Thu · May 19

Introducing Startup FDA

For a medical device startup, getting FDA clearance can seem like an insurmountable hurdle.

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That’s largely because applying for 510(k) clearance from the FDA is far from straightforward: There is no official template to follow, no set application to fill out. There's only a long and often confusing list of guidelines that must be met.

Making matters more complicated, many of the consultants in the field are focused on working with large medical device companies, not upstart firms -- and have convoluted practices and sky high prices to match.

"When it comes to FDA clearance, people at startups don't know how to start," says Beth Kolko, the cofounder and CEO of medical device startup Shift Labs (YC W15). "We personally spent a year fretting about it. We were thinking, 'Can someone please just give us a template for what our submission should look like? If you tell us what to do, we'll do it.'"

According to Kolko, the confusion around the regulatory process is not only damaging to the psyche of startup founders: It actually holds back the entire industry, and the patients it is meant to serve. "I am convinced that this is a huge barrier for innovation in the medical device space," Kolko says.

Demystifying the process

Kolko and her cofounder Koji Intlekofer want to change that, with a new initiative they're calling Startup FDA.

Startup FDA

Startup FDA is a repository on GitHub where medical device startups are encouraged to open source and share their 510(k) submissions with each other. The idea is to demystify the process and show how much variation there can be in a successful submission for FDA clearance. Shift has already uploaded its 510(k) files with sensitive information redacted here, and is encouraging other startups to do the same.

The Macro spoke with Beth Kolko to get some more insight on how medical device startups can approach compliance and make the process work for them. Here, in a lightly edited version of our interview, are five key pieces of Kolko's advice:

  • Don't be intimidated.

"The thing I wish that we knew most was how much the process is not as scary as people want to make it out to be. It's a super opaque process, so a lot of what makes it intimidating is the opacity, not the requirements themselves. If you think of the FDA as a partner, not as a foe, that really helps. Remember that the FDA doesn't want you to fail.

Now, there are lots of people who want you to be intimidated, who want to make you more afraid of the process -- lots of really high priced consultants who will tell you the only way to do it is to pay them. You have to trust yourself and your ability to figure it out, and not be intimidated. Have a healthy respect for the process, but don't be paralyzed by it.

There have been big stories recently about startups and companies screwing up with compliance. I think part of the problem is that some founders and investors see the whole compliance thing as so difficult and scary that the only way to succeed is through a loophole. I don't think that's true. You can play by all the rules and still move fast and create a great company."

  • You should be doing the work anyway.

"If you're building your startup and product in a responsible way, you're already generating the documentation and processes that are important for compliance. Anyone who is doing thoughtful product design -- where they engage with their users and document their work -- is going to have the foundation of de facto design control, which is what the FDA wants to see.

The question is, how do you put those into a format that makes sense for federal regulators? How do you articulate that? That's just a translation issue though. It's not asking you to do all this work your team isn't already doing."

  • Get help -- from people you understand.

"You have to be purposeful about building a network and talking to people who can help you. Go out, find networking events for medical device entrepreneurs, ask for introductions.

That said, you have to learn to trust yourself and only work with people you understand. I learned this with lawyers: Some lawyers explain things to me, and I still won't understand what they've said. For a long time I thought the problem was with me, and that the information was over my head. But then I met with a lawyer I really jived with, and everything made total sense. FDA consultants are the same way. You have to find someone whose vocabulary meshes with your own. Find someone whose explanations make sense to you.

You might sit down with someone and have an hour and a half long conversation, and at the end think, "Gosh this stuff is impossible. I guess I have to hire this person for $350 an hour to do it for me." But that's not the way you should think. If you're paying someone to help you, you have to make sure you understand each other.

It's about fit. Someone could be super competent, but just not the right person for you. When you meet with someone you understand, you'll see the difference."

  • Use free resources.

“For medical devices, the FDA has a program called the Division of Industry and Consumer Education (DICE.) You can call them on the phone and ask them questions about the FDA process. Sometimes they'll say, ‘Just go read such-and-such document,’ but sometimes they'll tell you exactly what to do.

They're super nice, and they want to help. When they can't give you a straight answer it's only because they aren't the experts about your device. You are. You have to make certain judgement calls about how to present the information.”

  • Educate your investors.

“Going through the FDA process, no matter how scrappy and resourceful you are, there are fees you have to pay, regulatory compliance testing labs, and outside expertise that costs money. We did hire a consultant to package our application, who brought a lot of value and saved us a tremendous amount of time.

We have five full-time employees, and one of them is focused 100% on quality control and regulatory compliance. There's a whole chunk of resources we have to allocate. That makes our burn rate look different to investors.

An investor once told us our burn rate seemed too high. Instead of freaking out and and making cuts right away, or fighting back and saying they were wrong, we asked him to help us manage it. We went through our budget together, line by line. In the end, he came to the conclusion that we were actually operating very lean -- this compliance stuff that was taking up more money, it's stuff that we need to be doing.

So it's a process of education: Educating yourself, and educating your investors. You have to constantly communicate and be on the same page.”

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