NOVEMBER 2006

Crossing Disciplines to Breed Biomed Ideas

The collaborative projects are so real that some have led to medical device startups.

Engineering students, from left, Samson Phan, Stephen Lee, Kiran Singamsetty, plus Darren Hite, MBA ’06, teamed up in their biodesign class to design prototype electromagnetic shoes to help alleviate inflamed tendons.
Photos by Anne Knudsen

by Margaret Steen

Spend enough mornings making hospital rounds with doctors and you’ll quickly fill a notebook with ideas for reducing suffering or saving money. That doesn’t mean, however that you can implement most of your innovations, which is one of the lessons students learn quickly in Stanford’s Biodesign Innovation Program.

Designing devices that solve medical problems in a way that doctors, patients, and regulators will all accept is the goal for students in a two-quarter Biodesign Innovation course. Run jointly by the Business School and the departments of medicine, mechanical engineering, and bioengineering, it brings together MBA students with engineering and medical students to address real-world medical needs. Students learn about the reality of working with teams of experts in other fields—and of the medical device market itself.

“The thing that surprised me was how much money it costs,” said Jeffrey Bernd, MBA ’06, whose team in the most recent course was looking for an alternative to existing breathing tubes that allow patients to be mechanically ventilated during and after surgery. “You look at our little tiny idea and think, ‘Why can’t we just do it on $20,000 and credit card debt? It’s going to cost us $1 million to make this little tube?’”

Bernd and the other students learned how the systems set up to protect patients and inventors also add to the cost of new devices: Regulators demand expensive trials of proposed devices to prove they are safe and effective. And making sure a device doesn’t infringe on anyone else’s intellectual property involves costly searches each time the design is changed.

“It gave me more perspective on why it costs so much money for these medical innovations,” Bernd said.

The graduate course is part of Stanford’s Program in Biodesign, which also includes a yearlong fellowship program for graduate and postgraduate students who want to devote full time to biodesign. The program was launched in 2001, and the Business School became involved in 2004.

“We believe that there is a discipline of innovation, or something close to it, that can be taught,” said Paul Yock, program director and the Martha Meier Weiland Professor in the School of Medicine and professor of bioengineering and, by courtesy, at the Graduate School of Business. “That’s really the essence of the class and the fellowship. How do you actually bring a good idea forward?”

Nuts and Bolts

At the beginning of the academic year, the program’s fellows spent several weeks shadowing doctors at Stanford Medical Center and compiling long lists of procedures or technologies that could be improved. The fellows chose some of the problems to work on themselves; the rest were passed on to the students in the course.

The small patch, left, designed to monitor cardiac arrhythmias for 30 days, was one of the ideas studied in the Biodesign Innovation course.

For example, the team of biodesign fellow John White, MBA ’05, developed an improved heart monitor to detect cardiac arrhythmias. They won a $10,000 business plan prize from the Silicon Valley Boomer Venture Summit at Santa Clara University for the work and plan to file U.S. patent applications related to their inventions.

When each class starts, students evaluate medical needs, talk to doctors, and scour medical databases. They form teams of business, engineering, and medical students, each focused on solving a particular problem. They consider possible engineering solutions and evaluate how difficult it would be to bring them to market.

In brainstorming sessions at the biodesign lab, Darren Hite’s team came up with more than 100 ways to relieve inflamed tendons: braces, invasive procedures, new drug delivery techniques. They narrowed the list to three, including electromagnetic shoes. “We thought it was the most creative and interesting solution,” said Hite, MBA ’06. “It was also something that we would be able to create a prototype of in the lab.”

The teams presented their potential solutions to a panel of entrepreneurs and venture capitalists.

“They give you very candid feedback on whether your market is correct or not,” said Darin Buxbaum, Class of ’07. His team was focused on alternatives to gastric bypass surgery. They started by deciding what outcomes they wanted for patients: They wanted the procedure to have fewer post-operative complications than current procedures, and not to involve general anesthesia, which is particularly risky for obese patients. “We just wanted to reduce all the risks, so patients wouldn’t be afraid.”

In the second quarter, each team honed one solution by creating a detailed market analysis, a financial model, and a regulatory strategy. The teams met weekly with one of the three faculty members: Yock; Stefanos A. Zenios, professor of operations, information, and technology at the Graduate School of Business; and Josh Makower, consulting associate professor of medicine.

