Medsider: Learn from Medtech and Healthtech Founders and CEOs - Who’s Paying for It?: Interview with Aclarion CEO Brent Ness

Episode Date: January 22, 2025

In this episode of Medsider Radio, we sat down with Brent Ness, President and CEO of Aclarion, a startup developing a decision-support tool designed to improve the diagnosis and treatment of chronic low back pain. Brent has over 28 years of experience in medtech. Before Aclarion, he led Cleerly as President & CCO, driving the adoption of their AI cardiology solution through strategic partnerships. As COO of Mighty Oak Medical, he guided their FIREFLY spine navigation platform from FDA clearance to international launch. At HeartFlow, Brent spearheaded the global expansion of their image-based SaaS solution, and at Medtronic, he led the acquisition and rollout of the O-Arm technology. His career also includes leadership roles at GE Healthcare, Philips North America, and ProNerve.In this interview, Brent shares his approach to reimbursement, why continuing to prove your technology is crucial (even after regulatory approval), and how to effectively engage with KOLs for optimal support.Before we dive into the discussion, I wanted to mention a few things:First, if you’re into learning from medical device and health technology founders and CEOs, and want to know when new interviews are live, head over to Medsider.com and sign up for our free newsletter.Second, if you want to peek behind the curtain of the world's most successful startups, you should consider a Medsider premium membership. You’ll learn the strategies and tactics that founders and CEOs use to build and grow companies like Silk Road Medical, AliveCor, Shockwave Medical, and hundreds more!We recently introduced some fantastic additions exclusively for Medsider premium members, including playbooks, which are curated collections of our top Medsider interviews on key topics like capital fundraising and risk mitigation, and 3 packages that will help you make use of our database of 750+ life science investors more efficiently for your fundraise and help you discover your next medical device or health technology investor!In addition to the entire back catalog of Medsider interviews over the past decade, premium members also get a copy of every volume of Medsider Mentors at no additional cost, including the latest Medsider Mentors Volume VII. If you’re interested, go to medsider.com/subscribe to learn more.Lastly, if you'd rather read than listen, here's a link to the full interview with Brent Ness. 

You're going to need so much money to go chase revenue in a non-reimbursed model that you really have to be thoughtful about whether that's worth it or not. Or are your early dollars better spent at KOL development, evidence creation, and then reimbursement, a thoughtful market access reimbursement strategy. So that when you do hire those feisty salespeople to go out there and make it happen, they actually are selling into an environment that's receptive to their message as opposed to, hey, I love the technology, but who's painful? Because that's a, you know, that's a deal breaker. Welcome to Medsider, where you can learn from the brightest founders and CEOs in medical devices and health technology. Join tens of thousands of ambitious doers as we unpack the insights, tactics, and secrets behind the most successful life science startups in the world. Now, here's your host,

Hey everyone, it's Scott. In this episode of Medsiter, I sat down with Brent Ness, president and CEO of Ecclion, who has over 28 years of experience in MedTech. Before Claren, he led clearly as president and CCO, driving the adoption of their AI cardiology solution through strategic partnerships. As CEO of Mighty Oak Medical, Brent guided their Firefly spy navigation platform from FTE clearance to international commercialization. At Heartflow, he spearheaded the global expansion of their image-based SaaS solution, and at Medtronic, Brent led the acquisition and rollout of the O-Arm technology. His career also includes leadership roles at GE Healthcare, Phillips, North America, and ProNerve. Here are a few of the key things that we discussed in this conversation.

First, if it's not clear who's going to pay for it, it can be a deal breaker, regardless of clinical efficacy, even if the technology is groundbreaking. You need to build a reimbursement strategy from the beginning. To do that, commit to generating solid scientific evidence, surround yourself with KOLs who can amplify your message and focus your resources on strategic growth, not flashy launches. Second, don't just invent for innovation's sake. Tie your product development to practical customer-driven needs. To do this, you need a rock-solid foundation of science,

a deep understanding of the market, and strong relationships with key opinion leaders. Engage end users early, listen to their challenges, and involve them in development. This is how you position a product as essential. Third, when resources are limited, focus on what truly matters. Stay disciplined, align every decision with your core goals, and embrace constraints as an opportunity to sharpen your priorities

and move with purpose. Challenges can bring clarity and force you to operate smarter, not harder. All right, before we dive into this episode, I'm pumped to share that volume 7 of MedSider, mentors is now live. This latest edition highlights key takeaways from recent Medsider interviews with incredible entrepreneurs like Bill Hunter, CEO of Canary Medical, Brian Lord, CEO of Pristine Surgical, Don Crawford, co-founder of Safion and current CEO of Corvista Health, and other proven MedTech founders and CEOs. Look, we get it. Keeping up with every

