Why IV Access Devices Need More Than Clearance

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0:00 In medtech, the difference between a good quarter and a great one isn't always the product. It's the friction standing in the way. Broken sales cycles, misaligned teams, deals that stall at the finish line. Every leader feels it, and the best ones know how to remove it. Welcome to Zero Friction, the podcast where we go inside the minds of MedTech's top commercial leaders to uncover the real barriers they face, the decisions they make, and the systems they build to keep the revenue moving. I'm your host Terry Coutsolioutsos. Let's remove some friction.

So, welcome audience. Thank you for joining us today. I have the privilege of having Gary Wakeford with me today. Gary is the founder and CEO of Sonostik and he has taken on a big challenge to bring a revolutionizing technology to the marketplace and so with a company called Sonostik. So Gary, I'm going to turn it over to you to give us a little background on your career and what has led you to Sonostik and where do you see it going? First of all, thank you for having me.

I've been very much looking forward to having this conversation. Always happy to spread the word about who we are and what we're trying to accomplish. As far as my personal background, I spent 30 years in the medical device industry. The first half of that career was with a large-scale company that initially was a private company when I went to work for them, but we had a very successful IPO and they were eventually acquired by a much larger company. But the first half of my career was all in sales and sales management at every level. I started as an entry- level sales rep with this medical device company was over the course of my 15 years there I was promoted to just brick manager, regional manager, divisional manager and eventually national sales manager and then the second half of my career kind of out of the blue I got tapped on the shoulder by a company that wanted to bring me on a very early stage startup company to manage and build the Midwest

For them. So I I made that that leap of faith and left a very solid really good company to uh get involved with the startup. Um happy to announce a test startup was very successful. They were eventually acquired by Medronic for a little over $500 million. And once you've had that experience of being involved with everything from the ground zero with a company, it it just kind of comes be part becomes part of who you are. And I loved it because I got involved in everything from raising capital to helping to get through the FDA regulatory process to getting salespeople up and running, sitting through an FDA audit, you know, when the FDA came knocking. So, it really rounded out my personal background. And the second half of my career has been involved in just doing that. that I've been involved. Uh Sonostik is my fourth startup that I've been involved with and I'm happy to report that the first three had successful exits at varying degrees.

3:04 Some much more successful than other but they all continue to be viable operating companies. Um first half of the career was all sales and sales management. The second half was uh been in the early stage startup world. That's exciting to say you're kind of a serial entrepreneur at this point. I see. Pretty accurate description. Yes. Oh, that's great. Well, it's awesome that you've taken that early sales experience and you've you've managed to kind of find a way to now lead four companies to market and to or three companies to to four companies to market, three companies to exit and hopefully another fourth exit coming up here. So, tell me about Sonostik and I think you know when you and I first talked about it, it sounds like it's potentially a gamecher um for the front door of the hospital.

We believe that it is. Sonostik is focused on the IV or intravenous catheter market. And most people that aren't intimately involved with vascular access don't realize that the insertion of an IV catheter is the most commonly done medical procedure in the world. Bar none. There are 400 million IV catheters purchased every year in the US alone. And there are two billion purchased every year on a global basis. And we're focused on that market, but in particular, we're focused on a subset within that market where the patients are basically considered divas. And I love that acronym because when you hear the word diva, you always think of a real problem child or a real pain in the neck. Well, in this instance, it simply stands for difficult intravenous access.

In these poor patients end up feeling like a human pin cushion. I mean, it is not uncommon for these patients to experience six, eight, 10 or more failed insertion attempts before a an IV catheter is successfully placed. And we just have a very simple device, the Sonostik Guidewire Introducer that helps the clinician get it right the first time. And when I present our technology to potential investors, that's the one line I ask them to pay attention to. Sonostik helps you get it right the first time. If you remember that and only that, you know who we who we are and what we bring to the table.

That's really exciting. So, what are the costs of failed intravenous access to a hospital? Well, it varies. Um, if you look at just placing an IV catheter, it's minimal. I mean, I think a standard IV catheter probably costs around $3. But the real cost and the real waste involved is when you have these multiple failed insertions with the patient is a general rule of thumb. The standard of care. A lot of the the IV catheters are placed by nurses depending on where in your hospital can be a physician if you're in emergency medicine. You know, the the notion is that it's a standard of care.

