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Anesthesiologists spend thousands of hours in operating rooms, surrounded by other people’s inventions. We may think, “Why can’t I be a physician entrepreneur? Why can’t I start a company to invent something like the pulse oximeter (i.e. Dr. Bill New, Stanford anesthesiologist-engineer), the laryngeal mask airway (i.e. Dr. Archie Brain of England), or even the Bair Hugger? Heck, I use a hair dryer every morning. Why didn’t I realize how useful hot air could be in warming surgical patients?”
In a recent Stanford Anesthesia Grand Rounds lecture, anesthesiologist-entrepreneur Jeffery Bleich, MD discussed this very topic. How does a physician go about converting his idea into a medical technology company? Dr. Bleich is a unique individual, a board-certified anesthesiologist and pain medicine specialist who completed Stanford Business School’s Sloan Fellowship and founded not one but two Silicon Valley medical companies. These are some highlights from Dr. Bleich’s lecture:
- Anesthesiologists can be ideally suited for starting companies, because our specialty interfaces with all aspects of medicine, from neonates to geriatrics, from cardiac and brain surgery to ambulatory procedures such as orthopedics, ENT, and plastics. Anesthesiologists have ample time to contemplate new ideas as they take part in surgical and medical interventions, and we have the ability to create flexible schedules to explore entrepreneurial ventures.
- Dr. Bleich recommends a 20-year plan as an approach to starting a medical business. Where you want to be in 20 years dictates what decisions you will make regarding your future 10 years from now, 5 years from now, and most importantly, today.
- Think of a Problem that needs a better solution. Then the most important ingredients in your plan are Team > Market > Idea. One might think that the Idea is the key to starting a company, but Dr. Bleich stressed that an excellent Team comes first. If one assembles an excellent Team to approach a big Market, the Idea will develop out of Team and Market.
- Find a Mentor. A seasoned role model who has started a company prior to you will be your greatest asset in guiding you through the process. For a modest percentage of ownership in the venture, recruit a Mentor. In the Stanford geographical area, Silicon Valley is a rich resource of such individuals.
- “Kill ‘em Quick.” This phrase refers to the concept of killing bad ideas quickly. Try to criticize and defeat each new idea you have. If you are capable of killing the idea in short order, this is preferable to investing years of time and quantities of dollars only to find the idea is not viable. If you can’t kill the idea quickly, go with it.
- Expertise + Passion = Magic. Passion is necessary and contagious. If you have Passion for the Idea and the Expertise to back it up, your likelihood for success grows.
- Deliver. This requires sweat and effort. Dr. Bleich reports that starting a company becomes a 7-day a week project that infringes on family time, traditional work time, and free time. He stresses that intellectual honesty and execution are needed to keep the company on path. The need to “make a difference” in the world can be an overriding theme that keeps the work on track.
- Funding. From 2004-2009, Dr. Bleich was the Founder and CEO of Baxano, Inc, a company that developed both a minimally invasive procedure and instruments to approach lumbar stenosis surgery. In the company’s infancy, Dr. Bleich was the sole owner of Baxano, Inc. During the ensuing years, Baxano raised $70 million in venture capital money to support the company. Eventually the company merged with a public company in an acquisition.
- A cautionary tale: Dr. Bleich described venture capital (VC) funding as an “extremely financially risky path,” particularly in the medical technology industry today. However, he added, if you can obtain this type of financial capital, it does provide a sort of “rocket fuel” that can enable a company to attempt to grow a business very quickly. Unfortunately, it also requires giving up control of the company’s major financial decisions to the Venture investors.
- Dr. Bleich has since founded a second company, Pulson, Inc., where he again serves as President and CEO. This time around he’s been able to avoid VC funding, partly because Pulson, as a software company focused on consumer health, requires less overhead than did Baxano, a medical device company developing minimally invasive surgical tools. Forgoing the “rocket fuel” the venture capitalists offer means the new company has grown more slowly than a typical VC funded enterprise, but bootstrapping the company in this manner has allowed control of the company to remain with the founders, which so far appears to have been worth the tradeoff.
- Dr. Bleich described the current financing climate for medical device companies as a “wasteland.” It’s his personal opinion that the federal government, appropriately concerned with out of control inflation in medical care costs, has recognized that proprietary new medical devices are typically very expensive compared to generic devices, yet more often than not they are at best only marginally better than old technology. In order to shut down expensive new proprietary products from hitting the market, the government has three ”levers” that it can pull to suppress medical device innovation: a) it can make it more difficult to get products approved or cleared through the Food and Drug Administration (FDA); b) it can make it more difficult for new products to gain reimbursement through Centers for Medicare & Medicaid (CMS); and c) it can (and did) add punitive new taxes that specifically target medical devices. These factors have combined to increase the risk and cost of bringing new medical technologies to market, while decreasing the value of the few that actually make it, causing many of the finest investors across the medical technology industry to leave for greener pastures.
