What made InnAccel, India’s first medical technology incubator, to become a product innovation company? What led to this transformation?
InnAccel started with a vision of enabling medical technology innovation that effectively, and profitably, resolves the challenges in the Indian healthcare segment. We initially felt that an incubation model that provides comprehensive support to selected medtech startups, would be the right way to realise our vision. However, we saw that most startups were creating versions of existing medical devices (more affordable, portable, etc), rather than solving specific healthcare challenges from the ground up. For us, this is a fundamental different value proposition than, say, creating another patient monitoring system. In this, our thinking was shaped by the Biodesign methodology, developed and taught by Stanford University.
As a result, we started working on identifying critical unmet needs and setting up teams to create novel technologies to solve those needs. Eventually, we realised that we were much more excited to identify problems that hadn’t been addressed before, and create new technologies to solve them. So, we decided to focus on in-house innovation instead of the incubation model. Today, InnAccel has a portfolio of six innovative products in three different areas that will be in the market this year- products that address gaps which result in over 700,000 deaths annually in India alone. Our long-term goal of launching 20 innovative technologies by 2025 and transforming Indian healthcare, still stands- we have just changed the model for achieving it.
Do you think grant funding ecosystem to start ups in India is thriving, particularly for the healthcare segment?
The grant funding ecosystem has seen tremendous improvement over the past five to six years. A large part of the credit for this goes to the Department of Biotechnology, and its funding arm, BIRAC. Under Dr Renu Swarup’s leadership, BIRAC has been the leader in funding MedTech and Biotech projects, at all stages. Several projects at InnAccel have received grant funding from BIRAC. Other grant-making organisations, such as foundations, are also very active in India and funding many healthcare projects. So, the grant funding ecosystem is definitely thriving in India for the healthcare segment.
Start ups in the medical devices segment are focusing on re-engineering. Do you think it is correct or what should be the focus?
The needs and gaps in the Indian healthcare sector are so many; there is a need for all kinds of medical technology innovation. Firms focusing on re-engineering will hopefully make critical technologies more usable and affordable for the Indian setting. However, it appears to me, that the vast majority of medtech startups are focused on re-engineering, which is not healthy. There is a big opportunity for firms to create novel technologies and first-in-world products that specifically target Indian needs. As we saw earlier, there are several gaps that are seen in the Indian healthcare system- these provide the opportunity to create new technologies and products, which in some cases, may have global markets. I believe this is where the real value of indigenous innovation will be tapped, and can make India the medtech innovation hub for global emerging markets.
What are the risk factors applicable to healthcare start-ups and what kills them in few years of its existence?
Most start-ups significantly underestimate the time it takes to develop a truly market-ready product. This becomes a significant issue as the start-up requires more capital to complete development than previously estimated and can lead to a funding crunch. Another risk factor for start-ups is misunderstanding the product-market fit, especially for new, innovative, products. Too often, we believe that if a product provides a healthcare benefit, there must be a market for this. This belief is often erroneous, and a start-up should rigorously evaluate its target markets’ ability and incentive to buy its product.
Few must-do things for a healthcare start up to survive, sustain and scale up?
Be conservative in your timelines, and be ready to expect significant delays. If possible, raise more capital than you think you need to develop and launch a product, things never work out the way you plan. Leverage grant funding to the maximum- there are many good sources of grant funding today, and these can supplement investor’s capital during product development.