The Relentless Pursuit of Innovation: Mike Connolly on Building Breakthrough Medical Devices

Summary

00:00 - Introduction to Mike Connolly's Impressive Background

02:52 - Teaching Physics and Its Impact

05:59 - The Journey of Medical Device Startups

08:56 - Persistence in the Face of Challenges

11:53 - Innovations in Dialysis Access Devices

14:51 - Understanding the Market Needs

17:47 - Navigating Regulatory and Reimbursement Challenges

21:04 - The Importance of Data in Medical Devices

23:48 - Iterative Development and Team Dynamics

26:44 - Future Milestones and Focus Areas

29:37 - Advice for Scaling CEOs

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Full Transcript

Jeff Holman (00:01.228)

Welcome back to the breakout CEO podcast. I'm Jeff Holman hosting the show and I'm here today with Mike Connolly. I have an intro with Mike and it might be one of the more impressive intros that I've seen. Not that we don't have a lot of impressive people, but I don't know that I've had anybody else who's been the Naval Academy, engineering at MIT, MBA at Stanford, part of venture capital, a couple exits in your background.

now running your own business and some other stuff I've missed in there. Mike, welcome to the show.

Mike Connolly (00:35.919)

Thanks. Glad to be here.

Jeff Holman (00:37.9)

Yeah, well, I want to ask you, I have two questions to kind of intro this before we dig into anything else. Out of your background, what's your favorite part? There's a lot in there. Is there one that sticks out to you that like, I love that part.

Mike Connolly (00:50.864)

I don't know, probably the most unique experience I had was getting invited to go back and teach physics at the U.S. Naval Academy. Some years after I graduated and after I served on the ship, they brought me back and teaching physics was a blast.

Jeff Holman (01:03.768)

That's very cool. Very cool. I had a few physics classes on my way through high school in engineering and I can't say a lot of it stuck with me. Certainly not enough to teach anybody else. In fact, I don't think my kids liked it when I tried to teach them. wasn't, I maybe wasn't the patient dad that I should have been. But.

Mike Connolly (01:20.016)

Well, the fun thing about it was I could bring in, I create my own experiments to bring into class every day to keep, you know, make things go bang and sparks fly and keep everybody interested.

Jeff Holman (01:31.426)

That's awesome. You know, I was just the last guest I had on Spencer Harrison. He was, he and I talked about a physics teacher because he and I grew up together. He's now teaching in, you know, about creativity and culture and organizational behavior in France. But we spoke specifically about our physics teacher, Mr. Jackson at Viewmont High School in Bountiful, Utah, because he did exactly that. He brought

physics to life for us. And it was, I mean, it was so impactful that 30 years later, we're still talking about it. that's so cool. So you've

Mike Connolly (02:06.255)

One of the most influential physicists of our time actually measured the speed of light and showed it was the same in all directions, regardless of Earth's travel through the ether. That led directly to Einstein's discovery of general relativity. This was a physics instructor who preceded me by about 120 years at Naval Academy.

Jeff Holman (02:31.951)

wow, that was...

Mike Connolly (02:32.079)

So got to go in the store room and find his experiment sitting there on his shelf.

Jeff Holman (02:37.25)

That was, so you're saying the one that did the experiment leading to Einstein's discovery of the theory of relativity, excuse me, was you followed him in teaching at the Naval Academy. wow.

Mike Connolly (02:48.558)

Yeah, yep, he was a junior naval officer, invited back to teach like I'd been.

Jeff Holman (02:55.246)

Wow, that's so cool. It's fun to see how these connections all, I mean, we're just all part of one big community here and that's a pretty cool connection. I can see why that's a highlight in your background here. The other question I wanna ask you Mike is, for having done all this stuff over the last 30, 35 years or more, what is it that keeps you motivated? Because being in this industry, doing startups, working with startups,

It's it takes a lot of energy. What is it that keeps you going day to day?

Mike Connolly (03:28.911)

I have a sense of wanting to do good things for people when I joined the military that continued when I got out, which caused me to look for medical device industry work as soon as I got out of the Navy and got my MBA. So my first job was in a surgical laser company and the founder of that company was a physician entrepreneur who asked me to come help him start another company. And we wound up starting four or five companies together.

three of which have had access to date. And I've just continued in that vein. I want to do things that I feel like is directly helping people. And as you know, it takes a long time to get a medical device to market. So it's not as instantly gratifying as a software development or AI type thing nowadays. But you definitely know it's impacting people's lives when it does make it to market with a medical device that's proven to do.

better than existing techniques.

