Meeting Unmet Needs in Cardiovascular, Endovascular, and More with Innovation | LSI USA '25

Farzad Azimpour  0:05  
All right, so pretty small topic here, right? Al, let's talk about all unmet needs in the entire space of cardiovascular and Endovascular, and maybe sprinkle in some other things. I'm Farzad Azimpour. I'm a cardiologist by background. I serve as Senior Vice President of Strategic Innovation at Edwards life sciences. I also wear the hat of Associate Director and lead for design at the Stanford masala center for Biodesign. And I am joined here by two incredible now friends of mine as of last night. We had a pretty fun night last night, and Evelyn t so I'm going to let you introduce yourself as well, but just high level. Evelyn is a finance expert who helps strategics invest. And Firas Dr, Firas Al Ali. He is a boots on the ground neuro interventionalist, but he also happens to be an entrepreneur, so I'm gonna let each of you kind of expand on that a little bit to give us context for what we're gonna talk about. Yeah.

Evelyn Tee  1:07  
So Hi everyone. My name is Evelyn tee, and I lead the med tech practice of LSC. It's a mid size boutique consulting company, and we work a lot with strategics across different therapeutic areas, mostly around conducting market opportunity assessments and helping them to assess strategic targets.

Firas Al-Ali  1:26  
I'm Dr Firas Al Ali, a neuro interventionist for the last 25 years, I think I scrubbed my first case in 87 that's made me, made me see the whole career. Last year I retired, and I'm focusing now in my company, and

Farzad Azimpour  1:44  
there's a lot more to come from him too. Okay, so before we kind of dissect our way into this the first cut, I want to take just a moment to define how we look at using the Biodesign process, how we look at articulating an unmet need. And so it's very important for us to lay this groundwork before we dive in. First, we have to be sure that we've identified a population, a patient population, who's uniquely unserved by the status quo, and perhaps even desperate for change. Second is identifying and articulating a mechanistic problem, and in many cases, a physiologic problem that we're going to use as our target to hit. And third is identifying and articulating a value driven measurable outcome, so that if we are to hit that target in that patient population, we can measure and we can express ourselves in a way that society, that clinicians, clinical practices, can identify something worth adopting. And then we take a step back and we say, if we, if we get that right, is that something that's going to change the practice of medicine? Is it novel? Is it kind of publishable, right? Can you design a series of trials that would that would allow you to investigate this and generate the right evidence to move forward. So it's really insight is the key differentiator. So now let's, let's jump in, because what I've said sometimes doesn't align with maybe what a physician sees on the ground, right, like you're experiencing things in what you call an unmet need, and what you kind of classify in your head is an unmet need in let's say Endovascular. Let's walk through your mind a little bit for us, what does that mean?

Firas Al-Ali  3:27  
I think it's this really very exciting time, for the first time, maybe for a physician like me in the lab, I start thinking like you in the big company, because now we are doing 10 million procedure a year. So if I see my patient having like, 2% complication, and we can decrease that 2% complication rate to 1% that's 100,000 patient. So because we came a dominant and mainstream interventional procedure, so every tiny improvement, it will have a significant population impact. That makes sense to you, and that's you, because when I start working, we were, we were a sub niche. Well, not even niche. We're sub niche doing like 10,000 case a year, versus 10 million. So these improvement that we used to call incremental. It's not incremental anymore at the level of the society, because 1% is 100,000 patient, and that's

Farzad Azimpour  4:29  
new. So we're going to push we're going to push on each other a little bit here, because that may be assuming that you believe the market is mature, you believe your space is mature, or am I? Am I? Am I interpreting that correctly? Right?

Firas Al-Ali  4:43  
No, I don't think it's mature. I think we are mature enough to became mature. That's like, now we were like, fit today in the dark side of the hospital, and now we are in the mainstream. So now is the time, you know, remember we were talking, I said, if you. Going to correlate our history in Endovascular to United States. History today is 1869 we linked the east and west coast, Pacific and Atlantic Ocean. Now we need sheriff in town, and we need grass cover to be built. So now we build the springboard to go for a massive improvement, but also what we used to call incremental improvement, it will have a significant population improvement. That's it. So, no, we're not mature. We mature enough to became who we will become. It's extremely exciting time, excellent.

