Thursday, August 23, 2007

Radiant Medical: a blimp in medical device history but a grave leasson to learn and re-learn about the industry

I heard this on the Medical Device Network newsletter today:
"Radiant Medical of Redwood City has ceased operations as of today when further venture funding was not available. Nearly all of the 25 employees were laid off. Radiant was a private medical technology company focused on the research and development of endovascular therapeutic hypothermia. This news was relayed to me by an employee who is leaving today."

For those in Wall Street, medical device companies are just another avenue to praise or complain about the economy. Whenever there is a small movement at Medtronic, J&J or Boston Scientific, there is a lot of noise. But the difficulties persist for smaller companies too.

Medical Device companies have to wade through a whole array of problems leading from safety and efficacy to quality, regulation, competition among hundreds of other factors. Having a great idea and a great team might also not be enough for an industry riddled with several problems.

Radiant had a lot going for them. From what I have known historically, therapeutic cooling did seem like a good idea. Radiant's team also was supposed to be good. (A friend of mine used to work there in the past and only had good things to say about the place). Still, it took too long and while we may or may not find out the actual reasons behind why the device never took off, they simply ran out of funding.

The moral of the story: even if you have good things going for you, it may not be enough in medical devices!

The takeaway: If there are geniuses in your company wasting time with paper work, unnecessary plant closures, too much pow-wow about innovation without actually producing anything, and creating a hostile enough working environment that the company looks like one big revolving 'em! You already have too much to worry about as a medical device company!

This is also a warning. In the medical devices industry there cannot be and should not be a bubble! So don't be taken in by all the funding that is driving the industry right now. When the correction happens, and it will, things can get painful...

The point is not to make a gloomy post, but to make sure that people have their feet planted on the ground when looking at the industry.

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