Tips for Otolaryngologists Who Want to Enter and Excel in Entrepreneurship

Physicians are problem solvers; this truth underlies the practice of medicine. For many clinicians, the problems to be solved daily surround the diagnosis, treatment, and management of individual patients. For others, it’s translating that problem-solving ability to a larger landscape—to see a problem for which a solution is lacking and strive to solve it for the benefit of patients, providers, and even healthcare systems. 

Otolaryngologists are in a unique position to enter and excel in entrepreneurship. As both clinicians and surgeons, they’re trained and skilled at managing the full spectrum of problems that a patient may present with. “Otolaryngology allows you to solve a patient’s problem regardless of whether it requires surgical or medical treatment,” said Karen Stierman, MD, an otolaryngologist practicing in Austin, Texas. “You get the blanket problem and then get to figure out how to tackle it.” 

The types of medical problems that otolaryngologists encounter also mean that the specialty is ripe for innovation, according to Dr. Stierman, who mentioned the electrical and mechanical components of many ear, nose, and throat problems that could be improved through innovations in biotechnology, for example. 

Citing the large number of otolaryngologists engaged in entrepreneurial work, Peter Santa Maria, MBBS, PhD, current chair of the American Academy of Otolaryngology–Head and Neck Surgery (AAO-HNS) Medical Devices and Drugs Committee, emphasized the inclusivity of this group, which comprises otolaryngologists in both private practice and academic medicine, as well as those engaged in the full spectrum of entrepreneurial activity, from consulting work to owning a company. 

Meet an Unmet Medical Need 

Innovating is creating something new or building upon something that already exists in order to make it better. In medicine, this may be a device or therapeutic to improve outcomes for patients, a surgical device to reduce surgical time or ease the difficulty of a procedure, or a new software to help manage chronic conditions. The possibilities are endless. 

But the first step in launching an innovation with commercial potential is seeing an unmet medical need. 

“ENT, like any specialty, unfortunately, has treatments that have complications, and many of our treatments are expensive to the healthcare system,” said Dr. Santa Maria. “What can we identify as the problem areas and what can we do to make them better?” 

Recognizing a problem area and then coming up with a solution for how to make it better is the correct sequence to innovation, he said, and one that he teaches potential entrepreneurs in his role as associate director for the Stanford SPARK program in translational research at Stanford University in Stanford, Calif., as well as when he mentors participants attending the Stanford Byers Center for Biodesign. 

Begin with something simple and work up to the development of the full idea. 

—Marlan Hansen, MD 

Often, Dr. Santa Maria sees the opposite, and cited building a solution and then chasing a problem as one of the biggest mistakes to avoid. “Some people get locked into building something new or developing a cool technology and then find there’s nothing to really apply it to,” he said. 

Once an unsolved problem is identified, the next step is to become immersed in understanding the problem and brainstorm all the possible solutions associated with the outcomes desired. 

Josh Makower, MD, MBA, director and cofounder of the Stanford Byers Center for Biodesign, created a needs specification to help entrepreneurs through this process. Culled through many years of working as an innovator and the founder of many companies listed on his website, ExploraMed (https://www.exploramed.com/), the process includes becoming deeply embedded in a clinical environment to develop a list of needs that frames a set of criteria for success that’s based on input from all stakeholders who may benefit from the innovation. After completing the needs specification, innovators should have all the information they need to successfully create a solution, said Dr. Makower.

Important considerations to keep in mind at this stage are the complexity of the problem and the full scope of what will be needed to address it. 

Start Simple

Marlan Hansen, MD, chair and professor of otolaryngology at University of Iowa Health Care and co-founder of Iota Motion (https://iotamotion.com/), a company specializing in cochlear implant innovations, advised entrepreneurial newcomers to start with something simple. “Begin with something simple and work up to the development of the full idea,” he said. “What I learned in practice is that you bounce your ideas off of other people you trust.”

Once an idea gels and people have signed on, bringing in a team of people who can help assess regulatory and other hurdles to bringing the idea to commercial viability is critical. “The regulatory pathway can be extremely hard,” Dr. Hansen cautioned, citing that as one key factor in deciding whether to pursue an idea that requires Food and Drug Administration (FDA) approval or to switch gears and look for a simpler idea that doesn’t require the rigors of FDA approval.

Dr. Stierman learned this by practice as well. In her first innovative venture—a medical device for chronic sinusitis—she realized that the complexity of moving the device through the approval and commercialization stages to bring it to market was beyond what she wanted to do. She currently holds the patent to the device, which is in the prototype stage, as she negotiates with a company better suited to launch the device. She’s also working on simpler innovations, including an allergy app she’s worked on with three other founders and an app with utility in the facial cosmetic industry. 

Build a Team

Natural problem-solving abilities are necessary for those wishing to achieve success in the entrepreneurial space, but they aren’t enough. It’s essential to team up with people who understand and are experienced in the business aspect of turning an idea into a commercial success.

