Doctoring devices

SOFTWARE helped startups flourish, with open-source programs and the web providing easy collaboration and a fast route to market. Tens of thousands of software developers will produce apps worth more than $30 billion this year. Now cheap computing power and the shrinking cost of small-scale manufacturing are spawning more hardware startups. As examples from Europe show, a particularly thriving area is medical technology.

“Easy access to technology empowers creative minds,” says Ulrich Weinberg of the Hasso Plattner Institute in Potsdam, Germany. Although Mr Weinberg often works with big companies that make medical devices, he has seen the costs of entry tumble. “Even groups of students with very limited financial resources are able to build functional prototypes within a couple of weeks,” he says.

Turning ideas into products has never been easier. It begins with cheap—and in some cases free—computer-aided-design software, which allows devices to be modelled and simulated to a high level of accuracy. Rapid-prototyping equipment, such as 3D printers, can quickly give the ideas shape. And besides open-source software, product developers now have low-cost open-source hardware they can use too, such as Arduino microcontrollers.

Medtech, as the business is known, is particularly attractive to inventors because the market is eager for new devices that can improve people’s lives, help with treatments and make the jobs of health-care workers easier. The field is also big and growing: medical-technology sales are expected to reach $228 billion by 2015, up from $164 billion in 2010, according to Markets and Markets, an American consulting firm.

The startups come from myriad areas. Babybe, for instance, was founded by Raphael Lang, an engineer and artist from Barcelona, and Camilo Anabálon, an industrial designer who lives in Santiago, Chile. The pair met while studying at the Stuttgart State Academy of Art and Design. After working on projects for a number of companies, they got the idea for Babybe after visiting a neonatal intensive-care ward and being struck how babies in incubators were surrounded by lots of high-tech gear which, although helping them, separated the babies from the arms of their anxious mothers.

Copying mother

That led them to develop a system which replicates the heart beat and breathing pattern of a mother for her baby while it is in an incubator. The idea is to maintain a link between the two, which could help reduce infant stress. A pad called the “turtle” is held by the mother to her chest. The turtle contains various sensors which read her vital signs and it transmits those data to a soft, flexible mattress that is filled with gel. The mattress uses pumps and other electronic systems to create a gentle rhythmic movement which copies that of the mother’s chest.

Developing the bionic mattress cost less than $150,000. And being a two-man operation based in different countries was not a handicap. “You can combine the best technology from all over the world with the help of freelancers,” says Mr Lang. Hence the gel used in the mattress comes from Germany, miniature pumps from America and most of the digital innards and plastic parts from China. Big companies are far too bureaucratic to be able to operate with the same speed and at such low cost, Mr Lang believes.

Many medtech startups are academic spin-offs. Scopsis, for example, is a collaboration begun in 2010 with Charité University Hospital in Berlin and the Fraunhofer Institute. The company makes navigation systems for minimally invasive surgery. These use various data, including images from the endoscopes used in such procedures, to ensure surgeons are following the correct path. One system allows the virtual plans a surgeon has made on a computer screen to be overlaid on the video from an endoscopic camera during the operation.

Ideas for new devices often emerge when doctors team up with engineers. This was the case with Transcatheter Technologies, founded in Regensburg, Germany, by Wolfgang Goetz, a cardiac surgeon, and Hou-Sen Lim, a mechanical engineer and entrepreneur. They developed a new method of implanting artificial aortic valves into a patient’s heart without open surgery. The artificial valve, which has a special sealing cuff, is placed into position with a catheter. Importantly, it can also be repositioned, which greatly reduces the risk of complications.

Some startups focus on the consumer market, often with devices that connect to a smartphone app. One example is Kolibree, a Paris-based firm which has launched an “intelligent” electric toothbrush. It gathers data on a person’s brushing habits and informs him through the app how well he is doing and which teeth he should brush a bit longer. Like many startups, Kolibree used a crowdfunding platform, in its case Kickstarter, to raise money. Delivery of its smart toothbrushes is planned for October.

Despite benefiting from the lower cost of entry, medtech minnows may not be much of a threat to the industry’s giants. Innovation has long bubbled up from below, though not necessarily in the form of independent startups. In the past, doctors were more likely to offer ideas to big firms to commercialise. Some would help with the product development.

Even though it is easier to get a business going, most startups tend not to remain on their own. Many large medical-equipment firms now acquire new products by buying small companies that invent them—an exit strategy factored into the business plans of most startups. Selling out also helps when costly clinical trials and other regulations have to be met. And marketing a new product all over the world can be hard for a small company without a well-known brand.

But there is a third way, one that Babybe intends to try. The company’s founders do not want to sell their firm but hope to get support from an established company in return for a share of the profit. It is a partnership that might prove a good deal for both sides.