Jeff Holman (04:29.323)

Yeah, that's really cool. mean, and to do several of those with multiples reaching market and exiting, that's, because like you said, it does take a really long time. I've worked with some startups that are, you know, they've been in that process for years and years, maybe decades, it feels like sometimes. So to have multiple that are going through the process successfully in, you know, just one career, that's very impressive. Tell me a little bit about some of those. What were some of the highlights along the way for you as you were, you know,

starting those companies, working with different people, finding that technology, how did that all come about for you?

Mike Connolly (05:05.998)

So the first company that I co-founded with this traditional entrepreneur Rodney Perkins was it became what was called Novosept. And it's just a fascinating trail that startups follow. And the most important element is persistence. That's what I learned working on these different startups. Because Novosept started off with a totally different business plan.

focused on a technology to use little tiny endoscopes to look in tiny joints like the fingers and couldn't raise money at some point. So they said, okay, you we have to figure out do we shut down or we go do something else. And at the time I was saying, well, you know, if we look at women's health, there's a lot of hysterectomy is being done for bleeding, which kind of seems like hitting a fly with a sledgehammer.

And so the company started focusing on some very smart, technical people there started focusing on ways to address that issue. And what they came up with was a electrosurgical method where you insert something vaginally without any incisions and expand it. And then using radio frequency, you ablate the very thin inner lining of the uterus and it saves women having to go through hysterectomy. And it's now, I forget how many millions, maybe three or four million women have had it done.

It's definitely a market share leader. Eventually got bought by Hologic, by Cytic, then got bought by Hologic. So that was probably my first real lesson in persistence because it took time and the restart was very demoralizing, but the founding CTO of the company stayed persistent and came up with a great product.

Jeff Holman (06:56.269)

So what is that? I'm really curious, I mean, that's a theme among startup and scaling CEOs. You got to keep going. You got to get past the failures till you find success, because everybody goes through iterations. Everybody has to pivot. Very few people hit success the first time around. For you in that company, what did that look like? Because I imagine, as you're doing this, say, well, we've got this cool technology. And you kind of use that technology and say, well, maybe apply it here. Maybe apply it there. Maybe apply it there.

And other people, it's more about the team. It's like, well, you know, we've got a team and the team says, well, I've got this experience, I'll draw from that. I'll get this experience, I'll draw from that. cause a pivot from, you said, you know, image, I think you said imaging finger joints to saving women from hysterectomies. Like that doesn't seem like there's a direct connection there. What was that path like?

Mike Connolly (07:40.556)

A little imaging scopes.

Mike Connolly (07:49.645)

No, the physician entrepreneur I was partnered with said, know, women's health seems like an under-served area. And then I started looking at what are the problem areas in women's health and hysterectomy really stuck out. And so, the more we researched it, the more we realized that there's an opportunity there.

Jeff Holman (08:10.049)

So did the technology from the imaging finger joints carry through to the hysterectomy or did you guys just go total, okay, so there wasn't like.

Mike Connolly (08:17.529)

and totally different technology. There was some carry through because that company, the original company was Invision Surgical Systems. It's split into two companies. One was Noviset with a hysterectomy treatment. The other was Pulmonix with, at the time, using some of that imaging technology to image laryngoscopes. That's what a anesthesiologist uses when he's inserting an airway for like part of surgery. And that company, Pulmonix,

actually want to completely change into a different area later on too, lung volume reduction surgery for emphysema, and it went public finally. It took a long time, but it went public three or four years ago.

Jeff Holman (08:59.721)

wow, wow. And that was one of the other, so you were involved in both of those to some extent, the noiseptium pulmonics.

Mike Connolly (09:04.906)

Yeah, very early stage, early stages of their development. I said there's a similar path that HelioX has followed. It spun out of University of Washington a number of years ago with this novel platform biomaterial technology, which it's kind of magical. Any implant device you coat with it, you can mostly do a way of form by reaction. Form by reaction is the body's reaction to anything which goes under the skin.

And what the body does, it tends to wall it off with scar tissue and that can impair the device's function. It can also trap bacteria between that scar layer and the implant, leading to long-term problems with infection like they're seeing with breast implants recently. So lots of different potential applications. The company started this before I joined, started with the hypothesis that large companies are going to want to this for their devices. We can license this out, build a business model that way.