Evelyn Tee  5:33  
And we talked a lot about this. You know, in our previous discussion, not every single technology has to be a blockbuster technology, right? Like even incremental technologies can provide a lot of meaningful value to society, especially when we're talking about Endovascular, you know, diseases whereby you're talking about large affected patient populations. So for example, like even improvements in deployment mechanisms and your delivery methods, like anything that improves, improves ease of use or procedure efficiency, can be highly impactful to an interventional is. And if you talk about just regulation specifically, you know if the device is an incremental improvement over already existing, pre established device, it might fall under the FDA, like class two pathway, which means a smoother regulatory pathway and a faster, you know, time to market. If you talk about reimbursement, you know, an incremental technology might already fall under a current reimbursement code, for example, and so it might even just be adopted without any need for reimbursement changes. And the last thing to point out here is, how about, you know, the thing about develop showing the value in a very cost constrained environment right now, the median Hospital has a net profit margin of one to 4% that's the median profit margin in hospitals right now. So these are really razor thin margins, right? So any re engineer technology that even if it's an established technology, if it can prove to do it proceed in a more cost efficient way, you know, it can improve the number of throughput per day, like that. Can have a strong market position, even if it's incremental.

Farzad Azimpour  7:22  
So. So do you think, and I guess this is, this is to both of you, do you think that an early stage entrepreneur, somebody who's who's who maybe doesn't have the resources of a big strategic Are they better positioned to take on one kind of strategy versus another?

Firas Al-Ali  7:41  
If you're asking me, I say yes for two reasons, because we're just so close and we're not we don't have culture like a big strategic had their culture, and now, as I said, because I spoke with many people in strategic very few people at the beginning of our discussion agree that we are in a very special time of Endovascular they cite, okay, flow diverter. I'm going to have flow diverter. You have coral. I'm going to have coil. Very few of them understood that. Now we are 1869, now it's time to have incremental improvement, because it will have significant impact in the health of the population. And the second one, it's really time. We can produce skyscraper like now it's the time to say we're going to talk about a brain computer interface. So brain computer interface now we can do because we acquired over the last 40 years a superior navigation skill. We can go almost not only to any artery. We can go to any vein, and we can place one vein as a location where we're going to place our microchip. 15 years ago, we couldn't do that, see, and for many strategic they still thinking about it as a science fiction. And I will bring back here a me interview I saw with Bill gate, and Bill gate one time said, I'm never scared of other strategic those guys are busy like me just running the day I'm starting. I'm very scared of these two kids in the shop somewhere thinking about something in you. And I think here is a is, I would love if people strategic are sitting here just to think about this point. They are many out there, many great ideas that doesn't fit within the the mold, you know, because for them is as we go. But now we link. Now we can bring something like brain computer interface. We have the skill to put it almost in a vein. I'm not talking about arteries. And one more thing, which is very peculiar to us in our stage of development, when we started, we are through treating a disease inside a blood vessel. Now, over the last five, seven years, we start taking the blood vessel that is normal as a venue to treat a lesion that has nothing to do with the blood vessel itself. Life, and that's for us, is as as as physician in the ground, looking to anatomy and remembering what we were doing and and reading this physics book is an amazing, tremendous opportunity to make a breakthrough completely different. So we are at two extreme now you know this incremental improvement will do a significant impact on society level, because we have 10 million patients. Another level, we are ready to build scramscripper, if you wish, because we acquired so much skill over the last 40 years, and computers, you know, improve so much, so we really can go beyond the traditional story we had before.

Farzad Azimpour  10:40  
So Evelyn, is there? Is there a way to invest in in kind of this range of possibilities and offerings, whether, whether an entrepreneur has decided to take on something huge or something maybe that's seen as more incremental?

Evelyn Tee  10:54  
Yeah, I think I'm going to focus my answer on strategic, since I work so much with them. But I think just to level set like for P for like, between the financial investor and then the strategic investor. So for a financial investor, like a VC, for example, they're going to be investing in these smaller stage companies, high growth potential. They're looking for transform, more transformational technologies can that can unlock, like, significant unmet need. For PE, for example, there'd be like, later stage, you know, they're looking for recurring revenue streams. That's proven already. They're looking for potential scalability. Now, when it comes to strategic, you know, they're looking at an incremental technology, not just in terms of how that technology addresses episodic care, meaning just one point in the patient journey. They're all moving towards a full path free strategy, meaning they want to understand how that technology, incremental or otherwise, unlocks value throughout the patient lifetime. So strategics are thinking about, you know, specifically for Endovascular diseases, as well as cardiovascular diseases, which are often takes a long term, like chronic management approach versus, like, a one time treatment. You know, for example, in PhD, right? We're talking about drug coated balloons, we're talking about stents, we're talking about atherectomy. So there's a whole portfolio of solutions that they are thinking about. And so they are thinking about how, you know, when they are acquiring or looking at a particular investment, it's like, how does it complement their entire product ecosystem? Does it lead to, you know, cross selling opportunities? And how does it, you know, support the other products down, you know, downstream? And one trend that a lot of strategics are thinking about is this move towards value based care. So it's really important for Medtech companies to think about positioning, or at least mentioning how your product reduces long term complication rates, because they're really looking at the cost effectiveness of the solution over the lifetime of a patient versus a specific like procedure expense.

