Medsider: Learn from Medtech and Healthtech Founders and CEOs - Innovate or Get Left Behind: Interview With Bright Uro CEO Derek Herrera

Episode Date: January 31, 2023

In this episode of Medsider Radio, we sat down with Derek Herrera, founder and CEO of Bright Uro.Derek served as an elite Marine officer in the U.S. military before suffering debilitating injuries while in the line of duty. Using his personal experience, he founded UroDev Medical, Habit Camera, and Bright Uro. His latest venture aims to launch an innovative urology device that’s meant to replace an invasive bladder diagnostic test that hasn’t changed in decades. In this interview, Derek shares important lessons in driving device innovation, running a medtech startup, and developing products efficiently.Before we jump into the conversation, I wanted to mention a few things:If you’re into learning from proven medtech and healthtech leaders, and want to know when new content and interviews go live, head over to Medsider.com and sign up for our free newsletter. You’ll get access to gated articles, and lots of other interesting healthcare content.Second, if you want even more inside info from proven experts, think about a Medsider premium membership. We talk to experienced life science leaders about the nuts and bolts of running a business and bringing products to market.This is your place for valuable knowledge on specific topics like seed funding, prototyping, insurance reimbursement, and positioning a medtech startup for an exit.In addition to the entire back catalog of Medsider interviews over the past decade, premium members get a copy of every volume of Medsider Mentors at no additional cost. If you’re interested, go to medsider.com/subscribe to learn more.Lastly, here's the link to the full interview with Derek if you'd rather read it instead.

And so as an entrepreneur, what I feel like you need to do, especially if you're a CEO or leader or founder, any sort of leadership position in these startups, is think about and understand and try to have a good feel for a holistic understanding of how we can go quickly and efficiently while also maximizing the chances for success. Welcome to MedSider Radio, where you can learn from proven med tech and healthcare thought leaders through uncut and uncutelytons. unedited interviews. Now, here's your host, Scott Nelson. Hey, everyone, it's Scott in this episode. I sat down with Derek Herrera for a round two interview. He's the CEO of Bright Euro and served as an elite Marine officer in the United States military before suffering debilitating injuries while in the line of duty. Using his personal experience, Derek founded Euroduv Medical, Habit Camera, and his current company, Bright Euro. This latest venture aims to launch an innovative urology device that's meant to replace an invasive

bladder diagnostic test that hasn't changed in decades. Here for the key things that we discussed in this conversation. First, leverage your personal experience or close connection to the problem you're trying to solve. When developing medical devices and intimate knowledge of patient or clinician challenges can be a powerful motivator and provide valuable insights into your target market. Two, to set your med tech startup up for success, you must carefully tread the line between efficiency and maximizing opportunities for success. From top to bottom, it's imperative that each person on your team clearly understands their role and the impact it has on the company's goals. Third, be ruthless with your decision making during product development.

Incorporating only the most necessary features and having a clear picture of how you will navigate the regulatory landscape is crucial if you want to successfully launch your device in a cost-efficient way. Before we jump into this episode, I wanted to let you know that we recently released the second volume of Medsider mentors, which summarizes the key learnings from the most popular Medsider interviews over the last six months or so. Look, it's tough to listen or read every single Medsider interview that comes out, even the best ones. But there are so many valuable lessons you can glean from the founders and CEOs that join our program.

So that's why we decided to create Medsider Mentors. It's the easiest way for you to learn from the world's best medical device and health technology entrepreneurs in one central place. If you're interested in learning more, head over to MedsiderRadio.com or slash mentors. Premium members get free access to all past and future volumes. If you're not a premium member yet, you should definitely consider signing up. In addition to every volume of Medsider mentors, you'll get full access to the entire library of interviews dating back to 2010. This includes conversations with experts like Erica Rogers, CEO of Silk Road Medical, Dr. David Albert, founder of Albuhr, and so many others. In addition, as a premium member, you'll get to join live interviews with these incredible med tech and health tech entrepreneurs.

