Cardiac Insight got its start with a scientist at the University of Washington. Then it needed an experienced engineer/entrepreneur to put together a medical device that was good enough to put on the market. Now it’s turning to the guy who it hopes will end up selling the company for a big return.
Bellevue, WA-based Cardiac Insight, the developer of an inexpensive, lightweight heart monitor, has named Brad Harlow as its new acting CEO. Harlow replaces the medical device entrepreneur Tom Clement, who will stay on as president of Cardiac Insight for a couple more months until the company turns in its first application for FDA approval, Harlow says. Once that filing is done, Clement will turn his attention to another UW spinoff he’s been running, Aqueduct Neuroscience.
Cardiac Insight, which Harlow invested in and co-founded with UW cardiologist David Linker, expects to turn in its first FDA application to market a product in December after spending less than $1 million of investor cash. The company has put together its device for monitoring patients for atrial fibrillation (a-fib), a type of irregular heartbeat that affects 2.2 million people in the U.S. each year, and which leads to an estimated 90,000 strokes a year. Cardiac Insight expects to have a device ready to pass regulatory and market scrutiny by mid-2013. If the company can get there, it should have a technology that big players will want to acquire, Harlow says.
“We’ve said, let’s not be anything other than a development company,” Harlow says. Once the product is ready for sale in the U.S., “we’ll sell the company,” he adds.
Clement, the founder of Pathway Medical Technologies, got involved in Cardiac Insight after spotting its commercial potential while he did a stint as an entrepreneur-in-residence at the UW. He said it was always his plan to get the company up and running and then move on. “We looked at an 18-month window to get the business organized, funds raised, and the product development well underway.” He said that as an investor in Cardiac Insight he hopes to stay involved, just not as CEO. “I know I cannot do well for either company if I am a ‘full time’ CEO at both,” Cardiac Insight and Aqueduct, Clement says.
Harlow, though, is wearing a couple CEO hats himself. He’s also the CEO of PhysioSonics, a company that uses ultrasound for automated monitoring of stroke patients. That company is based in the same building in Bellevue as Cardiac Insight, so he can at least minimize his commute.
So far, Cardiac Insight has put together a tiny device that weighs about one-fourth of an ounce, has a flexible circuit board that makes it easy to wear, and costs less than $25 to produce, Harlow says. The company’s proprietary algorithm, which is supposed to accurately read electrocardiography (ECG) waves for signs of a-fib, has been validated by an outside researcher, Dr. Charles Swerdlow at Cedars-Sinai Medical Center in Los Angeles. Importantly, Harlow says, the device can capture ECG waves for a month, and that data can be analyzed by the algorithm, and printed out in the doctor’s office during the patient’s visit. The data doesn’t need to be sent to a centralized scanning service for review, which can take a week to deliver the results back to the physician, Harlow says.
Cardiac Insight, however, isn’t the only company that thinks it has a better mousetrap for monitoring atrial fibrillation, and it isn’t the first to reach the market with a lightweight monitor. San Francisco-based iRhythm raised a $22 million Series C venture financing last year to commercialize its wearable patch for monitoring atrial fibrillation. Harlow says that product, the Zio Patch, has gotten “very good uptake” in the marketplace. Cardiac Insight hopes to show its product has an advantage in being smaller, and more convenient because the data doesn’t need to be sent to a scanning service.
“iRhythm has raised awareness. They’ve helped build the market,” Harlow says. Other big companies, like GE and Philips Electronics, have also taken notice of the opportunity in lightweight a-fib monitors, he says.
Cardiac Insight’s first application to the FDA, later this year, will be for a basic device that simply records electrocardiography data, Harlow says. The company plans to beef up the device with the algorithm by mid-2013, Harlow says. If all goes well, it should win regulatory clearance for that second, more robust version of the device, and be able to reach the marketplace by mid-to-late next year, he says.