Farzad Azimpour  13:07  
Yeah, that's that's great. And I think it's important also to highlight that different strategics kind of behave differently and have different business priorities, right? So as an example, Edwards tends to invest early on things that need a lot more de risking, but that gives us an opportunity to bring it in early, put our fingerprints on it, and invest where we prioritize things, which is internal, organic development. It doesn't mean that we don't also occasionally get something that's a little bit later stage. But when you're an entrepreneur and you're approaching companies, I think it's important to have that understanding of who your target audience is. There are other kind of players in our space that specialize in later stage investments, and they need to see different things, and they're going to prioritize different things. But getting back to the unmet needs part, I think that when you're making earlier investments, you have to be able to articulate that with more confidence and more clarity, because somebody's taking a big bet on you, right? And they have to believe in you, and they have to see that same vision expressed in this, in the way that you've chosen to express it.

Evelyn Tee  14:15  
Yeah, it's interesting that you brought a point of at what's and you know how it compares to the other strategics. Like they even within the strategics, there are different approaches to acquisition. So for example, like, you know, Edwards, you have a very focused portfolio. Please correct me if I'm wrong. Like, you're focused on trans catheter, hot technologies, structural heart, you know, and now moving on to heart failure. So you're often thinking about, how do you invest in tricuspid Mitro, beyond your dominant aortic franchise, right? So your approach is like at least an observer, like a long term, iterative, clinically driven approach. And if you like, look at Medtronic, for example, they have a much larger cardiovascular portfolio. You know, anything from aortic aneurysm repair to Jack called it blue. Solutions to even, like, Reno, you know, renal innovation systems. So they are investing both in next generation technologies, but they're also thinking about portfolio expansion. And another way to cut it is just by, like, even, you know, innovation strategy companies like Abbott Edwards, you know, they're often taking the first in human first in class, like trials, you are actually like shaping the regulatory pathway to bring novel solutions to market, you know. And in comparison to a company like Boston Scientific that's a much more fast follow approach, right? They're like acquiring like emerging technologies very quickly. For example, they acquired BTG back in 2019 for these like ultrasound, thrombolysis systems, instead of being like the one that has the first first in human clinical trial.

Firas Al-Ali  15:53  
Farzad, can you ask a question as strategic, do you or do you know your company or other companies? Do you guys have, like, a small boutique about wild idea, or you leave that farmed out in the society, and then some people came up as the wild idea. Then they come to

Farzad Azimpour  16:09  
you, you would think that he that this was a prepared question, actually, no,

Firas Al-Ali  16:13  
it's not okay, no, but I think it would be interesting, because you do have the resources, okay, and but also it demands some shift. You know, we're not here to improve and stuff, because the way it is now, it's farmed out to, you know, to physician, to entrepreneur, whoever come up with idea and then come to you, does strategic have, and I don't know the answer, have a small boutique of their own where just innovative people sitting and thinking wild, because I think it's a time. I truly think it is a time to have such a thing, because sometimes it needs so much resources for two, three people to be sitting thinking about it, it's hard. Well,

Farzad Azimpour  16:51  
thank you for justifying our existence. I appreciate that that lay up there. So the way that we're structured today is that within each of our commercial business units, there are teams that are, in fact, designing for not only the next generation of an existing technology, but also taking a step back and looking more holistically at that disease process. What are other ways that we can tackle it? Now we live, and my colleagues and I live in a world called advanced technology, which is a non commercial unit, and this is more of an experimental space, and so this is where we are kind of Chartered with taking the big, bigger swings that allow us to create entirely new categories of care, right? So we're actually not looking at valvular disease within our group. Currently, we're focused on interventional heart failure. This becomes another side topic, which I'm happy to discuss over coffee with others. But where do you draw the box on what is structural heart disease? You know, is there actually a box here? And do we need to focus in on that? Or in the case of heart failure, you know, it's, it's affected by many things outside of the heart itself. It's not just the blood vessels. It's, you know, you have the neuro endocrine system, you have the kidneys, the lungs, all these things kind of working in tandem together. So it's been a very fun and interesting challenge for ourselves to define where is our sandbox? Actually?

