Promises and perils at the Bleeding Edge of Healthcare
By Shelby Cate
As an industry that is often bemoaned, highly regulated and endlessly complicated, it is difficult to be an entrepreneur in healthcare. BBC’s Ed Butler once again hosted Oren Gilad, Don Straus, Shawn Iadonato, and Caitlin Cameron, the CEO’s of the FiRestarter companies Atrin Pharmaceuticals, First Light Biosciences, Kineta, and OtoNexus Medical, respectively, to discuss their experiences and the future of healthcare innovation.
“It’s certainly a competitive landscape,” said Iadonato. “One thing that has evolved from the pharmaceutical industry is that they’ve largely gotten R&D, they are increasingly reliant on companies like my company, like [Gilad’s] company, to get the most attractive new technologies.”
Cameron sees the same story in the medical device industry.
“They look to young companies like us, but they want the angels and the ventures to take the initial risk,” she said.
Straus wondered the effect this trend has had on new ideas, and said he has seen a lot of good ideas wither and die on the vine because they aren’t developed enough for venture capitalists and angel investors, and yet can’t move forward without development money.
“Right now it feels like we’re on a great wave and things are working,” he said.
But he also said he has had periods of “sitting around waiting for a wave and it feels like maybe nothing is coming.”
Straus, whose company provides rapid diagnosis of infections also touched on the challenges that high profile failures on his industry, such as the recent Theranos bust.
“I talk to angel investors and every other one asks me ‘why are you not Theranos?’” he said. “We’re not Theranos, we have something real.”
According to Iadonato, the challenges of getting capital in pharmaceutical development in particular are that development is high risk, capital intensive, and takes a long time. This is in contrast to many technology ventures that are lower risk, require less investment and have quick development cycles.
Gilad, however, took on a more hopeful perspective, pointing out that there are now venture arms associated with pharmaceutical companies that are on the ground in academic institutions looking for very, very early stage opportunities.
“Capital is needed in the early stages where risk is high,” he said, “but it is out there.”
All four CEOs acknowledged the ups and downs of the being on the bleeding edge of this industry, but also the excitement that comes along with it.
“We’re part of this lunatic group of people that actually feel we can do something good,” said Gilad. “and it’s very fun.”
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