Alec: Hi, I’m Alec Santiago, Founder of Clutch City Science, and this is HXTV, championing Houston’s innovators and entrepreneurs. Our guest today is Josh Mecca, Founder and CEO of M&S Biotics. Welcome, Josh. Happy to have you.

Josh: Alec, thank you for having me as well.

Alec: Let’s go ahead and get started with just a little bit of background on how your company stands today.

Josh: Yeah, M&S Biotics stands today by focusing on two unique problems in the operating room. One right now is that 14% of operative time is spent counting surgical sponges alone, no metal instruments at all. The reason they’re counting these items is to ensure they don’t leave them behind in a patient at the conclusion of a procedure. Our technology today is solving specifically that problem. We ensure nothing is being left behind, the patient comes out of that procedure with a great post-op prognosis. The other aspect that we’re focusing on is when you bring in a hundred instruments, in a lot of cases, less than 20% of those instruments brought in a room are even utilized during the course of that procedure. We have a great way of solving two of those problems. On the front end, patient safety, as it should be. Downstream is how do we automate some of these processes that are archaic in the fact that they’ve been done the same way for 30-40 years now.

Alec: It’s amazing to me that nobody has optimized this before. 20% utilization of your instruments just sounds crazy.

Josh: You’re absolutely right. There are ways to go at it. People are always trying to digitize and optimize preference cards, but what’s the best way of doing it outside of interviewing surgeons every single day to see what they truly need versus what they don’t. The missing link is quantifiable evidence. Hey, we tracked you over 30 cases and this is what we know now, versus just asking them to kind of use their own experiences to see what’s needed and what’s not. That’s typically how it’s done today.

Alec: Would you tell us a little bit about the technology, how it integrates into the operating room?

Josh: One of the primary technologies we use is radiofrequency identification, or more commonly known as RFID. What we do with this system is we build a, I call it an RF module, that could either replace or retrofit preexisting space inside the operating room. And that’s important because we don’t want to disrupt any current manual workflows, we want to be able to optimize the operating room and not be an impediment to it.

Alec: So, your technology is actually in addition to the equipment the hospital would already have, correct?

Josh: Exactly. We don’t want them to have to get rid of anything. We simply want to be nice plug and play.

Alec: Let’s break this into the two parts. There’s the benefit that’s having the equipment and then there’s the data analytics. So first, walk us a little bit through the benefits that come to having your technology in the surgical center.

Josh: From a hardware standpoint, the benefit is right now, inside the operating room, they manually count surgical items one by one. They do so before, during, after each surgical procedure. From the hardware we do two things. First, we fully automate that counting process so that it’s significant, because that’s a serious bottleneck right now. Not only are we automating that surgical counting process, additionally, we’re tracking those surgical items from start point to the endpoint, which might be over the patient. Now this does two things. The automation makes a procedure that much more efficient, but then there’s the patient safety benefit. No more retained surgical items, no more accounting discrepancies, and no more extended time in the operating room that was unnecessary. That’s the hardware. Now when we look at the data analytics aspect is another problem, which is, less than 20% of the items brought into the operating room are even utilized. By tracking instruments from start to end, we can get a better picture of what’s truly being used, so that way we can make better assumptions and validation on how those sets should be constructed. We can supply the hospital with those data analytics in order to do so. The front end, we’re adding a lot of automation, we’re reducing—you’re increasing patient safety; on the back end, we’re providing these data analytics so they can optimize these surgical sets.

Alec: A core component of your technology is actually tracking. Do you have a lot of problems with tracking that you have uncovered?

Josh: Yeah, when we look at the problems, one is the accounting discrepancies. One in eight surgeries have accounting discrepancies. There are 50 million cases done a year. That means 6.25 million there’s a discrepancy. It doesn’t mean every single one of those cases will lead to an item being left behind in a patient, but when there is a discrepancy, it goes up a hundred-fold of that chance actually happening. We’re looking at the raw data that this and saying, hey, we need to focus on this problem specifically. Let’s ensure we don’t have, at the bare minimum, no discrepancies anymore.

Alec: Anything that keeps an instrument out of my body is fantastic.

Josh: It’s important because between 2005 and 2012, 16 people lost their lives as a direct result of that. It’s probably underreported because a lot of lawsuits that happen tend to get done under the radar. They don’t make it to the national news stage or even the general news station.

Alec: Even though it might not be common it’s still present and gruesome.

Josh: Oh yeah. I think the most alarming statistic is these accidental deaths that do happen within the medical—within healthcare, I think what they say is, if you took two Boeing 737s and two of them crashed every single day for a year, that would be the equivalent of the 250,000 people who lose their lives over the course of a year. We know that if one plane crashes it makes the national news and it’s very obvious that it doesn’t get quite the attention that maybe some of these planes have.

Alec: In your pitch deck you have one particular picture that’s a little gruesome of a patient that actually has an instrument implanted inside of them. Your system actually helps to prevent things like that.

