We recently caught up with the CEO of Lungpacer Medical, Doug Evans. Lungpacer is developing a novel therapeutic solution that preserves the strength of the diaphragm muscle for critically-ill patients on mechanical ventilation.
Doug is also a board member of Intact Vascular, which was acquired by Philips, and the former COO of Kensey Nash. He’s a medtech veteran with decades of experience launching startups, developing products, working with payers & regulators, and commercializing novel technologies. Today, we’re going to discuss all these topics, and hear more about Lungpacer’s impressive technology.
But first, here’s a bit more about Doug Evans and his background:
Doug started his career at GE in business development, and later joined Kensey Nash when it was just a startup with fewer than ten employees. As COO, he led Kensey’s growth to over 400 employees, across the span of 20 years, before they were acquired by Royal DSM. After that, Doug began working with other startups like Intact Vascular and TELA Bio.
Doug holds a master's degree in electrical engineering and photonics from Penn, as well as an MBA. He knows the medtech startup landscape better than just about anyone, and we’re grateful he’s sharing his perspective with the Medsider community.
Listen to the Interview with Doug Evans
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Read the Interview with Doug Evans
The following interview has been lightly edited for readability.
Doug, can you tell us a little bit more about how the idea for Lungpacer came about? You mentioned that there's a personal element to the story.
Brand new ideas often start with a patient experience. In this case, it was the mom of a professor at Simon Fraser University in Vancouver. And it was my son Cameron, who was a patient at Children's Hospital in Wilmington, Delaware. The son of that patient in Vancouver and I both watched our loved ones spend time on mechanical ventilation and struggle greatly. After Kensey Nash was sold, I connected with another entrepreneur and we collaborated to raise an initial five million in seed financing for a company we set up in Vancouver. For me, the death of my young son is always difficult to talk about. But that experience really has driven me to find a way to get better outcomes for patients on mechanical ventilation and to focus on creating a better future for all individuals that have respiratory distress.
That’s tragic to hear about the loss of your son. As a father of four myself, I can’t imagine going through that. Thank you for sharing. How much has your personal connection to this helped you push Lungpacer through challenges and setbacks?
This time, it's really personal and so truly rewarding to see dozens and dozens of examples of patients who were in similar situations to the mom in Vancouver and my son in Delaware. I see my son in all of these patients. Sometimes a family getting ready to make end-of-life choices. They're going to go to hospice and remove life support. And days later, they're off the ventilator and they're going home. And they live weeks, months, years after that point in time.
Doug, tell us a bit more about the need behind Lungpacer.
The situation we face today with Covid-19 across the world has highlighted the weaknesses of mechanical ventilation and the danger associated with traditional ventilation. So we created this company with a mission to revolutionize the way we treat patients by providing them protective respirator support. And the core principle is that the diaphragm muscle, like the heart, is always working. This diaphragm also atrophies at an extraordinary rate when a patient goes on a mechanical ventilator. In fact, a patient can lose up to 50 percent of muscle mass in just a couple of days.
At some point, the patient recovers from whatever brought them into the ICU. And then you've got this muscle that's just been getting weaker and weaker. So our idea is to use the Lungpacer technology to strengthen that muscle, or to keep it from getting too weak in the beginning. so that when we're ready to remove ventilation, they can breathe on their own as quickly as possible. And we're really excited about the data that we have on it and bringing this into the healthcare system.
Let’s talk about those first alpha or beta versions of a medical device. Where do you think most medtech entrepreneurs make the biggest mistakes when it comes to early product development?
It's super important to understand the user's needs. So you'd have to get yourself into the shoes of the clinician, and not only in how they're interfacing and trying to help the patient, but also the clinical pathway. So what do they do every day? What are the time constraints? What are their objectives or the goals? You've really got to understand both the user needs as well as what their life is like when you first start out with the product. And once you understand that clearly, I think you can start to define the goal.
