

PRODUCT = NEED * VALUE PROPOSITION

DIGITAL TRANSFORMATIONESTIMATED TO SAVE BILLIONS + DISRUPT MULTIPLE MARKETS

ELECTROCARDIOGRAM (ECG)NOW IN YOUR POCKET!

FUNDING STRONG

Source: RockHealth.com Source: CBInsights.com

HOT CATEGORIES

… BUT HYPE DRIVES COMPETITION

Source: RockHealth.com

DIGITAL TRANSFORMATION

Source: CBInsights.com

HOW HIGH IS THE TIGHTROPE FOR YOU?

ENTREPRENEUR MINDSET

NOT FOR EVERYONEAPPRECIATE CHALLENGESVENTURE CAPITAL ANALYSISEVALUATE HEALTHCARE VENTURES