35 Technology innovation in plastic surgery
A practical guide for the surgeon innovator
This chapter will familiarize the surgeon-innovator with a systematic approach to innovation. This process includes idea formation, valuation, funding, intellectual property, institutional technology transfer, the FDA regulatory process, and conflicts of interest.
Innovation drives the advancement of medicine. Recent medical innovations, from evidence-based medicine to robotic and endoscopic surgery, have revolutionized the practice of medicine. In the surgical arena, innovation has lead to increasingly effective and less invasive therapies resulting in better patient care.
What separates invention from innovation? Invention is the formulation of new ideas for products or processes, while innovation creates the application of new inventions. In business, invention uses cash to create a product and innovation takes a product and creates cash. In medicine, invention is an attempt to create a solution to a clinical problem and innovation drives the solution to the bedside – analogous to the process by which translational research applies basic science to clinical problems.1
Plastic surgeons, by trade, are innovators. We devise innovative solutions to difficult problems. Our competitive advantage lies in innovation. Unlike the neurosurgeon or cardiologist, we do not lay claim to any one part of the body.2 In the hospital we are called upon for our creative solutions to the neurosurgeon’s need for calvarial reconstruction; the cardiac surgeon’s need for chest wall reconstruction, and the orthopedic surgeon’s need for hardware coverage. Our innovative spirit transcends beyond innovative surgical methods and encompasses innovation of novel technologies as well. Historically, microsurgery, distraction osteogenesis, tissue expansion, endoscopic plastic surgery, liposuction and laser technology have all served as platforms to expanding the scope of our practice, as well as expanding the scope of what we can offer our patients.3
The expansive breath of plastic surgery exposes our field to multiple competing subspecialists. Dermatologists, otolaryngologists, ophthalmologists, obstetricians and internists are increasingly involved in aesthetic surgery. Similarly, general surgeons are competing for abdominal wall reconstruction, breast reconstruction, and wound healing. Otolaryngologists compete for head and neck reconstruction. Orthopedic surgeons compete for hand cases. Each of these fields involves important new innovations, and subsequently opportunities for patient care, research, and revenue. Aesthetic surgery is riddled with novel technologies including skin resurfacing techniques, noninvasive body contouring, injectables, and laser therapy. The attractive revenue stream in this cash-based field is obvious and draws in more and more competition. Similarly, abdominal wall reconstruction has been revolutionized by the introduction of new biomaterials. Breast reconstruction is changing with the introduction of new breast implants. The field of wound healing has dramatically changed with negative pressure wound therapy. Head and neck reconstruction has seen the introduction of bioabsorbable plates, screws and alloplastic bone substitutes, while PyroCarbon arthroplasty and artificial nerve conduits continue to expand the offerings of hand surgery. Innovation is the sustainable competitive advantage for plastic surgeons in this competitive clinical reality.
Today, however, the arena of medical innovation is far more complex than it was 50 years ago. There is more scrutiny from the US Food and Drug Administration, an exponential growth in the number of patents filed and more complexity in regulatory pathways for new medical products. In the setting of a healthcare and economic crisis, it is harder to justify increased development expenses with increased competition for limited investment funds. When the surgeon is asked to innovate, he/she also faces a plethora of challenges unique to the surgeon innovator including conflict of interest concerns and navigating within the confines of the intellectual property claims of universities.4 The challenges faced by today’s surgeon innovator are captured well by Machiavelli’s The Prince: “There’s nothing more difficult to plan, nor more dubious of success, nor more dangerous to manage than the creation of a new order of things. Whenever his enemies have the ability to attack the innovator, they will do so with a passion of partisans while others defend him sluggishly so that the innovator and his party are likely to be vulnerable.” The enterprise of surgical innovation may receive little support and face many barriers, however it can create new technologies that may revolutionize a field and impact millions of patients. To overcome today’s barrier’s to surgical innovation, we must create and use a systematic approach to translate ideas based on a human problem into a product that can change clinical practice.5 This chapter sets out to discuss a systematic approach to surgical innovation and gives a few examples of new technologies in our field.