MedSider interview isn't easy. That's why we created Medsider mentors. These e-book volumes distill the best practices and insider secrets from top founders and CEOs, all in a downloadable, easy-to-digest format. To check the latest volume out, head over to medsiderradio.com forward-slash mentors. Premium members get free access to all past and future volumes, plus a treasure trove of other resources. If you're not a premium member yet, you should definitely consider signing up. We recently revamped Medsider with swanking and features, especially for our premium members. In addition to every volume of Medsider mentors, you'll get full access to our entire interview library dating back to 2010. You'll also get Medsider Playbooks, curated guides,

path with actionable insights and topics like fundraising, regulatory challenges, reimbursement strategies, and more. And if you're fundraising, don't miss our exclusive investor database featuring over 750 life science VCs, family offices, and angels. We've even created three custom packages to help you with your next fundraise. Learn more about Medsider Mentors and our premium memberships by visiting MedsiderRadio.com forward slash mentors. All right, without further ado, let's dive in the interview. All right, Brent, welcome to Medsider Radio. I appreciate you coming on. You bet. Thanks, Scott. Thanks for having me. It should be a fun conversation. I'm excited to learn a little bit more about your journey in MedTech as well as kind of what you're doing at A Clarion. So with that said, you've got a pretty impressive background to say the least, right?

You've been around the device game for three, three-ish decades or so at several well-known companies. But let's start there. If you can kind of give us a two to three-minute overview of your background leading up to your current role as this, you have a clarion. That'd be great. Sure. Yeah. I see. started off selling beepers on the south side of Chicago. That one's not necessarily listed most of the time. I certainly learned how to wear out shoe leather on a street commission job. But from there, I was fortunate to land at a company called Pegasus Airwave, where we sold therapy beds to burn victim patients. And I got a real strong passion that developed for healthcare, really to probably the lowest common denominator of our, of our, you know, physical human existence, bedbound and burn victim patients that, you know, it was really very raw. From there, I was able to send through

various levels and ultimately ended up at GE healthcare. At a, at a formative time in the story of GE, Jack Welsh was the CEO, Jeff M. I had just, just about to come on board as the CEO of GE medical systems at the time was the name. And while at GE, I mean, it was such a fantastic experience. I'll probably talk more about that later. But, you know, to work alongside some of the current CEOs of fantastic med device companies was a great learning experience. GE, I went to the Global Healthcare Exchange, where we worked on some real high little

strategy kind of tectonic shifts in the healthcare supply chain world. developed tons of relationships throughout medical device industry and imaging industry while there. Did a short stamp as a turnaround management specialist while I was getting my MBA, so I got to work with companies in the zone of insolvency. From there, went to Phillips as the VP of sales operations from North America, so the $4 billion Phillips North American operation. And then landed really a transformative job for me, the vice president of global sales and marketing at Medtronic, the navigation division of Medtronic, really a fun time, a good old days, as we used to call it back when we were experiencing them. And then from there, I went to pro-nerves

for five years, and that is a industry roll-up of multiple IOM companies to try to consolidate a highly fragmented industry, so a lot of M&A work and bringing in disparate cultures under a single organization. And then I went to Heartflow. And that really probably most closely translates to the business model of what we're doing here at Eclarium. I was the original chief commercial officer of heart flow. Spend time with Mighty Oak Medical after that as a chief operating officer back into my spine world. And then on to clearly as president and chief commercial officer of clearly another heart, you know, heart-based imaging technology business. SaaS-based business model. And then, you know, throughout that time, I've been consulting in

capital equipment finance work with a great company out of Minneapolis called K2 Capital. And obviously, here I am today at Ecclarian. So at the long list, some people might consider that that's a guy that can't keep a job. Right. I don't know. Those are pretty, that's a pretty impressive, impressive companies and lots of experience, I think that we'll get into over the course this discussion, but you've been at the Clarion for it looks like a little over three years. You guys are developing the no-c-scan. Tell us a little bit more about the technology and kind of like the major problem you're trying to solve it. If you can kind of frame this up for like maybe what's current sort of standard care, like in most common standard of, you know,

