A Formula to Help Maximize Your Results and Business Growth in Medical Devices with Duke Rohlen, CEO at Ajax Health and EPIX Therapeutics
Hey Outcomes Rocket friends, thanks for tuning in to the podcast once again. As a leader in health care, you have big ideas great products, a story to tell, and are looking for ways to improve your reach and scale your business. However there's one tiny problem. Health care is tough to navigate and the typical sales cycle is low. That's why you should consider starting your own podcast as part of your sales and marketing strategy. At the Outcomes Rocket, I've been able to reach thousands of people every single month that I wouldn't have otherwise been able to reach if I had not started my podcast. Having this organic reach enables me to get the feedback necessary to create a podcast that delivers value that you are looking for. And the same thing goes if you start a podcast for what you could learn from your customers. The best thing about podcasting in healthcare is that we are currently at the ground level, meaning that the number of people in healthcare listening to podcasts is small but growing rapidly. I put together a free checklist for you to check out the steps on what it takes to create your own podcast. You could find that at outcomesrocket.health/podcast. Check it out today and find a new way to leverage the sales, marketing and outcomes of your business. That's outcomesrocket.health/podcast.
: Welcome back once again to the outcomes rocket podcast where we chat with the day's most successful and inspiring health leaders. Today I have Duke Rohlen. He's the CEO of Ajax Health and a CEO of EPIX therapeutics. With over 15 years of experience as an executive in medical device companies, Duke serves as a chairman and CEO of both of these firms recently having raised a 120 million Series B dollars for Ajax Health, they're moving and shaking. Previously he was a founder and CEO of Spirox which he sold to ENTellus in 2017 for 200 million. And he is now on the board of ENTellus. Prior to spy rocks he founded and served as CEO of CV Ingenuity which he sold to Covidien in 2013 for 300 million. Of course this gentleman is distinguished in his ability to create companies to add value in the healthcare space but also to create viable business models that can get acquired so it's exciting to be able to dive into his thoughts and the way that things are shaken in the Capitol environment but also in the many devices environment. So Duke want to give you a warm welcome. Thanks for joining us.
: Thank you. It sounds much more impressive than I actually am so you should feel free to keep speaking.
: You're too funny. So you've definitely done a lot. Very humble. Love that about you. Anything that I left out in your intro that you want to talk to our listeners about anything you want them to know.
: Yeah the only thing that I think is missing from that very kind introduction is how that's done and I get a lot of the credit. But there's an enormous group of talent underneath me on the technical side, on the business side, on the finance side, on the operations side that doesn't get that credit and I think that it's important for everybody to understand that this doesn't happen by one person that clearly happens with extraordinary and coordinated teams of people working together.
: That's a great call out and I love your leadership style because it really encapsulates that vision of a leader that puts together those teams that it takes to win. Tell me what made you decide to get into the medical sector.
: I like people I like interacting with people and they're interested in science and technology. My father in law is a famous inventor in the cardiology space. My brother's physician and I felt it was a really interesting area to combine working with people, working with patients, working with innovation, and working in the capability that I have which is the business side. So early on I recognized there was compatibility with physicians who are trained to be caregivers right and were trained to invent and my ability to potentially interface with those two groups and create cohesion and a smile around. I love it. I don't really understand technology outside of healthcare and I'm not that interested but healthcare is the many interesting to me and the innovation that comes with very tangible and at the core it's helping patients you know the people which is what I care and which gives meaning in life.
: That's wonderful. Yeah. There's no other place like healthcare that really helps you get that impact directly with patients lives, families lives. And so you've worked with various companies you've established and turn around some very successful firms. Now you're in your current venture Duke. Tell us a little bit about what you believe is a hot topic that needs to be on healthcare leaders minds today and how are you guys approaching that at Ajax.
: Yeah. So for me the most pressing issue facing all healthcare is how do you take out cost you're dramatically reduce cost in the healthcare system. Something I'm very interested in and it is a big macro issue but if you drill it down comes into play in everybody's lives. The backdrop is that our country is truly the only industrialized country in the world where cost of health care is not contained. You know we almost seem to really operate in a red zone above the profit line annually which is that the cost of care new inventions new technologies are actually reducing the profitability of our healthcare system as opposed to making it more viable affordable. The only way in my opinion. Healthcare is going to continue to get the innovation that it needs is by creating ways to lower costs and reduce expenses associated with it. So for me in my world that means focusing on what I think are the critical pieces of technology which are you know speed efficacy simplicity and cost. How do you make something faster? How do you substantiate that speed with efficacy that is objective? Right to that verifiably the speed that you're getting out of a procedure has data that supports it simplicity. I think the world is moving more and more towards a lower common denominator terms of technical treatment and caregivers that have broader caregivers that aren't just training trained physicians. Right. And so having a simpler procedure that the supporting team at hospitals can do or out of care centers can effectively do is important and then the key thing is cost right. So all of those things plus reducing costs in my opinion is what you're going to do in my world medical device workers offering to help reduce costs in this market.
