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We have learned a remarkable process that allow us to be highly focused, and we have learned a tool of trade we can now repeat. This has been of tremendous value to us.
Andrew Norris, Principal Investigator BCN Biosciences
Over the last three years the National Science Foundation I-Corps has taught over 700 teams of scientists how to commercialize their technology and how to fail less, increasing their odds for commercial success.
To see if this same curriculum would work for therapeutics, diagnostics, medical devices and digital health, we taught 26 teams at UCSF a life science version of the NSF curriculum. 110 researchers and clinicians, and Principal Investigators got out of the lab and hospital, and talked to 2,355 customers. (Details here)
For the last 10 weeks 19 teams in therapeutics, diagnostics and medical devices from the National Institutes of Health (from four of the largest institutes; NCI, NHBLI, NINDS, and NCATS) have gone through the I-Corps at NIH.
87 researchers and clinicians spoke to 2,120 customers, tested 695 hypotheses and pivoted 215 times. Every team spoke to over 100 customers.
Three Big Questions
The NIH teams weren’t just teams with ideas, they were fully formed companies with CEO’s and Principal Investigators who already had received a $150,000 grant from the NIH. With that SBIR-Phase 1 funding the teams were trying to establish the technical merit, feasibility, and commercial potential of their technology. Many will apply for a Phase II grant of up to $1 million to continue their R&D efforts.
Going into the class we had three questions:
- Could companies who were already pursuing a business model be convinced to revisit their key commercialization hypotheses – and iterate and pivot if needed?
- Was getting the Principal Investigators and CEO out of the building more effective than the traditional NIH model of bringing in outside consultants to do commercialization planning?
- Would our style of being relentlessly direct with senior scientists, who hadn’t had their work questioned in this fashion since their PhD orals, work with the NIH teams?
Evidence-based Translational Medicine
We’ve learned that information from 100 customers is just at the edge of having sufficient data to validate/invalidate a company’s business model hypotheses. As for whether you can/should push scientists past their comfort zone, the evidence is clear – there is no other program that gets teams anywhere close to talking to 100 customers. The reason? For entrepreneurs to get out of the building at this speed and scale is an unnatural act. It’s hard, there are lots of other demands on their time, etc. But we push and cajole hard, (our phrase is we’re relentlessly direct,) knowing that while they might find it uncomfortable the first three days of the class, they come out thanking us.
The experience is demanding but time and again we have seen I-Corps teams transform their business assumptions. This direct interaction with potential users and customers is essential to commercialize science (whether to license the technology or launch a startup.) This process can’t be outsourced. These teams saved years and millions of dollars for themselves, the NIH and the U.S. taxpayer. Evidence is now in-hand that with I-Corps@NIH the NIH has the most effective program for commercializing science.
Lessons Learned Day
Every week of this 10 week class, teams present a summary of what they learned from their customers interviews. For the final presentation each team created a two minute video about their 10-week journey and a 8-minute PowerPoint presentation to tell us where they started, what they learned, how they learned it, and where they’re going. This “Lessons Learned” presentation is much different than a traditional demo day. It gives us a sense of the learning, velocity and trajectory of the teams, rather than a demo day showing us how smart they are at a single point in time.
BCN Biosciences
This video from team BCN Biosciences describes what the intensity, urgency, velocity and trajectory of an I-Corps team felt like. Like a startup it’s relentless.
BCN is developing a drug that increases anti-cancer effect of radiation in lung cancer (and/or reduces normal tissue damage by at least 40%). They were certain their customers were Radiation Oncologists, that MOA data was needed, that they needed to have Phase 1 trial data to license their product, and needed >$5 million and 6 years. After 10 weeks and 100 interviews, they learned that these hypotheses were wrong.
If you can’t see the BCN Biosciences video click here
The I-Corps experience helped the BCN Bioscience team develop an entirely new set set of business model hypotheses – this time validated by customers and partners. The “money slides” for BCN Biosciences are slides 22 and 23.
If you can’t see the BCN Biosciences presentation click here
You Can’t Outsource Customer Discovery
What we hear time and again from the Principal Investigators is “I never would have known this” or “I wouldn’t have understood it if I hadn’t heard it myself.” Up until now the NIH model of commercialization treated a Principal Investigator as someone who can’t be bothered to get out of the building (let alone insist that it’s part of their job in commercialization.) In the 21st century using proxies to get out of the building is like using barbers as surgeons.
Clinacuity
While the Clinacuity video sounds like an ad for customer discovery, listen to what they said then look at their slides. This team really learned outside the building.
If you can’t see the Clinacuity video click here
Clinacuity’s technology automatically extracts data in real-time from clinical notes, (the narrative text documents in a Electronic Health Record,) and provides a summary in real time. Their diagrams of the healthcare customer segment in slides 15-18 were outstanding.
If you can’t see the Clinacuity presentation click here
GigaGen
The GigaGen team – making recombinant gamma globulin – holds the record for customer discovery – 163 customer interviews on multiple continents.
