Episode Transcript
<cite>Tobin Arthur:</cite>
<time>0:19</time>
<p>Hi, everybody. This is Tobin, Arthur, your host for innovation 4 alpha and today I'm joined by Eric Goslau, who is the co founder of a really interesting medical startup company that's got a fascinating story. They've got a great trajectory ahead of them called Transverse Medical. I've gotten to know Eric and transverse over the last year. And I wanted Eric to share his story with you. Eric, welcome to the show.</p>
<cite>Eric Goslau:</cite>
<time>0:48</time>
<p>Thanks, Tobin. Thanks for having me on today.</p>
<cite>Tobin Arthur:</cite>
<time>0:51</time>
<p>It's also fun. You're a another Colorado startup. And we love the fact that Colorado's got more and more great health tech startups of which you are one. So that makes it a little double bonus.</p>
<cite>Eric Goslau:</cite>
<time>1:04</time>
<p>It certainly does. Yep.</p>
<cite>Tobin Arthur:</cite>
<time>1:06</time>
<p>Eric, why don't you tell us just give us a brief introduction of your background, you've got an extensive background in medical device and medtech. And then why don't you introduce transverse transverse, and both for an audience that's a lay audience, as well as maybe for some of our more, you know, clinical focused audience members?</p>
<cite>Eric Goslau:</cite>
<time>1:26</time>
<p>Sure, Like you mentioned, at present I'm CEO with Transverse Medical. But my you know, my experience of Transverse actually extends before that I've been in the medical device space for probably over 26 years. I always joke, or there's a joke in the family that actually I got my start when I was five years old, because I actually was a model for for my dad's company, which he was one of the original startup officers for Valley Lab, which is another, you know, Colorado startup as well up in Boulder, which we all know now as Medtronic. So just a small little history there I kind of got my start in medical devices when I was five years old. But fast forward, the professional side of things has been pretty much the last 26 years, sales and marketing. And Transverse has been my first CEO role. So I took that as a co Founder, co Inventor, and startup and working with the the conceptual inventor, I kind of drew the short stick and took on the the. So, Transverse now, what we, what we what we've developed, and what we're working on is Point Guard. And Point Guard is a surgical block protection device. And that's designed to basically protect the brain. During cardiovascular procedures, our primary focus is structural heart right now, which has a lot of a lot of spotlight on it. stroke rates range between two and 5%. That's within the literature. And so anything above 1% is obviously not good. Our goal is to virtually eliminate or minimize stroke and try to get it down below 1%. And that's the optimum goal that we're striving for. So our solution is pretty elegant. And again, it's called the Point</p>
<cite>Tobin Arthur:</cite>
<time>3:26</time>
<p>So talk a little bit about the migration in the Guard. industry from say Savar to TAVR. Just a little bit, specifically, of what those are, and then and then kind of tie that into what is it that's being protected? What are you trying to keep from the brain that ultimately is resulting in stroke, that Point Guard is focused on?</p>
<cite>Unknown:</cite>
<time>3:56</time>
<p>The surgical aortic valve replacement or transcatheter aortic valve placement, that's the TAVR procedure. It's a complex procedure in the sense. You're going into replace the valve. And when they do that, for lack of better, better words, it's chaotic, you're going in there destroying the old valve or replacing it with a new valve that goes inside of it. And so when that happens, there's a lot of debris shower and particles that break off. And that's just one aspect of what we're protecting against. So the Point Guard is designed to create that shield or that defense mechanism that's between the valve and what's happening aortic arch, and create that filter that layer to protect against the brain, and debris. And we do have a capture capability that's this integrated into the device, but the primary emphasis of our devices flexion or deflection and filtering. So there's other risks to not just the valve being deployed, the actual act of going in with the in ritual wires and catheters from the operator, all that has, you know, an impact potentially, of releasing particles and debris that would go to the brain and cause a stroke.</p>
<cite>Tobin Arthur:</cite>
<time>5:14</time>
<p>I had not really thought about this a lot, until I learned a little bit more about these procedures. As I learned about Point Guard, it made it even more interesting. But when you think about debris floating through and these procedures getting done, is there a level of debris or size of debris that presents an acceptable risk? Or is all debris potentially harmful?</p>
<cite>Eric Goslau:</cite>
<time>5:36</time>
<p>I think the important message is you can't predict when strokes going to occur, right. And it can take one micro piece of debris that causes a stroke, or you could have multiple pieces of debris, right. And if we think about debris to just define it a little bit for, you know, the folks that might be listening in I mean, the particles or debris could be for material that break off from the valve itself, right, or a catheter or wire, something of that nature. It could be thrombus, it could be calcium, it could be plaque, right? So any particle or debris is foreign, right? And that's not a good, you know, we want to minimize the just have red blood cells that, you know, feed the brain and give it its cardiac output and oxygen. So, you know, that's, that's the main breakdown of what the particles are, and what goes to the brain.</p>
<cite>Tobin Arthur:</cite>
<time>6:22</time>
<p>Perfect. So if you step back a little bit, what was it that gave you guys the idea for this mean? Why were you thinking about debris and stroke and things of this sort?</p>
<cite>Eric Goslau:</cite>
<time>6:31</time>