: That's some great call outs there, Duke. And so what are we doing today listeners? You know what are we doing to eliminate this cost? What are we doing to speed things up in a clinically backed away? And these aren't the hard questions they have to be asking yourself about your business model because if you don't ask them you go out of business. So give us an example of how you and your organization are creating results in these three areas that you mentioned.
: First of all I don't think that in a medical device company you can be successful if you just have one of those four capabilities. If you're just simpler or faster or have efficacy that's better or you don't take cost out where you have costs. That's the. You can't be successful you have to think of it as a Venn diagram or each one of those four capabilities needs to be addressed and needs to be superior. So what we're trying to do we have a company called EPIX which is an our ablation catheter that's what we view it as a next generation far off ablation catheter for patients that are afflicted with atrial fibrillation. The current standard of care is for contact where you're applying a certain amount of force with the catheter to the tissue for a certain amount of time. And then there are mathematical algorithms that are spit out that allow you to heal and understand and hope that you're making lesions. What we've tried to do is turn that on its head and have the information that's coming from the distal interface between the tissue and the catheter the real time. Real time we're getting rid of 4000 reads per second about what is exactly happening at the distant tip of the catheter that allows us to do is know exactly where we're made creating a lesion how long it accrete how long the burns for meaning how long until that lesions trains mirul and then when to move on to the next lesion. The result has been that we've taken that procedure time that can be three or four hours and reduce it down to less than an hour. We've taken the number of lesions that you have to create in order to put the patient back into normal sinus rhythm. We reduce that by about 50 percent. The implications of that are profound. Right you have patients that are being treated more quickly. So the one thing is to undergo a treatment is higher. You have hospitals that are able to increase the throughput per day from two or three cases to five to six cases. And that impacts cost dramatically. And the ultimate goal is to have efficacy that comes from knowing exactly what lesions to make and where to make them and when to stop the efficacy should go higher. So our approach is to use information and the massive data processing speed.
: I was just... right. The data is the differentiator.
: That is the differentiator. Right so we're we're using the fastest processing engines that are possible. We've taken the information source and moved it from the distal tip to the processing computer and that enables us to continue to improve as quickly as data processing accelerates right. And so then having to go and optimize the catheter every time you want to make a change. We're literally optimizing software relying on the interface and the feedback we're getting from the distinctive interface of allegiance to regain power that position. So all of those things those things are drivers of change in this space where ultimately data. Data is going to be what drives treatment and that data is also going to be what drives physician benefit.
: Duke, this is such a great example and and so are you guys right now. Is it FDA approved you're getting here kind of where are you in the stage there.
: Yeah. So we are approved in Europe but we're not commercial. And we are enroling or ID each day to get PMA approval we're about two months short of being completely enrolled and then we expect to have approval in the United States in early 2020.
: That's wonderful and I mean these ablation cases they take forever. And if you're able to reduce that time I mean these patients have a lot of comorbidities you know time under anesthesia. This could be hugely impactful not only to the hospital's bottom line but also to patient outcomes. So kudos to you and your team for that.
: That is exactly right. It's interesting to what physicians that use it liken the analogy that they use is working on a dial up modem which is current standard of care versus high speed internet connection. And it is true not only we can almost see important but physicians you know people want cutting edge technology and they want to have information that they previously didn't have. And the trick for us is to make sure that we're capturing all this information in such a way that we can have the user interface be very simple so you take a very very complex mathematically driven set of algorithm. You put them down to a very simple interface which in our perfect world as a green light, yellow light, red light. Green light you're in contact, yellow light you're making, red light You done move on. So that's the vision. And if you think about that from a utilization standpoint if you can really do that you take a procedure that has to be currently performed by a highly highly trained electrophysiologist and potentially you make it a little bit more ubiquitous to the physicians that or even the technicians who aren't as extensively trained. And that's the vision.
: That is huge. I love the vision that you have there Duke and I think the outcomes the costs everything will follow. I was walking down the street. I like to go for walks in the middle of my day and I walk to the Starbucks which is like four blocks away. And I've been noticing lately in front of people's homes that they're starting to put these little ring doorbells. And I noticed that a couple of my neighbors swapped out from a different one to a ring doorbell and a ring doorbell what it does is it actually provides videos of either packages being stolen or just criminal activity that happens in the neighborhood. So I saw a couple of people swap out for a ring and it goes back to that data. You know that data that you get from the device. It's no longer enough to have a device you need to have data and dashboards.
