Enjoying good health? Thank a venture capitalist!
Citizens of the US have access to the best healthcare on earth even if they are not the healthiest people walking the planet. US companies have developed a myriad of technologies to treat everything from sleep apnea (severe snoring) to epilepsy to foot bunions. New technologies are constantly reaching the market that improve existing treatments or offer solutions for untreated conditions. Each year, the US FDA regulators approve about forty brand new devices through the PMA process and another 3500 iterative devices through the 510-k pathway.
A multitude of factors contribute to the rushing device innovation stream including fantastically creative engineers, a terrific educational system, and our nation’s entrepreneurial spirit. But one factor makes an enormous impact and that is the venture capital (VC) community. In the last three years they have invested $26 billion in private med-tech companies. And the result of past VC investment is well-manifested in the Borna Health Fund’s portfolio. Venture capital funding supported approximately two-thirds of the companies in the portfolio. Somehow an enterprising engineer with an idea to solve a problem connected with these financiers to fund them through years of work to develop and commercialize an important technology.
The impact of these companies extends beyond developing the devices themselves to educating physicians as to how to use them. They drive the advances in the care delivered in the hospitals and surgical centers around the world. Companies fund trade shows with peer-to-peer learnings, workshops to learn to use their devices, and frequently have clinical support reps on site to help the medical team using the devices.
Having spent 15 years in the med-tech VC investing community, I have seen its drawbacks. And I encourage entrepreneurs to view the VC funding process with caution. But one fact remains, the VC funding vehicle has enabled or accelerated the reality of medical robotics, minimally invasive heart valves, insulin pumps and gene sequencing. These are among the largest medical device markets in the world today.
While the VC funding system is not perfect, the end-products are impressive and helping patients around the world every day.