Mark Twain said, “The name of the greatest of all inventors is accident.” In 1957, Mason Sones accidently injected the right coronary artery with dye, he immediately recognized the problem and pulled the catheter out while the injection of dye continued. He later said, “That day I realized that I had discovered something very important.” He then went on to refine the technique that led to coronary angiography. On the other hand, Plato’s frequently cited proverb, “necessity in the mother of invention” hints that innovation certainly does not need to rely on an accidental discovery.
Today, there are calculated and systematic innovation paradigms that start with the identification of a clinical problem. The problem should be an unmet clinical need. The scientific knowledge in the arena and the limitations of the current solutions should then be explored. The clinical problem can be taken to the laboratory or into multidisciplinary think boxes where a solution is systematically developed, with the hope of translating it back to the operating room. Robert Frost thought that ideas are feats of association, “Having what is in front of you brings up something in your mind that you almost didn’t know you knew.” This paradigm of discovery may describe why the majority of surgical devices are rooted in the ideas of observant surgeons. The timeless story of Dr Thomas Fogarty’s development of the Fogarty catheter started with a defined clinical problem and was assisted with “feats of association”. Fogarty was a scrub technician and witnessed acute limb loss as a result of surgery to remove blood clots. As a medical student of the University of Cincinnati, he started to work on a solution to the clinical problem he had identified years previously. In his garage, he developed a balloon on the tip of a catheter that could be inserted through a small access incision and passed through the artery beyond the blockage. Once past the blockage, the balloon could be inflated and the clot dragged out of the artery. His ability to invent and prototype this novel device was perhaps facilitated by his prior association with surgical tools as a scrub technician. He met much criticism from his mentors but went on to patent the balloon catheter, built the device in his garage, and worked tirelessly to have the catheter adapted by vascular surgeons. The Fogarty catheter has since revolutionized vascular surgery and led to a platform for innovations in minimally invasive techniques.
Whether accidental or systemically created, the idea behind an innovation can lead to the development of two broad categories of innovations: a novel method or a novel device. Because the majority of the chapter discusses medical devices, we will briefly discuss the innovation of novel methods. Delos Cosgrove describes his idea for a novel surgical method: “Several years ago, in preparation to perform aortic valve replacement, I found the ascending aorta entirely calcified and both femoral arteries occluded. Recognizing the danger of cannulating either one of these vessels, I raised the patient’s arm to expose the axillary artery, which I used as the cannulation site. The aortic valve replacement was successfully performed.”6 Bruce Lytle expanded this idea and refined the process of cannulating the subclavian artery for this problem. Substantial changes to a surgical intervention are reviewed by the Institutional Review Board (IRB), funded through academic sources, and described in new academic publications and presentations. The surgical community generally shares new methods without recovering royalties for the benefit of patients, even though novel surgical methods can be patented if desired.7
As physicians, we are constantly assigning value to our therapies as a means of deciding how to provide medical care. We define the value of a given therapeutic intervention as the potential benefit to the patient in relation to the potential risk. Based on the risk–benefit ratio, we decide to precede or abandon a given therapy. Similarly, as surgeons we define the value of a surgical innovation as the potential benefit to the patient in relation to the potential risk. Based on the risk–benefit ratio, we decide to adopt or not adopt an innovation. In today’s healthcare arena, before any novel surgical device is even available for use at the patient’s bedside, its commercial value must be demonstrated. The commercial return on a device must outweigh its development risks in order to have a realistic chance of having the device available for patient use. To understand the value of an innovation, it is important to understand the perceived benefit the innovation has on (1) patient care, (2) technology, and (3) commercial impact. We will review some of the terms used to describe an innovation’s perceived benefit in these arenas.
The impact an innovation has on patient care can be described as revolutionary or incremental. A revolutionary innovation has a significant impact on patient care where an incremental innovation has a smaller affect. Consider the revolutionary impact of the endograft for repair of abdominal aortic aneurysms (AAA). The technique of using a transfemoral intraluminal graft for repair of AAA was first published by Balko and associates in 1986, the first published human experience was by Parodi in 1991, and the first device manufactured was designed by Harrison M. Lazarus and developed by Endovascular Technologies Company.8–10 In September 1999, two devices were granted FDA approval for marketing. Now endovascular repair of AAA offers shorter hospital stays, decreased operative mortality and morbidity and an undisputed advantage to patients with multiple or significant comorbidities. On the other hand, consider the reiterations of multiple laparoscopic dissectors. These instruments have been developed in the attempt to improve laparoscopic dissection, but none with a significant impact on patient outcomes or care.