- Dr. Bleich encouraged would-be entrepreneurs to not be discouraged by the lack of interest in medical technology investing as we used to know it. In fact, he described a silver lining in these dark clouds, and provided examples of newly emerging areas in healthcare innovation that are bursting with future promise. He suggested that some of the best new territories for medical innovation include the individual and converged categories of: a) wireless technology, b) genomics, and c) Big Data.
- What about the value of a physician going to business school and gaining a business degree? Dr. Bleich graduated from Stanford Business School, one of the world’s elite business schools. Was it worth it? Dr. Bleich admits it helped him approach the business world with more confidence. The degree itself didn’t help him find a job that was of particular interest to him, because an MD with one year of business school is very unlikely to be able to qualify for a high level business position. After interviewing with a couple of large medical technology companies, he soon realized the only way he would be able to find a job in the business world that gave him the level of responsibility he was looking for was to create the company himself. Not surprisingly, when he founded his own company, Baxano, as the only employee, he hired himself as CEO.
- With MD salaries as high as or higher than most mid-level business jobs, and with the income potential of MD’s still relatively high, Dr. Bleich stressed that the motivation to go into business and start a company should not be money. “If your major motivation is simply to make a fortune, your odds would be better rolling the dice at a craps table in Las Vegas than starting a medical company,” he said. “It’s a gamble either way. You should become an entrepreneur because you know in your heart that you cannot go to the grave without trying to make the world a better place with your business idea.”
I thank Dr. Jeffery Bleich for his expertise, candid remarks, and advice.
The American Dream is alive and well in the 21st Century, and if you have the heart and soul of an entrepreneur, I hope you summon your intellect and your courage, and start a company that changes the world we live and work in.
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Published in September 2017: The second edition of THE DOCTOR AND MR. DYLAN, Dr. Novak’s debut novel, a medical-legal mystery which blends the science and practice of anesthesiology with unforgettable characters, a page-turning plot, and the legacy of Nobel Prize winner Bob Dylan.
In this debut thriller, tragedies strike an anesthesiologist as he tries to start a new life with his son.
Dr. Nico Antone, an anesthesiologist at Stanford University, is married to Alexandra, a high-powered real estate agent obsessed with money. Their son, Johnny, an 11th-grader with immense potential, struggles to get the grades he’ll need to attend an Ivy League college. After a screaming match with Alexandra, Nico moves himself and Johnny from Palo Alto, California, to his frozen childhood home of Hibbing, Minnesota. The move should help Johnny improve his grades and thus seem more attractive to universities, but Nico loves the freedom from his wife, too. Hibbing also happens to be the hometown of music icon Bob Dylan. Joining the hospital staff, Nico runs afoul of a grouchy nurse anesthetist calling himself Bobby Dylan, who plays Dylan songs twice a week in a bar called Heaven’s Door. As Nico and Johnny settle in, their lives turn around; they even start dating the gorgeous mother/daughter pair of Lena and Echo Johnson. However, when Johnny accidentally impregnates Echo, the lives of the Hibbing transplants start to implode. In true page-turner fashion, first-time novelist Novak gets started by killing soulless Alexandra, which accelerates the downfall of his underdog protagonist now accused of murder. Dialogue is pitch-perfect, and the insults hurled between Nico and his wife are as hilarious as they are hurtful: “Are you my husband, Nico? Or my dependent?” The author’s medical expertise proves central to the plot, and there are a few grisly moments, as when “dark blood percolated” from a patient’s nostrils “like coffee grounds.” Bob Dylan details add quirkiness to what might otherwise be a chilly revenge tale; we’re told, for instance, that Dylan taught “every singer with a less-than-perfect voice…how to sneer and twist off syllables.” Courtroom scenes toward the end crackle with energy, though one scene involving a snowmobile ties up a certain plot thread too neatly. By the end, Nico has rolled with a great many punches.
Nuanced characterization and crafty details help this debut soar.
Click on the image below to reach the Amazon link to The Doctor and Mr. Dylan:
Learn more about Rick Novak’s fiction writing at ricknovak.com by clicking on the picture below: