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Analysis

4 Ways Children's National Hospital Is Conquering Innovation

By Mandy Roth  
   January 21, 2020

With a focus on the challenge of developing pediatric devices, Chief Innovation Officer Kolaleh Eskandanian, PhD, MBA, PMP, has tackled innovation with a robust network of partnerships, including Johnson & Johnson Innovation - JLABS.

This article appears in the March/April 2020 edition of HealthLeaders magazine. 

How has a health system with a 323-bed hospital and a three-person innovation team built connections with more than 100 startups around the globe and attracted a Johnson & Johnson innovation lab to collocate on its campus? And how does it simultaneously challenge its own academic faculty to tackle the quandary of pediatric device innovation?

Children's National Hospital in Washington, D.C., has accomplished these feats by weaving a robust network of partnerships. Many of the threads lead back to Kolaleh Eskandanian, PhD, MBA, PMP, who is vice president and chief innovation officer at the health system and executive director of the Sheikh Zayed Institute for Pediatric Surgical Innovation.

The focus of innovation at Children's National is to address the unmet needs of kids by bringing new solutions, therapies, and products to the pediatric market, which Eskandanian says is "not always necessarily lucrative and attractive to the industry." There are three areas of development: devices and diagnostics, drugs/biologics, and digital health/software.  

Compared to drugs, the time period related to patent exclusivity for medical devices is shorter, tightening the window of profitability for developers, she explains. In addition, beyond the inherent challenges of developing medical devices and putting them through clinical trials and the regulatory pathway, the pediatric market presents additional difficulties. Children grow fast, have a different biological structure than adults, and the market is smaller. As a result, pediatric medical device development "doesn't really bring a lot of financial benefits," she explains.

As health systems explore ways to maximize innovation with tight resources, a closer look at the approach Children's National took provides some compelling ideas.

1. A Leader With Roots in Engineering

Interestingly, Eskandanian's initial professional path had nothing to do with healthcare. Her background is in mechanical engineering, and she fortified her career by also earning an MBA, as well as a PhD in management science. Her prior life includes working for Intelsat and Accenture. She entered the academic healthcare realm when Georgetown University recruited her to develop the "first-ever adverse event reporting system," she says. 

Eleven years ago she joined Children's National to help translate clinical discoveries, knowledge, and research into the marketplace through product development and innovation. The George Washington University School of Medicine and Health Sciences is the primary academic affiliation for Children's faculty.

"There was a need to come up with the type of infrastructure that would de-risk some of the good research," she says, "and also put [developers] on the path that could transfer the technology to the marketplace.

"It was tough to fit the discipline of project management and program management into a nonprofit culture," she says. "Being an engineer—and having had the experience of product development and creating solutions for the market—helped me in this position."

2. A Consortium to Stimulate Innovation with External Startups

While lobbying and advocacy for pediatric drug and biologics development has been strong since early 1990s, she says, it wasn't until 2007 that Congress passed the Pediatric Medical Device Safety and Improvement Act and authorized development of the U.S. Food & Drug Administration's Pediatric Device Consortia Grants Program. This program facilitates the development, production, and distribution of pediatric medical devices through funding of nonprofit consortia.

Seven years ago, Children's National applied for and was awarded a grant from the program that resulted in the formation of the National Capital Consortium for Pediatric Device Innovation (NCC-PDI), operated by the Sheikh Zayed Institute for Pediatric Surgical Innovation at Children's National and the A. James Clark School of Engineering at the University of Maryland, along with other partners. Eskandanian serves as principal investigator for the Consortium.

For Children's National, in essence, NCC-PDI creates a symbiotic relationship between the health system and startup companies focused on pediatric device development. The startups obtain access to experts inside Children's National to refine and validate their products in a clinical environment, and the health system benefits from exposure to novel technology.

"In the past seven years, we've assisted over 100 startup companies that are external to Children's National, says Eskandanian. "I'm very proud of this accomplishment because it's opened our eyes to what might be possible beyond our own four walls, and we imported external innovation by interacting with startup companies around the world."

Among the success stories she cites are Velano Vascular, which developed a blood draw system that reduces the need for needle sticks while in the hospital, and PhotoniCare, which created technology to noninvasively visualize the middle ear.

To ensure the pipeline remains full, NCC-PDI sponsors an annual pediatric device innovation contest.

3. A Method to Import Expertise: Entrepreneurs in Residence

Eskandanian operates with a lean staff, including a director of intellectual property and director of marketing and partnerships. To expand their capabilities, Children's National partners with BioHealth Innovation. This Rockville, Maryland, nonprofit organization functions as a regional innovation intermediary to accelerate and facilitate technology transfer and commercialization of market-relevant research in federal labs, universities, and biohealth companies.

One of the most valuable advantages to this partnership is the Entrepreneur in Residence (EIR) program. A popular tactic in the venture capital world, EIRs are often former CEOs and serial entrepreneurs who share their expertise with startup companies that may have a novel idea, but don't have the internal knowledge or capabilities to get their product to market. BioHealth's program connects clinicians and scientists with experienced entrepreneurs to help their innovations make the leap from the lab to the real world.

"It's very different when you do research for the purpose of publication and writing grants, versus developing something that industry would buy," Eskandanian explains. "The EIR program helps [faculty] with business planning, understanding intellectual property, regulatory science, and the types of disciplines that you need to know to make a product out of your research. Basically, it brings expertise from the industry and the culture of productization and innovation to an academic environment." One EIR from BioHealth Innovation is dedicated to Children's National fulltime, and access to other EIRs with select expertise is provided as needed.

The EIR program is coupled with a "gap fund." Eskandanian says these internal funds, available to faculty members on a competitive basis, provide support to de-risk and validate technology to make it more appealing to buyers or for licensing.

4. A New Campus to Ignite Crucial Connections

This year the health system will open its new Children’s National Research & Innovation Campus in Washington, D.C., on a 12-acre site that resides on the former location of Walter Reed Army Medical Center. It will provide far more than space to grow, says Eskandanian; it will become a regional hub for healthcare innovation and deliver the opportunity work with "like-minded partners with whom we can collaborate to bring more innovations to the market."

Last fall, Children's announced a partnership with Virginia Tech, which is building a 12,000-square-foot biomedical research facility in the complex.

Earlier, Johnson & Johnson Innovation - JLABS (JLABS), announced it is opening a new 32,000-square-foot facility on the campus, which can host about 40 startup companies. No other children's hospital has a JLAB facility on its campus, Eskandanian says.

JLABS is a global network of life science incubators located at eight primary sites, including the one at Children's National, as well as three affiliate sites and two smaller "JPODs." According to JLABS, these facilities are designed to create an optimal environment for emerging companies to catalyze growth and optimize research and development.

A benefit of having JLABS as a neighbor is the programming the facility will provide, as well as connections to venture capital investors. Its proximity will influence the mindset of researchers and the health system's culture, says Eskandanian. "By having industry in the same building, and interacting daily with totally different phenotypes, if you will, I think we will see a big transformation in terms of thinking about product development," she says.

“In the past seven years, we've assisted over 100 startup companies.”

Mandy Roth is the innovations editor at HealthLeaders.


KEY TAKEAWAYS

Through a pediatric device consortium, Children's National has worked with more than 100 startup companies.

The health system imports expertise through an entrepreneur-in-residence program to advise faculty innovators.

A new research and innovation campus has led to partnerships with Virginia Tech and Johnson & Johnson, which are building massive, on-site innovation labs.


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