Q&A with Rudy Mazzocchi
President, CEO, & Secretary of BioMedX Group, Inc.
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Family Office Insights sits down with Rudy Mazzocchi of BioMedX Group to discuss his late-stage development medical technology company that has designed a fully-integrated facial simulation technology for the cosmetic plastic surgeon and his patients that yields real-time predictive surgical outcomes based on specific medical procedures and their injectable materials (e.g. Botox and facial fillers). BioMedX has raised $1,500,000 and is now seeking an additional $500,000 in convertible notes to complete the development of its commercially-viable product in the 3rd Quarter of 2018 before seeking a $5,000,000 Series A Preferred Financing to complete the production and launch of its commercial products through established distribution partners throughout the U.S. and International markets.
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Tell us about your background and your company, BioMedX.
I have nearly 30 years of senior executive management, technology and intellectual property development, and financing experience in the healthcare, med-tech/biotech and medical device industries. I previously served as Chief Executive Officer, Executive Chairman or Independent Director of various stage private and public companies involved in ophthalmology, cardiology, neurosurgery, orthopedic, stem cell therapies and aesthetic/plastic-surgery.
I also previously served as Managing Director of two medical Venture Capital Funds and founded or co-founded over fifteen (15) technology-based companies, raising over $600 Million in private and venture capital with a dozen M&A transactions completed to date.
I am the recipient of the Technology Leadership Award, the Businessman of the Year Award, the Ernst & Young Entrepreneur of the Year Award in Healthcare, and Global Entrepreneur of the Year Award. I have also authored more than 90 patents, three published award-winning novels and a top-selling business book on Entrepreneurism.
Most recently, I served as Executive Chairman of Establishment Labs, a successful, global plastic surgery company based in Costa Rica, where I gained experience and insight into the needs of this industry. They developed a body scanner that allowed women during breast implant consultation to see the best ultimate options for her body type and to visually see the outcome post-surgery.
When I look for opportunities it is to address unmet needs. It goes beyond clinical needs, but to optimize procedures for clients. I was asked to be an advisor for Pulse Evolution, the creators of the Michael Jackson holographic performance founded by the world’s leading producers of photorealistic digital humans. I joined to assess how these opportunities utilizing digital humans can be utilized in healthcare. While there, I worked for Pulse Biologic, the medical subsidiary of Pulse Evolution to focus on digital human animation in the surgical simulation and life sciences industries. The team and I acquired 100% of the assets with exclusive I.P. rights and re-named the company, the BioMedX Group.
Who is BioMedX’s target market?
Our core audiences are plastic surgeons, plastic surgery clinics, and centers of excellence, specializing in cosmetic and reconstructive face and head surgical procedures. According to the International Society of Aesthetic Plastic Surgeons (ISAPS) in their 2016 report, the total number of invasive and non-invasive procedures in this specialty totaled close to 13 million in the Top 10 countries surveyed.
Clinical validation is key for such novel technologies and we know that interfacing and working with the plastic surgeons for the next few years of our evolution is essential. Currently, we are focused on selling our product directly to the clinics and plastic surgeons, down the line there’s opportunity to work with strategic partners, such as pharmaceutical companies who provide injectables in this market.
The beauty of this system is that it will optimize the injection process of Botox and Tissue Fillers (e.g. hyaluronic acid). There are a select number of dominant market leaders in aesthetics market and we are looking to them for advertising dollars to co-promote/co-market our technology, giving them the ability to upsell the products they offer. We will slowly expand into a global distribution model that may end up in the hands of the strategic market leaders.
In 2016, according to the International Society of Aesthetic Plastic Surgery (ISAPS), the global number of invasive and non-invasive procedures that would be applicable to BioMedX system (i.e., face and head only) was close to 13 million. Since the typical conversation rate is around 30%, even a slight increase of the conversion rate by 5% would produce staggering increased revenue.
What are the challenges faced in this market?
The challenges in this market also provide for several opportunities and enhance the value proposition provided by the novel BioMedX system. As a non-reimbursable industry (i.e. coverage not provided by insurance companies or Medicare), patients are required to pay out-of-pocket for their cosmetic procedures. Without true predictability of what the outcomes might be, the vast majority of patients do not elect to proceed beyond the consultation visit. The BioMedX system allows the patient to visualize those outcomes (in real-time), persuading them to confidently move forward on the recommendations of their plastic surgeon.
In addition, this industry is highly marketing-driven, with physicians competing for every potential patient in their local region. Based on internal research, the conversion rate from consultation to patient is approximately 30%. Clinics rely on advertisement, word-of-mouth, and a strong social media emphasis to reach as many patients as possible and to differentiate themselves from their numerous competitors. BioMedX provides a unique platform (both a fully-integrated clinical system and a Mobile App) to promote real-time modeling with highly predictable outcomes at a low cost to the patient.