the sort of issue is tackled in today's healthcare system and kind of what it was going to look like maybe potentially at with scale and at Acclarion. You got it. So a clarion is addressing the largest single expenditure in all of health care, the treatment and diagnosis of chronic low back pain. And chronic low back pain is unfortunately suffered by 266 million people around the world. And I'm talking about the real debilitating chronic kind of pain that is the number one cause of opioid addiction in the world. You know, more people are on opioids for cancer, but unfortunately those people pass away, you know, sooner so they don't become addicted. But low backdane is a incredible problem. Another problem is that the treatment of

that pain, the most invasive, the surgical fusion treatment, has a success rate hovering around 49 to 54% success rate in fusion surgery. And this brought the, you know, the brilliant team at UCSF to really start to probe into why are we missing on this critical outcomes metric? And they realize that anatomical evaluation of a patient in diagnostic imaging really is left wanting because of this factor that you can't see pain. And outcomes in back surgery is correlated to pain most of the. time. You know, the patient feels better or they don't. So they're asking, why is that? Why do we have

all of these patients that come back after what would look like a perfectly good fusion and yet still in pain? So the source of the pain is really the root of what we're after at Ecclarian with our technology called Nosey scan. And for you Latin majors out there, you know, that Nosey is Latin for pain. So pain scan is how you can kind of think about that. And they went after the disc space because we have these high volume, like bright looking, healthy looking discs on an MRI. But as it turns out, they're the source of pain. So they took high field MRI and they looked into the actual biomarkers inside of those discs with an MRI technology called spectroscopy. So rather than creating a picture from the data, it measures the biomarker content inside the disk.

So then I realize this gets a little dense, but just follow me here. When they were able to measure the content of the disk, they then looked at the correlated measurement of the gold standard, which is provocative discography, where they inject a needle into each disc, and pressurize that disc, trying to replicate an incidence of pain. So they could say, okay, how does that feel? Uncomfortable, how does that feel? I'm not great. How does that feel?

You know, and they scream off the table in pain. It's like, okay, that's the painful disc. Well, to look at the biomarker ratios using MR spectroscopy and correlate it back to those provocative discography tests, we were able to determine that it's a combination of low-strospection, structural integrity markers, proteoglycan collagen, and high levels of pain generating chemicals,

think of it as acids in the disk, aline, lactic acid, etc. That high acid, low structural integrity, equals pain. So here we go. Now we've got a non-invasive, truly objective, less expensive, and simple MRI-like procedure for a patient to go through to provide the kind of insight that

used to only come from a highly subjective, painful, invasive test called provocative discography. And that's the information that when put into clinical trial evaluation actually lifted the outcomes. And this is key, Scott. I'm not talking about equivalence to a gold standard. in a diagnostic sense. I'm talking about outcomes, patient outcomes, went to 97% when the levels treated correlated with the nociscan information and fell at 54% when there was a discordance in the levels treated and what nociscan indicated as should be treated.

So this is super compelling, you know, data, and we have clinical data that we have, and really hope to help those 266 million people with chronic low back pain get the treatment plans that really are informed by this kind of new gold standard. Got it. And so if I understand this at least at a high level, getting too far into the weeds, noses skin, in essence, it is kind of similar to clearly, and or heart flow for that matter. It is a kind of a SaaS platform that does insert and interpret kind of MRI data, like in a better way, like, I guess maybe the better way to say this is if I'm a patient and I'm hearing about this for the first time, do I have to go get an MRI and then hope that the physician is using noce scan to better interpret those results? Well, and your MRI creates a picture. You need an actual noc scan order.

Okay. It'll be in the same MRI machine, but they'll use an MR spectroscopy pulse sequence to get the data that I'm talking, if opposed to creating a picture. picture. And listen, this isn't meant to be used all by itself. It's a decision support enabling technology. So you're still going to get a lumbar MRI. They still need to be able to see if you've got a bulging disc or, you know, Spondiolo thesis or, you know, other diagnosis that need to be treated as well. But it is exactly like heart flowing clearly in the business model, meaning that there's a scan, the raw material that's sent to the cloud where advanced algorithms are applied to that data set, and then it is sent back to the referring physician so that they can make better clinical decisions out of that complex information.

