(as seen at Forbes.com July 18, 2016)
As the CEO of a start-up life science company, I am always watching what is going on in my industry. During my company’s Board of Directors meeting about a year ago, I was asked about the blood testing company Theranos. At that time, they were hot in the press with their CEO all over the media, a $9 Billion valuation and a reported $750 million in funding. This caught our attention, as it is unheard of in our space. The question asked in our meeting was how such a young start-up CEO like theirs could possibly attract so much valuation, investment and media attention to her company.
The only answer I had at the time was that Theranos must have found the holy grail of blood testing. I reviewed our product, something we have invested years of work designing and testing, with multiple issued patents – but could not identify a short path to market, just my stepped path. At the time I thought Theranos had not only secretly created an extremely advanced product, but had also found a way to do it faster and cheaper than anyone else. What I didn’t know then was that was only half the story…
At the end of the BOD meeting last year, I felt a little beat up. I was leading a talented team of scientists and engineers, developing something that had huge potential, but this blood testing company was kicking our butt in developing something that seemed to be impossible to our team. Although we are not competing in the same space as Theranos, we certainly will be compared to them as a start-up life science company.
What I didn’t know at the time was their future. No crystal ball on my desk!
In the early years of Efferent Labs, I had assembled a well-seasoned board of directors and was able to make extremely good progress with our product. We have done so in a step-by-step process: building, testing and validating one specific component of our product prior to moving to the next step of development. Although at the time, we were still more than 24 months from market, I felt we had done a great job with the science and engineering of our product, an insertable biosensor that uses the patient’s own cells as the sensor. It is a ground-breaking product with enormous implications for personalized healthcare, but it must be developed carefully. We know that with such an advancement in medical technology, any misstep on our part could result in complete failure.
New Year, New Meeting
At our most recent BOD meeting in May of this year, there was more conversation about Theranos, but this time the theme and tone had changed. Our strategy to validate our device along the way and obtain data before our next step was proving a very smart and prudent thing. I also had directed, due to my past experience, that all documentation would be fully compliant from the start, so as to be prepared for the eventual FDA scrutinization.
We are moving the ball forward every day. We may still have a ways to go before our product is ready to be used by patients, but I devised a path to market that allows for investors to benefit along the way. These are early step-markets, where each step has a stop, and each stop has a market. For us, the first market is preclinical research. I am an engineer. Methodical might not be flashy, but it yields good results.
A lesson everyone in the life science industry should learn from Theranos – don’t get ahead of yourself. We don’t know the future for Theranos, or for that matter, my company Efferent Labs. My hope for both the companies is great success. However, the industry implications created by the hype of Theranos are already being felt. The Theranos Effect is not a good one, and it has hurt every start-up company in our space.
I think the main difference between myself and the CEO of Theranos, Elizabeth Holmes, is experience. I am much less interested in hype for my company and a lot more interested in proven results from our step-by-step methodology. I am not saying that she wasn’t interested in results, but it looks to me that she was ahead of her company’s outcomes. A CEO is expected to have optimism and excitement about their company and product, but this must be tempered with the reality of the situation so as not to unintentionally mislead anyone. Because I am seasoned (read old) in comparison to Ms. Holmes, I can hold my optimism for my product in check a bit better.
I don’t want to promise before I can deliver. Yes, every company promotes their future products to some extent, but it is an absolute that the hyperboles not out-pace the results.
I am excited for the future of my products, but I want to ensure that my team successfully gets it to the people that will benefit from its use: the patients. To me the journey has always been about the patient, from the day I started Efferent as a patient myself.
We as patients deserve the very best healthcare. Maybe we can all learn a lesson here.