SPEAKER_01 0:00

Hello everyone, and welcome to a Training Thought Podcast with your O team Arrington. Today's guest is Jane Paddett, the entrepreneur, investor, and CEO of Harvard MedTech, the company transforming cloud chain treatment through virtual reality. Jane is an award-winning entrepreneur recognizing the Chicagoland Entrepreneurial All of Game and an Illinois high-tech entrepreneur of the year. Jane, thank you so much for being here. So um I'm curious, what brought you into healthcare entrepreneurship?

SPEAKER_00 0:36

It was actually, you know, uh, like a lot of things in life, things sometimes often happen accidentally. I mean, I I would love to say that I have this life plan that's planned out till the day I die, which would actually be very boring, but in terms of on the healthier side, it was like by accident. My first company I started after college. Uh I but let me let me just back up a little bit. I went I went as an undergrad studied, uh, my major was in biology, focus was in neurobiology. So it's not so so so so so it's not that far away from healthcare to begin with. I mean, I've always been into this space. But the first company I started out of out of college and have never worked for anyone was actually a consumer products company. And uh it was great. We had a great run. Uh took it up to about 20 million in sales in a few years. I sold out, my partners continued, uh, and and that was great. But then the second company I did was a healthcare company, a medical device company. And to me, it just you know, just um, I mean, this sounds kind of corny, but it just really gave me more energy every day to know that what what we're doing when we were going to work is helping people heal or helping them in the when they're where they're in a bad spot. And and we would get letters from patients, and that's and that's what gave me the uh energy to have 14 or 15 hour days. It's just so meaningful. Uh I mean it's it's the most important thing for everyone, their health. Uh any billionaire would would give you uh you know half their money or more if they were b bed bound and they could they could they could uh be okay. So it's it's a privilege to uh to be able to help people and and and uh it happens to be an area like I mentioned that I had a passion for anyways, and so that's kind of how I got into it.

SPEAKER_01 2:20

Okay. Do you think that the the passion, the drive is necessary for for younger entrepreneurs or younger business owners to really scale and work their business?

SPEAKER_00 2:30

You m yeah, you you know, it's it's it's sort of uh it's sort of it's sort of uh there's an interesting line that I read the other day by uh it was a line by said by Elon Musk, uh, I think in a conversation with Peter Field. And um, you know, I'm I'm not you know uh an Elon Musk fan. Um that's not why I'm why I'm sharing with me. I'm neutral and all this stuff. But but he said that you know delusion can be a very powerful tool for an entrepreneur. And and and and there's a lot a lot of truth to that. I mean, not literally all the way, but but you know, there are so many things that you don't anticipate that will happen that uh you know uh were not planned. And the successful entrepreneurs, in my opinion, have two key characteristics. Number one is perseverance, because there's so many times where you just go, you know, put your head down on the table and just go, you know, why am I doing this? This is, you know, I'm I'm doomed to fail, or you know, whatever the bad news of the moment is uh that really that that really uh you know kind of kind of gets you down. And and you and you have to have you know the the ability to have uh perseverance to sort of say, okay, I can overcome this, I can, you know, I'm not gonna die, you know, in terms of just whatever you have to do to it because we're all different, but get it into your headspace that um you know that uh failure is not really an option. Let's let's really examine everything we can do. And of course, sometimes you will fail. But but but a lot of times that that pressure forces you to think creatively outside the box. And um, you know, like in one of my companies, we moved the sales force off our balance sheet to our distributors, uh, and all of a sudden we became eBADO profitable. So I so I mean so so so there's the there's different things you can do as you go along the way uh to be to be sensitive to that. I think that uh, you know, and uh in in in addition to uh perseverance, another really critical quality for the entrepreneur to have is a really high degree of belief in what they're doing. Because if you don't really think that this is going to be something that is of value to somebody in in in in in whatever fashion, um then you know this you're gonna you're gonna run out of money almost, you're gonna run into jerks uh who uh along the way, all sorts of stuff. And you know, it's it's you have to be able you it's those two things, the perseverance and the passion, that get you through to hopefully success.

SPEAKER_01 4:51

I love that. So now as you look at Harvard MedTech, you guys use virtual reality to address chronic pain and behavioral health challenge. That's pretty different from kind of your pathway. How did you get into kind of this world and what gave you the passion for getting into that?

SPEAKER_00 5:10

Yeah, so it's you're right, it's not in my pathway, but but it also is. Let me uh share with you a little bit between between the first company that we talked about, which was a consumer products company, and and uh this company. In between, I started and scaled and sold uh two medical device companies and one tech enabled services company, all three in healthcare. And uh in in terms of the of I like healthcare as an industry as an entrepreneur because it's huge. Uh it's pretty recession proof, and um it's it's broken, it's terrible. And the our healthcare system, we pay more than anyone else in the world. And you know, we're like number 15th in health or just some some embarrassing number. And and so we're not we're we're not getting you know what what what we uh think we're we're we're uh paying for. And so I I think it is just it's just really important that the in that that in that peep people just just recognize the opportunity.

SPEAKER_01 6:07

So what made you look at virtual reality? Was it a research line? Was it a finding a personal experience?

SPEAKER_00 6:16

Yeah, uh great question. So one of the things that I've all this in terms of actual business models, I have a couple of passions in healthcare. Number one is wherever you can move the point of care into the patient's home. Don't make the patient go to a hospital or go to a clinic because every time you do that, they may have logistical challenges as well as just human nature, there's going to be some fall-off over time. Um uh and and I and I just have had it had an orientation to that. So, as an example, my second medical device company, claim to fame, was invented the first truly ambulatory infusion pump. So this was an infusion pump that was in the hospitals, they were the size of a shoe box of a shoebox. I shrank it down to the size of a cell phone, and it could do everything a hospital pump could do, and then more. And that was just because of a different or or more up-to-date technology, whatever you want to give uh credit to. And it really it really helped expand the home infusion home home care industry as you think of it today, where people can get get infusions at home and and it and it's a whole different dynamic. There's no secondary infections running around, you're surrounded by people who care about you, and you can take your treatment whatever you want. And you know, it's not big, you know, you can take it 20 minutes later if you're in the in the middle of something because it's a it's your house. Um, and so the the the outcomes tend to be a whole lot better. At first, when I when I when I wanted to suggest you that you would have thought the uh you know the uh the you know the earth was uh falling apart. What are you talking about sending an infusion pump home? I mean, people use these things for chemotherapy and antibiotics and pain management, and you know, we we can't possibly allow this out of the hospital. And uh, you know, we never had an incident. And uh by by the time uh we were done, uh everyone was a believer, even though there's a lot of skepticism up front. And so then so so so so in that, you know, uh the the the next company was a tech enabled services company where we took care of the sickest populations, sickest member of a health plan's population. So the sickest, uh, you know, 5% who create 60% of the cost. People with just some heart failure, uh, chronic pain, uh TOPD, asthma, diabetes, you know, whatever it may be. And we we were very effective in reducing the cost of those patients. After I sold that company, and I was thinking about uh what I wanted to do next to do next, uh, if anything, one of the one of the things that that that really was caught my attention was the whole opioid epidemic. Uh, I mean, I was just sort of watching uh from the some of the sidelines, but you know, between 2010 and 2016 or 17, it was crazy. They were handing these things out like popcorn, you know, and if you ask some, and it wasn't, you know, it wasn't the doctor's fault, you know. Uh they were just going off of what they were told. It was some bad actors and Purdue Pharma, Johnson and Johnson, Malacrot, you know, and there's others too, you know, who who sold us a bill of goods. I don't mean I don't mean to be too too negative, but you know, they were not being factual in terms of the ramifications. And so uh so so so I asked the simple question that, okay, well, it's not really good to have, you know, you know, this many people in the country's life destroyed. I mean, the numbers were just climbing astronomically. And you know, let's see if you can't find a solution to this and find a solution to why are people taking opioids and can we get them uh to to to do something else that will manage whatever they're trying to manage? And so I so I said, and and so the answer was, well, these are all people who are opioid users are primarily people with chronic pain. You know, they've had pain for years and years, and there was an injury first, whatever the injury may have been, that traumatic accident or incident, and then after that, you know, a very high percentage of them have chronic pain going forward. Um I said, okay, well, look, that's interesting. But then but then, you know, you as as a as a biologist, you look at at opioids and you realize that, well, you know, the problem with that explanation is uh it's bullshit. Uh, because opioids don't heal anything. All they are is a masking agent. It's the same as if your doctor told you to go home and take four shots of tequila every four hours. You're not going to be feeling a lot of pain. But and we're not doing you any favors. And over time, you'll need more and more and more of it because you're building a resistance, kind of like with opioids. I mean, people don't start off with 50 or 100 milligram opioid doses. They start off with five or 10 or 20. But then over time, they they get to this point of like if you're taking more than about 50 milligrams morphine equivalents a day, you're dysfunctional. You're not the same as if you're if you're scrape, put it that way, uh, in terms of what your capabilities are. And so I said, okay, well, let's let's find a way to to help people get all the pain relief they're getting out of these opioids. Uh but we we can't use any narcotics uh in it. Uh, we don't want to use any other pharmaceuticals. And and so I you know, it just gave I didn't really have a uh have a particular agenda. Um, you know, just over the course of my own curiosity, I studied a lot of Ayurvedic medicine, Chinese traditional medicine, lived in China for a year. Um, and then there's and and and not all of their remedies work, but this uh some stuff in there that is amazing how successful it is. For like diabetes, there's in India they had these plants, these trees that patients can use instead of insulin to uh to bring down their blood blood sugar levels. So, anyways, through that I said, okay, so let's find something new. And and in that search, uh, I came across virtual reality. And virtual reality was uh had been proven not you know, uh, you know, I didn't invent it. VR was already being used in hospitals and burn units because the pain was so intense that when they're changing the wound dressings, the virtual reality was the only thing that really brought peace to those patients. And uh it it it's it's uh uh virtual reality focuses on using the distraction principle. It it you know because it's an immersive environment, a headset that we have programmed everything, sound and vision into, uh, two and a half hours broken up into 89 experiences. As a patient watches