If you can’t see the GigaGen video click here
GigaGen’s learning on customer value proposition and who were the real stakeholders was a revelation. Their next-to-last slide on Activities, Resouces and Partners put the pieces together.
If you can’t see the GigaGen presentation click here
Affinity Therapeutics
Affinity came into class with a drug coated Arterial Venous Graft – graft narrowing is a big problem.
One of things we tell all the teams is that we’re not going to critique their clinical or biological hypotheses. Yet we know that by getting out of the building their interaction with customers might do just that. That’s what happened to Affinity.
If you can’t see the Affinity video click here
Affinity was a great example of a team that pivoted their MVP. They realized they might have a completely new product – Vascular wraps that can reduce graft infection. See slides 17-23.
If you can’t see the Affinity presentation click here
Haro
Haro is making a drug for the treatment of high risk neuroblastoma, the most common extracranial cancer in infancy and childhood. On day 1 of the class I told the team, “Your presentation is different from the others – and not in a good way.” That’s not how I described them in the final presentation.
If you can’t see the Haro video click here
After 120 interviews the Haro found that there are oncology organizations (NCI-funded clinical development partners) that will take Haro’s compound and develop it at their own expense and take it all the way into the clinic. This will save Haro tens of millions of dollars in development cost. See slides 12 and 13.
If you can’t see the Haro presentation click here
Cardiax
Caridax is developing a neural stimulator to treat atrial fibrillation. Their video points out some of the common pitfalls in customer discovery. Great summary from Mark Bates, the Principal Investigator: “You don’t know what you don’t know. Scientific discovery is different than innovation. You as a prospective entrepreneur need this type of systematic vetting and analysis to know the difference.”
If you can’t see the Cardiax video click here
After 80 interviews they realized they were jumping to conclusions and imparting their bias into the process. Take a look at slides 8-11 and see their course correction.
If you can’t see the Cardiax presentation click here
The other 15 presentations were equally impressive. Each and every team stood up and delivered. And in ways that surprised themselves.
The Lean Startup approach (hypotheses testing outside the building,) was the first time clinicians and researchers understood that talking to customers didn’t require sales, marketing or an MBA – that they themselves could do a pretty good first pass. I-Corps at NIH just gave us more evidence that’s true.
The team videos and slides are on SlideShare here.
A Team Effort
This blog post may make it sound like there was no one else in the room but me and the teams. But nothing could be farther from the truth. The I-Corps@NIH teaching team was led by Edmund Pendleton. Allan May/Jonathan Fay taught medical devices, John Blaho/Bob Storey taught diagnostics and Karl Handelsman/Keith McGreggor taught therapeutics. Andre Marquis, Frank Rimalovski and Dean Chang provided additional expertise. Brandy Nagel was our tireless teaching assistant. Jerry Engel is the NSF I-Corps faculty director.
Special thanks to Paul Yock of Stanford Biodesign and Alexander Osterwalder for flying across the country/world to be part of the teaching team.
I created the I-Corps/Lean LaunchPad® syllabus/curriculum, and with guidance from Allan May, Karl Handelsman Abhas Gupta and Todd Morrill adapted it for Life Sciences/Health Care/Digital Health. The team from VentureWell provided the logistical support. The I-Corps program is run by the National Science Foundation (Babu Dasgupta, Don Millard and Anita LaSalle.) And of course none of this would be possible without the tremendous and enthusiastic support and encouragement of Michael Weingarten the director of the NIH/NCI SBIR program and his team.
Lessons Learned
- The I-Corps/Lean LaunchPad curriculum works for therapeutics, diagnostics and device teams
- Talking to 100 customers not only affected teams’ commercial hypotheses but also their biological and clinical assumptions
- These teams saved years and millions of dollars for themselves, the NIH and the U.S. taxpayer
- Evidence is now in-hand that the NIH has the most effective program for commercializing science
- In the 21st century using proxies to get out of the building is like using barbers as surgeons
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Filed under: Customer Development, Investment Readiness Level, Lean LaunchPad, Life Sciences (NIH), NIH (National Institutes of Health), Science and Industrial Policy, Teaching |
Great news! A lot of biotech startups will benefit from this very disciplined way of leveraging NIH’s expertise.
Good to see NIH adopt this program and approach for SBIR Phase I awardees. It should yield stronger candidates for SBIR Phase II funding and for NIH’s flagship Commercialization Assistance Program (NIH CAP) targeting Phase II awardees, designed and managed by Larta since 2004 in partnership with the Agency. We have seen remarkable outcomes in orienting company founders enrolled in the NIH CAP to “learn by doing,” testing and validating their business and revenue model assumptions with industry customers and partners. We refer to our approach as a “body contact sport”. The results of this approach are noteworthy: alumni have raised $580M in follow-on funding, many licensing and acquisition deals have been inked, and companies exiting from the program have testified to their business strength and viability as a result of the CAP. So indeed, NIH may lay claim to having the best end-to-end commercialization program in the country.