Episode’s transcript

Julio Martinez: 0:04

Welcome to the Latin MedTech leaders podcast. This is a weekly conversation with med tech leaders who have succeeded in Latin America. Today our guest is James Jordan and with these interview with Jim we start a new topic in our podcast, the EU MDR and how it could potentially impact the medical device business in Latin America. James, his presidency, he all at Pittsburgh, life sciences greenhouse and a healthcare professor or Carnegie Mellon university. GM is an accomplished fortune 20 level executive with external experience in the industry, consulting and academia. He's a recognized expert in market development and guiding the successful formation of intrepreneurial startup businesses in the life sciences and healthcare industries. Prior to joining the P L S G Jim served as senior vice president of a 3 billion division of my case and corporation and at Johnson and Johnson. Jim has leveraged these experience insurers that are ventures and he's active on Xero board of directors. He's experienced also includes consulting engagements with numerous companies including Metronic for us and Sullivan and or Tuka pharmaceutical. We're continually show, Jim, are you doing today?

James Jordan: 1:25

I am doing great. Actually our conversation has the advantage of this morning I had an executive in residence discussion, which is normally part of our weekly fun discussion and so we actually brought up some of these questions that you're answering me and so you've benefited from having more than one opinion.

Julio Martinez: 1:42

That'd be a fun conversation then. So first of all, Jim, I am very privileged I think to be in contact with you now. I went through your book and let me tell you, I mean some of the mentor works is magisterial is as fascinating. I didn't have much chance to go deeper into it, but I went through the first pages in that. It's really fascinating and the work that you guys are doing at uh, PL SGS, yes, Antarctic. So I'm very, very impressed with what you guys are doing and certainly a pleasure to be in contact and thank you for connect on the phone and to speak about these. EU NBR topic is topic hasn't been researched enough. And companies in the us and Europe have trouble understanding that the American region, even though it is very close to the U S I am really, really looking forward to hearing your thoughts on, on the topic.

James Jordan: 2:37

So the first question is, you know, shell medical technology companies still consider Europe as their first commercial market before they seek FDA approval. And so the general conversation that we had here today on that topic was the mentally separating out clinical trials from regulatory commercial approval. So the FDA has recognized certain countries that they will accept data for first in man and some of those things as data elements that they can file to the FDA, but that you have to have more than just those countries. So both Europe and Latin America are great places to gather early first in man data in places that might be, um, more friendly to work with. So from a regulatory perspective, the answer is yes, but from a commercialization perspective, I think the world has historically looked at Europe specifically as one sort of regulatory body. And on some aspects that's true, but for the most part it is not true. So you have to go country by country to clear a reimbursement to clear other hurdles besides the EU hurdles. So you know, we have found that if you think of the what I would call more of the chairman, Netherland Belgium countries, they're easier to commercialize in and say France, UK or Italy, they're much slower process. But in general your strategy has two aspects of it to consider. The first is I'm in money from an execution perspective. And the second consideration is funders. So one of the things you'll read in my startup book is you have three constituencies in a startup. You have the customer themselves who you eventually sell to. You have the investors and you have the acquirers. And so when you're considering, um, people that are going to invest in you, I think a lot of venture capitalists are hard pressed to find a company is an example where going to Europe for us, for commercialization ended up in any material revenue. And so although it ends up in getting first and man validation quicker in terms of scaling revenue, it has not. And so whether we're moving from the current state to more of a synergized EU that is more aligned with FDA, which is a different maybe heightened regulatory pathway. The question for VC would be if I have to put resources on the ground and have risk Europe other than getting me really clinical data is limited value, limited value. And so the same thing goes to the second question. Is Latin America a place where you know you would consider entering for us? So years ago Brazil and Argentina were great places to go to because of the quality of the physicians and the lower regulatory barriers. Today they are more like the U S and so again, the answer to that question would be the same as Europe in the sense that you would get your early clinical data there and you would be very pleased with that. Whether you would have a full commercial strategy, there is maybe not your primary action. So that goes to the, what's been your experience with EU in general? Which is also the same common of flattened America is very few investors have found that they have either materially reduced their time to market or materially increased post-approval revenue by having a European or a Latin America only strategy. However, I said the book is about commercialization, it's about the investors, and then it's about acquirers. So as companies get a little more mature and they're looking at increasing their exit value, having regulatory approvals across the globe is actually very attractive because Latin America and EU were both very, very large markets, particularly, you know, Argentina and Brazil historically has been where the U S has focused on, particularly for med tech. So it might not be my first strategy, but after I started commercializing in the U S anyone, how long I think I need to keep my company going before I sell it. Yeah, it's a matter of adding value, right? So if I can expand my market places and get approval, then that would be a good thing. So a lot of times what happens is when a company buys you, sometimes their hurdles go up. And so for example, I might be in Argentina where I'm working with a famous physician, I think in the old days of when I was at Boston scientific, working with Juan Perotti, right? And that company was me docs before it got bought by Boston scientific. It was a startup. They worked with the famous physician, you know, there was good synergy, there was good teamwork, and the government recognized the cash constraints of a startup company. And so they had certainly requirements of safety and efficacy, but then they maybe didn't talk about economic studies or other things that they might expect out of a Boston scientific or Jane J. So in that case, if I can get a regulatory approval in Argentina or Latin America or anywhere in Europe, and then I'm balling, that's by a company that regulatory approval goes with me. And for the acquirer, they may get into that country in a less costly way. We're an acquisition. And so that sort of answers the next question. The other question is, you know, what has been our company's experiences here? We've had three or four companies in our portfolio that went to Europe first they commercialized and they believed that they would be able to not have the same barriers in the U S and the fact of the matter is they did and they stumbled. They had a down round and it costs them more money. And I would say that the same experience in Latin America. So again, if Latin America is looking for cutting edge technologies to come to their individual countries ahead of time, certainly by participating and getting clinical data, they built global relationships and those global relationships are eventually going to pay dividends. They may not pay those dividends during the startup phase, they may pay them later on in the commercialization phase.

