Key Learnings From Jason’s Experience
- Validate your therapy’s core concept before investing heavily in device design, especially when introducing a disruptive treatment. You can create a prototype using off-the-shelf products for early testing. This allows you to focus on understanding the therapy's mechanism of action and potential benefits.
- Design clinical trials to demonstrate both the clinical efficacy and the economic benefit to healthcare providers – it is crucial for securing reimbursement. This involves considering the cost impacts of patient care, like hospital readmissions and the need for further interventions.
- Gain your investor’s trust with a detailed financial plan and by consistently achieving your goals. Build credibility and prove that you can deliver on your promises in order to best position your company for a future financing event.
Jason Hannon has been steering the ship as the President and CEO of Mainstay Medical since 2017. The company’s flagship product ReActiv8 is a restorative neurostimulation device that aims to solve the underlying causes of chronic back pain. For those unfamiliar with nautical terms, ‘mainstay’ refers to the main support structure for the mast on a boat – just like the spine is the main support structure of our bodies.
Originally a lawyer, Jason entered the medtech space with NuVasive, where he took the company public, handled roles from legal to product development, and saw the company grow from millions to billions in sales. "Turns out, I had a knack for sales that took me until 40 to discover," Jason admits with a chuckle. However, after 12 years at NuVasive, the allure of further disruption called him to Mainstay.
Mainstay’s focus area is chronic back pain, specifically mechanical back pain. For years, treatments have largely targeted neuropathic pain – which is typically related to spinal nerves being inflamed, squeezed, or pinched – relying on surgery or spinal cord stimulators to provide temporary relief. On the other hand, mechanical back pain is often associated with a weakened or inactive multifidus muscle, the primary stabilizer in the lower back.
"This is genuinely the first approach at long-term treatment of a cause of mechanical pain,” Jason shares. Mainstay’s flagship product ReActiv8 is a minimally-invasive, implantable device that targets this condition. The therapy works by stimulating the nerves that control the multifidus muscle, helping patients to regain muscle control and restore functional stability to the spine, and allowing the underlying injury to heal. Rehabilitating this muscle means addressing the underlying instability that leads to chronic pain, offering patients a chance at lasting relief.
Mainstay is currently commercializing in the US, Australia, Germany, and the UK. They have a busy year ahead with more clinical initiatives and an effort to tackle insurance coverage and reimbursement within the US healthcare system. Jason shares, “In the next 12 months, we believe we'll deliver all the clinical data and the economic proof to convince U.S. insurers that ReActiv8 can be a long-term solution for patients, greatly reduce reliance on opioids and other drug or nerve-burning treatments, and also saves money for the healthcare system. And we can demonstrate that.” He foresees the team will have everything assembled in the next year to compel insurance companies in the US to provide ReActiv8 to their policyholders.
Jason Hannon holds a J.D. from Stanford University Law School and a B.A. from the University of California, Berkeley. After 12 years at NuVasive, where as COO he led the company to incredible revenue milestones, he transitioned to his current role as the President and CEO of Mainstay Medical, where he and his team are commercializing ReActiv8, an implantable neurostimulation system for intractable mechanical chronic low back pain.
Put the Patient Experience and Clinical Need Front and Center
In medtech, the well-trodden route is often optimizing for regulatory requirements and commercializing as soon as you can. However, if you’re developing a disruptive technology that challenges the treatment status-quo, you must first become an expert on your solution’s mechanism of action. “We want to prove objectively exactly what changes in the body when we apply this therapy,” says Jason.
Mainstay’s focus lies squarely on the patient experience and finding solutions for their needs. “We are therapy first, not technology, not size or features. Therapy first.” Jason explains. "We focus on what the patient is experiencing and how we can address it. Then, we develop the technology to serve those needs.”
Mainstay focuses on the multifidus muscle that stabilizes the spine. This muscle is inhibited by pain, and once the brain shuts it off, it doesn't naturally reactivate until the pain goes away. Therefore, the main question is, “If it has turned largely to fat, can the muscle be restored with the stimulation over a period of time?” To answer this, the team needed a muscle stimulator.
Instead of developing a new device from scratch, they repurposed an off-the-shelf spinal cord stimulator and programmed it to target the specific nerve associated with the multifidus muscle. This was helpful for Mainstay’s team to understand the therapy’s potential without spending years developing the perfect device.
It was apparent that patients were feeling better, but Jason wanted to fully understand what was actually happening. They went straight to the world leader in studying multifidus muscle in Australia and ran randomized studies on animals. Eventually, their team was able to see the effect of the therapy. “If we hadn’t done that, it would be just a theory forever,” says Jason.