Josh: Exactly, it is a gruesome picture and it’s what kind of turned me early on in this problem of retained surgical items, unfortunately. Why are they counting these items? To make sure they don’t leave any of them behind. Unfortunately, one in eight surgeries actually have an accounting discrepancy, meaning they might not know where this item is in the operating room. Even more interestingly is that when there is a retained surgical item left behind and it’s qualified that patient might have some inflammatory response, studies show that between 62-88% of the time, those counts were correct. They thought they got it right, wheeled the patient out, and that item was left behind the whole time. It’s a big problem, but the uniqueness is the way we’re going about solving it.

Alec: They’re pretty broad applications though. You might be setting some standards for surgical procedures.

Josh: Absolutely. One of the things about this technology is we start off by qualifying two points; could we automate the surgical count, and could we track utilization of these individual instruments. Being in the operating room is this new up and coming market called intraoperative analytics; data insights from the operating room that lead to actionable change. What we’re hoping for, and the grand benefit is this company is more organic than anything. We look at it as a lot of white space potential. A lot of data that we’re going to collect that may spin out different applications that we didn’t even know about. That’s why I think it’s so crucial to work with these hospitals because everybody is going to be looking at it from a different perspective, which is only going to allow us to further improve the data sets, further improve—make new claims, new hypothesis, test those, validate those, and understand where we are in the market. I think that’s kind of the way we keep the target off our back, is continuously growing, growing organically, and optimizing everything we’re doing.

Alec: Let’s step back a little bit and tell us how you got to where you are today.

Josh: I actually am from Scranton, Pennsylvania. For those of you who don’t know, the home of The Office, and Joe Biden. I went to school actually in more of a bioengineering point. I went to undergrad and grad school and graduated with both my undergrad and masters with a degree in bioengineering. With that bioengineering, the idea originally was to go to med school. I had a curious, insightful type of thing of looking at a lot of immunotherapies. What kind of turned me on to, kinda left field, into the entrepreneur is the fact that I had a kidney transplant. In having this kidney transplant, I’d be a little bit more prejudgmental to the operating room, as that was a career I wanted to go into. I did a lot of my own research in looking at what my life would be like on the lead up to that transplant, and what it would be like post-op. That’s when I started really uncovering a lot of these statistics, a lot of these bottlenecks, and how they not only affected the patients, but the surgeons, the nurses, all the way down to the chief financial officer, at the end of the day. That really put a limelight on how much opportunity there was to fix. I think healthcare could use all the fixing we can provide it.

Alec: And you’re not a Houston native, correct?

Josh: No, I’m a transplant.

Alec: Ok, so coming down here, how do you feel that the Houston ecosystem has opened itself for a first-time entrepreneur?

Josh: Very welcoming. I think coming down here for life sciences, more specifically, med devices, I think in the next 5-10 years this will be the place to be. One thing that Houston will have to start scaling up is the access to venture capital. Traditionally, it’s on the east coast. It’s in New York, Boston, and California. Actually, 70% of all VC capital comes from those three areas. Houston, in the next 5-10 years, with TMC³, CDI, I think it will start pushing those VCs to start at least putting n office space in Houston when they have interest in these life science deals.

Alec: Where do you see M&S Biotics in the next five years?

Josh: In the next five years I would say in one, we will be in our next—hopefully in our next stage of capital raising, likely with the same VCs we are using today. In five years, what I would like to do is, once we qualify those initial points, I think you hit the nail on the head, what if? Every entrepreneur starts off asking, ‘What if?’ What if we were able to track utilization as it may pertain to patient outcomes? I grew up in a healthcare depressed region of the country. Northeastern Pennsylvania 20 years ago was 30 years behind the national average. It made sense, and you were always told, leave. Go to Philly, go north, south, east or west, just leave northeastern Pennsylvania. Why? Because the quality of the procedures being done and the access to quality healthcare was missing.

Alec: That’s frightening.

Josh: But what if we could track utilization as it relates to patient outcomes in these top tier medical systems? The MD Andersons, the Mount Sinais, the Cedar Sinais. See what is the best and then we can qualify, is this the best way, the technique that leads to the best patient outcomes. Now we can take that information and get it to the rural areas of the country where those patients don’t have access to quality of care like people in Houston are used to. I think that is hitting the triple aim immediately. Better access to quality care, less of a burden of cost for everybody because it’s more efficient, and the global—the national increases to patient outcomes and quality of life improve too. That is like the golden goose of this technology, is asking if we can do that, essentially providing the best possible care for everyone regardless of where you are geographically in the country, because we are seeking out that information.

Alec: Thank you very much for coming in to talk with us today, Josh. I’m very much looking forward to your company and its forward trajectory.

Josh: Thank you so much for having me. This has been fantastic.

Alec: Thank you, sir. This has been Josh Mecca, from M&S Biotics. I’m Alec Santiago and this is HXTV.