those, uh, we're driving neuroplastic change in their in their brain. So what we're really doing is making them more resilient. I mean, you know, and an analogy would be that uh, you know, it all of us are born with different capabilities. And this, you know, this that's just the beauty of of diversity, right? If it if if if there's even the slightest bit of discomfort, my mom is uh a perfect example of, oh my God, the world's falling. Give me two two tail knoll extra scrunchs like now. Um, and then you have like people who are like super athletes or uh people in special operations in the military who have very high tolerances for pain and have a very high degree of stuff. So, really what we're doing is uh is is by by uh by initially having the patient watch these uh these videos, stuff is going on in their brain in terms of reprogram of reprogramming. And a lot of it really is to teach them to to deprioritize quote unquote the bad signals or the negative signals like pain, uh and and amplify and and amplify um you know uh feeling better. But one thing that was also critical that I found though was that for these patients, you very seldom have a patient just with chronic pain. People tend to have multiple disease conditions, comor morbidities, uh, which makes it a little bit more complex. And in the case of trauma victims, you know, they have huge challenges with depression, with anxiety, with poor sleep architecture, uh PTSD, in the case of uh lot of folks, you know, our biggest customer is the VA. And I would say that about a third of the of the veterans who use the VA, 9 million, a third of them have some form of PTSD, unfortunately, which they picked up while serving our our country. So so so so so I'll so uh you know I going way, way back, uh, you know, in terms of like one of my companies was called Health Integrated. I've always really believed that the mind and the body are not separate entities. It's very intertwined. And if you don't take a holistic whole person approach, you're not gonna be able to solve the problem. So that chronic pain patient, uh, you know, even if the pain is temporarily gone, but they're depressed and they're anxious and stuff, they're still not going to get the highest level of pain relief. They're still on edge and so on. Once we so the program, the way it works is it's a 90-day program. The patient uses the VR headset every day for the 90 days, and they you know we'll watch it for about half an hour to an hour the first uh month, and they're using it for like three or four hours by the end by the uh third month, because neuroplastic change takes about 90 days to take effect, like with a stroke victim. If you have a stroke, it's an electrical charge, you lose millions of brain cells, your brain goes to work and builds new neural networks, saying that, hey, you know, Matt used to be able to use his right arm, now he can't, but but he's he he physical therapy, he looks like he wants to do it. Let's build him a new neural network. And that way it never goes away. You know, it's not a temporary solution. And and and and and our effectiveness rate has been phenomenal. We've reduced pain in patients. All this without narcotics or any other pharmaceuticals, uh, we've reduced pain by about uh a third. Uh yeah, uh, and in terms of pain interference, how much does it interfere with their activity? I knocked it down to 20%, starting with about 90% impairment. So these people are now leading normal lives. We have brought down anxiety levels by about 60%. If we bring down depression levels by about 40%, uh these patients are getting two to three hours of extra sleep a night and uninterrupted sleep. Um, and and and we're very effective on uh on likewise in PTSD in terms of bringing the PTSD level down, generally by about a quarter to a half on a 90-day program. Because a lot of these things they may need more time because you know we're talking Vietnam War vets or um the the the the folks who went to uh you know uh to Iraq and Afghanistan, there's been a lot of time in between for these things to have set in. And so, you know, so so that was the idea. Okay, well, you know, why don't we uh have a have a have a digital therapeutic product that uh really does no harm to the body, uh is actually leveraging the powers of the body. I mean, one of the interesting things as a neurobiologist is that what we know about the brain is about at best 1% of what there is to know about the brain. There is so much that we don't know in terms of how it works and the interconnectivity, and it's really an unbelievably complex uh but beautiful organ in terms of how it how it how it how it functions. And so I yes, so so for me, you know, the real win was that you know now people can can handle their pain. They don't have to become dysfunctional. Uh you know, some of the patients who have come on our program actually already come in with a very high dosage level, people who have been injured for for multiple years. Those people uh uh in some cases completely go off of opioids. We don't sell the program as that. It's an unintended uh uh side benefit. But also, you know, in addition to that, the the the the I think like with one cohort, like 40% of the people quit opioids and 29% of them reduce their usage levels down to below five milligrams or or uh or 10 milligrams a day, which you or I could take. I mean, there's there's reasons. I mean, we can't be absolute purists. There's reasons why some things you have to make exceptions. And and and and we do that. And and and you know, and it's and it's just really endearing. Our patient satisfaction rate is 97%, uh, which is unheard of because people in healthcare are generally cranky because they're sick. So they're never that excited about something. The prescriber, the doctor uh uh satisfaction rate is 97%. Our net promoter score from our patients is about uh in the low 80s. Uh these are all numbers that are just off the charts in terms of on stuff. And so, you know, we've treated over 5,000 patients, probably about 6,000 patients by now, uh, since we've been around three or four years ago. And at any one point in time, like like today, we have 500 patients on service. And those numbers will continue to uh to grow. So far, we've been in the VA market, uh veterans administration. We're also in the workers' compensation market where injuries that happen in uh that are covered by insurance, car accidents, travel, you know, or a workplace accident in construction, all things that are traumatic once again. And and and uh so so so so you know, kind of you know, running rounding it it it it it back up. You know, it's it's it's really, really rewarding to me in terms of, you know, why do I at this stage of my life still put in you know 12, 13 hour days uh regularly and um I think about it stuff a lot because I love what we do. I mean, it's it's such a privilege to help people turn their lives around. And you know, a lot of people are suffering in p in silence. Amazing number of people have opioid challenges or or or chronic pain challenges or whatever. And if we and if we get the testimonies, um, you know, I uh or our senior team interviews at least two or three vets or patients every month. What did you like about the program? What did you not like about the program? All those things. And you know, it is it's pretty hard to uh to keep a uh dry eye when you hear these stories of these vets. And it just makes you feel really good. I mean, these people have done so much for us. I think as a country, we sometimes don't repay our debts to our vets in in in perhaps as as complete a fashion as as as as we put it.

