TechTalk: MedTech Spin-Off Proves AI Is Good for Your Health

Wael Elseaidy:

Thank you.

Fritz Spencer:

So, in a few sentences, could you quickly explain your background for our audience?

Wael Elseaidy:

Yeah, this is our, my second venture. Before that, I started the company in 2006. I used to work for Philips Medical and the company was focusing on building a healthcare IT solution for cardiovascular workflow and grew the company until when we exited. We sold it to Cerner, which is now Oracle and grow it to probably 1,200 customers, clinics and hospitals. And along the way we also acquired a couple of companies. One of them was the largest provider for registry data for cardiovascular societies. And this data is used for research purpose enhancing the MedTech devices that used for a lot of cardiovascular surgery. And our company as to the imaging is also a spinoff from the previous company. So, with it we have customers, we have data, we have a lot of valuable Titan technology.

Fritz Spencer:

So, like you said, you're in the MedTech space and with this new venture that you've spun out, what is the problem that Astute Imaging is seeking to solve? What were some of the complaints that you may have heard or praises that you've been given around your solution?

Wael Elseaidy:

Yeah, that's a very good question because one of the things we noticed over our previous venture is that there is a lot of inefficiency in the surgery. Around the surgery, either in the planning phase, during the surgery or post-surgery. Our previous company was focusing more on the diagnostic and follow up. So, one of the reasons why we did the spinoff and focused on that is with the advancement in the AI and all the capabilities and all the data, we all ended up spending off with us. We really believe that we can make a huge difference in creating more efficiency in the surgery planning phase during the surgery and the follow-up, which also, as we all know that the majority of the revenue in the hospital space is coming from surgery on intervention. A big part of that in the cardiovascular domain. And that's basically why we focus on that area. The unique part of what we're doing is also not just creating efficiency for the providers, but also use the data that we collected during the surgery planning and the follow-up, collect this data and put it in the cloud and provide this data for the MedTech device company to use it for their regulatory need and R&D need to enhance their devices. So just killing two birds with one stone.

Fritz Spencer:

Great. Great to hear. So, you talked a little bit about the services that you guys are providing. Tell us a little bit more about the platform, what you've built out and how you are selling it to these hospitals.

Wael Elseaidy:

So, it is Azure Based Cloud Platform where all our data, which when we spin off, we have about close to 350,000 historical cardiovascular surgery cases over time. And we use that as a basis for our AI and for something called reward evidence, which basically the data when you adapt the data to service the MedTech device company. So basically, we have the multi-tenant database, Azure in the Cloud, and then we have our software running there and the hospital  uploads their CT images, many CT based right now we're expanding to ultrasound very soon. And then we have in the Cloud, we have our AI algorithm running there, which in every surgical procedure there is a protocol with a protocol means there's several measurements the physician has to do certain segmentation of the images has to do for the organs that they're going to target. And then there is also selection of the MedTech device company that fit this particular patient.

And our AI algorithm does all of that for the physicians. They don't have to do anything with, that's why we call it zero click surgery planning and publish that back to physician. If they are okay with it, they take it to the operating room. Part of also what we provide is a patent technology where we actually model the devices based on the spec in 3D and super impose it on the anatomy to create a real simulated environment for the physician in order to make the surgery very easy for them. And then we charge per case and we're changing that with our new release to be per volume so we can have a more predictable subscription model. And then on the flip side, with a MedTech device company, if they want us to help them with tracking the performance for their devices so they can provide whatever the regulatory needs from them, we charge them third device per year.

Fritz Spencer:

Understood. Okay. That's several different revenue streams that you mentioned there. So, you have several different types of customer bases. What has been some of the most crucial feedback that you have received from your customers?

Wael Elseaidy:

It's very actually extremely positive from both sides. So, we have two revenue stream, we have the provider revenue stream and MedTech device company revenue stream. And both of them are very excited because right now what we offer is like hybrid AI. In end of this month, early May, we are releasing the zero cliff, which is literally zero effort from the physician. But also, there is another interesting twist. Also, a lot of the surgery planning for simple cases is done actually by the sales rep for the MedTech device company. So, our customer also for the surgery planning piece is also the MedTech, not just on the regulatory front. Which actually that's very, very powerful for us because it also creates a massive productivity boost for the sales rep because right now, they wasted more than 60%, 70% of their time during the planning. Now we move this to almost zero time so they can focus more on selling the product. Plus, it gives the company itself, the MedTech company more control about their data and also how their sales guys are selling the device and also more visibility about their devices over time.

Fritz Spencer:

So, you mentioned a couple of things there and I wanted to focus in on one of them where you talked about assisting providers with their regulatory requirements. That seems like a really big piece of it and I know it's very expensive going down those roads with the FDD, have you seen any kind of efficiencies that you've been able to provide for your customers in that area?

