Medtech startup Endomedix is feeling the excitement and satisfaction that follows five years of hard work, and the company is poised for its next key stage of growth. Led by CEO Richard Russo, a veteran at developing products and building businesses, Endomedix has overcome many of the challenges and early missteps that overwhelm most medical device startups.
Russo came to Endomedix in 2009 after the firm’s initial progress had stalled. He immediately identified core problems and addressed them head-on. This included changing the firm’s business model and the direction of its product development program which eliminated most of the product concepts under development. While building a platform technology, Russo directed Endomedix towards commercializing its first product, a gel spray that controls bleeding during surgery.
One of Endomedix’s investors is a surgeon who emphasizes why their hemostatic gel was chosen to be the company’s first product taken to market. Dr. Paul Heltzer, an obstetrician and gynecologist working in New York, invested in Endomedix specifically because of his own difficult experiences in achieving rapid and consistent cessation of bleeding during surgery. He quickly understood the full potential impact and value of the Endomedix technology.
“Surgeons often deal with slow and inconsistent hemostasis during surgery, which leads to unnecessary blood loss, lengthier procedures, additional hospital costs and the use of additional units of blood,” said Heltzer.
“I invested in Endomedix with one case vividly in my mind: a laparoscopic hysterectomy in a 40 year old women. It took me over an hour to achieve hemostasis, and I was almost forced to convert the closed procedure to an open surgery due to the persistent bleeding.”
Russo and his new team overcame obstacles that medical device start-ups must negotiate if they are to be successful. Medical devices typically require a lengthy development path, have more technical risks and need substantial capital to take the final product all the way through trials and FDA approval. Narrowing their development to one product was critical in moving the company to where it is today.
Said Russo about his decision to focus on a single product, “The mission and development program needed to first address a large market with a clear and significant unmet need, or else the program is not worth the effort and risk.” The spray gel readily met that criteria.
Yet, as Russo chose this narrow product direction, he also needed to resolve a series of legacy legal, IP, technical and capital structure issues to give Endomedix a chance to succeed.
His trial by fire in the first couple of years was nowhere near finished. He moved their lab to its current location in the NJIT Enterprise Development Center business incubator in Newark and built a new development program and team to address the technology challenge of the product performing inconsistently. He gained funding through a combination of investments brought together by one founder, a series of successful SBIR grant applications developed by the other founder, and his own substantial sweat equity investment.
“The sweet spot for a winning surgical technology may be clearly defined, yet be difficult to hit. It must provide superior performance that leads to improved clinical outcomes, reduces costs, reduces risk, and be easier and simpler to use. And we’re in that zone”, states Russo.
Endomedix emerged with a new platform technology capable of supporting the development of several product groups. Multiple patents have already issued in the US and Canada, and Endomedix expects Europe to follow suit.
Their first device used to control surgical bleeding has moved beyond proof of concept to prototype stage. It has successfully undergone controlled animal trial comparing it to the current standard of care. According to Russo, the next major milestone will be the development of a dispenser for the hemostat and biocompatibility testing.
Russo sees a well-positioned company with a dedicated development group supported by a team of directors, investors and entrepreneurs. Their stakeholder investors, most of whom are surgeons, truly recognize the full value of the technology that impacts personal health and wellnessin which they are involved daily. These investors provided the financial boost needed for Endomedix to be within reach of professional investors.
As a result of new leadership and technology successes over the past five years, Endomedix is able to focus exclusively on the forward looking steps of this next critical stage. This is a chasm that all startups must move through and with so many fundamentals hitting on all cylinders, Russo and team feel the excitement of being within reach of market introduction.