Once the team knew what the therapy was specifically doing, it was easier to further refine what is now ReActiv8. For example, there were limitations with the stimulator in real-world scenarios like patient movement causing leads to shift position. But understanding the therapy’s underlying mechanism allowed Mainstay’s engineering team to move through technical challenges more efficiently.
It’s also important to keep in mind that not all patients will respond to the treatment the same way. So selecting the right crowd for your trials is also important. ReActiv8 is a therapy that aims to address the underlying cause of back pain, which is very different from temporary symptom relief. Jason explains, “In order to realize the full clinical benefit of this therapy, you need to be compliant with it for months."
Design Clinical Trials to Prove Efficacy and Economic Benefit
ReActiv8 is a promising therapy with compelling clinical results from early testing. However, changing the status quo means answering some tough questions. "The more disruptive your therapy, the more you need to demonstrate how it works and frankly, why it works," Jason shares. That’s why he prioritized two goals in clinical trial design at the outset: proving the concept delivers clinical results and demonstrating its cost-effectiveness to healthcare providers.
Proving efficacy is seldom enough. You must also prove economic benefits and secure reimbursement for widespread adoption. This means getting into the weeds. Instead of just counting how many people feel better, you need to analyze factors like whether the therapy lowers hospital readmission rates, decreases the need for further surgeries, or impacts other costly aspects of patient care. "Our first senior-level hire as we approached FDA approval was our head of reimbursement," Jason shares. He further adds, “Writing the study in a way that foresees ultimate reimbursement as the issue is critical because you can't go back and rerun that study.”
When it comes to building out a financial case, while you’re likely the most passionate party to prove your device’s utility, you’re also probably the most biased. That’s why an independent economic report can build tremendous trust. Jason advises partnering up with third-party experts and having them run an analysis that shows your therapy is either a break-even or a net gain to the system. This bolsters your case and increases the likelihood that insurers will see the value in covering your device.
On that note, it's never too early to start building relationships with the decision-makers at insurance companies. Engaging with medical directors helps tailor studies and evidence to match the criteria these payers use, ultimately improving a therapy's chance of widespread reimbursement.
Jason also emphasizes, “If you introduce a new therapy that copycats an existing therapy, you have instant access to reimbursement in the US. But if you do something new and novel, it's a long process.” Achieving broad insurance coverage is rarely an overnight success. You need to consistently demonstrate cost savings over time, address the questions from different insurers, and have the perseverance for what can often be a long process.
Educating Patients and Winning Over Investors
Disruptive therapies often require you to focus on the long game. You need a shift in patient expectations and to gain the trust of potential investors.
ReActiv8 is a long-term therapy, so it takes a while before patients start seeing results. For it to be successful, patients need to understand that benefits unfold over time and that everyone's recovery journey is different.
That’s why, above all, the ReActiv8 website serves as a channel for patient education. “I don't care if no one can find my name on the website. That's not the point,” Jason shares candidly. Instead, they highlight patient stories on their way to recovery. “The patient who's six months out who can talk about their journey, that's an incredible education pickup for someone,” Jason explains. Similarly, with physicians, he notes that testimonials focusing on patient progress over time are far more impactful than simply sharing that they’ve used the device. Their patient ambassadors are also key players in dispelling misconceptions and setting the right expectations about the therapy.
It’s easy to think that the vast number of chronic low-back pain sufferers and the underserved treatment landscape suggest a slam dunk for investors. However, it’s never the case, especially with disruptive technologies. On top of proving efficacy and educating patients, you also have to convince investors to write sizable checks.
According to Jason, “Can this team do what they say they're going to do?” is the major question in every investor’s mind. If a company needs to raise more funds before achieving broad coverage, it introduces a significant risk factor. Even if they believe you’re going to get broad reimbursement, the question is, “How quickly?” This influences their decision whether to invest now or wait two or three years and see if you come back with milestones in hand. In Mainstay’s case, it took almost a year to earn the credibility they needed. And it was by developing a detailed financial plan and relentlessly executing – hitting their goals consistently, month after month.
Furthermore, Jason notes that investor interest can wax and wane due to their own funding cycles and priorities. That’s another reason for maintaining open communication, because, as Jason explains, "A ‘no’ now may eventually turn into a ‘maybe’, and then a ‘maybe’ can turn into a ‘yes’ over time." His own experience with Mainstay’s recent lead-investor coming through two years after the initial introduction, demonstrates this. “There was an initial meeting and nothing happened for a year. We just kept them up to speed on what we're doing. And then we reengaged toward the middle of last year and they did a ton of work. But it doesn't happen if you write the group off, because timing is everything, not just for the company. Timing is everything for investors, too.” The end result was a $125 million equity financing, an exceptional deal size that validates the company’s work to date and prospects for future growth.
