Federal money on the table for health IT projects

Photo / James McCarthy Darrell Williams, CEO of HealthTech Maine, stands outside Maine Medical Center in Portland. Williams is spreading the word about a federal grant program offering $225,000 to Maine companies developing innovative health informatics solutions.

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By James McCarthy

Darrell Williams is the founder, president and CEO of HealthTech Maine, a Portland consulting firm that provides small business development assistance to health technology entrepreneurs.

After graduating from Bates College in 1986 and attending graduate school in Texas, he spent 20 years in Washington, D.C., working on public policy and small business lending. Since 1999 he's been doing outreach for the U.S. Small Business Administration's Small Business Innovative Research program, which focuses on small business development. Williams came back to Maine 10 years ago and about a year-and-a-half ago he formed HealthTech Maine to help Maine companies and entrepreneurs secure funding under the SBIR program.

In effect, he says, the SBIR program enables the federal government to act as a venture capitalist, investing money in companies and entrepreneurs to come up with technologies that can go to the marketplace. There's one big difference, though. Williams says the federal government doesn't want anything from the company in terms of ownership or intellectual property, it simply wants to make sure the company succeeds.

Williams recently met with Mainebiz to explain a $225,000 grant funding opportunity for Maine health technology entrepreneurs through the National Institutes of Health and SBIR to produce pioneering medical technologies or innovative health care IT solutions. The deadline for submissions is April 5. The following is an edited transcript.

Mainebiz: Can you tell us a bit about the focus of your company and the opportunities that might exist for Maine companies to tap into the SBIR program?

Darrell Williams: I have another company called 18 Ventures, which works with companies that received SBIR awards from the National Institutes of Health. Through that experience I found there were Maine companies involved in the health care industry that were having difficulty getting contracts through the NIH and the National Science Foundation. I found out that Maine was lacking in terms of the number of contracts and the number of applications going for this money to develop technology or health care information technology.

In fact, to give an example, Vermont, with half the population of Maine, over a 10-year period from 2004 to 2014 had twice as much money in terms of winning grants from the NIH than Maine. So, roughly, Vermont was bringing in $12 million over that period while Maine was bringing in close to $6 million.

MB: So that suggests there’s an opportunity to take advantage of that program to a greater extent?

DW: Exactly. Maine has all the ingredients to be successful in the health technology industry. It has the University of Maine system, it has a robust research and development sector in The Jackson Laboratory and IDEXX. It has the various health systems throughout the state, and it also has the talent. What is missing, the key ingredient, is that they were not getting the money through the federal government and the National Institutes of Health.

If you look at examples like Cleveland and Pittsburgh, which were “Rust Belt” cities, they have all the same ingredients, but the key ingredient was they had successfully tapped into NIH money and had used that money for their companies and also for that industry.

MB: How might that program benefit Maine?

DW: If you look back at what was kicked off last year in Portland, and the report that was prepared this year, about how to get the Portland area involved in a health informatics cluster. Health informatics essentially involves data. And the group that put together this study and effort, including the University of New England, and the city of Portland, and also the Maine Technology Institute, is looking at how to grow this industry around ‘health informatics’? And their thrust was: How do you increase the number of employees, because their talent is really needed in this industry.

Maine Technology Institute, as you know, provides a lot of support for small business development and has been trying to help increase Maine's entry into the health technology development industry. So 'health informatics' is one of those entries. If we can increase the number of small businesses that can capture federal NIH and SBIR dollars designed to help them grow, that will obviously generate employment opportunities and offer Maine an opportunity to tap into this expanding health informatics industry.

MB: In effect, grow a health informatics industry cluster?

DW: Exactly. NIH and SBIR are offering small companies, entrepreneurs and startups opportunities to go after this money and create health IT tools that will be essential in terms of helping the whole health care industry deliver better health care in terms of outcomes and reducing cost.

MB: So if a startup or entrepreneur wants to apply for some of that NIH/SBIR funding, what do they need to do?

DW: Think of HealthTech Maine as the interpreter of the request for proposals. So an entrepreneur comes to me and says, ‘We have this idea for a product that involves health informatics.’ We work with them to identify which institute or center under NIH would provide that funding.

Now, what will happen is either that we look at the list of available NIH/SBIR funding and the company can choose either to go after one of the RFPs or they can go to the NIH and say, ‘We understand you only will fund these types of projects. You don’t have an RFP that lends itself to our project. We can recommend what that technology will look like.’