Learn more by visiting MedsiderRadio.com forward slash mentors. Again, that's Medsiderradio.com forward slash mentors. All right, Derek, welcome back to Medsider Radio. Thank you. Pleasure to be here with you again. Yeah. And for those that aren't familiar with Derek's background, we recorded our first interview. Gosh, we're doing this in late in December of 2022. And it's probably, I don't know, 18 months ago, something like that, maybe like mid-2020.

This is when we, I think you had, you'd just moved spinal singularity, which is now Eurodev to Minneapolis. So I think kind of mid-2021 timeframe, something, something around that. So definitely, if you're not familiar with Derek, we went kind of deep on his, on his backgrounds in that first interview. If you haven't listened, highly encouraged you to do search for for Derek's name on MedSider and you'll find the first one. But let's start out, if you don't mind, Derek, for those listeners that didn't, that haven't listened and are not maybe going to go back and listen to the first interview. Tell us a little bit more about your professional background leading up to starting Bright Euro. Yeah. So my background, prior to becoming an entrepreneur in the

medical device industry, I served for eight and a half years as a Marine officer in the infantry and special operations community. And so I served as an infantry officer in places like Iraq and across the world. And then as a Marine Raider, which is kind of like Navy Seals, just it's even better because we're Marines, more handsome, run faster, jump higher, all those things. And so I was fortunate to become a special operations officer and served in Afghanistan. And unfortunately, in the line of duty, was injured in 2012 in Afghanistan and suffered a spinal cord injury during an enemy firefight where I was left paralyzed in the chest down and still am today. And so I was fortunate to survive that incident, came back, recovered, went back to graduate school

and tried to figure out what was next and found passion and purpose in the medical device industry trying to leverage the insight that I had from being a patient to develop new and innovative technologies to help people like me. And so in 2015, started Spinal Singularity, which is a company now called Eurodev Medical and developing the first fully internal extended use bladder management system for men with chronic urinary retention and transition that company to a new CEO a few years ago and have stayed obviously involved as a board member and contributor to this day as we're working to get the final stage of regulatory clearance. And then recently started a new company, also in urology called Bright Euro, which is developing

a miniature sensor for the bladder for diagnostic purposes, replacing what is a currently outdated paradigm of urodynamics and urodynamic analysis and monitoring. And so that's my background. I've been living here in Orange County, California, since 2011, so over 10 years now, and have headquartered the companies here and been working to try to make change since. Yeah, that's cool.

Thanks for the background information. And EuroDev, which is the first device company that you started, that's based in Minneapolis, correct? Correct. Yeah. So we, in 2020, I believe late 2020, we'd hired a CEO based out of Minneapolis and decided to redomacile the company in Minneapolis for a lot of reasons.

One, because the CEO was there, but two, for some of the listeners who may not know, Minneapolis is the hub for any urology device innovation. And so among other medical devices, specifically for urology because of the headquarters for Medtronic and what used to be American medical systems, coloplasts, all of the major companies and in the corporate side, the big players are all up there. And so it's a really phenomenal ecosystem there. Got it. Got it. Yeah. And then, but Bright Euro based in Southern California in Orange County. That's correct. But, uh, so we're headquartered here because I live here.

Yeah. And all of our employees, all of our full-time employees with the exception of a couple of remote employees are all here. But we still have very strong ties to Minneapolis. So we have contract manufacturer there, R&D operations consultants there, clinical regulatory consultants there. I mean, you know, there's just a center of gravity of talent and experience there that if you haven't tapped into and you're in neurology, you should start to work to do that because they know a lot more than me. I've eliminated the industry for, you know, almost 10 years, but these people have been way, way longer than I have. And so we're fortunate to have, have access to that network. Yeah, Minneapolis certainly, I mean, I always kind of use the analogy.

It's similar to, it's like the Silicon Valley of the device base, but the caveat being there's not a lot of startups, you know, in, I think it's, the ecosystem is maybe the startup ecosystem is maybe starting to improve a little bit of Minneapolis. But that's one thing that's always kind of surprised me, considering how many awesome engineers, the engineering talent is so prevalent. Really, really great work, I think, within, within kind of the device space. But yeah, surprisingly, not a lot of startups. But maybe that's another another conversation. So let's shift to Bright Erio. So you started the company in just recently, but was it like 2021-ish? Yeah. So we formed the entity in 2020. And so I formed the company, but there was a shell of a company right because we were working through licensing and all the basic startup formation and things. But really we've been in business for just under a year.