Jeff Holman (09:43.255)

Okay.

Jeff Holman (10:00.238)

Mm-hmm.

Mike Connolly (10:02.892)

But fairly quickly found out that, well, big companies want to see it in animals, then they want to see it in people, then they want to see it FDA approved before they take the risk because big companies just aren't very good at commercializing novel technology. so, Helionics initially, I'm not even sure I recall how they got focused on glaucoma as an application of their device. I think it was probably just a physician they talked to that said, hey, we have this problem with glaucoma where

pressure builds up inside the eye and they put in little drains to try and drain the pressure off in one high pressure or low pressure area, but the drains get plugged up and get scar tissue around them and plugs them up. And so the solution was to use a sliver of our biomaterial that we call star material. You implant it in the eye and it drains that high pressure fluid and it doesn't get scarred up. So it has long-term lasting benefits. Helionx actually spun that out as an independent company. It's now been through

its own venture rounds and it's completely an event company in Europe that's implanted the license over 7,000 people. So it's doing, you know, it's really got a lot of human experience. Meanwhile, Heliox Proper continued to look at other applications and settled some years ago on, you know, going after vascular grafts and phlegmatic blood vessels. Again, you know, as a physician who pointed out, there's a huge problem here with patients who have kidney failure. They have to get dialysis three times a week to filter waste stream of blood in order to survive.

And the biggest unselfish problem is maintaining access to the bloodstream because the easily accessible blood vessels are too small. And one way that they do that to create a route that they can get this high flow rate to the dialysis machine in the back is to implant a synthetic blood vessel under the skin of the arm, basically short-circuiting an artery to a vein so you get this immediate high flow rate. And when you're ready to do dialysis, you poke in one of these dialysis needles, it circulates.

blood to the dialysis machine. Clean blood comes back through another dialysis needle, also poked in through the skin, into the graft. So that's the state of the art. And there are on market grafts to do this, or synthetic blood vessels, but the problem is they plug up and they get infected. Number one and two causes of failure are these grafts, and it's a really high rate of failure. 60 % will plug up within a year without some sort of intervention. About 10 % will get infected every year.

Jeff Holman (12:17.356)

Okay.

Mike Connolly (12:29.103)

And that can be an emergency situation where you have to go in and remove the graph. Yeah.

Jeff Holman (12:31.405)

Because this is the graft or this is something that's been implanted, right? And so when it gets the blockage, I think you called it an occlusion at one point, right? Or it gets infected. Do they have to replace it? Is that how you fix it normally?

Mike Connolly (12:46.09)

So if it gets blocked or partially blocked, they'll go in with an antioplasty balloon to open it up. And sometimes they'll leave a stent in there, which is basically just a structural metallic thing to keep the graft open. So you can do that maybe four five times. And then typically you can't reopen the graft. And then they do have to abandon it. And typically they'll go to the other arm and start over again. But it's scary because by the time you...

by the time the second arm goes bad, then the patient might be stuck for life on a catheter. And a catheter is what everybody wants to avoid. This is a tube that's permanently placed through your chest vault, directly into the central vein and the heart. Very high risk of infection and death, and yet still widely used to develop problems with the other methods, the graft. And there's a third method I didn't mention, which is to directly connect an artery to a vein. It's called a fistula.

And there's a lot of problems with that. The fistula often you have to wait four to six months for the blood vessels to enlarge enough to use it for dialysis. And often it never happens and you start to collect it with another surgery. So those are the three methods, the catheter, the fistula, and the graft. And all three are really problematic now. The biggest problem really is maintaining access to the bloodstream for dialysis.

Jeff Holman (13:59.502)

And this is something just to maybe step back for a minute, because I was having a conversation with a friend, a really good friend, another childhood friend. I tried to stay in touch with a few people and he was telling me about some health issues he's having. he said, you know, ultimately there's, know, he's a doctor and so he's, he's measuring his own, like, you know, uh, I don't know what you call it. He's watching his own symptoms and he's taking some of his own measurements. He's like, Hey, this is an issue. He's getting with a specialist, but he told me,

I'm at like stage three liver failure, he said. I said, I'm not a doctor, so I'm like, what does that mean? He said, well, if it goes to stage four, that means your liver's dead and you're pretty much on dialysis the rest of your life. I'm like, what does that mean? Because I haven't seen it before. And he's like, yeah, that's three times a week, three hours a session. got to go sit and you have your blood dialy.

the dialysis done so you don't die. This is a serious thing for people. You're dealing with life and death.