The impact an innovation has on technology can be defined as enabling or refining. An enabling technology is an innovation that serves as a platform for further developments within a field. In 1976, the Fischers introduced the modern era of liposuction, which is now one of the most commonly performed cosmetic surgery procedures.11 This innovation has served as a platform for many further developments including ultrasound and power-assisted liposuction. Both ultrasound and power-assisted liposuction represent refining technologies. A refining technology is an innovation that marginally improves upon available technology and does not lead to a significant technology change.
Finally, to help describe the commercial impact of an innovation, the market-based terms “disruptive technology” and “sustaining technology” are used (Fig. 35.1). A disruptive technology is an innovation that supersedes industry leaders and takes over their market share. When disruptive technologies are introduced they are often inferior to the existing leading device and ignored by the incumbent industry leader. In surgery, the device’s inferiority is usually secondary to the device’s learning curve, lack of safety information, and inferior technology. However, as clinicians learn to use the device, as its safety profile expands and as the technology improves, its market share surpasses that of its leading competitor. The “industry leader” can be applied to the corporation that produces the leading technology, or more broadly the subspecialty that uses the technology. For example, when percutaneous transluminal balloon angioplasty was introduced, its safety profile was not well understood and it was inferior to open coronary artery bypass. Over time, it proved to be a disruptive technology that shifted the market share of patients away from cardiothoracic surgeons (the incumbent industry leaders) to interventional cardiologists. The coronary stent, on the other hand, was a sustaining technology. A sustaining technology change is an improvement, usually made by the current industry leader, to maintain growth in the market. The technology can still be enabling (leading to further technology changes) or revolutionary (leading to significant improvements in patient care) but by definition it is not disruptive to market forces. In this case, the coronary stent led to further technologic advancement and improved patient outcomes but did not supersede industrial or clinical leaders. The interventional cardiologist used this technology to maintain their growth in the market.1
Generally, the larger the perceived benefit of an innovation, the larger the potential for financial return, however there also tends to be more risk involved in all stages of its development. With a revolutionary innovation, there is significant risk in developing the unproven technology, a riskier FDA approval pathway usually requiring Pre-market Approval, and more resources needed to create a large and experienced development team that can handle the challenges involved in developing a revolutionary technology. A revolutionary innovation, such as the endograft for AAA repair, will also have a large patient impact and large potential market that will justify the increased resources and risk required to develop the device. An incremental innovation, such as the “bullet” endoscopic dissector, has a smaller patient impact and ultimately less potential revenue. To justify its value, there must be less risk and resources involved in its development. Indeed there is less risk in the technologic feasibility of incremental technologies because they generally rely on proven technologies, the FDA regulatory pathway general falls in a “510(k) pathway”, with faster approval based on predicate devices, and the development team can be a small group of focused individuals. It is important to understand what general category a new innovation falls in so that the risks and subsequently expected benefits can generally be understood.
An innovative idea develops from concept, to product, to patient use in a stepwise manner. As each milestone is met, the innovation builds value and reduces risk (Fig. 35.2). Funding throughout this process is acquired based on progress towards building value. The initial smaller investment used to prove the innovative concept is termed seed money. This smaller investment is generally $50 000–$500 000 and can come from a variety of sources: Friends and family, angel investors, device company grants, small business innovation research (SBIR) and technology transfer (STTR) grants. Angel investments come from affluent individuals or a group of individuals, often with industry expertise, usually in exchange for ownership equity in the company. Angel investments in 2009 were estimated at $17.6 billion from 259 480 active investors, with a total of 57 225 entrepreneurial ventures receiving angel funding. Healthcare services and medical devices and equipment accounted for 17% of the investments second only to software, which accounted for 19%.12 Small business technology transfer grants (STTR) reserve a specific percentage of federal R&D funding for partnerships between small businesses and nonprofit research institutions. The idea is to combine the innovative ideas that tend to come out of small businesses or academic centers that lack the means to support serious R&D, with the ability of non-profit research laboratories to develop high-tech innovations. The goal of these partnerships is to transfer the technologies from the laboratory to the marketplace, with small businesses profiting from the commercialization and thus stimulating the US economy. Each year, the Department of Defense, Department of Energy, Department of Health and Human Services, National Aeronautics and Space Administration, and the National Science Foundation are required by STTR to reserve a portion of the R&D funds towards these partnerships.
