We first spoke with Byron Hewett, the CEO of Cambridge, Mass.-based BioBehavioral Diagnostics Co., late last summer, following a $2.5 million funding round that saw the company sell convertible debt securities to a trio of investors.
In the interim things changed for us and Hewett and BBDx. We upgraded our office computer and, in the process, lost our notes from that first conversation. Things went more smoothly for BioBehavioral, which raised another $7 million toward a $10 million Series B round and ramped up sales and marketing efforts for its Quotient system, designed to assess symptoms of Attention Deficit Hyperactivity Disorder.
So we circled back with Hewett for an update on BioBDx, his deep roots in diagnostics and his thoughts on reforms afoot in the healthcare system and at the Food & Drug Administration.
MassDevice: Can you give us a brief background on BioBehavioral Diagnostics and its ADHD diagnostic tool?
Byron Hewett: The technology was licensed from McClean hospital and Harvard. Back in 2004 BioBehavioral Diagnostics licensed a portfolio of about about 25 patents from McClean. In 2006 the A Round was funded and that gave us the money to develop the product. The initial A [Round] was $8.5 million. The second tranche of the A [Round] was another $8 million. That money was used to develop the technology and to begin the initial commercialization of the product.
The device that’s been developed really combines a couple different technologies in one. One component of that is using infrared motion tracking systems to track motion at the same time that people are taking a go-no go attention task. What we’ve done is patented the analysis portion of that in a way that was never done before, that turned out to be statistically significant in terms of its ability to distinguish ADHD from non-ADHD.
So with the motion piece we track movements greater than 1 millimeter 50 times a second. We actually have two different tests. We have a child test, which is 15 minutes, and we have an adult test, which is 20 minutes. On the child test we just measure motion on the head, we put a reflector on the child’s head while they take the attention task at our kiosk, which is almost like a library carrel they sit at while they take the test. We’re capturing all that information, we can capture movements and patterns of movement that the naked eye is not going to pick up. So then the go-no go task is that the child is presented with two different targets. One is an eight-pointed star, where if they see that they’re supposed to hit the space bar. The other is is a five-pointed star, where they’re supposed to do nothing. The idea is that when someone is taking the test we can measure their accuracy and their errors of omission and their errors of commission. What that allows us to do then is to calculate what percent of time they’re on task. We can also calculate what percentage of time they’re distracted, what percent of the time they’re impulsive and we can also calculate whether or not they are disengaged from the process.
Someone without ADHD, when they’re taking a task like this will tend to be stationary. So people that have ADHD have what is called “motion discontrol.” The idea is that their natural state that they’re most comfortable in is one with movement as opposed to sitting still. And so what we’re capturing is that when a non-ADHD person takes the test you see a spot on the chart that looks very much like a bullet hole, it’s just a dot. Whereas a person with ADHD will cover much more space and there will be a lot more movement around the starting position of the head. And so we’ve got a variety of measures we use to calculate the statistical significance of this. The way we do this is we compare each patient’s result against a database that had age- and gender-matched norms in it. The reason for that is that one would expect a six-year-old boy is going to move more than a 12-year-old boy because some of this is developmental, and then boys do in general tend to move more than girls. So that’s why you do gender and age-matched norms.
You need the test to be long enough to give you valuable information, but not so long that it’s basically so difficult that no one can complete it. You want to capture enough data, and we actually have in our test that if somebody becomes disengaged from the process we can note the amount of time they were disengaged and that may then cause us not to be able to give a result for that particular patient.
On the attention side one of this, one of the key differentiators that we do is that we break the attention state down into 30-second blocks and we use statistical algorithms to calculate for each 30-second block whether or not that patient was on task, impulsive, distracted or disengaged. What that allows us to do in a way that was never available before is to break that down in a way that in a glance a physician can see how much time they were on task. What we find is that people with ADHD have many more attention shifts. In other words, it’s not that they cannot pay attention, it’s that they cannot sustain the attention.
So this becomes a way that we can graphically capture this and present it to the physician in a way that it’s very easily understood. We also have composite scores that tell the physician the likelihood that the patient has the disorder, and then we also have scaled scores on motion and inattention that show the severity of their symptoms, if you will. So the point is that this winds up being a very powerful tool to aid in the assessment of ADHD, not only at baseline but also in the assessment of ADHD post-diagnosis. Because you want to see are they in fact responding to treatment.