<p>It's a good story. And actually, one of the co founders is from the industry. He and I met actually at Cordis, when I was with them in the field carrying the bag, which is always fun, right? You learned a lot carrying the bag, but he and I were working together or actually knew each other when I was out in Seattle. And he came to me with a with the concept. And in the reason being was that his father in law had actually suffered from a stroke, following a basic standard coronary intervention. And so his, you know, his thought process was, you know, there's got to be a better way. And here I am, I'm in medical device sales. I, I mean, cardiovascular, but, you know, my father in law, just, you know, had a stroke, and he was convinced that that stroke was a result of that procedure. And so, you know, that's how it kind of got its, you know, first start in, you know, I drew the short stick, as I mentioned before, in started the company. And that's it, you know, that's where it's, you know, that's where it's evolved, right? You know, we started working on the concept, doing some initial seed funding around that filing some initial peat IP and, you know, Freedom Operation, did all the stuff that you're supposed to do as a small startup, right, getting going? And then we've just evolved the design since then. So our first inhuman we did in 2019, we finished that up, and now we're on the second generation device. So a lots happened from concept to first generation to now second generation device, and getting ready to put that second generation device or get to a point where we can put it into a feasibility study and back in humans is going to be a nice milestone.</p>
<cite>Tobin Arthur:</cite>
<time>8:15</time>
<p>Speaking of IP, what does that look like? Now? Have you guys do you have granted patents at this point? Do you have some pending or what give us the status?</p>
<cite>Eric Goslau:</cite>
<time>8:24</time>
<p>Yeah, so so we have four issued patents in the US we've had patents issued, outside of the US as well, we actually earlier this year, we just got our first European patent issued, and then we went into national filings on that. So we're in 10 Different countries now with that initial patent. And I just got word to that we get a second European patent that went through as well. So we'll be following students that are, the good part about this is, you know, the four initial patents they went through in the US, it's a great foundation of our base and our core technology. And we've built on that and added the, new intellectual property on top of that, and continue to file that. Obviously, the US being the stronghold for th the business side of things, but it's good to have those European patents as well. And we're actually in Japan, China, and Australia and Brazil. So some some good traction there globally for IP.</p>
<cite>Tobin Arthur:</cite>
<time>9:19</time>
<p>That's great. Give us a sense of the next year. What are the milestones that you're hoping to accomplish in the next 12 months? As we're sitting here this time next year? What do you expect to have done?</p>
<cite>Eric Goslau:</cite>
<time>9:31</time>
<p>Yeah, you know, and I'll comment real quick, COVID, we all have experienced COVID did set us back substantially. We thought it'd only be like a six month run or one year run. We weren't sure, right. But here we are, we're still filtering through that. But I think we've been able to keep our head above water and drive forward and achieve some significant milestones. So what we were able to do over the course of the last year is continue that second generation device - get it into design freeze, get it ready so that we can move into verification and validation. And get ready to do a submission with FDA for a feasibility study. So going into 2022, gotta get used to saying that, we're coming around the corner on that, we need to secure some, some additional financing around that. But once that's in place, we'll be driving hard and fast towards this feasibility study to confirm that next generation design, once we confirm that we'll use that information that data to basically inform our process, we're moving into a market approval study for a pivotal 510 case study in the US.</p>
<cite>Tobin Arthur:</cite>
<time>10:42</time>
<p>That's great. And speaking of financing, what are you looking to raise? Give a sense of what you've done to date? Where are you? And what do you need over the next 18 months?</p>
<cite>Eric Goslau:</cite>
<time>10:53</time>
<p>Yeah, so historically, we did a series B at $7.2 million. That was just prior to that first in human clinical study around October of 2018. Then we followed that with moving into that modification in that second generation device and basically weathering the storm here with COVID. With an additional $2 million in convertible or bridge notes, we're looking to raise anywhere between eight and $12 million on our series B. And with that, that'll take us all the way through that feasibility study, we're targeting up to about 15 patients, three clinical sites in the US. And then that funding also will support, operations and the process and planning for going into that FDA clinical study and an IND submission with the FDA for that pivotal study.</p>
<cite>Tobin Arthur:</cite>
<time>11:44</time>
<p>That's great. And I want to get back to JP Morgan and tie that into financing here in a minute. But give us a sense of what else is on the market. So somebody's not familiar with this space. Who are the competitors? There's been some industry activity, why don't you share some of the things that have gone on there that are material for you guys?</p>
<cite>Eric Goslau:</cite>
<time>12:01</time>
