Interview: From tinkering with bikes to reinventing surgery

Derek Young’s i360 is a one-stop shop for outsourced healthcare engineering R&D

 

Convention has never attracted Derek Young. You can see it in his attire, right down to the blue suede shoes. Growing up in the shadow of the Slieve Bloom Mountains, hurling and Gaelic football were the choices on offer. Young had no interest. Instead, he spent his days BMX racing . . . and tinkering.

With a mechanical mind and an inquisitive nature, his earliest memories are of trying to mimic or improve on what he saw around him, initially for his bike and then other things.

It’s a skillset that has served him well as he develops a medical device innovation business, based in Ireland but operating worldwide.

The firm, i360 Medical, started life as the Centre for Innovation in Surgical Technology at the Royal College of Surgeons in Ireland, back in 2009.

Young, already a recognised entrepreneur with a track record of patents in medical devices, led the group assigned to capitalise on the capacity of the RCSI and medical staff in general to identify potential solutions to problems they encountered in theatre or elsewhere.

Within three years, in large part because of its success but also to tap more directly into the corporate world, i360 was spun out as a standalone company.

Based now in Fonthill, in Dublin, i360 is effectively a one-stop shop for outsourced R&D. They take ideas from the very earliest stage, assess their potential and, if promising, develop prototypes, put them through trials and the full regulatory approval process before presenting them as a commercially marketable device often housed in a start-up company based in Ireland.

The model has proved so attractive that i360 has replicated it with some of the largest US hospital systems, including Northwell (formerly North Shore) and the Cleveland Clinic, an early supporter.

Now it is looking for €3 million to ramp up its operations. It is also looking to develop a funding programme to support the chain of medical device start-ups that are emerging from its business. While Young and his team are specialists in medical innovation and development, he is aware that it is business expertise these companies will need to fully establish themselves and move on to the next level.

Creativity

Networking with the leading executives of some of the largest hospital groups worldwide and being at the heart of some of the most exciting developments in healthcare technology seems a long way from Young’s roots.

The son of a Bord na Mona fitter, Young’s first ambition was to become an engineer. Inspired by a teacher in his local secondary school, he was persuaded that this would provide an avenue for his creativity.

He studied initially at what was then Carlow Regional Technical College (now IT Carlow) before pursuing a degree in mechanical engineering at night in Bolton Street DIT.

His first job involved drawing product profiles at German group Wexal International, which had an extrusion plant in Enniscorthy and supplied parts to the motor industry including the likes of Ferrari and Porsche, he says.

“I learned a lot, especially working with people: that was the key thing,” he says. “It was not just me drawing up stuff, I had to make sure it was stuff that could be made, working with the fitters, the electricians and everyone else who was going to make this happen.”

The emphasis on the practical and the awareness of the different skills people bring to a team has stayed with him.

A spell in Bord na Mona as design engineer followed where he was responsible for creating new ways to mix and use peat moss as a fuel and for horticulture – a role that involved him working with his father, now a plant manager, on new processes for his factory.

Surgical device

However, increasingly, he was becoming interested in healthcare. On the advice of his former Bolton Street lecturers, he sent out CVs. One reached Frank Bonadio, an American bioengineer based in Trinity College who was then better known as Mary Coughlan’s husband.

Bonadio had a challenge. A Danish surgeon had suggested it would be helpful to have a device that would allow the hand of a surgeon into a patient’s body without using traditional “open” surgery but with more direct access than the increasingly prevalent laparoscopy, which involved insert instruments through a small incision and monitoring them on screen.

Young teamed up with Bonadio and, working from the basement of a building in Upper Mount Street, they spent six years developing a device that would do the job, interacting throughout with surgeons on what would and would not work – and drawing his key inspiration from a Slinky toy.

“I still have the device,” says Young. “It’s a very simple device but it wasn’t so simple to start off with.”

The device gave Young the first of more than 30 patents he now holds. And while European surgeons were slow to adopt it, seeing it as a step back from modern surgical procedures, American, Japanese and Australian clinicians were much more enthusiastic. Eventually the rights were sold to medical device giant Covidien.

While Young admits the company – Advanced Surgical Concepts (ASC) – never made a fortune in his time with it (the company is still operating), he says the real payoff was in building a track record.

“We were able to demonstrate on a global scale from a clinician point of view that these guys at least will do something with your idea,” he says.

Surgical simulation

After leaving ASC and moving into healthcare software, including establishing a surgical simulation company using Trinity-based virtual reality technology, a meeting with the RCSI’s head of surgical training Oscar Traynor and the college’s then chief executive Michael Horgan sowed the germ of the idea that was to become i360.