In contrast, there are an abundance of gimmicky apps available that “photoshop” a patient’s image in hopes of providing a glimpse of the procedural outcome. These often lead to disappointment—as they do not take into consideration the patient’s individual skin and facial muscles – yielding very different results. Patient and physician education will be required to properly explain the sophistication and value of the BioMedX system, which further enhances the promotional aspects of our novel, fully-integrated technology.
How do you differentiate from competitors? Who are your key competitors?
Globally, market research has estimated cosmetic surgery spending to rise to $27 billion by 2019. To date, there is still a lack of realistic simulation and visualization solutions to enable doctors to accurately show the post-procedural results. Many of the solutions in the market today deliver faux 3D results due to the lack of acquiring actual 3D data when capturing the patient’s face. Currently, solutions use 2D imaging to simulate 3D results. As such, many of the simulations lack accuracy and are limited in their realism.
BioMedX recognizes the opportunity to create a hyper-realistic simulation solution. With our expertise in creating hyper-realistic digital humans, we are confident in providing answers to the challenges faced by simulation solutions today.
BioMedX starts by creating an end-to-end 3D solution. We begin with a 3D camera/scanner for patient-specific data capture. The image data and medical parameters are processed by our proprietary 3D Physics Engine to deliver the most accurate and realistic simulations. Finally, the simulation results are output to a 3D holographic display that patients can view and interact with in real-time as well as have the option to utilize augmented or virtual reality devices.
By being the first to deliver hyper-realistic 3D simulations via a holographic display, BioMedX is setting the bar high, and with our family of patents and intellectual property protection, we are creating barriers to entry that will ensure the company stays ahead of the game.
There are a few competitors in the space. However, none can truly claim that they are delivering a true 3D solution that is computer-vision driven. The reality is that most competitive solutions in the market today use image processing as a way to deliver simulations.
Image processing delivers superficial transformations of the image. The most common application would be the methods we see in popular software such as Photoshop, and a host of many others tailored for mobile platforms such as FaceTune, and other retouching tools. While they can simulate the post-surgery results to some degree, the accuracy and realism is lacking, as they do not factor in real-life considerations, including the way different volumes of injectables respond and behave from person-to-person.
BioMedX approaches simulations of biomechanics through a new proprietary method we are calling Direct Simplicial Dynamics (DSD). It differs from the ball-and-spring approach to 3D dynamics in that DSD fully accommodates the tensorial nature of continuum mechanics which balls and springs do not, and in fact, more economically. DSD also differs from finite elements in a number of ways, but principally, its philosophical origin is entirely different: finite elements discretize the equations of continuum mechanics while DSD works directly with tetrahedra and triangles of a geometric discretization of the body and its surface. We expect it to be faster and more intuitive in its structure than the finite element approach as well as anything currently out in the market.
Some close competitors include: Crisalix, which currently focuses on breast augmentation, and uses a low-end camera; FaceTouchUp.com, which allows users to upload photos and uses image processing to deliver the simulated results; Canfield, which uses static images, and through their software, creates a pseudo-3D effect; and Quantificare, which uses hardware added to a DSLR camera, and through their software, delivers a similar product to Canfield.
How are you changing the landscape in your industry?
BioMedX is transforming the cosmetic consultation experience by empowering doctors to demonstrate post-procedure results to potential patients. By enabling the patient to visualize the results that are based on their own personalized data, prior to actually undergoing the procedure, patient confidence is increased, and doctors have a new tool that will optimize the patient conversion from consultation to scheduling of the procedure.
Injectables are the fastest growing procedures in the market. Many of the botch-ups are done when patients go to dermatologists instead of plastic surgeons for more affordable work. All doctors have disclaimers signed from patients as this is just a simulation and nothing is 100% accurate, but since ours takes into account elasticity of the skin, the accuracy is uncanny.
To give an idea of how sophisticated and technologically advanced our system is, a mobile phone captures 10,000 points in the face, and BioMedX captures 4,000,000 points. We will be 10x more powerful than anything currently available in the market.
The key value proposition is about converting the patient consultation into a procedure. The average procedure is $3,500. We are evaluating a leasing system business model, charging $25 per scan, which the doctor will incorporate into their consultation fees. Everything else is added profit. The ability to market and promote this system gives that clinician the market advantage over his/her competition for being revolutionary beyond the current Photoshop system because our output is a true 3D hologram.
We believe this tool should be available to both high-end dermatologists and plastic surgeons. Our complete system with the holographic display is rather expensive, at $50,000 a unit. Our initial revenue model is based on penetrating 1,000 doctors around the world. We estimate that our doctors will perform 40 scans a month. With 1,000 targeted doctors, this will yeild $1,000,000 every month from reoccurring revenue.
Our product is commercially viable and the algorithm allows for the ability to expand into additional clinical offerings. For instance in the future, we can include dental procedures and even various hair regrowth and transplant procedures . We already have the know-how from Pulse Evolution from their technical focus on Michael Jackson’s hair thickness and how it moves during his performance.