And it's sent to them in a very simple and usable format. Obviously, the heartblown clearly used coronary CT, coronary CTA, or using MRF spectros. Got it makes it sense. And I'm on the website right now, clearing an ACLA-R-I-O-N, and just as it sounds, definitely highly encourage everyone to check it out in more detail. It's really cool. It's really nice website. The visual images help you better kind of graphs sort of what's going on here. So if you don't get to the full write-up on Medsider,

clarion.com is the website where you can learn a little bit more about the company as well as Nosey scan, right, which is the product that the brand just described. So give us a sense of kind of where the company is at right now in terms of stage. Are you actively commercializing? Yeah. So we follow a very disciplined standard of care journey to standard of care. journey to standard care kind of strategy where, you know, your foundational science needs to be in place and rock solid. You need to have key opinion leaders that are advocating to the technology.

You need to have, you know, the structural barriers, meaning enough scanners up and running and operating, you know, for the capacity side. And then reimbursement. Reimbursement is an impediment to the adoption of any technology until it's reimbursed. And then, you know, then we can, move into a full physician adoption mode. So where we are today is we're really right on the cusp of those reimbursement conversations. And we've had excellent news in London. We've got three private payers who have approved the use of nocise scan and are paying for it there through our relationship with the London Clinic. That's really the first example of where we've traveled through the journey. And now just last week, I was lit in London.

we're able to go after a broad physician adoption model there. So you'll see volumes grow in London. You'll see adoption come out of London, even some clinical papers that the experts over there are drawing up and writing and publishing on behalf of the technology. So that's where we are. We're working our way through the reimbursement. And that, of course, reimbursement requires evidence.

So you've got to create evidence to bring to the payers. And you might, this might surprise you Scott, but the payers don't really care when I call them. But they do care when my list of KOLs called them, right? The actual physician expert, you know, from major academic centers throughout the country, are foring calls into the payer community, the medical directors, and having meaningful conversations about what this can mean by way of outcomes and in the economic side of health care, which is a reality that can't be ignored. when you bring something to market.

100%. Maybe the single toughest turtle, right, for novel technology, like what you're, what you developed at the declarant. I want to, you know, spend the next half hour or so 20, 30 minutes, covering some, some cross-functional sort of buckets, if you will, that every startup is going to have to, you know, face at some point, you know, if they're, if they're going to see, you know, any, any sort of success. But before we get there, you know, hearing you kind of explain the failure rate with fusions,

kind of, I mean, it literally just reminds me, I had had each back contractor come to our house last week, if I remember correctly. And he, I mean, the other guy, I think he's like maybe like 40, had a had a had a fusion, I think a cervical fusion, if I remember correctly. And, you know, he, he mentioned like, it was like a week after he had some like, such severe pain out of nowhere that he passed out, passed out his wife had thought he had a heart attack. He was kind of explaining to this.

And I was chatting with my wife and like, how odd, like pain is so weird. Right. I mean, it's just like, it's so hard to like properly diagnose oftentimes. and it's like almost everyone throws everything under the sun to try to solve more, right? Because it can be so debilitating, right? I mean, anyone who's never pinched a nerve or their back, like, no's firsthand. It's like for that first week or so, it's terrible, you know what I mean? And so this is, I had no idea that the fusion, like the failure of fusions is that, you know,

I mean, it's just, it's pretty remarkable. Yeah, I mean, it's, listen, I'm not disparaging any of the surgeons out there that are doing, real good work, disc replacements, fusions, Lavanesc, you know, they do great work. What I am here to say is I'm here to help. Like, we are here to help you diagnose. And at least even as a rule out for that adjacent level, like, hey, it's not screaming off the charts with pain biomarkers.

So you can leave that one alone. But if it is, you may want to include that adjacent level in the treatment plan. to help improve those outcomes. So yeah, we're all in in helping the community of pain management positions and in narrow surgeons, spine surgeons, you know, just get them as much information as we possibly can so they can help those patients. Yeah, it's a mass and it's such a massive market too. I mean, the sheer number of people that suffer from chronic low back pain. I had James Ryanstein with conformal on the show just yesterday actually and we were talking about just how important it is in MedTech, right, considering the sheer amount of time and capital that you throw at these companies, like how crucial it is to be tackling a big product, right?