: That's exactly right. Exactly right.
: Yeah and it is. And what you're doing is so cool because you're you're taking this into the operating room and helping cardiologists out. And like you said right traditionally you got an E.P. doing this procedure why can't a cardiologist or somebody that does different procedures just do it and it's just wonderful that you guys are working on this. It's going to make a big difference for us and a phenomenal example so listeners take this into consideration. What are you doing with dashboards and data? How are you leveraging that to make your product differentiated? Because if you're not your competitor will. And they will leave you in the dust. So Duke talked to us about a time when you had a setback something that you learned from that setback.
: Yeah. So you know it's funny because I think the biggest setbacks come when there is a breakdown of communication. I think that in our world, our medical device world, innovation world setbacks are present every day. You're constantly pivot and you're constantly changing adjusting and getting information from either regulatory body for the animal study that isn't right thing. The key thing for me is making sure that when we get that information that the appropriate people within the organization are aware of where you get into problems is when organizations become siloed. And what somebody who's working on is isolated from information that sends to another group and the organization is getting an incredible book I just read called bad blood about pheromones which is a great book to me and one of the things that we know that Elizabeth Holmes and this guy somebody who ran organizations is a siloed information. And they made sort of iron walls between different parts of the company that needed to be communicated together. We can't do that right. The challenge sometimes is that what's right for the organizations strategically may be different than what everybody is marching towards. I'll give an example. So I believe fundamentally that you have to align three things to work to have a successful medical device. You have to have a great technology. You have to have a great team. You have to have a great business model. None of those three things is more important than the other. The technology doesn't trump the scene and doesn't trump the business. All three of those are equal contributors to success. However a team is organized around and galvanized a business small base. I think it's the right business model and that's the business model of unity communicating as a CEO to that organization. There are times however when the marching orders of the organization are different than the strategic initiatives that a smaller group like the CEOs CFO are working on to create value. And one of the times that I think I could have done a very significantly different job and a better job as it is when we sold Spirox. So we had this incredible team of people that were focused around building a company that was going to change that ear, nose and throat space with a very simple elegant technology that got very that passed up in the market. At the same time I felt there was a need to be a multiproduct company so we brought KKR in to help us provide capital to be able to go buy other assets. And we started looking at other companies. What happened is while we were doing that and ENTelus came to us and said hey listen we like to buy new. I think I could have done a better job of communicating the pivot in direction from being a standalone single product company to being one that was potentially to be acquired to the team. I think that the business model makes sense and I think there are there were a number of employees who felt left out of the decision process as we think we could have done a better job of aligning the trick chain around where the company was going. Even though I thought to do so would put at risk some of the pace at which we were we were operating. So I think a line around goals alignment around objectives is critical. And I think the biggest challenges for me are when that communication breaks down. In this case it makes strategic sense to do it. But I think that it was probably very frustrating for the employees.
: Now it's a good call to do. And oftentimes it's that speed at which we we want things to work and finding that right mix of communicating and keeping speed going because how do you distinguish that Duke? Coming in present at a certain point if you if you let too many people know or too many people and then it could really make the project drag on.
: It's very challenging because first of all there's there's information limits. When you're working with a company that is trying to acquire can't communicate all of the stuff that's going on. Second of all the probability of a transaction happening is much lower than the probability that tracks the transactions fail savoury into a company and a broader group of people around what might happen is a very significant distraction from the objectives that they are following and need to adhere to in order to keep the company going in the case that it doesn't happen so I don't think there's a lot you can do. I think the trick is to make sure that everybody understands that the business model of medical technology companies is opportunistic and there are windows in time. There are inflection points where you have to be incredibly opportunistic about what might or might not happen. And I think where I potentially do a good job is communicating it opportunistically. I would look at a transaction if it made sense for the organization. It's a tough line to walk but I think it is the. It's something that I could've done better. I fundamentally believe though that all of these companies and all of the organization needs to operate with what I call tension in the line. Intention of the line is intensity. I got that because I was one time fishing at dude ranch in Colorado and the guy came to me and said You're never going to catch a fish fly fishing without keeping tension in the line. And I was thinking like that and it's very relevant to running companies right. We're just selling companies are setting goals. You have to have a line that starts with goals and then the success of those goals and the success and a recession relies on communication and that intentional line fans innovation and technology development. Everyone must know what they're doing and everybody knows you know exactly how what they're doing fits into the hole. If people don't understand that you have too many people or b you don't have enough communication going on about what we're trying to accomplish. To team the teams out of the small everybody. What happens to these big companies is they get too many people and the small and concise communication goes away. And people are sort of punching the clock as opposed to knowing that what they're doing with their contribution is natters. And when that's gone you lose accountability. So my whole focus is being really tight and that in the business more important is that we that was making sure that you're going but if you can create tension along those three areas on the technology team and the business model Candy if you're opportunistic right then you have a scenario where good things happen. It's where you get 7 8 9 10 years out and you're sort of hoping that something happens where I think it becomes very challenging to create tension and to create a momentum for the organization that is value creative.