One of the things about people with ADHD is that they’re often very creative, their brains just work differently than those that don’t have ADHD. That doesn’t mean it’s a bad thing, it’s just that it’s different. And for some people it’s disabling enough that it really gets in the way of their ability to succeed, either in their careers or in their home life, and therefore becomes a reason to be treated. Treatment can be behavioral intervention as well as medication, it can be combinations of the two, and it often involves helping the parents understand how to change their parenting style. Children with ADHD basically just cannot control these behaviors that create the difficulties. And so to discipline a child for this disorder because they continue to do behaviors that drive you crazy doesn’t help them get over the disorder. It just tends to polarize things and make things worse. Part of the parenting style is to help the child through this stuff and provide them with some support, and that’s where the behavioral interventions come in. They try to teach the child over time how to do better at maintaining attention on different tasks.
Our objective is to help manage these patients to find a more effective way so that they have a higher quality of life. There’s data that show that families with an ADHD member have higher costs of healthcare, even if you take out the cost of treatment for ADHD. People with ADHD tend to engage in more risky behaviors, they tend to have more car accidents, more broken bones as a child, they may inadvertently break the bones of somebody else in their family because they’re out playing and they get a little rough. Those are the kinds of things that you see. It’s estimated that 40 percent of people in prison have ADHD. It only takes one moment of impulsivity to spend years behind bars. And many people with ADHD self-medicate, which means between coffee, nicotine and other, illicit, drugs people wind up trying to deal with their disorder the best way that they can. Without proper intervention they may not do it so well.
MassDevice: How did you come to be involved with the company? What was your background before joining the firm?
BH: I’ve been in the diagnostics industry for most of my career. Early in my career I was with Abbott Laboratories and I also did a stint with Chiron Diagnostics [Eds. note: Chiron was acquired by Novartis in 2006], as well as Bayer Diagnostics, and then I was the CEO at Immunicon Corp. based outside of Philadelphia. While I was CEO of Immunicon I was also on the board of BioBehavioral Diagnostics. And so in 2008 we sold Immunicon to J&J and later the board asked me to get more involved as a part-time executive chairman due to my extensive background in the commercialization of diagnostic technologies and products. And then I became full-time executive chairman at the end of March of ’09, so I’ve been in the seat now for about nine months.
MassDevice: BioBehavioral Diagnostics recently announced raising $7 million towards its $10 million Series B goal, saying it plans to use the money to expand its sales and marketing operation and fund additional clinical work for the Quotient system. Can you elaborate a little more on exactly how you plan to spend the cash?
BH: The reasons for raising the money haven’t changed from last summer to now. What’s happened is that we’ve gone ahead and expanded our sales force. When you and I spoke last summer, we had two sales reps. We have seven currently and we’re looking to add an eighth on the West Coast.
MassDevice: Where do you think the next generation of innovations in behavioral health will occur?
BH: This is an area where there’s room for tons of improvement. Just understanding the human brain and its complexities is an enormous task and despite years and years, decades, of research and study into how the brain functions and so on, we are really just scratching the surface. I think that there will be many, many areas for improvement. Particularly in the realm that we’re in, the possibility of providing objective measures that can be used to help assess these disorders is incredibly important. It’s so subjective today that it’s just fraught with a lot of errors and a lot of risk. One of the lowest-rated areas is in the follow-up with kids who are prescribed ADHD medications. part of this is that the assessment on that is subjective and it’s difficult, so it tends not to happen. It tends to be hit-or-miss. And that’s unfortunate because a lot of these children are either under- or over-medicated. If they’re over-medicated you can get adverse side effects and if they’re under-medicated you’re not getting the benefit that the medication could provide.
MassDevice: On the regulatory front, what’s your take on the changes afoot at the Food & Drug Administration, especially with the 510(k) clearance program?
