Health Innovators
Health Innovators

Episode · 2 years ago

The Keys to Launching a Successful Pilot


“Death by pilot” is a phenomenon that happens far too often for healthcare innovators, and it can take them out of business before they even start selling anything. What is the root of this problem, and what are the initial mistakes innovators make? What are the things you need to nail down before you launch a pilot so that it doesn’t mark the end of your business? 

On this episode, I talk about how to have a pilot that actually leads to sales and avoids “pilot purgatory”.


3 Things You'll Learn

  • Many innovators get so excited that someone was interested in their project they accept everything during the negotiation process. This is how they end up with unfavorable terms.
  • If you don’t negotiate any sales terms for the end of the pilot, you can be left holding the bag.

  • You want to have a pilot of early adopters because they are the people with a higher likelihood to buy your innovation after the pilot. 


When health innovators have to launch a pilot in order to establish medical validation or clinical evidence, they can end up in pilot purgatory and go out of business before making any sales. In order to get a good outcome from the pilot, you have to know what it’s actually for. The pilot is the pathway to demonstrating safety and efficacy. You still need sales afterwards for it to be viable. Your negotiations, goals, and KPIs should be going in that direction.

Welcome to Coiq, and first ofits kind video program about health innovators, early adoptors and influencers and their storiesabout writing the roller coaster of healthcare innovation. I'm your host, Dr Roxy,founder of Legacy DNA marketing group, and it's time to raise our COIQ. Welcome back to the show. On another episode of Coiq with Dr Roxy, I have met our producer with us today instead of a guest, andhe is going to have a conversation with me today and we're going to talkabout death by pilot, a phenomenon that is seems to happen very often.Yeah, and this is this is super fascinating. So let's start with differentdefining the terms death by pilot, because I'm assuming this is not a referenceto air crashes. What is her? The listening audience knows that you're tillyou're talking about pilot programs. What do you mean by death by pilots?Yeah, so I use this phrase.

I have talked to so many healthcareinnovators and when I say death by pilot, what I mean is this phenomenon wherehealth innovators end up having to launch a pilot in order to establish themedical validation or clinical evidence that they need for their innovation and they get stuckin one pilot after another and their business ends up going under before they evergenerate enough clinical evidence to you start generating sales and and I like to saythat, you know, I feel so bad for these health innovators because Isay that they're stuck in pilot purgatory and it's a it's a thing. It'sreally it's a real thing that I think a lot of health innovators can relateto. Well, let's start. Let's start at the at the kind ofthe root of the problem. Some they get the initial opportunity, they're superexcited. Let's walk through that a little bit. What are some of theinitial mistakes right out of the gate? Some of the things they don't naildown, the agreements, that pitfalls, things like that. When then,when you first get that pilot? Yeah, sure. So when I'm talking tothese health innovators, they get so...

...excited. They're like yeah, andI got this pilot and they're just thinking that, you know, it's goingto be a home run now that they've got this pilot, and then theyend up having this you know, rude awakening and there's a couple of thingsthat they either don't do what they could do to make that a better situationand a get a better outcome from that. So when they're negotiating this pilot agreement, just because they're so excited that I finally got someone that's interested inmy innovation, you know, the whole negotiation process is just kind of likeyes, yes, yes, to the hospital, to the health plan andwhat other whatever your terms are, let's do it, because I just wantyou to say yes so I can go down the street and say, Oh, I'm doing a pilot with John Hopkins or I'm doing a pilot with,you know, Florida Hospital, and and forget that through that pilot agreement Ineed to do certain things. I need to make sure that in that contractlanguage that we're measuring certain KPIS, whatever those indicators are to establish that clinicalevidence. I need to make sure that I get access to the data andmake sure that that's part of the agreement...

...because, you know, we havea pilot but I don't have the data to prove it. Then there wasreally worth its right. Pilotever actually happened? Yeah, exactly. And then thethird thing is, you know, again, it seems like it wouldbe obvious, but a lot of people miss this. Is some type ofterms that if x, Y and Z happen, then that's going to leadto sales because because, you know, the pilot is really supposed to bejust the pathway to demonstrating safety and efficacy and I need sales. And sotoo many times I hear that the health innovators will have a pilot with ahospital system or a health plan, everything goes smooth. They couldn't if theycouldn't have asked for a better pilot scenario. You know, patients are getting betteror they're actually adopting, you know, the mobile APP or you know,the widget, and but then it doesn't lead to sales. And soyou know this, it becomes an illusioned or the the innovator becomes delusions thatjust because they have a pilot, that...

...that's going to be on the pathto success. And really, if you don't negotiate any sales terms at theend, you can really be left holding the bag and a lot of alot of innovators end up going under before they actually generate any revenue because theyget stuck in this pilot purgatory. Yeah, and how when you say stuck init, because we gave the example of just how well maybe one specificpilot can go. You know, just doesn't produce the results that you wantto. It could go well without producing sales. But what do you meanby pilot purgatory? And we're going from one pilot to the next. Wewere getting stuck in one really bad pilot with bad negotiated terms. What areyou talking about? Yeah, so I'll give you a scenario. So astalking a couple of different innovators, and this is kind of what typically happens. I'm sure our audience will be able to relate to this. So again, I'm a health innovator. I go out to a health system, everybody'sreally excited, we ink the deal for the pilot and I'm excited about it. The pilot is under way and so... I'm negotiating terms with another hospitalsystem in the same area. So let's just say, for example, orI'm s Orlando Regional Medical was the was the first hospital. So now I'mpitching Florida Hospital and, you know, to adopt the innovation and they say, oh well, we need to do a pilot, and I'm thinking,I'm so glad you ask for this, because I actually just did a pilotwith ORMC in the same market and I'm going to, you know, sharethat clinical evidence with you, and they go no, no, our patientpopulation is different. Plieve this. Our patient population is different, and you'relike, no, but we're both hospital systems, are in the same city, and they're like yeah, but we have a different patient population. Soin order for a to adopt your innovation or even consider rolling it out,we've got to do a pilot here too. And so it becomes pilot after pilotafter pilot and you run out of money you before you ever actually startgenerating in sales. And so it's a real problem. And so that's whyI say stuck in pilot purgatory, because it's one pilot after another and nohealth innovators. I hear this over and...