Okay. We raised money, hired our first employees, and they started. started, you know, right before New Year's. Got it. So, Brite, you're about, about a year-end and, like, active kind of operational type of work. Give us an idea of, like, what the product is and how the idea kind of, you know, came, came to be.

And then we'll kind of shift to kind of, like, some of the key, key lessons like you've, you've learned, right, throughout your, your journey in the device space over the past, you know, 10 years or so. Yeah, the device itself is a, there's a few components to the system, but it's a system for Eurodynamic monitoring. And what it does is it's basically a miniature, the heart of the system is the sensor. And so we call it a sensor.

It's a small tube with flexible electronics and a power source on it that can be inserted through the erythra into the bladder, stay there for a period of time inside the bladder, collecting data, specifically pressure and volume data. And then we can pull that device out and download that data wirelessly. And so the reason why that's a big deal is because it's a functional assessment of the bladder. And it's a test that's been around. Your dynamics is a very comprehensive test that's been around for over 50 years.

But the problem is, is that it's all catheter based and console based. So literally to do this test right now, you go into a clinic, you lay on a table, put your feet up in the stirrups. They stick a catheter in your bladder that's hooked up to this laptop and this giant infusion pump and this machine. they stick another one sometimes in your rectum or vagina. And then in about 10 minutes, they fill your bladder rapidly until you feel like you can't hold it anymore. And then they ask you to urinate in front of them while they're watching, right? And that 10 minutes of data, that's the best thing that medicine has to offer.

Unfortunately, that's not real. That's not physiologic. That's not the way that the bladder operates in the real world, right? Nobody's bladder fills in 10 minutes. It's not the way it works. All of that setting, the entire setting is based off of a, one thing and that's the currently available technology. And so because these systems are very expensive, the console, the laptop, the printer,

they still have like an actual printer attached to it to print off the paper so you can look at it in squeakly lines. They cost between $30,000 to $100,000. And so because of that, now clinicians only buy one. And so if they need to see patients, they can't spend hours and hours with a single patient. They try to spend less than an hour with every single patient and turn this. room so that they can make the money back on this machine that they invested in. And so all of these downstream effects occur based on that technology.

And so for our technology, the reason it's different. And we re-invision this and the inventors, original inventors, we've licensed this technology. So I'm not the original inventor. I didn't come up with this idea. But the way that they originally envisioned it was, hey, wouldn't it be cool if you had a low-cost sensor that could go in someone's bladder, stay there for a period of time. And they don't have to be stuck on the table, right? They can walk around.

they can go home, they can do all these things and collect real world, more physiologic data to help inform these treatment decisions that clinicians are making because this test is used and the information sometimes can help the clinician to understand what's going on, the underlying pathophysiology of the bladder, and make a decision and say, hey, we're going to send you in for a sling surgery to help with your incontinence, that's a highly invasive, very, you know, significant procedure with major side effects potentially. And so if that data is flawed and then you go under this surgery and it doesn't work,

you know, it's not good for the patient. It's not good for the system. It's not good. The clinicians don't like doing that. Similarly for men with BPA, it's also an application. But what the test is designed to provide is a functional assessment of the bladder. And the way that our technology works is we've developed a single use low cost sensor that can be inserted into the bladder, stay there, collect this data, allow patients to go in their

real world setting, eventually home, in the home environment, and then provide not just more data, but more relevant and more physiologic data for the clinicians to rely upon. In addition to the clinical innovation and the technical innovation, it also unlocks kind of a new opportunity and a fundamental opportunity to change the business model as well, because now we can eliminate potentially that entire capital expenditure up front. And so if we get rid of the business or we get rid of the capital expenditure, we can make it easier for more clinicians to have this technology. In addition to that on the business side, if we simplify and standardize the technology while also using a connected health platform, we can do, we can aggregate this repository of high quality urological data that no one's been able to do before. And so all of that summarized with just the simple story is Eurodynamic monitoring today is like,