SPEAKER_01 19:58

One thing that I hear in your story, and it it feels like you're taking bigger and bigger uh bigger and bigger problem to take down as your businesses have scaled and grown. What in your early company gave you the confidence to take on as big of a problem as you're taking on now?

SPEAKER_00 20:16

You know, I I probably would not have taken this problem on uh for my first company, to be candid with you, because I didn't know the market very well enough. And it's not and like, you know, in terms of all these things like chronic pain and the stuff you're they were talking about, you know, is not obvious to a layman. And so uh it was it was it was really, yeah, so the first company was was was just a consumer products company, opportunistic, you know, we we hit we hit uh the right, we hit hit the market at the right time with the right product. But then after that, you know, in terms of all all the rest of this stuff, it is just sort of after my second company, which was a medical device company, I was hooked that, you know, healthcare is really where I want to spend my time. Because uh yes, I want to be a successful entrepreneur, yes, I want to be a great mentor, all those things. But I also ultimately want, I mean, look, if if some if some person invents the world's best styrofoam cup, who really gives a shit? Whereas if if if we can do something and save someone's life or give them their life back, that's something you can feel uh uh grateful about and feel good about.

SPEAKER_01 21:21

I know some college people who would love a great styrofoam cup. All right. Well, I I have loved our conversation again. I really appreciate your time. I encourage everyone to go check out uh Harvard MedTech as well. If you're listening to see all the great work as well as all it's uh LinkedIn, uh where's the best place to find you these days?

SPEAKER_00 21:45

You know, start by going to our website, uh Harvard, um Harvard, like the university, uh medtech M E D T E C H dot com. Take a look at what you're doing, and then you know, I'm really, really, and we're all very, very uh approachable. Uh you know, if you want to have a conversation with me, I'm always open to that. Just send me an email at uh my name is Shane Pada, so it's just S and then Pada, P A D D A at Harvard MedTech.com. And um reach out and love to hear from folks and and and and uh uh if I can be helpful, uh that you know, that that's a privilege.

SPEAKER_01 22:19

I love it. Well, thank you so much for being here and to all those listening. Thank you so much for listening. We will catch you next time.