...over is when am I going toactually get to the end of this where it's going to be enough clinical evidenceto actually start generating revenue? That's interesting. So let's talk about we talk alittle bit in a previous episode, which everybody should go check out atjust about the difference between launch and commercialization. We talked a little bit about whoare you speaking to right? Are you speaking to the mainstream? Whereyou speaking to the early adoption, and so kind of your solution to thisis is really part of your whole strategy of going to the early adoptors first. So let me ask you this. When you do a pilot, howimportant is it to understand the person that you're dealing with and whether they're apart of the mainstream or whether they're a part of that early adopt because itseems like that would drive a lot of the outcome of the pilot and whetherit actually leads to sales. Absolutely, I mean I think that sometimes,you know, these health innovators just spinning their wheels if they are looking todo a pilot with a hospital system or... play and that is really partof the mainstream market and are not one of the early adopters. So,you know, I would say that you want to be able to get pilotswith those early adopters because those are the ones that are going to be morelikely to buy at the end of the pilot instead of just doing a pilotand going yeah, that was great. And how common is it? Whattype? Tell me a little bit about this. This scenario where you canwalk into a pilot and come out with an agreement that, if this pilotdoes what you say will do and everything looks good and it comes out theway that we expect it to, that we will buy at the end ofthis pilot. What is that? What does this scenario look like? Whatis the company how is the company position? How is the innovation position? Putyou in that kind of a negotiating position, I think that you haveto, you know, identify one. You know what is the patient populationthat's even viable for this and you know what is the percentage of the patientpopulation that's participating in the pilot. Are... going to do you have enoughpeople participating to be able to extend those results or have those results validate theentire populate, patient population? Because I think another thing that you don't wantto get involved in is I did a pilot, but we did a pilotwith fifty patients and now they're still unsure on whether that's going to really thoseresults are going to apply to the TENZERO patients. So I think making surethat you've got a the right sample size is going to be really important andfor negotiating that and good having some early dialog or dialog early on in theprocess of you know how likely are you to buy and in and let's putthat in writing, let's put that in the agreement, that if a,B and c happen, then you are going to buy. And be specific. And I think health innovators are are like. They just struggle with havingthat negotiation power because all the power really... with the health system or thehospital system and and and so I might acquiesce or I might negotiate to lessthan favorable terms because I just want to be able to Hassay that I havethis pilot going on, but if it really doesn't amount to anything revenue wiseat the end of the day, then it really is just a waste oftime. It's interesting. Yeah, the it all, it all deals withwith limiting beliefs and personal developments and all kinds of fun stuff, but itis interesting. There's I think there's when when you talk about negotiation and gettingthe best, most favorable terms for a pilot before you even start, thereare there's some negotiating tactic things that you've talked about that have been very helpful. But the flip side of that is that hopefully, if they've been workingwith you through that process and they're being guided through an early adoption strategy withyour help. To me, what that does is it helps position them differentlyso that the negotiating conversation changes. It's...

...qualitatively different. Right. It's notjust a matter of well, I could have massaged that a little bit differently, I could have said some things differently during the negotiation. To me,when you're when your company is positioned well and you're coming in from a positionof strength, that change is the quality of the negotiation and I think that'spart of what your goal is when you're working through this early adoption strategies,is to position them completely differently so then not in it in a a weakenedput, you know, kind of negotiating position where there are kind of atthe mercy of these hospital systems and other types of people they're trying to sellto and they have to acquiesce on all these terms. Right, right,YEP, and it really goes back to what we're talking about. One ofour previous episodes, like you, had mentioned about the difference between launching commercialization. So if you're just looking for a launch plan, you're you're not generallydeveloping a pilot strategy or a pilot planned. It's just a it's a lot moread hoc and it's not part of that, whereas you know, fromour point of view it's a very important and critical component of the early adoptionstrategy going forward, that commercialization strategy to...

...make sure that you have market success. YEA, love it and I know we'll go into future episodes of talka little bit more about early adoption of strategy. You'll talk to some foundersthat have that have walked through this successfully and can share their own experiences withgoing straight after the earlier doctors and why that's important. So definitely for thefolks that are listening to go check those other episodes. What's the best wayto connect and just get into your world learn a little bit more about theCoiq strategies and brainwork? Sure, so you can go to Dr Roxycom andcheck out our show website, or you can go to legacy dnacom and getmore information about the commercialization services that we offer. Perfect Roxy. Fantastic.I really enjoy the conversation. I know people on the listening and got aton of value from it at because I'm sure you're describing exactly need, thatwhat they're going through, and and give some great tips to solve it.So thank you so much. Thank you. Bye Bye. What's the difference betweenlaunching and commercializing a healthcare in avation?...

Many people will launch a new product, few will commercialize it. To learn the difference between launch and commercializationand to watch past episodes of the show, head to our video show page atDr Roxycom. Thanks so much for watching and listening to the show.You can subscribe to the latest episodes on your favorite podcast APP like apple podcastsand spotify, or subscribe to the video episodes on our youtube channel. Nomatter the platform, just search coiq with Dr Roxy. Until next time,LET'S RAISE OUR COIQ.

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