“You need to understand your limits,” said Donald Gonzales, MD, founder and chief medical officer of Cryosa, a company advancing minimally invasive treatment for obstructive sleep apnea. He underscored the critical need to hire the best team possible, people who are experienced in the entrepreneurial arena and understand how the process works. “Hiring the wrong team can make the best ideas fail,” he said.

If you look at the successes in medical [innovation], they’re the result of collaboration.

—Peter Santa Maria, MBBS, PhD 

As a practicing otolaryngologist before starting his first company while he was a resident in 2003, he learned by doing that, after a certain stage in the development process—typically once a company needs to grow and requires venture capital funding and more staff—a different skill set is required than the one that physicians typically have. 

Dr. Santa Maria also highlighted the need to form a team with different backgrounds to “help the problem find a solution. If you look at the successes in medical [innovation], they’re the result of collaboration,” he said.

This focus on the collaborative nature of entrepreneurship is highlighted in the ENTrepreneur Faceoff event held during the annual AAO-HNS meeting (https://www.entnet.org/events/annual-meeting/speaker-resource-center/aao-hnsf-entpreneur-face-off/). Launched two years ago, the event showcases the innovative ideas of members via a competition in which teams are evaluated for how well their innovation meets an unmet medical need and by the work done to meet that need. A key purpose of the event, said Dr. Santa Maria, is to provide education to other members and to encourage networking, which may be particularly important for innovators who practice outside an academic center. 

Patents and Funding 

Once a solution to an unmet medical problem has crystalized, securing a provisional patent early is important, said Dr. Gonzales. “Companies start out with property, so the patent creates that property that you can then build upon.” 

He said that once he thinks an idea will work, he does the legwork himself to see if there’s anything similar already patented by scouring the United States Patent and Trademark Office website (https://www.uspto.gov/). If no other patent is held on his idea, he works with a patent attorney to file for a provisional patent. The provisional patent, which lasts for 12 months and is inexpensive (roughly $2,000), allows time for the research and development that is needed before applying for a more costly permanent patent. Once a permanent patent is secured, it lasts for up to 20 years, with required paperwork updates. 

Dr. Gonzales encouraged innovators to self-fund the patent phase to secure ownership over their innovation. Once a patent is secured, initial funding through the preclinical proof-of-concept stage typically comes from friends and family and angel investors. “It’s tough work to show that the idea will work,” he said. 

But if it does, he said, the next phase of funding is where the big money comes into play to move an idea through the FDA approval process, which may include clinical trials. For this type of funding, which typically runs into the tens of millions of dollars, he turns to venture capital. 

“You need to raise enough money to get to the next critical inflexion point, but raising too much too soon creates unnecessary dilution,” cautioned Dr. Gonzales. Dilution, in investment terms, refers to a reduction in a shareholder’s ownership percentage in a company as more money is invested. He emphasized the need to have realistic goals as you raise money to get to the next stage, while not taking on too much money early in the process. 

Dr. Santa Maria also noted the different funding needs required by each stage of the process and encouraged innovators to talk to companies and investors interested in the idea to get a good understanding of what they’re looking for in investing, which will allow the innovator to design a pitch to meet investor goals . “You may end up needing a lot more or a lot less money,” he said. “But you need to engage with industry to find out.” 

Parallel to this engagement is the need to tap into a pipeline of people to help you through the different stages of innovation. “Surround yourself by people who are doing what you’re doing, and find different mentors through the different stages,” said Dr. Santa Maria. Although it may be difficult to find such people, he pointed to the many groups within universities and U.S. device and drug companies. AAO-HNS members can use the association’s Medical Devices and Drugs Committee as a resource. 

Fail Fast, Stay Open, Follow the Data 

As an innovator with years of experience launching companies, Dr. Makower underscored the reality that failure is a part of the process. “The goal,” he said, “is to fail fast.” Even though failure is endemic to the process and happens at almost every stage, failures that happen before you raise too much money are better for all. “We try to keep existential failure at the beginning if we can help it, ideally before we launch the company out of the incubator,” he said. “If you can fail fast with the smallest amount of investment capital, you’re doing a very good job.”

More painful, he said, is when failure comes late, after large investments have been made. “That’s a tough situation, and it’s often challenging to recover,” he said.

To minimize the occurrence of late failures, Dr. Makower stressed the need to follow the data. “You must listen to early data and try to obtain really clear signals to build confidence to move forward. But even more importantly, you need to be willing to say that if something isn’t good enough and if it can’t be easily fixed, it should be terminated before too much time and too many resources have been wasted,” he said. 

Relying on good data is also the foundation to meet the strong skepticism that awaits all entrepreneurial activity, he said. “When you have the data and the conviction, you can stand up against critics and persevere against skepticism,” said Dr. Makower. “Try to understand what the skepticism is about and answer it with data rather than opinion.”

Understanding skeptics requires what Dr. Makower sees as a key quality for innovators: an open mind that requires careful, unbiased listening. “If you’re biased toward one solution before you even understand the real needs, you can easily be led down a pathway to a failure.” 

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Mary Beth Nierengarten is a freelance medical writer based in Minnesota.