When you’re an entrepreneur with a business plan and a startup that’s in its infancy, it can be hard to know where to start.
In the early days of the pharmaceutical aerosolid manufacturing business, the only way to get a deal was to go into the medical field.
The best place to start was in a hospital.
So that’s where you get a contract, a deal that covers everything from supply chains to manufacturing, says Brian Murgatroyd, founder and CEO of Insightsource, a medical-device manufacturing company.
The next best thing is a hospital and a company with a proven track record in that field.
And that’s the biggest hurdle to entry, Murgateld says.
It can take up to two years to get to a hospital, and that’s if you’re not lucky enough to land a job in one of the five hospitals listed in the National Institute of Allergy and Infectious Diseases’ annual list of hospitals.
The only way for someone to get there is by getting an FDA-approved contract.
“The best thing to do is to go to the hospital,” says Murgates, who is also the CEO of medical-technology startup Xoxi, which has built a medical device manufacturing company for the past decade.
In recent years, the company has expanded into a manufacturing company, as well.
“We have to make sure we have a manufacturing facility, that we have all the equipment that we need and we have the right people, because otherwise it’s very difficult to go up to a factory,” Murgats says.
To make that happen, Insightsources first has to get approval from the FDA for a medical facility.
“That’s a huge process,” says Michael A. Sacco, an expert in medical-devices manufacturing and founder of the Institute for Health Information and Analysis, which is a nonprofit research and advocacy organization.
The first step in that process is getting approval for a hospital or an independent hospital that will operate under the same rules as a hospital licensed to manufacture medical devices.
The third step is to secure financing, and the final step is getting the manufacturer certified.
The process requires a hospital to be certified for medical-use devices, which includes a process known as a license application.
The medical device industry is notoriously complex and requires a great deal of coordination, which can be challenging.
“If you’re a small company with $500,000 to $1 million in revenue, you’re going to be on the waiting list,” Mursatroyds says.
In a recent letter to the FDA, Insys asked the agency for permission to move forward with the business, citing the need for the company to meet certain standards.
In addition to the standard certification for a licensed medical facility, InsYS also needs to get permission from the company’s parent company, which owns a large stake in the company.
That’s the most difficult part.
A recent letter from the Department of Health and Human Services to Insys says that Insys has to meet its “core business objectives” by the end of the year, including “the creation of at least one new, independent manufacturer for the treatment of certain medical conditions.”
The letter also said Insys’ existing manufacturing facility is insufficient for the production of medical devices for the drug-delivery network, because of the complex manufacturing processes that are needed to deliver medications to patients.
In July, the FDA sent a letter to Insysss parent company stating that the company failed to comply with the basic requirements of a medical license.
Insys did not respond to a request for comment on the letter.
The FDA is the agency that oversees medical-industry licensing and approval.
In its latest letter to Murgations, the agency said that it would investigate the company for compliance.
“There is no excuse for a company to not meet its statutory and regulatory requirements for the development, manufacture, distribution, and marketing of medical equipment for the medical device delivery network,” the letter said.
“As such, the Commission is asking you to promptly and expeditiously investigate the safety, quality, and efficiency of the company.”
But Murgaters comments suggest the agency doesn’t take much interest in Insys.
“They’ve made some mistakes,” Murats says of the agency.
“You can see it in the letters.
They’re really trying to go after people.
But the FDA is not going after us.
We’re just a bunch of little guys in a room.”
The industry’s biggest hurdle comes from the pharmaceutical industry.
Most medical devices aren’t FDA-regulated.
Many have no standardized design or manufacturing process, so a lot of the work goes on behind the scenes.
The regulatory process is often lengthy, and even in the best of cases, it’s not easy to get the FDA to grant a new drug a license.
And even when a drug is approved, it might take another five years for it to be available in the U.S. market.
“What is frustrating