6:06 Normally, a clinician is allowed to try two attempts to place an IV catheter, and if they fail twice, they're done. They have to walk away and go get another clinician, and that person then just steps in and tries twice. If they fail twice, they're done. So, you know, in a situation where there's been eight failed attempts to get a catheter in place of one of these DEVA patients, you're talking the time and effort of four different clinical equal, not only the lost and the cost in materials in terms of the catheters and the preps and the wipes and everything used to to prepare the patient for this, but the time of those four different clinicians and the time it takes in terms of from start to finish of getting the catheter in face so you can start the administration of meds or whatever it is the reason you're placing the catheter in the first place. And that's where Sonostik comes in. You know, if you can get that catheter placed, you know, first

Time every time, you're saving a tremendous amount of time and effort and waste and you're making it a much more pleasant experience for the patient. Imagine you're the patient and this is your first experience in the hospital of them trying to place a catheter and every time they fail, it's painful. It increases your fear and your angst. It's a horrible way to start your hospital experience and patients tend to very quickly lose all faith in their caregivers when they come. That's not a good I think you bring up a great point where that's the first level of trust and it's probably the first interaction of something serious when they do get to the hospital and that's the first thing that if it were to fail probably drops that level of confidence and trust down considerably sit down considerably. But patients tend to remember that and as a result they give very poor patient satisfaction scores before they leave the hospital which uh is not a good thing for the

Hospital. No, we all know that they're they're rated and graded on that you know as we speak. So great novel technology. What was the premise or what was was there an event like what happened for somebody to come and say I'm going to go develop this stick? Real founder is Dr. Hawa Amadsori and she developed this technology at George Washington University when she was there going through her medical school and there are other guidewire introducers on the market and she was using one of these consistently but the frustration she had was all of the other devices on the market require a second hand to advance that wire and it just caused a diff additional difficulty and made it more kind of a clumsy and awkward procedure and she literally just felt there's got to be a better way to do this a simpler way. So that led her to develop the sauna stick guide wire introducer which has a patent protected track wheel which allows them to advance

9:06 The guide wire with the same hand they're using to insert the IV catheter. It makes it a much more seamless, smooth, and easy procedure to help you get it right the first time. That's great. And so it sounds like, you know, it was born out of need, which is a great thing. Born out of need from a clinician and it's it has the potential to to really kind of change the way things are. So founder made by a doctor. Where do you go from here? And so like well I just say number one is sounds like this device has the opportunity to remove some friction opportunities from the hospital system itself. So smoother, easier entry point into the hospital, better IV access, pleasing patients, creating better experiences, which is good for the patient, but it's also good for the hospital in the long run when it comes to getting those appropriate scores that they need for their reimbursement schedules and everything like that. So I'm sure this all plays

Into the value. All of that's true. And the thing that I really like about it, uh, two components of it. One, it's not high-tech. It's a very simple device that solves a very real solution and acknowledged problem at the hospital level and it also just enhances a procedure that they're already doing. So we're not really changing anything. We're not really asking them to do something different. We're giving them an easier way of doing what they're already doing and it gives them much much better success rates.

Again uh get it right the first time is our whole logo and I think that that is really important when you're trying to introduce a new medical technology to the marketplace and I think you know to take the next step with this product rather than it for it to be just a niche product I think there's a very important educational piece that we'll have to address and that is this right now the normal procedure is if a patient's in the hospital and they have to place an IV catheter they just they get all their materials that they need in the IV catheter and they try to take that next step. Now I think there are a few basic simple questions that they can ask the patient first and foremost and that's easily to identify if the patient is in fact a D.VA a patient. And if we can teach them to identify that they're a D.Va patient first and foremost, then they can reach for the Sonostik device first rather than put the patient