Key Learnings From Jason’s Experience
- Validate your therapy’s core concept before investing heavily in device design, especially when introducing a disruptive treatment. You can create a prototype using off-the-shelf products for early testing. This allows you to focus on understanding the therapy's mechanism of action and potential benefits.
- Design clinical trials to demonstrate both the clinical efficacy and the economic benefit to healthcare providers – it is crucial for securing reimbursement. This involves considering the cost impacts of patient care, like hospital readmissions and the need for further interventions.
- Gain your investor’s trust with a detailed financial plan and by consistently achieving your goals. Build credibility and prove that you can deliver on your promises in order to best position your company for a future financing event.
Jason Hannon has been steering the ship as the President and CEO of Mainstay Medical since 2017. The company’s flagship product ReActiv8 is a restorative neurostimulation device that aims to solve the underlying causes of chronic back pain. For those unfamiliar with nautical terms, ‘mainstay’ refers to the main support structure for the mast on a boat – just like the spine is the main support structure of our bodies.
Originally a lawyer, Jason entered the medtech space with NuVasive, where he took the company public, handled roles from legal to product development, and saw the company grow from millions to billions in sales. "Turns out, I had a knack for sales that took me until 40 to discover," Jason admits with a chuckle. However, after 12 years at NuVasive, the allure of further disruption called him to Mainstay.
Mainstay’s focus area is chronic back pain, specifically mechanical back pain. For years, treatments have largely targeted neuropathic pain – which is typically related to spinal nerves being inflamed, squeezed, or pinched – relying on surgery or spinal cord stimulators to provide temporary relief. On the other hand, mechanical back pain is often associated with a weakened or inactive multifidus muscle, the primary stabilizer in the lower back.
"This is genuinely the first approach at long-term treatment of a cause of mechanical pain,” Jason shares. Mainstay’s flagship product ReActiv8 is a minimally-invasive, implantable device that targets this condition. The therapy works by stimulating the nerves that control the multifidus muscle, helping patients to regain muscle control and restore functional stability to the spine, and allowing the underlying injury to heal. Rehabilitating this muscle means addressing the underlying instability that leads to chronic pain, offering patients a chance at lasting relief.
Mainstay is currently commercializing in the US, Australia, Germany, and the UK. They have a busy year ahead with more clinical initiatives and an effort to tackle insurance coverage and reimbursement within the US healthcare system. Jason shares, “In the next 12 months, we believe we'll deliver all the clinical data and the economic proof to convince U.S. insurers that ReActiv8 can be a long-term solution for patients, greatly reduce reliance on opioids and other drug or nerve-burning treatments, and also saves money for the healthcare system. And we can demonstrate that.” He foresees the team will have everything assembled in the next year to compel insurance companies in the US to provide ReActiv8 to their policyholders.
Jason Hannon holds a J.D. from Stanford University Law School and a B.A. from the University of California, Berkeley. After 12 years at NuVasive, where as COO he led the company to incredible revenue milestones, he transitioned to his current role as the President and CEO of Mainstay Medical, where he and his team are commercializing ReActiv8, an implantable neurostimulation system for intractable mechanical chronic low back pain.
Put the Patient Experience and Clinical Need Front and Center
In medtech, the well-trodden route is often optimizing for regulatory requirements and commercializing as soon as you can. However, if you’re developing a disruptive technology that challenges the treatment status-quo, you must first become an expert on your solution’s mechanism of action. “We want to prove objectively exactly what changes in the body when we apply this therapy,” says Jason.
Mainstay’s focus lies squarely on the patient experience and finding solutions for their needs. “We are therapy first, not technology, not size or features. Therapy first.” Jason explains. "We focus on what the patient is experiencing and how we can address it. Then, we develop the technology to serve those needs.”
Mainstay focuses on the multifidus muscle that stabilizes the spine. This muscle is inhibited by pain, and once the brain shuts it off, it doesn't naturally reactivate until the pain goes away. Therefore, the main question is, “If it has turned largely to fat, can the muscle be restored with the stimulation over a period of time?” To answer this, the team needed a muscle stimulator.
Instead of developing a new device from scratch, they repurposed an off-the-shelf spinal cord stimulator and programmed it to target the specific nerve associated with the multifidus muscle. This was helpful for Mainstay’s team to understand the therapy’s potential without spending years developing the perfect device.
It was apparent that patients were feeling better, but Jason wanted to fully understand what was actually happening. They went straight to the world leader in studying multifidus muscle in Australia and ran randomized studies on animals. Eventually, their team was able to see the effect of the therapy. “If we hadn’t done that, it would be just a theory forever,” says Jason.