Mike Connolly (14:55.72)

Yeah.

Mike Connolly (15:00.116)

Yeah, it's really serious. It's kidney failure rather than liver failure. yeah, that's the situation. There's well over half a million people in the country that are on dialysis. And it costs the healthcare system a stunning amount of money. It's 50 billion a year we spend on these folks. That's over $100,000 per patient per year. It includes 7 % of Medicare's entire budget just for dialysis.

Jeff Holman (15:05.46)

sorry, thank you.

Mike Connolly (15:26.96)

excluding all of the conditions that Medicare covers. So it's kind of breaking the bank here and worldwide, because this is definitely not just a US problem. The US isn't even in the top, not even in the top three in terms of incidence of dialysis, and probably a lot lower than that in terms of, if you look at total incidence of kidney failure as well.

Jeff Holman (15:43.65)

Really.

Jeff Holman (15:49.966)

That's interesting. But I would assume that the US has some of the most advanced techniques for this. that true? Are there other countries with higher incidence rates that have maybe are further ahead in the technology too?

Mike Connolly (16:04.264)

So nobody's coming up with a good way to prevent kidney failure. know, Zempik is out there, which people have thought might reduce the incidence of kidney failure, but the dialysis clinics, the largest dialysis clinics in the world are saying no, it might actually increase the number of patients with kidney failure because patients with chronic kidney disease will live longer and a larger number will transition to kidney failure. So as far as technology, we have

Jeff Holman (16:29.549)

Mm.

Mike Connolly (16:33.105)

good dialysis machines, we don't have good ways to maintain basket access and nobody else does either.

Jeff Holman (16:40.469)

Interesting. Well, so I want to step back a little bit then when you guys got into this because you've your other you've done your other businesses Like did you go at this saying I want to solve a big problem I want you know or because a lot of a lot of startup talk would be hey identify the biggest market available I get the feeling that you're you know, that might be part of your equation But it seems to me like you're also saying hey, where can I really make? impact and maybe those there's a high correlation between

know, and really kind of impact in humanity. Did you have a specific way that you looked at this and said, how are we going to get here? Where are going to go to join this company?

Mike Connolly (17:22.684)

Yeah, well, when you look at market opportunities, there's two things. How big is the market? How big is the need? In the case of dialysis, it's not necessarily the biggest market in the world, but the need is huge. And when you look at a market this size, I can't think of any other market opportunity this size that has such a huge need, i.e. the existing solutions are so unsatisfactory and patients' lives are drastically affected, mortality as well as sickness.

hospitalizations are really through the roof for dialysis patients.

Jeff Holman (17:55.553)

Hmm. Yeah, that's a great point. Thank you for bringing that up. A reminder that the need is, I talk about something similar with legal risk when I talk to people, I'm like, hey, there's the risk that it might happen and that might be high or low. But then when something does happen, there's the risk that it's a huge problem or maybe not a huge problem, right? What's the gravity of the problem versus the likelihood of the problem happening? It sounds like that's kind of what you're talking about there.

Mike Connolly (18:22.778)

Yeah, you know, another way looking at it is that you risk going to market and trying to prove that you're better than the other devices. The bar is lot lower when all the other devices are on the floor right now in terms of their performance. So, you know, we do have some pretty amazing results out to 24 months now with our graft in our current clinical trial. But again, the bar is low. You know, we're way above

control graphs that we use. We compare it against the leading on market graph and then we compare it against literature, which is meta-analyses of all the average performance of all the graphs on the market.

Jeff Holman (19:01.133)

Hmm. That's a, it reminds me of a story from when I, when I was early, it was probably 15 or 16 years ago. Somebody approached me and said, Hey, we've got a hospital. They want us to work on a project for them. They want us to commercialize it. Come on board, help us out. And we thought we had this like locked down market for this product, saving children and NICUs from VAP, I think it was.

I'd have to remember what it all meant, but people who were being intubated, it was whether or not you used a solution in your throat, a water or essentially a salt solution in your throat. And we thought, well, we have this built-in market, right? We're gonna go, we're gonna develop this, and we're turn around sell it to the people who told us to develop it. And what we found was a couple of interesting things that we identified as a problem. What they identified as a problem and asked us to help solve was...

was different than what their purchasing department was willing to do. So we ran into this really counterintuitive problem for us, even though we solved their problem, we made a lab solution at scale that we could sell back to them. We found out that they would say, we don't have that problem because people don't die in our hospital from that issue. Now we think they did, but they didn't report it that way, right?

