Daniel Powell [00:00:01]:

Have you ever wanted to go behind the scenes of a medical device company to hear about the ups and downs and ins and outs of taking an idea from concept to market? 

Daniel Powell [00:00:09]:

Well, I'm Daniel Powell, CEO of Spark Biomedical, and I'm joined by my fellow founders, Doctor Alejandra Covalin, Chief Technology Officer, and Doctor Navid Khodaparast, Chief Science Officer. This is Spark a Conversation. 

Daniel Powell [00:00:24]:

In 2018, when I was building my first investor deck, I wrote the number 42,500 overdose deaths. And I think I said to you, I was like, I think we missed the peak of the epidemic. It's going to be going down.

Navid Khodaparast [00:00:37]:

It was plateauing. Yeah.

 Daniel Powell [00:00:40]:

And unfortunately, last year in 2022 is 110,000 deaths, a two and a half increase. I never would have thought it would have just gotten worse and worse. But there was no fentanyl when we started this. That was the other interesting thing.

Navid Khodaparast [00:00:55]:

No, there was no fentanyl. It was almost primarily heroin. What are you talking about? Opioid use disorder. Yeah, yeah, yeah.

Alejandro Covalin [00:01:02]:

And that helped us with getting a faster trial because.

Navid Khodaparast [00:01:07]:

Well, that we had some. We had roadmap already built, though. Right? Because we had the idea, which is, you know, the opioid crisis is there. But then we knew the technology worked. There was some evidence to say that you could stimulate the auricular branches and effectively help patients.

Daniel Powell [00:01:25]:

Well, we go back, really. The origin is you built the very first device in your garage because you were looking at headache.

Alejandro Covalin [00:01:31]:

I was actually working on migraine.

Daniel Powell [00:01:33]:

Yeah, yeah, migraine.

Alejandro Covalin [00:01:35]:

I was trying to develop the occipital. The occipital, right. And. But I. But I. But I had looked into the occipital and trageminal a lot because. Because of the migraine. And then the Vagus was there also.

Navid Khodaparast [00:01:46]:

Did you ever see his device that this device?

Daniel Powell [00:01:49]:

Well, it goes here.

Navid Khodaparast [00:01:52]:

It was almost like an ocular headset.

Alejandro Covalin [00:01:53]:

Yeah.

Navid Khodaparast [00:01:54]:

Or VR. But it went on the back of your head.

Alejandro Covalin [00:01:56]:

Yeah, yeah. It had these electrodes.

Navid Khodaparast [00:01:59]:

How many electrodes?

Navid Khodaparast [00:02:00]:

It was like.

Alejandro Covalin [00:02:01]:

It was probably. It was like probably seven and seven. A row of seven on top and seven on bottom. But then. But then that technology, basically, I use the same technology. I took. We took that and used it for what we needed. It was still large, but the first thing was just to make it smaller.

Alejandro Covalin [00:02:24]:

But we had a circuit. We had the technology, we had the circuits, we had all those things, and we knew what to do. And so I think that made it moved as fast. It moved us fast. We already. So in the technology side, I think I had already made mistakes before. So that allows you to go much quicker, because, you know, what not to do.

Navid Khodaparast [00:02:47]:

Well, we knew exactly what to do.

Alejandro Covalin [00:02:48]:

We knew what to do, and, I.

Navid Khodaparast [00:02:50]:

Guess what not to do because we had the technology. There was the background science 

Alejandro Covalin [00:02:55]:

Yeah. 

Daniel Powell [00:02:56]:

And we met in 2017.

Navid Khodaparast [00:02:58]:

You met 2017. 

Daniel Powell [00:02:59]:

We're at a startup together that we were just employees at, not founders.

Navid Khodaparast [00:03:03]:

Right.

Daniel Powell [00:03:04]:

It went under, but we had got to know each other professionally, and we said, let's. Let's do something together. My friend Vic knew we were trying to work on something to do with auricular. Was selling transmagnetic stim for depression. And the psychiatrist was like, by the way, I'm using this acupuncture system for withdrawal. And he called me up.

Navid Khodaparast [00:03:28]:

Oh, that was the P-Stim.

Daniel Powell [00:03:29]:

The P-Stim device. And he called me up, and he's like, you got to see this. And I was like, so they're pushing these needles into the ear and electrifying. And, of course, ours doesn't have needles. It's transcutaneous, has hydrogels. And I was like, we can build a better mousetrap that's more efficacious. And that was our inspiration to start looking at withdrawal.

Navid Khodaparast [00:03:51]:

We knew this. You and I knew this kind of when we were at that previous startup a little bit, too. We had a good understanding of that.

Daniel Powell [00:03:57]:

Yeah. But when we were deciding what to go after and then did our research and everything fell in place, and just clearly, the opioid epidemic was, we needed Alejandro

Daniel Powell [00:04:09]:

We needed Alejandro.

Alejandro Covalin [00:04:12]:

No, it was. Yeah. From when we started talking about. It was. I tried to do. I was always trying to do a startup. Ever since I remember, I wanted to. I kept on working for large companies, but I always wanted to do my own stuff.

Alejandro Covalin [00:04:28]:

And when we were talking about doing something, I realized all the other parts that were missing. Before, when I was trying, like, we had everything. We had the perfect. We have the perfect. We have the great people. We could work together. We had a problem that could be solved, a real problem society was facing.

Daniel Powell [00:04:53]:

But the team was critical. Right. I've tried to do monthly startup before, and I didn't have partners. I was all alone. And that is hard, having each of us in our own swim lane. We don't. You know.

Navid Khodaparast [00:05:05]:

Right.