Once the team knew what the therapy was specifically doing, it was easier to further refine what is now ReActiv8. For example, there were limitations with the stimulator in real-world scenarios like patient movement causing leads to shift position. But understanding the therapy’s underlying mechanism allowed Mainstay’s engineering team to move through technical challenges more efficiently.
It’s also important to keep in mind that not all patients will respond to the treatment the same way. So selecting the right crowd for your trials is also important. ReActiv8 is a therapy that aims to address the underlying cause of back pain, which is very different from temporary symptom relief. Jason explains, “In order to realize the full clinical benefit of this therapy, you need to be compliant with it for months."
Design Clinical Trials to Prove Efficacy and Economic Benefit
ReActiv8 is a promising therapy with compelling clinical results from early testing. However, changing the status quo means answering some tough questions. "The more disruptive your therapy, the more you need to demonstrate how it works and frankly, why it works," Jason shares. That’s why he prioritized two goals in clinical trial design at the outset: proving the concept delivers clinical results and demonstrating its cost-effectiveness to healthcare providers.
Proving efficacy is seldom enough. You must also prove economic benefits and secure reimbursement for widespread adoption. This means getting into the weeds. Instead of just counting how many people feel better, you need to analyze factors like whether the therapy lowers hospital readmission rates, decreases the need for further surgeries, or impacts other costly aspects of patient care. "Our first senior-level hire as we approached FDA approval was our head of reimbursement," Jason shares. He further adds, “Writing the study in a way that foresees ultimate reimbursement as the issue is critical because you can't go back and rerun that study.”
When it comes to building out a financial case, while you’re likely the most passionate party to prove your device’s utility, you’re also probably the most biased. That’s why an independent economic report can build tremendous trust. Jason advises partnering up with third-party experts and having them run an analysis that shows your therapy is either a break-even or a net gain to the system. This bolsters your case and increases the likelihood that insurers will see the value in covering your device.
On that note, it's never too early to start building relationships with the decision-makers at insurance companies. Engaging with medical directors helps tailor studies and evidence to match the criteria these payers use, ultimately improving a therapy's chance of widespread reimbursement.
Jason also emphasizes, “If you introduce a new therapy that copycats an existing therapy, you have instant access to reimbursement in the US. But if you do something new and novel, it's a long process.” Achieving broad insurance coverage is rarely an overnight success. You need to consistently demonstrate cost savings over time, address the questions from different insurers, and have the perseverance for what can often be a long process.
Educating Patients and Winning Over Investors
Disruptive therapies often require you to focus on the long game. You need a shift in patient expectations and to gain the trust of potential investors.
ReActiv8 is a long-term therapy, so it takes a while before patients start seeing results. For it to be successful, patients need to understand that benefits unfold over time and that everyone's recovery journey is different.
That’s why, above all, the ReActiv8 website serves as a channel for patient education. “I don't care if no one can find my name on the website. That's not the point,” Jason shares candidly. Instead, they highlight patient stories on their way to recovery. “The patient who's six months out who can talk about their journey, that's an incredible education pickup for someone,” Jason explains. Similarly, with physicians, he notes that testimonials focusing on patient progress over time are far more impactful than simply sharing that they’ve used the device. Their patient ambassadors are also key players in dispelling misconceptions and setting the right expectations about the therapy.
It’s easy to think that the vast number of chronic low-back pain sufferers and the underserved treatment landscape suggest a slam dunk for investors. However, it’s never the case, especially with disruptive technologies. On top of proving efficacy and educating patients, you also have to convince investors to write sizable checks.
According to Jason, “Can this team do what they say they're going to do?” is the major question in every investor’s mind. If a company needs to raise more funds before achieving broad coverage, it introduces a significant risk factor. Even if they believe you’re going to get broad reimbursement, the question is, “How quickly?” This influences their decision whether to invest now or wait two or three years and see if you come back with milestones in hand. In Mainstay’s case, it took almost a year to earn the credibility they needed. And it was by developing a detailed financial plan and relentlessly executing – hitting their goals consistently, month after month.
Furthermore, Jason notes that investor interest can wax and wane due to their own funding cycles and priorities. That’s another reason for maintaining open communication, because, as Jason explains, "A ‘no’ now may eventually turn into a ‘maybe’, and then a ‘maybe’ can turn into a ‘yes’ over time." His own experience with Mainstay’s recent lead-investor coming through two years after the initial introduction, demonstrates this. “There was an initial meeting and nothing happened for a year. We just kept them up to speed on what we're doing. And then we reengaged toward the middle of last year and they did a ton of work. But it doesn't happen if you write the group off, because timing is everything, not just for the company. Timing is everything for investors, too.” The end result was a $125 million equity financing, an exceptional deal size that validates the company’s work to date and prospects for future growth.