And so it's what kind of do you run into some of those types of issues with what you're dealing with where there's like the data is there, but the market maybe acts a little differently than the data that you see.

Mike Connolly (20:42.662)

Yeah, absolutely. And there's a lot of layers to that problem. One relates to reimbursement. know, healthcare is oddity because it's not enough to just get regulatory approval. know, the FDA says whether or not your device is safe and effective and can be sold. But then you have to get insurers to pay for it because if you don't, you know, again, if it's dramatically successful enough and superior enough, maybe, you you can get it sold without the reimbursement.

reimbursement sure helps. know, the hospitals, because the hospitals look at, you know, are we going to lose money in buying your device and implanting it or, you know, they may be willing to do that if it saves patients' lives or has a huge impact on quality of life. But it's much easier to sell if there's reimbursement. So that's one layer. You know, another layer is the data interpretation itself. You know, I feel for physicians trying to make decisions based on the data that comes out.

for lot of devices. Things get approved just because they might be very, very slightly better than something else. You see that a lot in drugs, you see it somewhat in devices as well where they might have a marginal benefit or maybe there's really not a net benefit but you have to sort of delve into the statistics to understand it. The gold standard has always been a randomized controlled trial where you

Jeff Holman (21:56.768)

Mm-hmm.

Mike Connolly (22:11.085)

have two sets of patients, one gets your treatment, one gets the standard treatment that's on the market now, and you pick the patients by random, who gets what, and everybody's blinded, and then you see how you stack up. And those trials are fairly common in drugs. They're very expensive to do in devices, particularly when you have to follow patients for a long period like we do. That said, we are planning to do randomized controlled trials. That's what we've done prior, and we're getting ready to do our FDA Pivotal Trial.

which is what we do immediately prior to submitting for approval. And we were voluntarily doing a randomized controlled trial because we think that's really important.

Jeff Holman (22:48.736)

make it leave there. I mean, this is a really involved process, right? And a lot of stuff, I'm sure can go right and a lot of stuff can go wrong or sideways on you. I'm curious in this process, as you've been doing this, what kind of issues have you or your team run into that kind of, you know, might've seemed like maybe insurmountable obstacles? I'd love to hear kind of how maybe running into the one of those walls led to an opportunity to,

reflect on what you're doing and maybe have a transition or inflection and say, well, maybe we need to do this and kind of lead to one of those breakout moments in the company.

Mike Connolly (23:25.657)

Yeah.

Yeah. So, you know, I mentioned one example that, you know, they started off with a licensing model, business model and found out, you know, we really needed to develop the technology and get it all the way through clinical data and ideally approval before, you know, somebody's going to buy the technology for a given application. And increasingly the company realized it had to focus on one indication at a time. And so glaucoma was that first indication. Once we spun that out, then the vascular graph began the next indication.

But lots of challenges. We're very good at knowing what our star biomaterial can do and what it can't do and how to apply it. We have lots of know-how as well as patents in that regard. But as soon as you start to marry it with something else, in this case, we're putting it on the outside of a conventional vascular graft made of expanded Teflon. That's what the vast majority of grafts currently on the market are made of. So we're not changing the blood contact surface to the inside of the graft.

it's the outside where we put our material. And there's just all kinds of subtleties in how our material meshes with that bonds to the underlying expanded Teflon and what the structure of that EPTFE or expanded Teflon corn needs to be, how you apply our material, and then how you implant it. It uses a conventional surgical implant technique, but we do have to

wet our graft before you implant it. Basically, you get all the air bubbles out of these micropore structure that consists of our star biomaterials. The magic about it is that it's all these precisely dimensioned pores that are connected to each other that encourage capillaries to grow into the outside of the star material. That's what breaks up the formation of scar tissue. But you do have to get the air bubbles out. the surgeon has to wet it and heparize saline before he implants it. And how long does he wet it for? Too much isn't good. Too little is not good.

Mike Connolly (25:25.486)

So just lots and lots of things that we discovered. First in bench studies and in large animal studies, lots of large animal studies. And then in the course of our first two clinical trials where we had to iterate minor changes to the graph that made big changes in performance. And by the third time we did the clinical trial, which is an ongoing study now, we're getting really good results.