BH: I find that whole thing to be interesting, having been in the diagnostics industry for a long time. I did not have a perception from where I sat that somehow industry was influencing that in a way that was inappropriate. When I heard about those issues at the FDA it seemed to center more in the devices arena than the diagnostics arena. When you get to diagnostics specifically as it relates to the FDA, the FDA in a sense let the horse out of the barn on these CLIA laboratories back in 1999 [Eds. note: CLIA stands for Clinical Laboratory Improvement Amendments]. The labs developed tests that could circumvent the FDA rules and were not required to have submissions. My view is that at the stroke of the pen the FDA transferred a lot of the power in the diagnostics industry from the kit manufacturers, the more traditional diagnostic companies, and they put a lot of that power right in the hands of the reference laboratories and created this sort of evolution of these specialized laboratories that provide test results as a reference laboratory but they’ve been able to do so without going through the same data standards and clinical trials that were required for other diagnostic tests. I was kind of surprised by that, because even 11 years ago, 12 years ago, it was pretty obvious that there was a lot of innovation going on in molecular technologies, and the FDA process back in the late ’90s to get a molecular assay through the agency was next to impossible. It was taking years and years and years to get those tests through the FDA, whether it was companies like Roche or Abbott or Gen-Probe or Chiron or Bayer, all those companies were facing really significant challenges to make that work. Part of it is FDA wanted documentation on the genes and where they came from and how you derived it and so on, and a lot of that was really difficult to do back then. I don’t think its as hard to do today as it was then, but in many ways that was stifling the ability of new tests to come to market. So then what you saw was what certain companies have done, where they set up their own reference laboratory and made their tests available. Myriad Genetics and a number of other companies would fall into that bucket, and a number of those companies have wound up having very successful businesses.
Which is fine, but they basically went down a path that said, “Hey, the FDA said these rules don’t apply, so let’s go.” I don’t think you can really blame the companies for seeing the gap in the regulations and running for the gap. But now the FDA is trying to put the horse back in the barn and I think that’s kind of difficult to do.
The other one you get into is these very specialized, almost like “orphan” diagnostics. Those markets for these things are so small that if you’re requiring clinical trial work to be done like you would for a normal test, the cost for the trial far exceeds the economic benefit that you can derive from doing the trial and then commercially marketing the test. That creates this situation were for example if your patient could go on Gleevec, there’s a particular gene you want to look for to see if they’re going to respond to it or not. It makes sense to have that test, but the market size for that test is very tiny. So there are things like that that impinge on their policy-making. I think even the FDA recognizes that in some of those situations, they just can’t put the same regulations in place that they might want to have in other parts of the market.
You have to sort of classify what falls into which bucket. Part of that would be based on what the potential size of the market might be. That can also be complicated, because somebody may think that the market potential is big, but if you don’t get the uptake of the product in the marketplace in reality the market may be small. So do you later come back, after it’s on the market for a period of time and gained some success, and ask them to run a more elaborate trial at that point? These are big policy issues for the FDA to consider.
I also thing another area where the FDA could do a lot better is in this whole idea of personalized medicine, where you have diagnostic tests that could tell you something about that patient that could then tell you whether or not they’re going to respond to a particular drug. Right now there is no mechanism within the FDA for a drug and a companion diagnostic to go through in a way that both of them could gain approval from the same clinical trial. In the past, when I’ve asked questions of people in the FDA around this, it’s been an initiative that Janet Woodcock had spoken about on a number of occasions, but if you’d spoken to people in [the Center for Drug Evaluation and Research], which does the pharma stuff, they’re kind of like, “What? What are you talking about?” They can only think about a pharma trial, they can’t think about how you could do both in the same trial. I think the people in [the Center for Devices and Radiological Health] were in favor of developing something along those lines, but I don’t think their colleagues in CDER were particularly responsive to the interests of the diagnostic companies and the CDRH to pursue that.
MassDevice: What about healthcare reform? Is it DOA or do you still see a chance for something happening on that front this year?
BH: I think it’s in trouble, that’s for sure. I don’t know where we’re going to wind up on the thing. Personally I would like to see us find a way to expand care to people that don’t have it, because I think it’s ridiculous that so many people, basically because of cost or because their employers don’t offer a good program, basically go naked and take their chances. I think that’s inappropriate, because a lot of healthcare cost can be avoided if people just go through a regular checkup phase. Many things can be diagnosed early and early intervention can save huge costs downstream. I think it’s something that needs to be addressed, but that said, it needs to be done in a way that doesn’t tank the federal budget.
I think where we’ve wound up with the current healthcare reform that’s been proposed, particularly when you start cutting deals with certain states to get them on board, the whole thing starts to have an odor to it. That’s just not right. On the other hand, I do agree with President Obama that we need people to stick their hands across the aisle from both sides and find a way to work together. And of course that’s not happening. When Scott Brown won in Massachusetts, I was shocked and surprised, but at the same time I think it sends a huge message to both parties that they need to pay attention to their constituents. It’s not just about having their hands out for the lobbyists and listening to those who pay to play. When this stuff comes out about John Edwards and his girlfriend and the money that was coming out of his campaign to basically hide her away, every politician needs to wake up on that one and say, “Am I doing the right thing?” Because if he can do it certainly others can as well.