Succeeding from Failure
In times of economic uncertainty such as this, entrepreneurs and executives launching new products or new companies need to be certain they are maximizing their chances of success. This is one reason why our editors created the online Neurotech Commercialization Workshop [see Conference Report, p6]. In one of the afternoon breakout sessions at the first annual event, this editor led a session devoted to analyzing recent clinical trial failures in the neurotechnology industry. While the regulatory environment at the FDA has improved in recent years, clinical trial sponsors would be well advised to learn whatever lessons they can from some of these failed trials.
Apart from clinical trial failures, other factors like procedural complexity or insufficient capital can lead to a startup’s downfall. Victor Pikov, a neurotechnology industry pioneer and entrepreneur who has assisted Neurotech Reports in our market research activities, recently authored an industry whitepaper that examines failures of neuromodulation startups and clinical trials in the last 20 years. The report, which is available for free to Neurotech Business Report subscribers, looked at 14 failed neuromodulation therapies grouped by stage of commercialization.
“For the last 20 years, the implantable neuromodulation industry has been on a hype-cycle rollercoaster journey, which started with exuberant enthusiasm and inflated company valuations of early 2000s, went into a free fall during the Great Recession, and gradually recovered during the 2010s,” Pikov wrote. “As we reflect on this bumpy journey, it is valuable to take a close look at the therapies that did not make it across the finish line as, according to Henry Ford, ‘failure is only the opportunity more intelligently to begin again.’”
The whitepaper includes three detailed graphics. One table itemizes the firms and the therapies they pursued as well as the time frames and amount of investment involved. A chart calculates average time to failure and investment for each of the four stages of commercialization under study. Pikov graded each of the failed therapies with scores rating the level of complexity of anatomical, physiological, and clinical factors. These ratings, along with a composite complexity index, are summarized in a third table that correlates complexity with the neuromodulation market segment.
Pikov, who has launched his own neuromodulation startup called Medipace Inc., hypothesizes that a poor score on this complexity index could be a good predictor of a new therapy’s probability of failure.
Resources like this offer neurotech entrepreneurs valuable tutelage useful for developing a business plan and avoiding pitfalls. The report is available in the exclusive subscriber area of the Neurotech Reports website.
Editor and Publisher