Wael Elseaidy:

Yeah, I think probably MedTech device sampling another provider. Yes. So, to just give you a background, there is almost a revolution happening in the regulatory side, which is for good because historically the implantable devices all what the MedTech device company needed to do is to get pre-market approval. Over time they found that this is not enough if any piece in your car is tracked even over time. So how about us humans? When you implant a device within us, all the regulatory is basically moving towards, no, it's not enough to get pre-market approval. You have to show us that your implantable device is working over time. So, there is almost a law right now in Europe called EU MDR, that you cannot have your device in the market without tracking it longitudinally over time, FDA US is moving in that direction. But what that created is a huge need for data from the MedTech device company. The traditional way to get approval is to do something called randomized clinical trial. Very, very expensive. And another approach is what we are doing, which basically do what we call reward evidence, collect data from day-to-day clinical environment and use data to prove that your device over time is working. So, the saving of using a reward evidence platform like us is tenfold. And there's a lot of paper written about for post-market regulatory needs doing randomized clinical trial versus reward evidence. There is no comparison even from the cost wise.

Fritz Spencer:

Very interesting. Wow. So, I'm trying to think about what you guys are doing a lot of data storage as well, it sounds like. And I know when we first spoke, you mentioned that your background was actually in data storage and being a med tech company, you must have professionals across these sectors both in AI, medical and data storage. Can you tell me a little bit about the team that you've built and how it's functioning?

Wael Elseaidy:

That's very interesting question also because when we stand off, actually most of the team that work with us here is we have been working together for more than 15 years.  The co-founder is the same, I created the company with him. The lead architect is also the same. And so yes, we have been working together for, as I said, 15 plus years We have also new members and in our previous company actually we did many cloud solutions. So, we did Oracle Based Cloud Solutions. We did also Amazon Based Cloud Solutions and service hundreds of customers through that. So, we have a very deep, deep experience in the cloud part. We have very deep experience in the regulatory part because in our previous company we were, as I said, we were running a registry for the entire medical societies, for the vascular surgery society, for the neurosurgery society, where all of those was cloud offering with all the security around. It was also engaging a lot of the device company as well. So huge experience in the cloud, also in the regulatory, in the image processing. And with AI we assembled a very strong team also, especially related to imaging and image analysis.

Fritz Spencer:

Wow. Sounds like you guys are really advancing the cardiovascular surgery sector into the next decade. I would love to hear, looking forward, like I just said, what are you guys looking to do next? What's your next big step for Astute Imaging?

Wael Elseaidy:

The next step is a huge disruptive technology, which was very excited to, will release it for research purpose in our upcoming release, which is there is a technology mathematical modeling. I'm originally actually not a software guy. I originally a civil engineer and then came to the US on data PhD in computer science. But anyone working in civil engineering or mechanical engineering tell you about mathematical modeling called finite element. And the finite element is used to actually analyze the stress and strain on buildings, on airplanes, on gas pipeline. So, it would behoove you to start thinking all the cardiovascular spike is pipes. So why don't you also use finite element to analyze the stress on the walls of the arteries. And that's what we are doing. And actually, we have a lot of interesting result and showing massive success, especially in certain surgeries. I'm planning for certain surgery because the current standard for intervening to treat certain patients is based on diameter cross-section, which everyone, including the FDA, know that this is not efficient enough and basically measuring the stress on the walls is much better indication when to intervene and when not to intervene. So that's actually one of the very cool technologies that we are very excited about.

Fritz Spencer:

Wow, that sounds absolutely incredible. I can't wait to see what that looks like when you guys bring that to a product level. Very interesting. So, let me ask you, during your entrepreneurial journey, which sounds like it's been pretty extensive, has there been any pivotable moments that really stick out to you as a crossroads that you made and really went on the right path?

Wael Elseaidy:

There's so many entrepreneurial. I think the pivotal moment I would say is I used to work for Philips and I always thought I want to do something on my own. But you never think about the right moment and sometimes the right moment comes where basically you never expected that this will be the right moment. So, for me, I was planning to do the first company in a certain way and ended up doing it in a completely different way, in a much riskier way. I took my 401k out and started our first company where I was planning to do something much safer with another company, basically bring our technology to that company and do it together. But then I had to make a choice very quickly because those guys build out in the last minute and they have to make a choice easier to stay another five years working with Philips or to do a crazy decision and take my 401k and start. It was very stressful back then, but I think that was the best decision I ever made.

Fritz Spencer:

It sounds like huge risk and even bigger reward. That's so impressive. And like you said, opportunity knocks and you don't know when it's going to knock, you just have to open the door. What an incredible story. While I want to thank you so much for taking the time to have this conversation with me today, and thanks to our listeners as well for tuning into TechTalk, the entrepreneurs, innovators, and investors who turn to EisnerAmper for accounting, tax, and advisory solutions to help propel their success. Subscribe to EisnerAmper's podcast to listen to more TechTalk episodes or visit eisneramper.com for more tech news that you can use.