Julio Martinez: 9:13

Very well said. Yeah.

James Jordan: 9:14

Now if you think of that, that might not be such a terrible thing because when you're in the clinical trial, just getting data phase, usually companies in their investors have very specific money to give to do that. So you deliver the work, you get the money in the more longer relationship phase, you need a company to have a little bit more money. And if their post commercialized in the U S they actually have more cash and so maybe they can have a more broader relationship in the long run. So companies will never forget the people that did their clinical.

Julio Martinez: 9:46

Yeah. That's how I got started with first thing human trials. And that's what we continue to do it. And I'm actively lobbying the Colombian government to understand exactly what you're saying. And I'm actually trying to pass a new law in Columbia. I've met with the leadership at the Colombian Congress and everything about this. And it is a key opportunity for a country like Columbia to position itself as one of the top destinations in the world. Especially now that the country is looking to diversify its economy, uh, not to depend so much on oil and gas and murals, but uh, Chinese technology and innovation. I actually just last week there was a new ministry or secretary is, we called them in the U S the ministry of science, technology and innovation is a historical time for Columbia that regard because they finally understood that they have to take these investing times and value new patients as seriously. So, um, yeah, I agree with your statement.

James Jordan: 10:40

And I think that, you know, when you think about economic development for a nation, when those physicians are part of a landmark clinical trial, they end up being at all the top trade shows as being the person out there speaking about it. Whereas the U S physicians who may even have better brands and not get up and speak. And so what happens is, so if you just look at the time to what I would call relevance for a brand, so you're trying to make Columbia brand the time that those, you know, physicians can start participating and the time that they become attached to global companies because the global companies recognized them as the handful of people they want to do business with. And then other doctors and other institutions in the U S start inviting them to be visiting people. There's a company that I'm involved in. We started out with the training programs in Europe and when you're trying to train the U S physicians, you end up bringing over the Europeans to train the U S physicians, you know, same thing in Columbia, right? Or wherever you are in Latin America, you bring those physicians over to help train. Well, next thing you know, not only was that Colombian physician at this trade where you know they were in front of tens of thousands of people, but now the us top docs come in to be trained because you know the companies are naturally going to sell to the top people and your doctor's training those top people. Those are relationships that are forged for generation between the physicians. Well, that's my fault. Well, I appreciate finally getting to talk and thank you for being interested in my opinions and I thank you for buying my book and I hope you enjoy it. And you know, we do. Just for your own benefit. I have an academic website called healthcare data.center that has a lot of information on it about the health care system in the U S and my academic pursuit. So you should pick around there and maybe just some, I know if you look up the word valuations, there's some valuation standards up there that might be of interest to you.

Julio Martinez: 12:43

Health care data that's

James Jordan: 12:45

center instead of.com it's dot center. So maybe there's something that could value some of your constituents.

Julio Martinez: 12:51

Okay. Thank you again. I appreciate that. All right. If there's anything I can do to help anywhere, I mean, anytime you feel like doing anything about America, let me know. You already have my contact info and I look forward to keeping in touch.

James Jordan: 13:03

Perfect. Thank you so much. Thank you. Bye bye. All right, take care. Bye.