SAN FRANCISCO — Driver, an ambitious startup marketing an app to match cancer patients with clinical trials, has shut down after running out of money just weeks following its high-profile launch.
The company let go of all of its approximately 85 employees on Oct. 16, Driver’s co-founders confirmed to STAT. About 60 percent of those employees worked at Driver’s headquarters in San Francisco; the rest were based in Shanghai, New York, and Boise, Idaho.
Driver had been trying to raise another round of funding this fall, but it wasn’t making money fast enough to convince investors to give it the capital it needed, Driver CEO and co-founder Dr. William Polkinghorn said.
In the end, Polkinghorn said, “we ran out of money.”
Driver had the financial backing of Hong Kong’s richest man. It also scored partnerships with the National Cancer Institute and more than 30 cancer centers including top hospitals like the Mayo Clinic and Cleveland Clinic.
But none of those hospitals was paying Driver as part of the relationship. And the company never finalized any of the lucrative deals with other businesses — insurers, employers, and drug companies — that keep many health care startups afloat.
Instead, Driver had initially focused on marketing its product, which included both tumor sequencing and access to the clinical trial navigation app, directly to cancer patients. The price: $3,000 upfront plus a $20 monthly fee, all out of pocket.
“We made a really big bet on DTC,” Polkinghorn said, referring to the direct-to-consumer market.
But that bet didn’t pay off. Hundreds of cancer patients tried out the app once it became available in April of 2017 — the company was in “stealth mode” until early September — but nearly all of them did so on Driver’s dime, so that the company could fine-tune its product.
Only a very small number of patients actually ended up paying Driver for its product. (Polkinghorn didn’t have the precise number of those patients available on Sunday night.) Polkinghorn said it’s his “number one priority” now to work with those paying patients to make sure they’re in an appropriate place with their care, though he said that issuing full refunds would be difficult without resources.
Polkinghorn, a radiation oncologist by training who was previously on the faculty of Memorial Sloan Kettering Cancer Center, co-founded Driver in May 2015 with an old Harvard Medical School classmate, Dr. Petros Giannikopoulos. They set out to tackle a notoriously thorny and frustrating problem: Too few cancer patients get the best treatments, whether that’s the recommended standard care for their particular cancer or an experimental treatment offered through a clinical trial.
To try to solve the problem, Driver invested in both hardware and software.
The company built its own automated machines — one in San Francisco and another in China — to analyze patients’ tumor samples. The vision was that Driver would arrange to get patients’ tumor samples shipped from the hospital where they got their initial tumor biopsy and then use its machines to sequence each tumor and drill down into its other molecular characteristics.
Driver also poured resources into the clinical trial navigation app, which had an interface for both patients and for clinicians. The company started with the government’s trial registry clinicaltrials.gov, and then worked closely with top hospitals to upload into its database more trials and more details that could be used to match patients looking to try an experimental therapy.
The money to do all of that came from a number of places. Driver’s lead investor was Li Ka-shing, Hong Kong’s richest man. His venture firm contributed about 20 percent of the funding Driver raised since the company was formed in May 2015; the rest of Driver’s funding came from individual investors as well as the venture firm Nexus Venture Partners.
Driver had planned to generate revenue from employers, insurers, and pension funds. The idea was that these businesses could be persuaded to pay to give their members access to another version of the app aimed at healthy people, which would give tips about prevention and reminders to schedule screenings like a mammogram or a colonoscopy. Driver also had ambitions to sign up drug companies as paying customers, to help them accelerate enrollment in the clinical trials they sponsor.
Polkinghorn said he regrets not prioritizing those revenue streams earlier. “We needed to bring on revenue a lot sooner than we did — as opposed to maybe spending as much time and resources building such a robust solution,” Polkinghorn said.
As for the technology Driver developed, Polkinghorn said he’s working with the company’s board and investors to try to “monetize as much of that value as possible.”
Driver made a splash when it launched publicly in September. It held launch events, first in Beijing and then at Howard University in Washington, D.C.
The company also managed to get prominent figures in health care to vouch for its promise in the media: Driver arranged for STAT to talk to the director of the National Cancer Institute and the head of clinical research at the prestigious Massachusetts General Hospital Cancer Center about the broken clinical trials marketplace — and Driver’s potential to help fix it.
It was not six weeks after all that fanfare that the company ceased operation.
For Driver’s co-founders, “it’s been by far the most difficult few weeks of our careers,” Polkinghorn said. “We’re devastated.”
“we ran out of money” is just about the worst excuse a CEO could offer.
it’s the CEO’s job to make sure you *don’t* run out of money so you can retain your employees, build products, and ultimately serve your customers.
There are too many people already taking advantage of cancer patients already. Slicker sleazier marketers have already beaten them the punch. The targeted marketing to cancer patients and other sick and desperate people on social media, is already in full swing. This was not the only company looking to exploit patients with a targeted marketing, clinical trial site. These people are already engaged with marketing sites peddling clinical trials, that are merely seeking their personal information. Perhaps this scam has run it’s course. We have not seen one site warn people about these marketing gimmicks or schemes!
Seems that pay to trial is a much harder sell than most DTC that gives a product/service/result, not the chance of an untested one or a placebo…
Another reporter/resource not understanding how to perform due diligence. One look at the company books would have identified all the problems.
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