Start-Up

Getting Past Rejection as a First-Time Medical Device Entrepreneur: Interview with Derek Herrera, Founder of UroDev and Habit Camera

We recently sat down with Derek Herrera, who has an incredible story to share. He’s a decorated Marine veteran who’s turned a major combat injury into a mission to help other patients with spinal injuries. Derek is the founder of UroDev, originally Spinal Singularity, as well as Habit Camera, the first low-cost, wireless camera purpose-built for skin inspection and telehealth.

UroDev is on the cusp of bringing its Intelliflow device to market, a product uniquely designed for spinal injury patients who have urology conditions like neurogenic bladder that require extensive catheter use.

Derek and I chat about his journey from the military to the medical device space, and get into what he’s learned about becoming a first-time entrepreneur with a big idea but not a lot of funding or experience.

First, here’s a bit more on Derek’s background:

He graduated from the United States Naval Academy and served as a Marine Infantry and Special Operations Officer for over eight years. In 2014, he was medically retired due to combat injuries, and left paralyzed from the waist down. Since this injury, Derek has earned an MBA from the UCLA Anderson School of Management and founded both UroDev and Habit Camera. He also serves as President of the Board for the Marine Raider Foundation.

Listen to the Interview with Derek Herrera

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Read the Interview with Derek Herrera

The following interview has been lightly edited for readability.

Derek, welcome to Medsider! Please tell us more about your journey from the military to the medical device space as a first-time entrepreneur.

I grew up in an Air Force family and went to the Naval Academy to study engineering. When I graduated, I became a Marine Infantry Officer. I served in the infantry for about four years before I was selected to become a Marine Raider, which is the Marine’s version of Navy SEALs. I became a Marine Raider Team Commander, but when I deployed again to Afghanistan in 2012, I was shot during an enemy firefight, and was instantly paralyzed from the chest down. Due to the heroism and selflessness displayed by my team members and our Afghan partners, I was able to safely make it out of that situation. I had a long recovery process, but I'm still paralyzed from the chest down and still use a wheelchair. So I started to figure out what was next in my life. I went back to graduate school at UCLA for an MBA.

Through my recovery process, I became an expert in everything to do with spinal cord injury and rehabilitation. Over time, I learned there were opportunities to solve these problems and to do so in a for-profit environment as an entrepreneur. So, that was kind of the genesis for starting my first company, Spinal Singularity, which is now UroDev Medical. I wanted to develop products and solutions for people like me.

That’s an incredible story, Derek. If you want to learn more about Derek’s journey, he’s been a guest on some large shows, including the Jocko Podcast.
Derek, let’s chat more about UroDev. How did you identify your initial product concept, the Intelliflow?

After I was injured, I was able to utilize an experimental technology that was really transformative for me physically, but also emotionally, and psychologically. This device was a robotic exoskeleton designed by a company called ReWalk Robotics. It was the first exoskeleton device to gain FDA clearance in 2014 and enables paraplegics to stand and walk. For me, being able to set a goal of walking again through technology was really impactful.

I was able to meet and learn from the inventor of the device, a quadriplegic inventor in Israel. Seeing what he was able to accomplish -- that was a huge turning point for me psychologically. But walking wasn’t the biggest challenge I faced. On a day to day basis, it was bladder management. Traditional medicine only offered one-time-use catheters for people with neurogenic bladder, a condition where you can’t empty your bladder properly. The prospect of doing that ten times a day was terrible and I became obsessed with trying to solve this problem. There were no other competitors in the space aiming to address this issue so I started working to fund a company to build this product for people like me.

What was your mindset as a new, first-time entrepreneur in the medical device space?

Initially, things seem so daunting until you meet people like the folks at ReWalk Robotics and you realize that amazing things are achievable. I can do this. Even if I fail, there's no harm in trying. What more noble pursuit could there be? I understood the risk of failure and trying to be an entrepreneur because most startups fail.That's the reality. But what do you have to lose by trying? Ego, money? At that point in my life, I didn't care about that. I was just obsessed with solving this problem.

So, you've got this idea. You're passionate about it. But we both know getting a medical device from the initial idea to something tangible is expensive. How did you go about building out the first alpha and beta versions of the Intelliflow concept in those early years?