You know, because there's lots of good ideas and you'd love to see come to the light of day. You know, when all of a sudden needs to be, you know, a very, a very big, big problems to solve. It's the largest single expenditure in all of healthcare. Yeah. Is it really? No kidding. Wow. So we are the largest bark. Yeah, that's incredible. With that said, let's kind of move to some of these cross-functional questions that I mentioned before. The first one I wanted to tackle really was considering your pretty robust experience, right? You kind of rattled off several companies, right?

From GE to Philips to Medtronic, Heartflow, clearly, you know, all very impressive kind of senior leadership roles. When you think about kind of key lessons learned and maybe kind of frame this up around commercialization, considering that's probably more of your wheel, Are there a few things that kind of have surfaced over the years that you're really, like you're really utilizing now at Edeclaren? Yeah, very much. So I would say the first thing is that to try to launch a product without reimbursement and spend the kind of money and resources required to get physician adoption is really an uphill battle.

And you're going to need so much money to go. chase revenue in a non-reimbursed model that you really have to be thoughtful about whether that's worth it or not, or are your early dollars better spent at KOL development, evidence creation, and then reimbursement, a thoughtful market access reimbursement strategy, so that when you do hire those feisty salespeople to go out there and make it happen, they actually are selling into an environment that's receptive to their message as opposed to, hey, I love the technology, but who's paying for? Because that's a deal breaker. So I've learned that lesson the hard way, meaning I've tried to take sales forces out to market with non-reimbursed technology. And it is

difficult. It's very difficult. And I think a lot of the resources that we might have spent earlier on, developing that market access strategy and the reimbursement strategy would have born freaked and the ROI would have gone up on every investor dollar spent. So that's a big one. I mean, it's one that I definitely asked it in the context of what have I carried forward to a clarion. And we are incredibly disciplined about spending our money on that on that reimbursement pathway. Yeah.

There's no doubt. I mean, you could, you could, you could spend a lot of money. and time and resources on generating a lot of excitement about, you know, a really, a really great device, right? That maybe truly does have a significant efficacy. But at the end of the day, if you're left at the, you know, the value analysis team and everyone's looking around asking who's going to, who's going to pay for this or like, you know, who's going to, you know,

what DRJ, what, you know, what already, you know, DRG code that's already kind of stuffed already is going to be impacted by this. That ends up being a lot of, a lot of, a lot of circling, you know, circling right. Losing a lot of fruit. Right. And like to all my by cash pay friends out there who are going after, you know, cash pay business, of course, once the technology is FDA clear and you can get a contract, we don't

turn away the money, right? I mean, there are patients that fly around the world to get an OC scan. And, you know, we take a cash pay business. But it's just not the thrust of what the company is all about. It's not why we're investing millions of dollars. in a national randomized control trial called Clarity, led by Johns Hopkins, Nick Theodore Johns Hopkins, and those things take time and money and investment.

And we're putting our money there instead of, you know, high-room sales reps in New Jersey to go chase, you know, chase cash pay patients. Yeah, there's no doubt. And to your point like that, I was even involved launching a device when I was during my days at Caviti, where we did it, in essence, kind of have to launch effectively, you know, a sort of in a

cash pay model, right? But that was with an existing sales channel, right? So it's not like we had to build out of sales force. It already existed. However, the friction there was difficult, right? I mean, there is a considerable amount of friction, even for really cool technology that solves a real need.

At the end of the day, if it's not, you know, if it's not very clear who's going to pay for it, it's a tough call. I'll give a shout out to my team. it clearly, I mean, that technology can literally save one's life. And people go, you know, $900, I don't know if I, I really want to spend that for that insight into the plaque nature of my heart. I'll spend $900 on a Louis Vuitton purse. Well, probably $9,000, but I won't necessarily spend $900 to know what the plaque

composition of my heart is. Yeah, isn't that the behavioral psychology that is, it's very strange, you know. Yeah. Yeah, because it's even, I mean, they're like the company I started before Fastway, we commercialized entirely. It was a class two device. We commercialized entirely online, direct to consumer. And our average order value was roughly $14,500 at the time I was doing it. So pretty high, right? I mean, most people would be like, that's people were paying for that, like online and an online sort of transaction. But it's a different audience, right? It's like longevity enthusiasts, right? They're going to go to a spa or something versus the person that's going to get clearly scanned as it. It's just a different, a different sort of fetal side, you know. 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

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