<p>Yeah, so the space is a little interesting. So there's only one FDA approved device in the space, that's the Sentinal device. Boston Scientific, had acquired Clara medical for that technology back in 2018. And that's the only device that's available right now in the US. And I think there's there's one other device that's available in Europe, but it's Sentinal pretty much the predominant device that's being utilized globally. So really only one competitor in the market space. And, on that note, they're a partial protection solution, you know, and our chief medical officer, Dr. Michael Reardon, he's a strong proponent of, embolic protection, and even though Sentinel is partial protection, it's better than no protection at all. And so I think that's really kind of driving the market and setting the stage that embolic protection is clearly needed. And we're hopeful that we'll see a benefit on that as we move forward. There's some large randomized study that Boston Scientific is doing right now called the protective TAVR study, we believe that that study will be positive. And when that comes out, it'll certainly continue to validate that the embolic protection is needed. I think it's worth noting that the reason that Boston is doing that large study of around 3000 patients, they initially got through FDA approval on a failed clinical study, they missed their primary endpoint. But it's also interesting when you look at some of the percentages out there, and I think it's just off the cuff, it's around 62%, market adoption for the Sentinel device, for that kind of adoption, on a failed clinical study, and being able to only provide partial protection. I think it speaks volumes, that, yeah, it's gonna be important for this study to come out. But I think folks really understand that intuitively, you need to be able to protect that brain, it just makes good sense. And that's kind of where we're going to fall into place is with maximum protection, you know, broadening that exception for maximum protection, and kind of adding in and hitting that unmet clinical need, that Sentinel is not totally addressing yet.</p>
<cite>Tobin Arthur:</cite>
<time>14:17</time>
<p>That's great. And then that's obviously pivotal. You're heading to JPMorgan in a number of weeks. And it'll be interesting to see how JP Morgan plays out this year, but you're setting up meetings with investors. And you guys, as you mentioned, are raising capital, what kinds of investors are you looking for? Have you structured the round? And do you have availability at JPMorgan for anybody listening that might have an interest in learning more about what you're doing?</p>
<cite>Eric Goslau:</cite>
<time>14:42</time>
<p>Yeah, certainly. Yeah. We're gonna be heading out there. You know, JP Morgan just went 100% virtual, as we all know, I think that we're heading out that way. But that, you know, that hasn't stopped us. We're going to be out there Sunday, the January 9 through the 12th. We already have several meetings that are lined up and you know the title have investors that we're looking for anyone that's really interested in protecting a patient from stroke, and various things like that in the cardiovascular space. So, you know, we're happy to talk to just about anybody that is interested to lead the round, or wants to syndicate into that round. Again, as I mentioned, you know, we're looking for between eight and$12 million for the series B. If there's some smaller investors that are interested in getting into this space and wanting to put some money down, we certainly have that as an option as well.</p>
<cite>Tobin Arthur:</cite>
<time>15:38</time>
<p>That's great. And maybe just to add to that, what's the size of this market? So we know, there's one other competitor in the market? There's been some validation there, we know what the exit on that is, but what's the what's the total addressable market here?</p>
<cite>Eric Goslau:</cite>
<time>15:51</time>
<p>So we look at it cerebrum protection globally, has about a billion dollar market just for the TAVR procedure, right? There's other procedures, obviously, there that are going to benefit, we all know that there's stroke rates that are higher than 1%, and mitral valve tricuspid. left atrial appendage, and then you know, even you know, you get to that point where we validated involved protection, you know, why not use it for, you know, other procedures, like coronary intervention, like I mentioned before, with our one of our co founders and conceptual inventor, it kind of becomes that seatbelt, you get in the car you're going to put it on, right. So the market size globally when you look at TAVR is, somewhere between $10 billion So it's substantially large. And, you know, it's who wouldn't want to have their brain protected, if you knew that there's possibility and particles and debris that could cause a stroke, and it's greater than 1% chance, you're certainly going to walk into that procedure and say, Hey, Doc I want to keep my brain protected during this procedure, because it's important. I want to come out and be healthy and have quality of life.</p>
<cite>Tobin Arthur:</cite>
<time>17:14</time>
<p>Eric, anything you want to add, before we wrap up? In terms of what you're working on? How people can help in terms of we've covered investment? Are there any other things you're looking for? Or are you looking for medical advisors? What else do you guys need? Or is it really at this point, get the capital and get to the next step? Yeah, that's a great question too. With the financing, coming through, once we lock that in, we're going to be expanding our team substantially. So we're going to be looking at hiring some key hires into some high executive type roles or senior management type roles to help support and continue to build the company as we move forward. That primary goal is hitting that milestone of that feasibility, that's kind of a smaller team right now. But as we start to build and get through that, because we believe pretty strongly that, you know, the outcomes of that feasibility are going to be positive. You know, we're going to need to strengthen our team going into that pivotal study. Outside of that we've got a good following of some great KOLs and some great medical advisors, but it's always good to always hear from other folks that are passionate about cerebral embolic protection in protecting the brain.</p>