Not the way that you should do it, probably. I had zero experience in the industry, zero credibility other than I was a guy who was really passionate about solving a problem with a pretty good idea but no prototype, no data, no nothing. I'm kind of glad that I didn't really have a good understanding of how challenging it would be, because it was hard. It was incredibly hard.

We did a crowdfunding campaign for donations, we did grants, we did business plan competitions. We talked to investors and most said no. We kept at it. We're still not on the market today, but we're optimistic we will be soon. But the product is real, and it works. It just took a lot of time and effort -- putting yourself out there, meeting people and building relationships, and failing, quite frankly. But what’s most important is how this product will change the lives of people every day.

If you had to raise money for a new device startup, what would you do differently?

Use the SBIR program. There’s a healthy ecosystem for non-dilutive funding, mainly through government grants. Billions of dollars every year. Investors expect you to use that money. It's not an investment. It's just money that's used for the development of products and ideas. They seed ideas in high-risk technologies and help de-risk them so investors will come along and support them.

With investors, it's about shots on goal. How do you know if someone will back something? You have to ask and get turned down a lot. You have to pitch them knowing that there's a chance that 100% of the people will say no or not see your vision. Assume that risk. If 1 out of 100 writes a check, it’s worth it. You also have to be a quick learner. I’ve learned by doing when it comes to writing grants and what to discuss and not discuss with strategic investors. To succeed, every entrepreneur needs to adapt. Learn from failure as fast as you can and move forward.

Derek, take us back to when you were working on your first product concepts. How did you go about identifying the regulatory path for the Intelliflow device?

Regulatory is incredibly nuanced and challenging. First, you have to consider if there are clear predicate devices. People get hooked on whether a product is a 510(k) or a De Novo, but  I don't necessarily agree that you should try to design around a regulatory strategy or design to meet it. We are currently engaging deeply with the FDA as we prepare for our regulatory submissions later this year. I think regulatory challenges can be addressed with good data and good clinical evidence, as opposed to trying to make a product just to meet a regulatory strategy or regulatory need. We consider regulatory as one aspect in a long line of other business topics. But that’s just my experience in my specific domain. Frankly, in some cases, there are more investors that are looking for easier regulatory paths because they have quicker times to exit.

You now have some decent data for the Intelliflow device. Tell us more about your approach to clinical evidence.

Intelliflow is a simple, relatively low-risk, minimally invasive, non-surgical, totally reversible device that users can insert and remove in a matter of seconds. We were able to utilize the FDA's guidance for the policy on non-significant risk studies, and get into the clinic pretty quickly with our device.

We've done a first-in-man, we've done a feasibility study, and now we're doing our pivotal study. Every time we'd go into a clinic, we'd get closer to our goal of having a device that adequately meets the needs and the requirements of our users. We couldn't get it right off the bat because we're doing something nobody's ever done before. We actually didn't do animal testing because the anatomy was not representative to a degree that was sufficient for us to gain meaningful insight. So we went straight into humans.

We’ve tried to focus on the overall business objective of time to market. How do we generate the statistical evidence to do that? We go in-person to a lot of these cases to help train patients and see firsthand the impact of the device that we designed. That's what keeps me going through all the challenges. We're so close to getting a device on the market that could really revolutionize people's lives.

Sounds like the designation as a non-significant risk device certainly helped get some studies off the ground. Did you factor that into the design of the device knowing it might be helpful when it comes to collecting clinical evidence?

We didn't say, we're going to design a device that's a non-significant risk. We looked at the critical inputs for our users and for clinicians. One thing that happens with spinal cord injuries is people have autonomic dysreflexia, a rapid increase in blood pressure that can be very dangerous. It could be from something as small as stubbing your toe. So we looked at how catheters impact this considering you have to be able to remove them very quickly. So that became a design input for us. That took training for our users, but it dropped the risk profile significantly. Non-significant risk studies are good because it saved us time on the front end because we didn’t need an IDE.

How did you go about identifying sites for clinical trial enrollment?