We had a lot of nice-to-have features in our first alpha at Lungpacer. And I think it's really best to start with the must-haves for those products; get that first technology iteration out there that has incremental improvement and impact to help patients and clinicians. The final thing I think that is really important is really focusing on ease of use and not getting too complex too soon. I’ve seen customers opt for a simpler product with inferior data because it’s easier to use.
Your product has to fit in their clinical pathway or it won’t get adopted. We had a prior product that had best-in-class clinical data. But it was admittedly more complicated to use than we would have liked, and clinicians did opt for a simpler product even though it had a higher complication rate.
Let’s talk a little bit about the emergency use authorization you were able to get with Lungpacer in early 2020 as we experienced the onset of Covid-19. How much did your team consider the reimbursement pathway? Without a reimbursement path, it’s always just such an extremely challenging and expensive hill to climb.
I think that goes back to some of the training I had in the early days at Kensey Nash, where we were always looking at trying to hit this triple aim for our new devices. Number one, you wanted a clinician to achieve a better outcome. Number two, you want to improve the experience for the patient. And then three, you've really got to try to figure out how to bring a new technology to the market and reduce healthcare costs.
And it's really hard to do all three. So health economics and reimbursement were part of the conversation we had at the outset. If it's an iterative product that's following behind other similar devices, it's often easier to predict what that coverage and reimbursement environment is going to look like. But if it's a first-of-its-kind device, like ours, you do need a clear plan and you have to have that in mind at the start. It's really important to assemble a team of internal and external experts. And when you're a small company, it's mostly external folks. Adoption and device utilization really are going to strongly depend on having a compelling economic value proposition, as well as coverage and reimbursement to seal the deal in the end.
We're excited at Lungpacer because we've designed a clinical trial to really collect data that shows that the device can actually shorten the time on mechanical ventilation and ties to cost in the ICU, which correlates to healthcare costs. That is a really key piece of the clinical trial design that we baked in at a very early stage. And then our breakthrough designation, which we were able to secure recently, also puts us in a good position for coverage and reimbursement.
At Kensey Nash, you said you liked developing products that physician customers didn't even realize they needed. Can you walk us through that approach to product development?
Yes, because that is somewhat atypical to how most entrepreneurs think. Many will focus on some sort of existing need that they should try to solve for. John Nash and Joe Kaufmann, as well as other entrepreneurs, were my role models on this and helped me look at products differently. Their philosophy was that great opportunities are sitting right in front of you if you can see them. And then you have to roll up your sleeves and really work hard to find a way to get those ideas into the market and create a better future for patients. And so it was really all about thinking first about the patient; what are they experiencing? How can we make outcomes better for them?
Then you can look at it through the eyes of the clinician. What problems are they facing? What are they not aware of? What don’t they know that could improve patient outcomes? And then it's all about persistence and problem solving when it comes to these new technologies. There really isn't a blueprint. It's all about trying and failing, and observing and reformulating, and then trying again. And then you repeat. And you have to be optimistic. You have to have the vision. And of course, you can never do anything worthwhile without a great team.
How much time have you allocated towards communication with payers when it comes to their adoption of the Lungpacer system?
For our patients today, they're covered under an established DRG which covers mechanical ventilation. There are two different codes right now with various reimbursement levels. Instead of approaching those individual payers, we actually brought in some of the top consultants based in DC that know the big players and also work with CMS to set up coverage and guidelines for our devices. And we had a really quick read on what our best path forward was.
We did have an opportunity through the breakthrough device program to get an early read with CMS. We opted to not do that, and instead just gathered clinical data under a trial plan that was specifically tailored to bring economic data forward so that we could have that analysis done after the study. The added benefit was CMS putting forth a proposal to provide automatic coverage and reimbursement for these breakthrough devices, which is really important for us.
You mentioned the breakthrough device designation with FDA as well as emergency use authorization. Can you tell us about the processes you followed?