Through that four or six or eight failable attempts. And I think our long-term goal is any any facility that routinely places IV catheters should have the sunistic device on the shell for their DO patients. Got it. And is it an easy identification process on who might need one versus who who doesn't need one? A few questions you can ask. And the number one question which is so obvious and so easy is simply ask the patient, have you ever had difficulties or experienced bad experience with having an IV catheter placed? If the answer to that question is yes, then they are almost certainly a DVA patient. Couple of other things, you know, if you can see the vessel, the vein, but you can't palpate it, you can't feel the pulse, probably not a good vessel to try. Don't go after that. The flip side of that, which is a little bit odd, even if you can't see the vessel, but you can palpate it, you can feel it, it probably

12:35 Is a good vein to go after. So, it's just a matter of giving them a little reference card, ingraining that into them that they ask these two or three questions up front. And if the answer is yes, this patient's probably a diva. Reach for the sauna stick. Make your life a whole lot easier and make it a more pleasant procedure for the patient. And I'm guessing, you know, I'm just thinking about the patients that probably have the most probable cause for not getting it on the first stick would probably be the elderly, right?

And and maybe even small children as well, right? Those those two areas historically fall into this category. The elderly tend to be harder vascular access sticks uh than other people, but there's a whole host of people that fall in this category. Diabetics tend to have terrible vasculature. Uh people with uh renal or kidney diseases tend to have difficult vascular access. Uh the obese people are harder people to stick to stick. So there's a whole list of people that fall into this category. And with the current demographics of our company or sorry of our country with every year that goes by, the amount of the number of people that fall into this category continues to increase. We always say 15% of the patient population currently fall into this category. 100% of the time when I use that number with a clinician and they say, "No, Gary, it's more than that. It's easily 20 or 25%.

But even even at 15% of 400 million, that's the potential of 60 million procedures where we can help the hospital right out of the gate. That's a lot. That's quite a bit. Oh, yes. So, what's next for Sonostik? Where do you stand today? Um, and what's your pathway in getting this thing in the hands of clinicians where they can, you know, really see some impact and value? Very happy to report that we have, uh, achieved our 510K FDA clearance to market. So that is a huge milestone that we have overcome and that's also a significant de-risking factor for potential investors. So our immediate um short-term mission critical items are pretty simple. One is we're currently in the process of raising a series A capital raise. We have a target of $1.5 million for that raise. So number one is to raise capital. Number two is we will use that capital to get production quality product on the shelf so that we can then get that quality in the hands

15:05 Of clinicians. We have our FDA clearance but it's very important to initially get some very good real world feedback from the clinicians to be absolutely sure the product is truly market ready. You know, it's not uncommon that when you get to that step that there may be some minor changes or minor tweaks in the product so that it's just exactly the way the clinicians want it. So, we need to overcome that step first. And once we get that thumbs up, that solid green light for clinicians, then we know we'll be truly market ready to do an initial probably controlled release to the marketplace.

You've got the basic development done with a thumb wheel on the whole thing for the delivery system, right? it's pretty much a done deal and get tweak it up a little bit. We feel the product is ready to go, but trying to be cautiously optimistic. You always want to hear that from the clinicians before you take that that last step. So, what's been your biggest challenge up to date right now? Other than the money piece that you're you're in you're in their fundraising spot, but up until now, what was sort of the the more fun challenges that you had getting it to this stage? probably identifying the right contract manufacturer to work with. Um, and you know, we're we're in the process of taking that next step. We have thoroughly vetted what we feel is an ideal partner for us. That's Valencian Medical and they're based out of Houston, Texas. But, you know, when you're a small startup company, you don't have any significant volumes to initially work with. So, you have to

Find that right contract manufacturer that understands that and they're willing and able to give you the time you need to get that product into what most people would call a a a VIP or um an MVP, which in this case stands for a minimal viable product. Right. So, you've got your clearance, you've got your manufacturer picked out. So, capital's the missing bridge at this point in time. And what does that story look like for you? like you know are you going to is it private equity is it going to strategics is it you know family office I mean what's your sort of game plan around getting the necessary funding to get it commercially ready and then launching office and specific angel investment groups you know you mentioned private equity and VC is a general rule we're not big enough for them yet you know if I would have those conversations they would probably say come back to me when you have a few million in sales and uh you know very sharp hawking curve. So