Evelyn Tee  18:23  
Yeah, very anecdote on that. So we recently did some work with congenital heart disease patients, and we're trying to figure out the unmet need. Like, you know, as a person in industry, like we knew that they were undergoing multiple interventions before the age of 18. Oftentimes, they're intervening on the child of congenital heart disease like at birth. And so we did this whole unmet needs exercise with these kids and the parents. And so we're like, you know what? You know? What tech you know? What unmet need do you have in the innovation? And the answer was, like, we can't think of any. Like they actually felt so grateful for the care that they had received like they were, like if our child had been born 20 years earlier, like we would not, our child would not have been, you know, born today. So unmet need often, yes, it's, I would say it's easier to get an unmet need based on where the carbon like technology is, but it's a much more difficult process as what you're saying, you know, to think about the out of the possibility, right? Like truly transformative care.

Farzad Azimpour  19:27  
Okay, so who wouldn't want to go into the angio suite and watch Firas operate? That sounds like the coolest thing, right? Like I want to go watch him in action. And I would argue that As tempting as that is, it's not where we're going to find the big, big opportunities right now. Tell me how you

Firas Al-Ali  19:49  
react. I agree. I agree. That's why I really asked you, do you have a small shop for you to think about the smallest possibilities? But it's not That's why I asked you, because I don't know how. You guys function. You are another strategic it would be so neat to have a shop in house for these new ideas, but open to people like me, like we can talk about it, and I don't know how we're going to be structured be, because it's truthfully when you deal with this family and with this patient, you truthfully have, you're touching life, and you know what's truly important, truthfully, as opposed to the numbers. Because I always say medicine is different business. It is business, but it's different business. We have direct contact with the human life, so direct and so palpable that is humbling, truthfully, out of this sometimes pain, you drive back in your car saying, Oh my God, if I had this, I would have done that. It come a very nice interaction, like sometimes I see my patient coming back in the office for a visit, and they cannot walk it stay with me for a week. So now I'm thinking it would be really nice if I can implant this device into that area and but that's too much for me. It'd be really nice for strategic to have this new venture, like discussing something. Do you follow me? So I think yes, it's more interesting to be in your seat, in that sense, but it's much more interesting to be in my seat because I have that direct understanding of the end met needs. No

Farzad Azimpour  21:23  
we need a continuous partnership with physicians who are out in the field, because day in and day out, you have things that are happening right under your nose, right? And it's up to us outside to take the time and take that step back to put together patterns that we can identify, and then bring them back to you and say, for us, this has been right in front of you the whole time. Here's something you may not have seen or appreciated. What do you think? And get your response

Firas Al-Ali  21:52  
to that, yeah, but my question, how would you come with this? It's better this. Hey, I have solution for unmit need today at the stand. And over for last 30 years, I've been working it's this disconnect. They wait on me to have an idea and maybe make it a company and maybe make a sale to come and talk to strategic to say, hey, I have a good idea. Let's could not buy it. I think it'd be much more it'd be much faster and much more productive if that innovative shop is open, and you walk into his idea the way it used to be 30 years ago, you know, 30 years ago, you come back, you go to the strategic and I did was something we draw in a napkin, literally in the over dinner, and then we came into level of maturity that, no, you have to sell the idea, and then Come back to us, follow me, and I think now we are at stage. It would be great to go back to the original, you know, revolutionary time, if you think we were creating new things all the time, and talking with these and many people in strategic I knew them when they were rep, so you were literally at the dinner. Now, this relationship is gone because of the maturity. I think it's great to make it even more mature, but have the essence of open door. I You don't need me to come to you with a product, finished product and sold it, and you don't need to think from far about what I need. It's been so much nicer to sit together, formalize it as inventive boutique without that take me three years to come to you because I prove something. You follow me. Yeah, I and this is for all strategy. Please take this to heart.