halter monitoring was 10 years ago. And so we want to be like irhythm, which is a wearable ECG monitoring, the company that kind of revolutionized wearable ECG monitoring. We're going to be like eye rhythm for urology and make all the same changes that they've made for the types of patients that we can serve. Got it. Got it. And so if I'm just to just to make sure I fully understand from a patient's perspective, I go to a clinic, I get this little chip or this little sensor inserted, right? And is that it? I kind of, I go about my, my, my day, you know, for whatever, a few days, weeks, maybe I don't know, something like that. And then I go back in and it's removed then after a certain point in time. Yes, exactly. And so the, the nuance,

the only nuance I died to that is specifically what we're pursuing is for the first generation product in order to to have a risk profile that enables a 510K process through regulatory to get it on the market quickly. And also qualify, potentially for the existing reimbursement that's available for coding and coverage and payment. What we're doing for this first generation product is just in clinic use. And so the patient comes into the clinic, a nurse, MA, doctor, someone who's trained, trained clinician can insert it in the bladder quickly and easily. The patient can then get up and walk around. They don't have to sit in the room, right?

You can go in the waiting room. You can go get a coffee. You can go walk around. Once your bladder fills back up and you need to urinate, you come back in, use the bathroom that they specifically ask you to use so that you can have the day. data from that urination, that voiding cycle. And then that's the minimum threshold of data collection that we have. So it might be an hour, two hours, three hours, depending upon the patient. And if that's enough to get the data that they need, you can pull the device out and

download the data right there. And so that's the minimum. But what happens a lot of times is it may take more than one voiding cycle. So for some patients, they mean an extended period of monitoring. And so this first generation product, the indication for use will be in clinic use for up to 24 hours. And so obviously not everybody's going to be there for 24 hours, but that's kind of the upper bound that we're bounded by for our initial 510K application.

Beyond that, we're going to run clinical studies and submit an expansion eventually once we have the data to show that it's safe and effective for patients to go home with this device for even longer periods of time, so potentially up to three days. Because sometimes, and this test is done frequently, but sometimes there's patients that have a really hard time with what's called symptom replication. And so if you can't replicate the symptoms, you know, the test sometimes is inconclusive. And so that's what the problem is, is if you're only in there for 10 minutes in this artificial environment, literature shows almost half the time, it doesn't actually replicate the symptoms that you complained about when you go in. And so

imagine you're a patient, you don't want to go into this test that only has a 50% chance of even giving any data that's conclusive for the clinician. And if you're the clinician, you're like, I don't want to buy this $100,000. piece of machine and then take up this room and do this test if it's only going to give me data half the time, right? And so that's where we want to go is be able to send patients home for a few days because what we're confident we'll see in the data. And we've already seen in some of the initial feasibility data that we have is that it's going to create a significant enhancement in the amount in the diagnostic yield from the data that we can provide. And as a diagnostic

company, that's how we can create value right, is providing information that's either not already obtainable or enhanced yield, which can create value and capture value down the line, specifically things like, you know, informing the treatment pathway, potentially, you know, improving outcomes from those therapies, getting the right patients, the right treatment at the right time, right? And that's long term where we want to go with this technology. Got it. That's super, super helpful overview. And I want to circle back around to your thoughts around reg and and reimbursement because I think that not only is is like super savvy, right, from your perspective, but I think it'd be beneficial to kind of for other other med tech,

health tech entrepreneurs to understand kind of like how you went about approaching, approaching those various paths. But real quickly, I know you brought up the Holter monitor example, but, you know, the bright Euro tech, it kind of reminds me of like sleep studies, right? Like 10, 15 years ago, you'd have to go in. into this center. And this still happens today, right? You'd have to go into the center. It's super clunky. It's not, it doesn't represent like a real, like your real life kind of sleeping environment where now there's all kinds of different devices available. Fast forward 15, 20 years. I think inspire,

I believe it's inspired, right? I think they're doing exceptionally well right now with like, you know, a device that's meant to be used at home. You know, then you've got like more health tech devices like like the ore ring, et cetera. And so yeah, it kind of reminds me like what you're, that's what I thought of, you know, hearing you describe kind of what you're doing for the Eurodynamic kind of problem. Your aerodynamic, I should say, kind of problem is kind of like what reminded me that the sleep scenario. But that said, let's, let's transition into kind of some key functional topics that I think would be interesting, right, for other folks listening and kind of see how you've gone about building and operating bright euro kind of in its formative years.