: Love that Duke keep tension in aligns folks. And it's definitely a great analogy for. We're all tasked with in this business because that's the way you get the feedback that you need. No tension you're not going to feel it. Keep that tension in a line. Duke, what would you say. One of your proudest leadership experiences in healthcare has been today.
: So what we do right which is take technologies from idea all the way through to market approval and then getting traction in the market is credibly challenge. It relies on people it relies on innovation it relies on C relies on having capital business models everything from the highest sense and gratification I get is when groups of people that work with me right the engineers,R&D, quality of manufacturing operations regens or farms have come together and created a package that allows us to get these things to get to market and then you're treating patients. I first saw it Pozzallo was overhauled. We went in and we were taking patients that were otherwise going to get amputations and eliminating the habitations as we go down and take quack out of those arteries and then Celera which was the CGI balloons or a balloon back up to marketing and changed the way peripheral vascular disease is treated with care and the same thing. It's the culmination of an extraordinary amount of synergistic work and time and having a business model that you actually are able to affect. And yet to the other end it's extraordinary. It's extraordinary to do that the people that we have obviously collectively is the greatest reward is sharing the benefits of these techno provide to patients with the team that created them.
: And it is hard you know I mean it's hard to even even if you're going to develop a software and it's a lot easier to ramp up and get out there. It's hard to hit the mark. So I give you big kudos Duke and you in the teams that you've put together to have done this multiple times. What keeps you coming back for more?
: You know it's funny because I wouldn't come back for more if I didn't have the teams right. And so what we do is we're all very good at what we do and I would tell anybody that wants to compete with us. They better watch out. He moves fast. We're very very smart about the different components that need to do to get to get these technologies to market. And fundamentally we are patient first people right. Never ever compromise patient safety or patient benefit to advance a business model or to support a team right that need that shouldn't be inherent. What keeps me coming back is that there are significant areas of improvement that especially in areas like electric physiology where you have a standard of care where there's like a 65 70 percent efficacy rate. It's almost a twin cause of whether or not the patients get the benefit from a treatment that's unacceptable. And I think that with the treatment that I have we have an ability to optimize and improve so that maybe we can take you know a 65 or 70 percent acidizing bump into an 85 or 90 percent acids to the benefit to everybody from that reduce the cost of reviews hospital cost is great. So what keeps me coming back is that there are other stones that turnover create enormous benefit for patients. It's quite addicting and it's quite fun to have people around the table that you take ideas in and execute them. Making products.
: Love that Duke. And there's no doubt you've assembled a a Navy SEAL the equivalent of finding gaps in the market turning this stuns over and cranking it out so well so love that you're doing that you've got a lot on your plate. Is there anything in particular an exciting project or focus that you want to tell the listeners about today?
: So my whole thing about my whole thing now is educating people about the opportunity in healthcare and medical devices. 17 percent of our GDP is an enormously important area because it's a little bit less straightforward than social media or technology. I think that the greatest inventor minds a lot of times go into healthcare but you think about the pretty Venn diagrams the technology team and the business model the human the business model are needing as much water and sunlight as the technology innovations. So what's important to me is sort of getting the word out. This is a very very opportunistic and exciting space. We are all different people of business people like me as well as physicians as well as inventors. The earlier you get into this space, the more exciting it is and the greater impact you'll have. I spent a fair amount of time at Harvard Business School and it's just exciting to see that eyes opened up when you say hey you can go into medical devices with your background and have an influence. The goal for me, what's exciting to me is as the demand to cut costs and to make health care more affordable becomes at the forefront of everybody's discussion. Having leaders and the next generation of people are thinking about that. Are we right in calling them in to looking at ethics as opposed to Facebook from my perspective this is incredibly say something that I have special interest in.
: That's awesome. And so listeners they had a call to action if you're listening to this and you're on the fence or maybe you're considering a career with the background that you have considering medical devices and consider healthcare. Because we need all the help we can get to make it better. Duke getting to the end here. Let's pretend you and I are building a leadership course on what it takes to be successful in the business of healthcare. It's the one on one of Duke. And so I like to write out the syllabus by getting a couple brief answers to this lightning round and then follow it with a book that you recommend to the listeners. You ready?