Larger investments can come from venture or corporate funding. Venture capital funds pool together investments from institutional investors and high net worth individuals. These investors become limited third party investors in the venture fund. The fund then invests in novel technologies that have the potential to generate high commercial returns at the expense of risks too high for the standard capital markets. In exchange for the high risk, venture capital funds buy a significant amount of control and ownership of the company. To ensure realization of the high risk investments, firms look for companies with an innovative technology with the potential for rapid growth with a well-developed business model, impressive management team, and markets valued at greater than $500 million.
Venture capital is offered in stages, the funding stages parallel the growth of the company. As the new enterprise moves from concept, to company, to product, and finally acquisition, buyout or IPO it gains value and sheds risk. Venture capitalists require a detailed analysis of the development pathway with a focus on reducing risk and building value at critical growth milestones. Examples of critical milestones are securing IP, building a working prototype, successful animal testing, FDA approval and first in man use. Paralleling each of these growth milestones are funding benchmarks. The first funding benchmark is the seed stage, as discussed above this can come from friends and family or angel investors. Many venture capital funds may not invest at the seed stage because the risks are very high and the concept has not been fully realized at this point. The second benchmark is known as start-up stage where the venture is ready to launch; these funds are required for company development, marketing, and product development. The third benchmark, which can be further divided into several rounds, is the expansion stage. Funds here are used for manufacturing, sales, and getting a company to a stage where it starts to turn profits. Often the final financing round is the mezzanine or bridge round which is prior to the final acquisition, buyout, or IPO. In this stage, short-term debt is usually used to support growth opportunities while preparing for an acquisition, a buyout or an IPO.
The first round of external funds is generally called “Series A” and the second round “Series B”. The investment vehicle is generally “Series A Preferred Stock” or “Series B Preferred”. This is preferred equity share in the company, meaning in exchange for their investment, the VC group will have first right to dividends in the case of success and liquidated assets in the case of failure. The equity share in each round is determined by the value of the company at that stage or the “pre-money valuation” in relation to the investment of the VC firm.
The US Patent and Trademark Office (USPTO) issues several different types of patent documents covering different types of subject matter. Medical devices are most often protected by utility patents. Approximately 90% of the patent documents issued by the PTO in recent years have been utility patents. Utility patents protect any new invention or functional improvements on existing inventions. This can be to a product, machine, a process, a method of making things, or composition of matter. A patent does not grant the right to use or sell an invention, rather it grants the right to exclude others from making, using, selling, offering for sale, or importing the invention in the United States for up to 20 years from the date of patent application filling. Thus, if an inventor takes a patented laparoscopic grasper and adds a design to make it more ergonomic, and then obtains a new patent on that improvement, he or she can exclude others from using their improvement. However, the new inventor needs the permission of the original laparoscopic grasper, to manufacture theirs.
To be considered for patent, an invention must be novel, unobvious, and useful. To be novel, the invention cannot have been known or used by others or even described in a printed publication. Specifically, a US patent cannot be obtained after 1 year from the time an invention has been revealed through public use or publication. In many countries, the 1 year grace period is not granted. Thus, inventors in the academic environment should obtain intellectual property prior to publishing their work and surgeon inventors should likewise obtain intellectual property prior to public use. The invention must also be unobvious to those involved in the relevant field. Finally, it must be useful, in the case of a surgeon innovator, it must meet a patient or surgeon need.
To make sure an invention or idea is novel, the surgeon innovator can search the literature and the US Patent and Trademark Office database. One can begin by using keyword searches to find a similar device on any publically available search engines.13,14