“They said clinicians were at a loss because no one was grabbing hold of their ideas,” Young says. “They had heard what I did and some of the clinicians had worked with me. They asked whether I would come in and set up an innovation centre in the RCSI.”

It was a cultural shift in mindset for Young who had always worked in the commercial sector. The Cleveland Clinic – one of the largest academic hospital groups in the world – had worked previously with Young and offered support. He spent a month in the US examining how they ran an innovation incubator before returning with plenty of work from Cleveland for the fledgling Dublin operation.

It suited Cleveland to outsource many of its projects, not least because if they were unlikely to work, having a verdict from outside the hospital group made it easier to break to an ambitious consultant.

Within a short space of time, Young and his small team were sifting through more than 300 ideas a year – half of them from Irish clinicians. Gradually it became clear that to deliver on its potential, i360 would have to step away from the RCSI. For all its virtues and importance as a brand, RCSI’s academic focus proved a deterrent to companies in the medtech sector and venture capital firms that might provide much needed finance to bring pipeline ideas to commercial fruition.

The parting was amicable with RCSI becoming a shareholder in the spun-out i360 Medical along with Cleveland Clinic, Enterprise Ireland, Kernel Capital, the Mater, the Hermitage and serial investor Dominic Considine.

“Basically, i360 was then able to go to the strategics [major medical device companies] to look for monies to move developing ideas along, or to VCs and set them up as start-ups,” says Young.

Its new shape appealed to Cleveland. Not only was it taking ideas for ideation, through development, it was now moving to bring them to market and to the patient.

“They asked, ‘could you do that for us,’” says Young and suddenly i360 Medical was moving from a company that just took ideas from the likes of Cleveland on an outsourced basis to one where it became an innovation partner.

“We would instil a whole system into a hospital,” says Young. “We have done that for Cleveland Clinic and we have done it for Northwell – set up a similar i360 structure there.”

Ideas ‘ecosystem’

Baptist Hospital in Miami and Cincinnati Children’s Hospital Medical Centre in Ohio are among others to have established a similar “ecosystem” with i360. Each pays i360 an annual retainer.

“So we are paid to create an ecosystem, paid to find the ideas, paid to develop them in i360, put them in as start-ups and then they become lives of their own and provide lots of jobs in Ireland,” says Young.

Having now established itself after a tough proving ground over the first three or four years, i360 is home to three Northwell start-ups and is processing around 160 ideas a year from that group alone.

i360 receives a substantial stake in each project at the start and retains a carrying stake right through the process and on into any start-up that emerges. The originators of the idea also retain a stake though very few have any direct involvement with commercial businesses that emerge beyond a continuing shareholding and possibly a seat on the board.

The intellectual property attached to most deals remains with the academic hospitals that feed them into i360 – though it may move into Irish-domiciled companies. Those hospitals will already have agreed arrangements with the inventing clinician, “and they are happy because they now have a route to do it multiple times as they come across more ideas and they have the possibility of getting more ideas into the system”.

“The originators are very busy people with busy jobs and I want them in the operating room,” says Young, who still believes there is a deep pool of ideas that have lain around, patented but not pursued in the absence till now of an i360.

“We are now world renowned,” says Young, with no trace of false modesty. Johns Hopkins and Duke University are among those who have since come calling. And i360’s model is now in demand outside the US, with Germany’s Charité and Singapore’s EPTL/A-Star both looking to set up similar partnerships.

That increased demand lies behind the current move to raise new funding. Young sees i360 as a model that can help Ireland to sell itself as an innovation hub.

“The value for Ireland is that we have great skilled people but I think we can bring those people into the next phase to make Ireland a global hub for innovation, a leading force in Europe,” he says. “America sees us as a gateway to Europe and even to Asia, and Asia sees us as a conduit the other way.”

CV

Name: Derek Young

Age: 46

Position: Founder and chief executive of i360 Medical

Family: Married to New Zealander Suzanne, they have three children – India (8), Xavier (6) and four-year-old Pixie.

Interests: We used to go to theatre and shows a lot but less so now with the children. Music is a very big part of my life as are clothes and design, like interior design. In general, I need to be challenged a lot – my mind needs to see something new.

Something you might expect: Despite the hope that the RCSI/i360 venture might mean less travel and more time with family, Young spends a lot of time on planes, especially to the US east coast.

Something that might surprise: Despite his very practical engineering background and focus on healthcare innovation, he sees himself as someone who is very spiritual.