17:38 We're not ready for them yet. It never hurts to get on their radar, you know, and keep them updated maybe with a quarterly update. But at this point, I think we're looking at probably three different potential investors. Family offices certainly fall into this category, particularly if you can find ones that are interested in this particular space. Angel investment groups I think probably are a very good target for us as well as you know here being in uh northeast Ohio. The state of Ohio is very supportive and have has a number of entre entrepreneurial support groups that we work with. So I think ultimately it'll be some combination of one of those three. And then once you do get the money and you do get the product is what's the pathway to to commercialism? Is it getting the, you know, getting the the early sites, the beta sites kind of proven out and then are you going to go standalone or are you going to go try and find a

Strategic or you just going to play your options? Playing the options is is a pretty good accurate description. Initially, you know, we're in conversations with a couple of different what I would call specialty distributor groups where they have strong experience in launching a product. You know, when you're launching a new product to the marketplace, that is very much a missionary sale. And it involves a lot of sweat equity to get over that hump and to get that flywheel moving before you start to see some really nice recurring revenue from it.

So, you want to find the right distributor that has expertise in the vascular access space and has that history of they know what it takes to launch a new technology. So we feel pretty confident that we have the right people to work with initially and then depending on how well the market accepts our product and what the adoption rate is that will ultimately decide what's the next step. I suspect it'll be adding additional specialty distributors throughout the US but you know a lot of those decisions remain to be determined.

Got it. I think you got one of those big distributors in Ohio somewhere too right. So, so that's great news. Have you thought about like the world's changing really fast. Have you used any type of AI or intelligence in your processes thus far with manufacturing with developing? Have you you know I know you know um is there anything that you've done with that technology? You mentioned Valentium Medical Contractors. We have no doubt that they are world class uh top quality uh they are all over that and so you know we feel like we have are partnering with a right group that will really help us take those next steps. Um, I do believe that AI is absolutely going to change the world as we know it. And as we grow, I could absolutely see us having the need to have a full-time person in charge of implementing AI into every aspect of our business, but we're not quite there yet. You know, I need to address those mission critical items

20:45 We've discussed before we'd be ready to take that next step. No, I definitely see that for sure. It's just exciting when you see all these different things happening, whether it's designing something, building a workflow process, you know, I'm sure the manufacturing, they're using it every day just to sort of maintain that QC. So, those are those are remarkable things. Um, well, any last, you know, thoughts for you on the on the technology? I I do have a finishing question for you, but I just wanted to make sure that you know is there anything else you want to leave us with regards to Sonostik next steps and when when do you think we'll hear from from Sonostik again with a major milestone?

Address the capital issue and that will open the doors to our next two mission critical items. So, it's uh Sonostik and that's spelled S O N O S T I K. anyone watching this, please feel free to visit our website and get us on your radar and keep us in mind. Well, great. Well, Gary, as we close up, I have one final question for you, and I think it's always a fun question, especially with somebody as experienced as you are. Um, you know, going through the trials and tribulations of a great career. What would Gary Wakeford today offer as advice to his 22 self?

Be two things. One is learn to trust your gut and more importantly learn to act on it. You know if if something doesn't feel right to you even if you can't articulate why don't do it. And if something does just in your heart all of your instincts are telling you this is the right thing to do regardless of what other people might be telling you. Listen to that inner inner voice and make a decision. So follow your heart not your brain. That's true. You know, when I look at my career, biggest mistakes I've made were when I allowed somebody to talk me into something that just didn't feel right.

And the flip side of that coin was the best decisions I've made were when I listened to that inner voice even though everyone was telling me I was wrong. That's great. So, you get anchored in your core belief and and don't let fear get in the way and all those other things trying to get in your ear. So, that's a it's a great way to end our our podcast today, Gary. Again, thank you so much. It's been such a wonderful time getting to meet you on our pre- calls and then today's call as well. I wish you and Sonostik the very, very best. Thank you. That's a wrap on Zero Friction, the show built around one simple idea. Remove the barriers and the revenue will follow. If today's conversation was valuable, please subscribe and share it with somebody who needs to hear it. That's how we will grow this community. I'm Terry Coutsolioutsos, revenue architect powered by AI. Come find me at my website my revrx.com and let's talk about what friction is costing you and your organization. Until

23:35 Next time, keep removing the barriers and keep the revenue flowing.