I want to talk a little bit about reg and reimbursement. But let's start with like, just the initial kind of alpha alpha devices, right? You started spinal singularity, right? So you have a fair amount of experience kind of thinking about alpha and beta. You also started Habit Camera, which I think we'll probably spend it. We talked about that in the first go-round.

We probably won't spend a ton of time in this discussion talked about Habit Camera. But Net-Net, you've got a fair amount of experience thinking about like how do you design alpha and beta, to get to market as ideally as quick as possible, right? So you're not burning tons of cash, you know, designing and iterating on various devices. So for other folks that are kind of in a similar scenario, right, maybe there are one,

two, three years into their startup, what are kind of like the key lessons that you've learned, you know, making, you know, making that process as efficient as possible where you're being able to, you know, you're demonstrating feasibility, right, but not wasting a ton, a ton of time and resources kind of in those early, early stages. Yeah, it's a great conversation to have. And I think if I were to summarize just some of the key lessons that I've learned, there's a constant. So just, just the, just the The opening disclaimer is, especially in our line of work, there is no compromise for patient safety or any sort of, you know, unnecessary risk for any patients, whether it's clinical studies or anything along those lines. So with that disclaimer aside, the way that I feel and what I've kind of like come to grips with as an entrepreneur in this space over the past few years is you have limited resources, both time and money.

And you have to make traction and show something compelling as quickly as possible. and as efficiently as possible. And so you have to be really ruthless and judicious with how you deploy capital and drawing the line of every single thing that you spend a minute on or a dime on, how is that furthering you in achieving the goal that's going to actually unlock additional funding opportunities or milestones? And so in some of the earliest stages, the way that can look is how quickly can we get a functional prototype on the bench? how quickly can we get a functional prototype in animals,

how quickly we can get a functional prototype in humans, right? All of those things and understanding the nuances and the challenges and any sort of like programmatic or project management efficiencies and understanding like what exactly has to be done this minute, this hour, this day for us to get into that, get into clinic, right, with our first and human or our feasibility data. And what do I need to see there to be successful? And so there's this constant ebb and flow of doing that and the challenge that I've found and

kind of where I think the best entrepreneurs that I've seen are able to navigate and no one can do it perfectly because until there's hindsight, you know, you don't know, but you're constantly trying to walk this line of rapid iteration and getting something out quickly, but also making sure that it's actually going to succeed. And so you're walking this balance because you could just spend forever and have all the money and spend all the money in the world to test it. And then whenever you get there, right, you know it's going to work perfectly, right? Maybe, maybe not. Most of the time it doesn't. You always learn something, right? But you also don't want to just go too quickly. So there's kind of this

line you have to walk, right? And so it's a healthy balance at the end of the day. And so as an entrepreneur, what I feel like you need to do, especially if you're a CEO or leader or founder, any sort of leadership position in these startups is think about and understand and try to have a good feel for a holistic understanding of how we can go quickly and efficiently while also maximizing the chances for success. And so one example of that would be, yeah, we can rush into clinic and go into a first in human and make sure we're not going to hurt anybody because this is not a, you know, I'm in urology where a lot of the stuff that we're doing is at least, you know, the methods that we're

using and the devices we're doing my experience, most of my experiences in non-life-threatening, non-life, you know, non-significant risk studies and devices. But if you go into clinic and then you learn something you could have learned on the bench, right? And you failed or you wish you would have optimized on the bench, you know, it's an expensive lesson to learn. Right. So like, and now having had those types of lessons and trying to figure that out, it's, you know, it's a constant push and pull of like, how much time do we spend perfect or trying to get, you know, what's acceptable, what's good enough, right? Because nothing's going to be perfect, right? But you also don't want to learn major lessons in a more expensive,