“We each specialized in what we were good at,” Buxbaum said of his team. The engineers built a prototype. The physician on the team helped with anatomical issues and considered how to get doctors to adopt the new device. Buxbaum analyzed the market—was there enough need to get funding?—and estimated how much money would be required to start the business. “We got a taste of the reality of launching a venture.”

About 60 students enrolled in the winter course; fewer continued in the spring. Some dropped out because of scheduling conflicts or because they realized the project they were working on wasn’t viable and they didn’t want to switch teams. And for some, the coursework made them reconsider their career goals.

“In some ways the course is a boot camp in entrepreneurship,” Zenios said. “Some students discover they don’t have the tolerance for being an entrepreneur.”

Real-World Lessons

The projects are so real that more than half a dozen ideas from the class and the fellows’ projects have become startups.

Stefanos Zenios

Elad Benjamin, MBA ’06, is president and CEO of Vascular Precision, a company based on an idea from the class, which he took his first year at the Business School. Feedback from the venture capitalists who heard the team’s final presentation—on a way for doctors to create and close large access sites in blood vessels without the need for surgery—encouraged the group to form the company. They have successfully tested their prototypes in the lab and recently in animals, and are seeking funding to continue R&D and develop the company.

And Buxbaum’s team continues to meet weekly, considering ways to raise half a million dollars to turn their idea into a startup. They have filed two patent disclosures.

“We don’t actually care about whether startups are created,” Yock said. “That’s not the point. Our point is education. Faculty believe the best way to learn about technology innovation and technology transfer is to do it for real. So we put a huge amount of work into making sure that the needs that the students are working on are real needs.”

Zenios said the innovation process is the same at a startup or a larger company, though founders of startups take greater financial risks and can reap greater rewards. “Recognizing that you are going to hit walls repeatedly—that process is the same.”

If students pursue a job with an established company, the course “gives a graduate about a six-month-to-a-year advantage in terms of having a better understanding of medical devices,” he said.

The course teaches lessons that students also can apply elsewhere.

“How do you work with people of different disciplines, different backgrounds, different interests, and all come together to pursue a common objective and deliver a valuable end product?” said Dave Plough, MBA ’86, partner at the Beta Group. He recently helped evaluate the program with a group of alumni volunteers. “The whole concept of this class is, I think, a very beneficial one for all MBAs.”

Buxbaum learned this firsthand as his team pondered ways to help the morbidly obese. “People attack problems from different points of view,” he said. “Engineers tend to be a little more analytical and methodical. The physicians tend to be very patient-oriented.”

Because the course teaches not just how to solve a medical problem but how to do it in a financially viable way, students learn “a lesson that nobody wants to learn,” said fellow White. That is that one of their ideas might help people, but no startup could survive on it because the cost is too high or the market too small.

With economics as the driving force behind so much of the medical industry, the course also teaches students how to do business ethically. First, Makower said, it’s crucial to disclose any financial interest that a doctor or hospital has in a particular treatment. And second, the interests of the patient must not be compromised. “One should never put the interests of the company ahead of the interests of the patient.”

Management Matters

The addition of MBA students and faculty to the Biodesign Innovation course has changed its dynamics.

Several students and fellows are shown above in a prototyping workshop.

“The way that the students participate in the class, how the professor interacts with the students, is really quite different in the Business School,” Yock said. There is more emphasis on case studies now, for example. And because MBA students are taught to communicate and to think on their feet, “in Business School classes, there’s more cold-calling on students. They’re asked to answer a question that requires their preparation. That’s actually unusual in the medical school and the engineering school.”

On the student teams, the MBA students define the market for an idea, write a business plan, and generally keep the projects on track. For Bernd, project management was “second nature.” He said, “Everybody at the Business School just does that.”

MBA students also help keep their teams focused on the market, said Samson Phan, a student in the PhD program in mechanical engineering. “There were some times when we thought, ‘OK, this idea is good enough, and it should work.’ The addition of the business students would kind of push the idea further in order to make it, say, more marketable or more appealing to a company or a user.”

White, who has moved on to a job selling cardiology devices, emphasizes what he learned about teamwork. The teams that did the best were not necessarily the ones that looked the best on paper, he said, but those with the best chemistry: “The teams that succeeded listened to each other and took advantage of each other’s different areas of expertise.”

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