Jeff Holman (25:51.499)

that's fantastic.

Mike Connolly (25:52.483)

So again, lesson learned is persistence. We could have thrown up our hands after the first trial and said, wow, this isn't working. Let's go back to the drawing board and look at a different application. But I give the team a lot of credit, particularly our founding chief technology officer, who said, no, we can fix this. I know how to do this. And we just kept coming back and got it right. I think that makes us somewhat unique.

Jeff Holman (26:14.368)

Yeah. I was just going to ask about your team. Yeah. Go ahead.

Mike Connolly (26:21.739)

Other companies in medical devices and even in our field, dialysis access devices that have not really taken that iterative approach. They've taken their first device and just said, okay, let's keep this constant. Now let's do massive clinical studies, get it approved and hit the market with it. And continued in that, let the momentum continue to carry them in that direction even when their data has not been good.

And part of that is because they raised a ton of money upfront, expanded their team to this really high burn rate. And I think they're just reluctant to say, we got to go back to the drawing board once they've ramped their burn rate like that. In contrast, we've got just eight people, really focused team and willing to go back to the drawing board when necessary to get it right.

Jeff Holman (26:56.086)

Hmm.

Jeff Holman (27:11.82)

What do you think it is about your team that allows that to happen? mean, size allows you to move faster, right? And maybe there's that lack of kind of open commitment to, hey, we've raised a ton of money on this technology. And so there's that commitment level there. But is there something about how your team operates that just maintains an openness to the data and what the data says? Or what is it about your team that's different?

Mike Connolly (27:37.633)

Yeah, I think the team is very focused on what's the data telling them and not trying to put their spin on it. There is a tendency to want to say our stuff is great and everything we do is perfect. The team is just very honest with ourselves, assessing the data as it goes. Nothing's perfect and that's an important thing to know because when you go into the human body,

Nothing is predictable, 100 % predictable. But you can assess, this better than what's out there? Is it a lot better than what's out there? And that's what we try to do.

Jeff Holman (28:20.94)

Yeah. So where are you taking the company from here? What are the big milestones? You mentioned a couple things doing the randomized trial, if you could call it, going for FDA approval. Do you have, what's on your timeline?

Mike Connolly (28:32.086)

Yeah. So we're going to start the pivotal trial in first quarter next year. Pivotal trial is going to be 75 patients randomized to 50 with our StarGraft device. That's what we call our synthetic blood vessel. And 25 using the leading on market graft. And again, they'll be randomized which patients get which. We'll follow those patients for a minimum of six months before we submit to the FDA for approval.

we're what's known as a 510K path in the FDA, which is a faster than two paths for devices. So, you the FDA has 90 days to review our application once we submit. We think we can get FDA clearance by second half of 2027. And at that point, we'll be on the market. We will continue, however, to do clinical data post-clearance, post-FDA approval, because we think that's important to accelerate market adoption and ultimately grow the valuation of the company. You know, the more patients

you can show data on the more committed the data is. And again, there's been a lot of noise in our space in terms of people doing what's known as a single-armor study without controls that look great, but then those results never panned out when you got into the real world. And so we want to make sure people understand that we're different.

Jeff Holman (29:49.165)

Yeah. How do you keep your focus to all this? Because I talked to some other CEOs and they're like, man, I've got ADHD and I've got, you know, we're trying to hit a hundred million in revenue or those don't necessarily go together those two, but you know, these really kind of fast paced, energetic, like we're going to grow at all costs, whether it's bootstrapped or VC, we're just on this kind of tear. And that's tough to do in your field and to keep your team.

focused throughout all of it. I assume it's a different team dynamic than hire a bunch of dev software developers, launch the product, iterate it, launch it. We'll have three products launched in the next six months.

Mike Connolly (30:31.935)

Yeah, so we've had to keep our focus on the Vascular Graph for the last several years. We do have a product pipeline with a bunch of other really exciting and planable devices that leverage our platform biometeorology, but we've got a lot of data for different applications in this product pipeline. But we've had to focus the last several years on really just the graph, get this over the line before we go back to the pipeline products. Yeah, focus is...

the key to success in startups.

Jeff Holman (31:06.294)

Well, let me just say on that point because I think you did, you just nailed it. I've seen some other CEOs who don't have that same focus and maybe that is what I'm thinking of when I think of this high energy kind of all over the place. But that's sometimes where moving too fast leads to failure, breaks things beyond repair. And you can't do that in your industry, right?

