MED TECH GROWING PART OF DAYTON START-UP SCENE
Companies know success can come only with effort, risk.
A Dayton start-up that’s developing a new kind of surgical rod wants to enter the $1 billion market of childhood scoliosis, limb development and traumatic injury cases.
AMB Surgical is now raising capital and aiming to get FDA clearance for its device, called the “flyte automated growing rod.”
It’s among more than a dozen young companies in the Dayton region trying to develop the next health care innovation.
The health care industry can be a minefield of rules and approvals needed to launch and require years of research and millions of dollars of investment to get started, but those med tech start-ups that pull together
funding and get needed regulatory approval will join the nearly 4,000 bioscience companies in the state representing $5.68 billion in payroll.
Medical device and equipment manufacturers employed about 12,000 people representing $676 million in payroll as of 2015, according to Bio Ohio, the state’s bio science membership organization.
Dan Sands, a consultant working with AMB, said it takes perseverance, a good network and an understanding of the market, and the right investors to make it through the start-up phase.
“It takes a lot of effort and essentially more risk, especially for medical device technology,” Sands said. “There’s a lot of things that have to come together.”
There are prominent examples to look to of Ohio med tech companies that have found success. This includes Cover-My-Meds, a software for prescription prior authorization that about a year ago became Ohio’s first “unicorn”, a term referring to tech start-ups that are valued at more than $1 billion.
NuVasive and Midmark are among established med tech firms in the Dayton area and
some of the recent start-ups in the med tech space are P&C Pharma and Ascend Innovations.
The dozen med tech companies presented their research and technology at the first Med Tech Showcase hosted recently in Dayton by The Entrepreneuers Center and Vensa Vensures, a Dayton advisory firm.
James Mainord, managing partner at Vensa, said Dayton already has established medical devices and medical technology firms, and Vensa wants to hold more events like the showcase to build the entrepreneurial ecosystem of med tech investors and entrepreneurs.
“It’s a natural fit that our entreprenuerial ecosystem matches our industry profile,” he said.
The med tech start-ups are finding their way in the Dayton area with the help of the region’s strong advanced manufacturing base, the built in customer base from a large health care industry presence and the resources from the Air Force Research Laboratory, which attracts an educated work force to the area and spins its research out into commercial technology.
Tyson Ross, an electrical controls engineer at AFRL, is one of the co-founders of AMB Surgical, and Sands said Ross’ experience at AFRL works well for his role with the company.
“That really parallels well with a medical device company, because you have to be very diligent and accurate,” Sands said.
Drew Cook, project and content manager at Bio Ohio, said the AFRL is a valuable asset for biosciences community with its potential to spin out new technology, like with Eccrine Systems, a growing Cincinnati-area start up working with AFRL and University of Cincinnati, was awarded a $1 million commercialization loan in 2015 to for an electronic patch that collects data by monitoring sweat.
In med tech, companies like AMB have had to settle in for the long haul to make it. It’s founders — Ross and Casel Bernett, a mechanical engineer at Toyota — have worked for a decade to get where they are.
Medical technology, especially surgical devices and other highly regulated technology, have a long development and approval cycle compared to other tech startups.
“For some people that’s attractive and for some people that’s prohibitive,” said Cook.
“There are people who say ‘well even if it’s difficult, even if it’s a long road, there are people who need it and I’m going to fight this challenge and make it happen.”