Daniel Powell [00:05:05]:

You got. You covered. The science. You're thinking FDA, you're thinking clinical design and grants. You're thinking R and D, patents, you know, anatomy. I'm looking out for the business, and we just.

Navid Khodaparast [00:05:20]:

But how many times do you see founders clash? You know what I mean?

Daniel Powell [00:05:24]:

Oh, if you had three engineers.

Navid Khodaparast [00:05:25]:

Founder. It's a single founder that feels like I control everything. You have to follow my vision.‍

Daniel Powell [00:05:31]:

Yeah, we didn't. I mean, we never had that.

Alejandro Covalin [00:05:34]:

No, no, because I tried that before.

Daniel Powell [00:05:39]:

You think you were. You were controlling everything.

Alejandro Covalin [00:05:41]:

Well, I didn't realize I was, but you kind of. But then you realize we grow. It's ridiculous.

Navid Khodaparast [00:05:47]:

No. 

Daniel Powell [00:05:48]:

Yeah, yeah.

Navid Khodaparast [00:05:49]:

But that's a nice part where you can let other people kind of think about it, too. Right? Like, sometimes I'm wondering about, like, obviously, I'm so focused in my world, but there are times where I'm like, Dan's got that, you know? What is an issue with the device? I'm like, Alejandro's got.

Alejandro Covalin [00:06:05]:

Yeah, we try. I mean, we trust in our abilities. We knew that. We knew that this. We knew we had something. We knew we could help people. We knew there was a business. It was just,

Daniel Powell [00:06:14]:

I think, you know, in the early days, we try to find reasons to kill it. Right. Is this really going to work? Is there really a business here? Is there really? Fail fast. Yeah, fail fast. And the doors would just keep opening. But about six or seven patients into the clinical study is when we got Eliza. The facility just calls us out of the blue and says, we have a patient that just finished enrollment or going through this, and she wants to do a testimonial. And it's hard to get people to put themselves on camera to talk about their addiction.

Daniel Powell [00:06:56]:

So Jackie and I packed up all the video equipment, drove to Austin, and got the most. Just, like, heart wrenching.

Alejandro Covalin [00:07:06]:

Oh, that was raw, emotional.

Daniel Powell [00:07:09]:

Yeah.

Navid Khodaparast [00:07:09]:

Well, Eliza didn't. She was the, in some ways, the classic OUD patient. Right. That just. I'm just gonna check in. I'm gonna detox, or I'm just gonna get on buprenorphine. I'm out the door.

 Daniel Powell [00:07:22]:

Yep.

Navid Khodaparast [00:07:23]:

She didn't believe in. She had her own agenda going in.

 Daniel Powell [00:07:26]:

Yep.

 Navid Khodaparast [00:07:27]:

And the fact that the device changed her thought process.

 Daniel Powell [00:07:31]:

That she was like, I am not going in. I'm gonna do my seven days, then I'm out, and as soon as I'm out, I'm gonna do heroin.

 Alejandro Covalin [00:07:39]:

Yeah, I guess. I guess their parents were actually for kind of forcing her, pushing her to go.

 Navid Khodaparast [00:07:45]:

Well, a lot of families do, but. Yeah, but they still have to be willing, of course.

 Daniel Powell [00:07:49]:

But then on her own at the end, because she was so clear headed and wasn't miserable with withdrawal.

 Navid Khodaparast [00:07:58]:

What did she say? The fog. I remember that she had this comment.

 Daniel Powell [00:08:02]:

Yeah.

Navid Khodaparast [00:08:02]:

I don't remember the video so long ago..

 Alejandro Covalin [00:08:04]:

But I remember the raw emotion of the video, but I had tears.

 Daniel Powell [00:08:09]:

Oh, we were all tearing up in the room, like, behind the camera.

 Navid Khodaparast [00:08:12]:

Oh, I bet.

 Daniel Powell [00:08:12]:

Like, I'm not crying. You're crying. That is the company motto. I think addiction's tough. It is a really tough business. It's a very tough crowd. And there's, it's, you know, people are really struggling and suffering and withdrawal is fight or flight. It makes you mad, it makes you angry, it makes you aggressive.

 Daniel Powell [00:08:33]:

And so it's a difficult patient population to be patient with. But the neonatal, coming upon the neonatal and seeing what those babies were going through, that that meant we're never quitting.

 Navid Khodaparast [00:08:45]:

Because neonatal, we started August 2018 and then neonatal came, that next year is when we got the neonatal grant.

 Alejandro Covalin [00:08:54]:

That's a very interesting.

 Navid Khodaparast [00:08:56]:

It was August, September of 2019 when we got neonatal.

 Daniel Powell [00:08:59]:

I found out about neonatal. We started in August 2018. November of 2018 was when I was doing my research and found out, oh, my gosh, this is affecting newborn babies. On a flight to San Francisco to go to a neurotech meeting, I emailed both of you guys and I'm like, we got to work on this. And by the time I landed, you both emailed back. I think I said, I don't care if we make money or not, we're doing this, we're doing it, we're going to do this. And you, both of you said, absolutely. And I go to this meeting.

 Daniel Powell [00:09:35]:

12 hours later, I land at night, 12 hours later, speaker gets up. It's Bashar Badran showing the results of stimulating newborn babies ears for stroke recovery. The only person in the world who's ever stimulated a baby's ear is sitting in front of me 12 hours after we make this decision. It was

 Navid Khodaparast [00:09:55]:

That spark, serendipity that we have every now and then.

 Alejandro Covalin [00:09:58]:

Yeah.

 Daniel Powell [00:09:58]:

The world conspiring to make this happen.