If you have a network or your advisers have a network, that's the place to start. One of the more accurate pieces of advice I've received from experts is, any time you do a study, expect a third of the sites to be high enrolling, a third of the sites to be low to average enrolling, and some sites may not even enroll a patient. Enrollment is about relationships, and understanding that not every site is going to enroll high numbers and they're not all going to be the same.

I would say the same thing when you're trying to build out a scientific advisory board. Seek investigators at all levels. You want a KOL, but you can't have 100% KOLs in your study because they're going to be so busy that you won't get the numbers you need. You need people at all levels I think.

UroDev recently relocated to Minneapolis and you brought on a new CEO. Tell us more about what you're most excited about over the next few years with the company.

I'm more excited than ever about UroDev Medical because we're so close to getting this product on the market. This has been my life's work for the past six years. We’ve raised additional funding, and hired a new CEO with experience commercializing devices in the urology space. The majority of urology executives and urology companies are in Minnesota. The move to Minnesota was somewhat symbolic at this stage because we still only have three employees in our company, but it's really laying the foundation for the future. Later this year, we'll look to raise a Series B as we prepare to commercialize with FDA clearance on the horizon. I couldn't be more excited to complete the study we're doing now, submit for regulatory clearance, and raise more money to go make this a reality.

Derek, you also recently launched Habit Camera, a consumer medical product. Can you tell us about that?

Habit Camera is a small family business that my wife and I started about a year ago after meeting researchers at the Minneapolis VA who had a great, simple idea. Habit Camera is a digital tool for skin inspection. Primarily, this is targeting people with diabetes who need to look at their feet or other places for any sort of wounds or pressure ulcers. It also has dermatological applications like skin cancer screening, moles, acne, and psoriasis. For all of these conditions, early intervention is incredibly impactful, reduces costs, and increases recovery.

And early intervention comes from vigorous and routine inspection. Right now, patients just get a little mirror to examine themselves with. And you’re supposed to be thorough. So instead of this mirror, the idea is to take a wireless camera, put it at the end of a flexible handle, and relay images and video in real-time to a tablet or a smartphone app. It's more ergonomic and more effective. You can also utilize telehealth applications where you can send these images and videos to caregivers and clinicians. We decided to bring it to market as a consumer product. We are taking pre-orders now and have totally bootstrapped the concept.

You’re also involved with some non-profit organizations, too. Tell us more about those.

The Marine Raider Foundation helped support me when I was injured, and now I’m on that board. We have a very simple mission. We raise money to support injured Marine Raiders and families of the fallen in their time of need.

I’m also involved with MedTech Vets, which is formally MVPvets. We have a very simple mission as well: help veterans find employment and meaning in the medical device and life science industry. So, we partner with companies in the industry to mentor and hire veterans who are looking for their next career.

Derek, let’s end this chat with your single best piece of advice for other medtech or healthtech entrepreneurs.

I can't stress enough to early-stage entrepreneurs that you're going to hear “no” almost all the time. If you just stay true to what you know is going to be most impactful and effective for patients, people will get on board. I see people lose confidence after 20, 30, 50 no’s. But when you truly have the message and product-market fit, don't sacrifice it just because investors are saying no. Stay true to what you're doing and passionate about it.

I also advise having experience in the industry before you try to start a company. I gained some, but you can always use more. There's never a perfect time for you to make the leap, but I left really early, and I don't recommend that for everybody. Don't commit to starting a medical company unless you're willing to do it for 10 years. There’s no shortcut to getting rich quickly in medical devices. If you’re only thinking about profits, this isn’t the industry for you. Do something you’re really passionate about and be ready to devote a decade to the work and the mission.

Switchback Medical

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First, their world-class engineering team has deep domain expertise in the endovascular space. Think of pretty much any interventional device and a Switchback engineer was probably involved in its creation. I can’t think of another R&D partner with the sheer amount of knowledge and experience they have in the vascular arena.

Second, Switchback recently launched BioSim Innovations, a full-on biosimulation lab that uses human & animal models, as well as cell, tissue, & organ cultures. It’s the perfect lab for physician training, preclinical model development, and device testing.

Demand is incredibly high for an experienced design & manufacturing partner like Switchback Medical. But for the Medsider community, Switchback is offering to expedite your quote to the top of the stack. Email me right here and I’ll personally provide an intro to their leadership team.

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