So the institutes and the centers are willing to listen to these entrepreneurs and their ideas on how their technology might be suitable for that industry.’The institutes want people to come up with these new technologies, and they are more than willing to help them find a way to frame their idea to get it funded. They really want to fund these great ideas, because that’s the mission of the NIH and these institutes and centers.

As I mentioned, we will help the applicant either look for or present a proposal that fits under the RFP’s criteria, or to look for an institute or center that may fund their particular idea.

MB: What are the steps a Maine entrepreneur needs to take to get the ball rolling in this current round of funding?

DW: We’ll make the RFP list available to them and if that person or that company cannot find something they are looking for on that list, we can work with them and help them find where the funding opportunities are within the institutes or centers of the NIH.

Secondly, we can work with them to help them define what their technology is all about. That is to say, ‘What is the product? Who is it going to serve? How does it get into the marketplace?’ Once we identify that idea, then we work with them in doing the most basic market analysis. The market analysis is the foundation. It answers key questions about patient population, competition, commercial viability for that product, and so forth. That information will lend itself to putting together a business plan, which is key because the market analysis and the business plan will contribute to the proposal itself for NIH.

Also, the business plan will help them begin to build the business around their technology. So you’ve got the innovation, you’ve got the business plan and you put all that into the proposal.

Now, in terms of funding, NIH … let me go back a minute. In terms of funding, you’ve got the Maine Technology Institute, which has two great grants to help them start out. There’s the Tech-Start Grant," which lends itself to starting a business plan. Then there’s the Phase 0 Kickstarter Grant, which pays for the development and the submission of the SBIR grant.

So what we would do is walk them through, in terms of identifying the funding opportunities. Help them identify what the technology is, in other words, defining it. We help them pull together the data and the information in terms of the market analysis to make sure the concept can be supported in the marketplace. We'll also work on answering what the NIH is looking for in terms of the proposal in order to fund it. Then we work with them in developing a business plan, which is another instrument in terms of supporting the proposal but also, more important, to support the development of that business.

MB: How competitive are these grants?

DW: It's a very competitive program. You are competing against companies that are across the country. That's why the people at NIH and MTI say, 'Start early.' That’s why it takes four months. Six weeks out of that time period will be taken up with developing information for their registration for the business through federal databases. So if you take those six weeks out, then you’re going to be really stretched in meeting the deadline.

MB: So the time to get the process going is now?

DW: Exactly. Now going through the process that we talked about, if you think about it in terms of these different steps, these are the same steps that small businesses are going to take on their own to develop a business. So, by going through this whole experience, now you’re done with setting up the infrastructure for your business. You’ve set up the infrastructure in terms of doing market analysis, you’ve set up the business plan and you’ve set up everything you’ll need to deliver a proposal to NIH. So all that’s in place now.

And if you don’t get a grant, now you can work with NIH, myself and the people at MTI to figure out what you might need to do to make sure we get it the next time. But the infrastructure is all in place.

Most of the time, in terms of rejection of an NIH proposal, it has to do with whether the idea is really innovative or not. Whether the individual or the people on that team doing the research and development have the experience or not. Another reason is whether they have a rigorous R&D regimen in place to test their ideas.

So these are the things that NIH will most likely disqualify a proposal over. So, by starting early, we begin to answer those questions.

To give you an example: Using that robot example, one of the things that we can do from what we’ve learned from that market analysis is the literature in the development of social robots. That’s key. Looking at what are the possible connections in doing research here in Maine. And the University of Maine at its School of Engineering has some experience with robotics. So now what a potential applicant can do is begin to partner with the University of Maine System. Or, if it’s another health informatics opportunity, like Idexx or The Jackson Laboratory, or with other entities here in Maine.

So the key here, again, is to start early and identify those connections that now you can make to make sure you’ll get accepted down the line.

MB: Anything else you'd like to add?

DW: The benefit of this program is not only that it's low risk, it's that the infrastructure is also set up for Maine entrepreneurs to succeed in the health informatics field. Maine has all the ingredients to be successful.

It's just a matter of connecting these ingredients and establishing a relationship with NIH and SBIR as well as with the Maine Technology Institute. They need, and they want to fund, these types of companies.

CONTACT: Darrell Williams, president and CEO of HealthTech Maine, can be reached by calling 207-347-1214, or by email at Darrell@healthtechmaine.com

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