Evelyn Tee  23:33  
I think much as unmet need is really important, like it's just a starting point when a strategic is evaluating an investment suddenly unmet need. Of you know, is it, you know, how much does this solution address, like a pinpoint for at a hospital system level, at a physician level and in the patient level, you know, the unmet need could also be an unmet in terms of access, right? Are you able to get your solution to the underserved population? But business fundamentals right, like reimbursement, regulatory pathway, is that even market adoption potential are all just as important as the ability to address unmet need. Some of the market viability questions they're going to be asking you is, are hospitals and physicians actually going to switch to your product, right? What is the impact on workflow? What is the procedure efficiency like you know, are you going to require training of the physicians? If it's a strategic investor into your product, it might be asking, Can I add your product into the current basket of products that my sales force is already selling, right? Is it a simple enough sale, or is it a complex sale? Or do I have to open up a highly new sales force, which is really expensive, like a new commercial organization is really expensive. So any product that can combine, you know, meeting a clinical unmet need together with a really viable, you know, business fund. Menthols will be far more attractive to a strategic I can give you an example of this, like when Becton Dickinson acquired van close, which is a radio efficient radio ablation, yeah, radio frequency ablation technology for the treatment of chronic venous insufficiency, they were evaluating how this product could complement the entire portfolio of Endovascular solutions. Like, did it stand? They had balloons, they have vascular access. So in terms of the clinical unmet need for their product, yes, it helps to address patients who are bruising and pain posts operatively. It also allowed them to, like, ablate a longer part of the vein per treat, per per treatment. But beyond that, they were looking at business fundamentals. Number one, it allowed them to diversify into the vast into the Venus space, beyond their current arterial portfolio. Number two, CVI affects 40% of women in the United States, 17% of men, of which a large portion was untreated. So this was a huge population for them. And most importantly for them is that they already had an existing sales force that was that enabled them to distribute and to sell to ASCs and OB LS very effectively. And this is where the majority of procedures are being moving towards. So it just makes sense for them to acquire a company like that, because they are able to scale it very effectively through the existing commercial organization.

Farzad Azimpour  26:28  
I think this is great. It highlights again, I'm going to reference the Biodesign process here, where we use what we call need criteria, which are essentially clinical adoption criteria. And we look at four categories. We say what must be true in order for the world to adopt this based on efficacy, safety, usability and cost, and across all four of those, we look at access. How does access and barriers to access affect each one of these categories? And so we have kind of our must have and our nice to have, but if we can't hit all of those that we've already defined as being critical to the survival of that technology. It's a no go, and we move on to something else. And it hits all those points that you talked about. Those are all critical for you as an investor, for us as strategics, for you as an entrepreneur, to think about these things as early as we can so we can map it out and show that we've thought thoroughly about the problem.

Firas Al-Ali  27:27  
I think it's very interesting time. I want to know from Evelyn, let's say Evan some strategy came to you. I'm playing your role now for that. And what would you say to them? Go big, like computers, brain interface, or go smaller, or what would you say? Well, what's this is

Farzad Azimpour  27:44  
a great way, by the way, to wrap it up already,

Evelyn Tee  27:49  
if I were, if I was a strategic I can afford to take a portfolio approach, right? So I will be looking at my entire portfolio, and I can say, like, how does it complement the rest of my products? What is the time horizon, what is the risk I'm going to be taking here? If I was a strategic I'll be much more willing to invest in early stage technologies that has huge impact and and truly transformational, just because I have the fun I have, like the firepower for it, right? And so, you know, I'm much more I'll be much more willing to take on the risk with the higher with the longer development and validation cycles required for that kind of technology. I think generally speaking, the bigger the unmet need, the more transformational the technology will be required, or more innovations required. And therefore there is some patience and tolerance needed, or risk tolerance needed to invest in that longer validation cycle. I'm

Firas Al-Ali  28:48  
going to tell you something is going to be my last sentence here, since I came into the business for the last year, I can tell you, from my experience, I was, like, really shocked, because as a physician, you treat patients, and you know everything you do going to have complication or no complication. So we're very rational. And I felt, in the business world is much less rational. I thought it's going to be more rational because have to do with fun and significant fun. And I I found the fun part of it like, wow, it's big, transformational sometimes sweep the way for instead of real improvement. So there is a degree of too much fun, like too big story to excite people and not always have significant impact on population. And like I say, like I was a very little boy watching us going to the moon and coming back and made me dream. What, how great, but how much impact had in our life to go to the moon. Impact, I would argue that will and the LA region had much more and more impact on us human life today, and that tension between you know, cultural, societal culture is not only big company. Culture, about the exciting, the big and they're really useful. I felt it here, and felt that is very interesting. I thought, gonna be more rational.

Farzad Azimpour  30:07  
I'm gonna take that as as kind of the wrap up message for us. Actually, this is, this is something that we need to be able to do is maintain excitement in the clinical world so that we can keep our physicians on the ground, excited, willing to work, you know, kind of fire minded on these topics, so that they they want to take on these, these, these projects with us, because without the partnership that we have with physicians and investors, we're not going to be able to move forward together. So I want to thank everybody in the audience for for staying tuned with us, and thank you so much to these excellent panelists. It was really wonderful talking today. 

Firas Al-Ali  30:46  
Thank you very much.