: All right. What's the best way to improve healthcare outcomes?
: Data and organizing data.
: What's the biggest mistake or pitfall to avoid?
: The biggest pitfalls to leave with technology and forget about the business model and the team.
: How do you stay relevant as an organization despite constant change?
: It's pushing constantly into getting information and adjusting and then using that information to reset goals constantly. If the world's changing you can't be in space like ours which has long long regulatory timeline. You can't be irrelevant because the market changes while you're getting approvals.
: Love that. Finally, what's one area of focus that should drive everything in health care organization?
: So as patients first right if you take care of the patient everything else will fall into place if you make sure that you address and we have an equation there's technology and business model.
: Love that you've laid it out so clearly for us Duke really appreciate that. That simple approach. What book would you recommend?
: So I read a book in college that I never thought I'd get through. And it still remains my favorite book. It's war and peace. It was interesting that night is at its core a war and peace is a book about people trying to find their footing in a world that's being turned upside down by war, by social and political change, spiritual confusion etc. and over and over again the book shows how that in moments of crisis people either can be shut down or they can open us up right and helping us tap into our deepest reservoirs of creativity and strength when these times happen. Is what I found incredibly inspiring about that book. It's a really interesting book. It was interesting what closet's dancer is this is a very interesting book in that today's you know challenges tragedy issues in the overcoming and they can pave the way for tomorrow's triumph. So that's my favorite book of all time.
: Love that. Thanks for recommending that Duke and listeners all the things that we discuss today. Duke synopsis of technology, teams and making sure you got the right business model, the book he recommended and all the things that he's up to. You could go outcomesrocket.health/duke. And find all of that there along with the show notes and a transcript. Duke before we conclude this has been a blast really enjoyed getting to know a little bit more about your thoughts in this space. I'd love if you could just share a closing thought with the listeners and then the best place make it follow you or get in touch with you.
: Sure. So my closing thought relates to something I saw on 60 Minutes last week I saw a photo of the earth from Voyager 1 which was launched in 1977. It's now over. I think it 11 miles from earth. And when you look at that you see that image of a picture Earth is just a small speck that our solar system is an even smaller speck in our galaxy and it's not even relevant which links those billions of galaxies so it's the thing that is interesting to me about that is it makes you realize how small and insignificant you are or potentially empowers you to take risks. Because in the scheme of time in history you're relatively inconsequential so you might as well make the most of the time you have here. And to me it's very empowering because I feel like if you're stuck in a job or if you're thinking about what you could do or should do and might want to do I would say Go jump and do it right. Because take the risk, challenge yourself try fail try again. You know what you need to do to try and create relevance because if you fail in the scheme of the universe it's not a big issue.
: Exactly a great message, Duke. You know I got that same feeling I took my son to the planetarium and they had a big big picture of galaxies. And it was like like you said it was a little like speck of salt on the entire thing.
: Exactly right. It's very very eye opening. Really daunting to think about it.
: It really is a great call out Duke go out there folks get it done. Don't be afraid take some risk and Duke what would be the best way for the listeners to get in touch with or follow you.
: So the best way is probably through LinkedIn or you can send me an e-mail at email@example.com. Those are the two best ways to connect with me.
: Outstanding. They have it folks. Duke Rohlen, again adding some major value to us. Podcasts is that you could rewind listen to this again while you go for a run or a drive. Lot of value left here by Duke and Duke just want to say thank you so much for making the time for us. We really appreciate it.
: No problem. Thank you so much. Talk to you soon.
Hey outcomes rocket friends thanks for tuning in to the podcast. Once again as a leader in health care you have big ideas. Great products a story to tell and are looking for ways to improve your reach and scale your business. However there is one tiny problem. Healthcare is tough to navigate and the typical sales cycle is slow. That's why you should consider starting your own podcast as part of your sales and marketing strategy at the outcomes rocket. I've been able to reach thousands of people every single month that I wouldn't have otherwise been able to reach if not started my podcast. Having this organic reach enables me to get the feedback necessary to create a podcast that delivers value that you are looking for and the same thing goes if you start a podcast for what you could learn from your customers. The best thing about podcasting in healthcare is that we are currently at the ground level meaning that the number of people in healthcare listening to podcasts is small but growing rapidly. I put together a free checklist for you to check out the steps on what it takes to create your own podcast. You could find that at outcomesrocket.health/podcast. Check it out today and find a new way to leverage the sales marketing and outcomes of your business. That's outcomesrocket.health/podcast.
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