When you look at a digitally recreated character, our mind’s eye can assess the slightest differences. Pulse Evolution technology captured 14,000 elements of Michael Jackson’s face down to the individual pores in his skin. This was viewed as low hanging fruit for us to make the easy transition from 2D to 3D facial simulations. We purchased the medical rights to the Pulse Evolution technology in November of 2016.
Who is your ideal investor?
We are seeking new private shareholders (e.g., high-net worth individuals, family offices and small private equity funds) who appreciate early to mid-development stage technology and are willing to participate in this round of investments to fund the completion of a commercially viable product with the potential of a handsome return in this rapidly growing healthcare market. These investors could come with prior investing backgrounds in software (e.g., algorithm and simulation software) including healthcare and related social media backgrounds.
How much capital are you looking to raise?
BioMedX has raised $1,500,000 and is now seeking an additional $500,000 in convertible notes to complete the development of its commercially-viable product in the 3rd Quarter of 2018 before seeking a $5,000,000 Series A Preferred Financing to complete the production and launch of its commercial products through established distribution partners throughout the U.S. and International markets. While our competitors spend about $3,000,000 on building assets, we have completed a lot of our development through acquisitions bought through shares.
In September 2018, we plan to demonstate our first commercially-viable product. Our goal is to finish the 3D physics engine with an initial series of medical applications to showcase to institutional investors a fully-integrated simulation product.
In medical and health care companies, it takes great deal of capital to get through the regulatory process. However, we are not a diagnostic or therapeutic company, which costs up to $30,000,000 to $50,000,000 to get through the European and U.S. commercialization process. BioMedX is here to help optimize the consultation tool and serve as an exceptional marketing tool. With our algorithms, we have the ability to assess the skin, tissue, fat, and skeletal structure in precise detail, and incorporate the knowledge of the molecular weight of the hyaluronic acid and how it absorbs into the tissues for an individual patient in real time, which no one has attempted to do, making it novel and proprietary.
What is your mission?
Our mission is transform the way cosmetic procedure consultation is experienced through hyper-realistic simulations that are accurate and personalized for the patient. In the future we are going to do surgical procedures and every time we build new functionalities, it’s a new set of data that’s incorporated into the physics engine. There are virtually no tools like this available for doctors today. We’re bringing science to beauty.
Other missions include:
•To commercially launch a fully-integrated novel system that will transform this industry,
•To disrupt the current low-standard simulation tools and provide true procedural predictability,
•To become the established market leader in facial simulation for a variety of applications and markets,
•To continue to enhance our technology platform through data capture, data mining and artificial intelligence,
•To continually expand the clinical indications to ensure ongoing market adoption and penetration,
•To provide our shareholders and employees with the maximum return on their holdings within the Company.
What's next for you?
Once we have established ourselves as the leader in delivering accurate and precise simulation results for the facial cosmetic procedures, our 3D Physics Engine can be advanced and applied to other medical related indications including, for example, dentistry. As the leader in real-time facial simulation, it is anticipated that our proprietary technology could potentially have a major impact in the growing fields of virtual and augmented reality (e.g. other optically enhanced procedures in medicine and the gaming industry).
We also believe that the stand-alone individual elements of our platform (i.e. 3D video camera, 3D physics engine and 3D holographic display) will have far-reaching opportunities and value in various medical and non-medical applications.
Mr. Rudy A. Mazzocchi, B.Sc. is the President, Chief Executive Officer and Secretary at BioMedx Group, Inc. Mr. Mazzocchi has 27 years of senior management and financing experience in the medical technology industry and has extensive healthcare background includes an academic, management and venture perspective.
In 1989 he founded the firm Microvena, which he built into a company valued at over $170 million. After this he founded and then sold additional companies including Vascular Science, Inc., CytoGenesis, Inc. and Image-Guided Neurologics. Over the years Mr. Mazzocchi has served in leadership capacity of various companies including NovaVision, CytoGenesis, Inc. Vascular Science Inc. amongst many others.
In the recent years. he has served as the CEO of Elenza, Executive Chairman of Establishment Labs Holdings, Inc. (ELHI), Executive Chairman of OptiStent, Inc. and Executive Chairman of LAFORGE Optical, Inc.
Mr. Mazzocchi was the 1997 recipient of the Minnesota Technology Leader Award, Nominee for the Rolex Enterprise Award, recipient of the 2004 Ernst & Young Florida Entrepreneur of the Year Award. He holds close to 40 medical device patents and is a well-published author of scientific and medical journal articles in various fields of medicine. He received Businessman of the Year Award (2005), and Global Entrepreneur of the Year Award (2013). In 2012, he published the award-winning novel Equity of Evil which is being developed into a movie.
Mr. Mazzocchi completed post-graduate studies in Biophysics and Mathematical Sciences at UCLA and has a B.S. in Life Sciences and Biochemisty from the University of Pittsburgh.
If you have any questions, please contact Rudy at firstname.lastname@example.org.