more costly environment when you could have done that in a more cheap and more an expensive way. And so those are the types of things I think about on a day-to-day basis. And then with respect to the overarching, you know, milestones and the goals for the company, this one, I think we're on the right track. And I've talked to enough people and we have a strategy. But at the same time, you know, we've talked to other people that have a lot of experience. experience industry and they have different thoughts, but what we tried to optimize for all of our company operations of our Euro thus far is how quick can we get a product on the market that clinicians will love and want to use and patients will enjoy as well. That's also reimbursed, right?

And so that's not perfectly black and white, right? Like some of that's gray and some of that's where kind of the art and what I think is really unique and exciting about them. medical device industry specifically as opposed to like pharma or some of these other industries is it's not always binary it's not perfectly black and white all the time there's some gray and that that enables ambiguity and uncertainty but as an entrepreneur i think the people that are successful in this industry you know that they're able to navigate that well and thrive in that environment and so you know you can look at it as this like stressor and this challenge but at the same time those types of stressors and risks and challenges are also exciting, right?

Like it gives you impact, right? Because when you're successful doing it, it's something unique and hard and challenging and worth pursuing and impactful, both personally and professionally. And so that's kind of the way we've thought about managing the lines between how quick do you go, how efficient can you go. There's orders of magnitude, right? So like, what am I doing this week, this month, this year? but goal setting and operational efficiency, you know, has to really be something that people

in the company are cognizant of and thinking of and being able to draw the lines of like, yeah, I'm a junior R&D engineer, but what am I doing today and what company goal is this going to help us accomplish, right? Like I'm doing this packaging study, this pouch sealing qualification because I need to get this done before we can get into our first and human and this is, you know, the timeline that we're going to, right? or whatever, whatever the situation may be. Yep.

But that's the better organizations that I've seen is where those people are all aligned and unified in that goal, that vision, and the missions that they're on. Right. I totally agree with your thoughts around scenarios in MedTech, right, that are ambiguous, right? And there is, there is great area. The best operators that I've kind of been around have always leaned in to those areas, right? I mean, they're clear hurdles, they're clear obstacles, right? But as long as you're not handcuffed, you know, the best will lean in and kind of figure

out away, right? And, you know, sort of some, you know, through kind of a combination of domain expertise plus creativity, right, will kind of be able to cross some of those hurdles. So I totally, I'm totally right there with you. And I love the framework, right, that you mentioned. And I'm going to kind of paraphrase here. But like just understanding like those key inflection points when you're, you know, you're in your earlier phases of development, knowing that we need.

to get to bench, then we need to get to animal in most scenarios and then and then human. And it's a big, it's a, it's a failure if we're getting to animal, you know, doing animal labs and we realize something that could have been, that could have sort of surfaced during bench top testing, right? And kind of just thinking, thinking through like what are, what do we want to uncover, right, on bench, right? And then what are we going to try to try to attempt to uncover, you know, in animal labs that we couldn't, we couldn't discover, right, during during bench top testing and kind of understand. understanding those key inflection points and those early earliest phases, I think is just a great, a great lens, great, great kind of framework to kind of be utilizing, you know, for any, any, any startup.

Hey there, it's Scott. And thanks for listening in so far. The rest of this conversation is only available via our private podcast for MedSider premium members. If you're not a premium member yet, you should definitely consider signing up. You'll get full access to the entire library of interviews dating back to 2010. This includes conversations with XIDER, Experts like Renee Ryan, CEO of Cala Health, Nadine Miarid, CEO of CVRX, and so many others. As a premium member, you'll get to join live interviews with these incredible medical device and health technology entrepreneurs. In addition, you'll get a copy of every volume of Medsider mentors at no additional cost. To learn more, head over to MedsiderRadio.com forward slash premium. Again, that's Medsiderradio.com forward slash premium.