Mike Connolly (31:25.908)

Yeah, yeah. Well, people do it. And again, I would look at other people in the industry, in our industry who are doing that, that they're simultaneously trying to pursue, you know, four, five, six different products in their pipeline, you know, take them through a preclinical and clinical stage and, and drag them along with their primary product without having to the primary product works. Yes. And they're all based on the same technology. So

It's rocking a hard place for them. They've spent a lot of money on these different applications and they improved that and they work better than what's on the market yet.

Jeff Holman (32:04.612)

They're doubling, tripling, quadrupling down on on unproven technology. Super interesting. What would you say, just kind of a final question here for you. I'm curious because you're, you you've been through this for a while. You've seen this, you've seen the highs and lows, I'm sure. You've seen some big successes happen from the work that you've done. What would you advise other people, other scaling CEOs?

Mike Connolly (32:07.732)

Yeah. Yeah.

Jeff Holman (32:32.534)

to keep in mind as they're going through this journey.

Mike Connolly (32:36.863)

I guess it depends on what stage they're at. Obviously most of my experience has been the earlier stage getting a device from concept up to clinicals and to the market. And it takes singular focus and it takes real resilience when you face adversity because you're going to face a lot of adversity. Again, the human body is highly unpredictable. You can have the best theories of how things are to work. It can look like it's working.

great in a bench, can look like it's working great in different animal models, and then you get to humans and wow, it just blows up. But you gotta have the resilience to stick with it. And of course you have to have the financial flexibility to do that as well. So you always have to hedge your bets financially to make sure you're able to recover if and when you do hit roadblocks.

Jeff Holman (33:29.642)

Yeah, there's probably a whole other discussion to have about de-risking this type of venture compared to other ventures that maybe move fast and don't have to go so deep. we'll have to save that one for another day. Mike, it's been really good having you on the show here. If there's somebody that was listening to this that was maybe interested in your technology or maybe they're on path of collision with you, a good collision, you know.

somebody you were hoping to connect with, who would be your ideal connection to meet in the next six to 12 months?

Mike Connolly (34:09.502)

I'm always interested to meet people in the industry. I talked with one person recently who was involved with what's called a managed care organization for dialysis patients. And he reassured me that capitation is coming. And capitation is where they, in particular in the field of dialysis, capitation is when Medicare pays one payment to some insurer who then covers everything that happens to the dialysis patient.

even if it's not related necessarily to dialysis. And that's important because there's a lot of companies out there nowadays that are making a ton of money off of doing interventions like the angioplasty, the stenting, repeat surgeries, hospitalizations, which are all bad for the patient and hugely expensive to the system. But our system, our healthcare system is not yet incentivized away from that. And to the extent that we can offer a device which

obviates the need for lot these interventions. It's important to that insurers recognize that and that Medicare recognizes that and starts incentivizing the providers to use our device. And this is a problem, you know, I think, you know, pretty much globally in the medical device industry that, you know, the best performance doesn't necessarily win if it goes against the financial incentives that exist in the market due to our strange insurance system.

Because doctors are making a lot of money off of doing those interventions, hospitals make a lot of money off of it, and of course the companies that sell the interventions are making a lot of money too.

Jeff Holman (35:35.947)

Yeah.

Jeff Holman (35:45.74)

And it may or may not be the best approach for the patients, it sounds like. it's fascinating. You're way beyond my level and expertise here. And I appreciate you coming on the show to share a lot of that with me today. I think our audience is gonna draw some insights from this too. It's always great to see people who've been down the path, they're ahead a little bit further than other people. They've seen around those corners a little bit more than...

Mike Connolly (35:50.013)

Yeah, no it's not.

Jeff Holman (36:13.834)

other people that are willing to share that with the network. So that's a benefit that our audience gets by having you on the show today, Mike. Thank you so much for coming on and wish you the best with your company. And if there's something we can do to connect you or help you reach those milestones you're working towards, we're happy to do that.

Mike Connolly (36:33.329)

Thanks, Jeff. Enjoy talking with you.

Jeff Holman (36:35.116)

Yeah, it's been fun. And for our audience, thanks again for joining us on the breakout CEO podcast today. I had a great time. We'll see you later.

Jeff Holman (36:47.392)

this stopped.