Another One bites the dust. Archives from the Startup Basement – 2

After I got my initial capital and the stents implanted by Dr. Vijan, there was a new swagger to my walk. The world seemed full of new opportunities. I started studying everything that a catheterization lab would need. A good friend from college introduced me to his brother, who was a cutting edge Interventional Neuro-Radiologist at Jaslok Hospital, Dr. Raju Ghodke, who let me hang out in the lab, chat up the technicians and make notes on the commercial opportunities. Product expansion followed; Interventional procedures are done with the help of Guidewires, who gave me a fairly large order for Guidewires made from Nitinol, shape memory alloy, again sourced by intelligent emails and sales spiel at zero cost from a company in the US, FlexMedics.

I turned my attention to a larger and more established coronary stent /balloon company, and over the course of a few months struck a deal with CardioVascular Dynamics (CVD), a larger company based in the US, with an interesting technology that claimed therapeutic benefits. The order was large for me – 20,000 USD dollars in investment in inventories – 20 Enforcer Balloon Mounted stents @ 500$ apiece and the rest in Balloon Catheters, the Lynx. In addition, I needed to spend about 6,000 USD to launch the company at a Medical Event in Goa, (made available to me at a great discount, again by Dr. Vijan). The Sales Manager of CVD flew down from the UK to do a marketing yatra of sorts with me, visiting various doctors on cath labs across the country, giving samples and help selling to the doctors. 

As part of the CVD launch in India, I met my distributor for New Delhi, Sangeet Chopra. He was tasked to crack open the market for Stents at Escort Heart Institute, headed at that time by Dr. Ashok Seth, a prominent Interventional Cardiologist. The volumes were large; 20 – 30 stents a day was not uncommon. Sangeet. Through sheer dint of persistence and street-smart fixing, Sangeet got us in record time. The sales price was 40,000 INR, my cost price was 20,000 INR – every time a stent was implanted, a clean gross contribution of 20,000 INR was clocked.

Now all I had to was to wait for the doctors to start implanting stents and start my money-printingfactory!

Now, with Sangeet’s doggedsales determination, we were looking at a stent and /or balloon usage at the Escorts Hospital almost every 2 /3 days. I developed a secret code for Sangeet. He had to send a blank email with the title “ Another One Bites the Dust” (after the famous song by Queen), every time a stent got implanted.  Sangeet was not a rock aficionado, but acquiesced.

My goal in life now was to wake up, check email and see these emails. I would check once in the morning, and once in the afternoon. Momentum started building up. 15 stents were implanted in 15 days. I would look for the phrase “Another One Bites the Dust.” That’s all that mattered.

On the last observed day, I saw the message not once but three times. 3 stents were put in. I was rocking.

Then, disaster struck.

The stent is a metallic truss that is mounted crimped on a PET balloon. The balloon was maneuvered into position at the legion, and the physician would then expand the balloon with water to as much as 18 Atmospheres, thereby expanding the struts and getting the stent lodged into the arterial vasculature.  Some doctors drove the pressure all the way to 24 atmospheres. Now imagine a small crack in the balloon, and the water squirting out at high pressure (the smaller the crack, the higher the force) could cause a dissection in the arterial walls. Technology reduced this probability in various ways, including Electro-polishing the Stainless Steel 316 that the stent was made of, but the risk is always there; at a molecular level, the surface of even Electro-polished surface is pocked with hills and valleys, all potential puncture points for the inflated balloon.

The CVD stents seemed to be less rugged in this respect relative to the competition. There was an adverse event and the product usage was suspended. We did everything we could do to fix the situation, and we got the doctors to use it again – and got back for a couple of weeks; but a couple more such events soon after sounded our death-knell at Escorts; we weren’t big enough to whisk away the doctors to an exotic conference in Business Class yet, which is how large companies managed such these.

We were down but not out. I built another significant demand source at the CMC Medical Hospital in Vellore. Travel from Mumbai to Vellore was now by second class sleeper – the extravagant daily return flights that I was used to previously evaporated as the gloom hung over us. My efforts in the South were helped by my good friend and business partner of 6 months, Natarajan – (who got, briefly, IIT /IIM Cal genes into my company).

But the business was changing, and consolidating – fast. The very same reasons that helped me 12 months ago were working against me. Margins were eroding. Anyone with a Stainless SteelElectro polishing machine and truss-designing ability could now manufacture stents. I did not represent a big brand like Johnson and Johnson, or Boston Scientific, with deep pockets and established and qualified Salesforce. At that time, the Kalam-Raju stent was also launched, at a cost of 15,000 INR. I even travelled to Surat, the diamond cutting capital of the world, in search of a machine that could produce stents; I found one, but the discussion never went ahead.

The stent business was opportunistic, and had given me revenue, and some experience and contacts; it was now time to look for something bigger, and something that had more Intellectual Property around it. It had to be BHAD, Big Hairy and Audacious.  It had to be rocket science, involving math, computation and cutting edge medical knowledge. It had to be rooted in something that the country genuinely needed and could create health benefits at scale. This was the next frontier for me.

Several weeks of research later, I was onto something. Something potentially Big Hairy and Audacious. And that, dear reader is subject of the next chapter in the Losing My Virginity series. Stay tuned!