I think the key area for the breakthrough device designation is looking for a patient subset that really has poor outcomes where there are really no great alternatives. The primary way we looked at it for these high-risk patients was by asking this question: how can we help reduce the risk for those patients when they're on mechanical ventilation? I don't want to say it's easier, but I think that FDA, and the various divisions at FDA, are being a little bit more open to some of the proposals from medtech companies for new technologies these days. And I think we're seeing a significantly larger number of devices get that designation today, which is really exciting.
So look at that patient population, be very clear and focused on how your device and technology can improve outcomes, particularly in reducing mortality. And if you make a really good case, we've been seeing that FDA has been good at providing those breakthrough device designations.
What about for emergency use authorization?
Our interaction with FDA on this was fast and furious and they spent a tremendous amount of time with us. We had calls with them late at night, early in the morning, and on weekends to get our Lungpacer device in the marketplace. And FDA is still on that frantic pace. They're doing a terrific job getting beneficial technologies into the market to help patients during the pandemic. And I'm not sure that they're getting the credit they deserve for it.
For us, it was all about having a technology where we had a reasonable amount of data. In this case, it was clinical data that demonstrated that the technology could help patients during the pandemic. The secondary element is to make sure the benefits outweigh any risks to the patient. You really have to be very compelling about those two areas if you want emergency use status.
Doug, can you tell us about your clinical research roadmap in the early days of Lungpacer? Is there a framework you used?
Typically, when you're forming that initial clinical strategy, it's really helpful if there's a similar product that's ahead of you on that pathway. My advice is to really learn as much as possible about that technology, what went well and what didn't, what changes have they made over time, what sites enrolled, and so on. Then try to find as many advisors and investigators that have experience with those types of devices. Ideally, people that participated in conversations with FDA for those technologies all the way through to commercialization.
For me, most of my first products don’t have an established pathway. So you have to know the clinical environment that you're entering. You have to understand what those patients, what they need from your technology, how you can best treat them in a critical care ICU where so much is going on. These patients are on life support. Their life is hanging in the balance. And you have to be really particular about how you're going to introduce this technology via a clinical trial. How do you collect that data on these patients? You have to be really clear what your endpoints are and what is that ultimate marketing label that you want. So you've got to really define those endpoints.
You also have to be able to execute the trial in a reasonable amount of time. And get a group of patients that is somewhat homogeneous so you can understand how the tech is affecting them. But if you overdo it and your inclusion criteria are too tight, you end up with a very small group and the trial can take longer. You have to balance all of this.
Let's hone in on the seed stage of fundraising for a medtech startup. Any advice that you give to other entrepreneurs in those early phases?
Keep the burn rate as low as possible. And if you can get human data, do it very, very early. I know that's a lot to accomplish in an early stage with very little money, maybe with just some angel dollars. But that's the mindset that you should have as an entrepreneur. I think when you're bringing a new technology forward, you have to be incredibly clear on the value of the opportunity, how you own it, and how you're going to protect it.
I recommend you bring in startup people who really know how to roll up their sleeves. They can do a lot of different jobs. They aren't going to panic when you have failures because you will probably have several a day. And so you really want to be surrounded by people who just look at the problem, solve the problem, and move forward day after day. And then finally, it's really persistence. You can't give up. It's only going to take that one investor to get you that series A funding. It worked for us.
By Series B, we actually weren't able to accommodate 90 percent of the people that had interest in investing. So that first investor was transformative for us.
Doug, what are you most excited about over the next few years?
I'm even more excited than I was when we started the company. It started with this passion for really helping these patients out. But the data that we've gotten is actually much more compelling than I ever expected. And for us, it started with the simple idea of a weak muscle that we wanted to make stronger. What we found is that when we use the Lungpacer device, we actually can start to mitigate a lot of that lung injury that occurs, as well as injuries that are happening to the other organs in the body.
Not only do we think we can solve the problem of muscles getting weaker, we actually believe that we can totally change the way these patients are ventilated. And so we're going to move from rescuing patients to protecting patients at the onset. And then ultimately, we believe that we're going to rebuild the ICU around a new technology that provides both positive and negative pressure. We want to replace the ventilator as we know it today.
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