Challenging the Gold Standard

Building Credibility Through Development: Taking the Long View

For disruptive medical technologies, cutting corners during development can be fatal to eventual success. Early in Profound's journey, Arun recognized that the company needed to prioritize building credibility over speed to market.

"If you don't spend the time to develop the technology properly, it will come back and bite you. You won't be able to commercialize it," Arun explains. "If you don't spend the time on the clinical development, the surgeons will say, 'Yeah, this looks like an interesting technology, come back when you have all the clinical data.'"

This approach means resisting the constant pressure startups face to move faster, and instead, focusing on creating a solid foundation of clinical evidence and user feedback.

Arun focuses on building a good reputation with end users through comprehensive clinical evidence. Instead of simply meeting minimum requirements, Profound designed its clinical trials to address physicians' specific concerns about treating different patient populations.

For Profound, this strategy took concrete form in their TACT (Transurethral Ultrasound Ablation of the Prostate) pivotal trial. The trial enrolled 115 patients across 13 sites in North America and Europe. Rather than focusing only on ideal cases, the study included men with different risk profiles. TACT demonstrated that TULSA-PRO could effectively treat these diverse cases while preserving urinary and sexual function.

This comprehensive approach allowed Profound's team to respond to physician concerns with actual data rather than theoretical arguments. When urologists expressed hesitation about treating patients with particular characteristics, Profound could point to specific outcomes from their trials, strengthening their position through evidence rather than marketing claims.

Here’s the bottom line: Making difficult investment decisions in thorough development and clinical validation pays off, even when capital is limited. The credibility earned becomes a powerful asset when approaching risk-averse clinicians, ultimately determining whether your innovative technology will be adopted or rejected in the marketplace.

Strategic Clinical Trials: Going Beyond Regulatory Requirements

One of Profound's boldest moves was conducting a head-to-head clinical trial comparing TULSA-PRO against the current standard of care, radical prostatectomy. While many would consider this approach risky, Arun saw it as a calculated strategic investment.

"For startup CEOs, there are times you decide to take risk, and I'm certainly not afraid to do that," Arun says. 

In Profound’s case, when asking urologists to transition from current robotic systems to the company’s new technology, they needed compelling evidence that this wasn't just another buzzword-driven innovation but would genuinely improve patient outcomes.

This trial, called CAPTAIN (Comparative Analysis of PCa Treatment Using TULSA vs. Radical INtervention), faced significant recruitment challenges that had derailed similar comparative studies in prostate cancer treatment. However, Profound's previous clinical work had laid crucial groundwork.

"Had we started the CAPTAIN trial earlier without that early data and that experience of our users, I think we probably would not have designed the trial properly," Arun reflects. "One of the things that helped us take that educated risk was the fact that we had done some broad early work that gave us the confidence that indeed we will be able to recruit."

The strategic value of this comparative data extends beyond physician adoption to payer coverage and societal guidelines. "Societies will be able to go and say, 'We can recommend it.' Insurance companies will be able to say, 'Yeah, we can see it in a comparative trial,'" Arun explains.

Rather than viewing this investment in comparative data as strictly a commercial expense, Arun frames it as a strategic alternative to traditional sales approaches: "I could have spent a lot of money in trying to recruit salespeople and be hard charging versus spend some money here to be able to produce data that they can now clearly sell,” he says. This falls in line with their primary goal of unlocking interest from early adopters and payers.

When Going Public Pre-Revenue Makes Sense

While many medtech companies follow a path of multiple private funding rounds before considering public markets, Profound took a different approach. Arun brings valuable perspective on financing disruptive medical technologies, having led multiple companies through the transition from private to public funding.

"My general thought has always been to wait as long as you can to go to public markets, because once you go to public markets, every quarter matters," Arun explains. As a rule, he advises startups to remain private as long as possible because early-stage development timelines rarely align well with the quarterly expectations of public markets.

Despite this principle, Profound Medical went public unusually early — before FDA clearance and before generating revenue. This decision stemmed partly from the limited venture capital ecosystem in Canada, where the company is based.

The more compelling reason, however, was the capital-intensive nature of developing medical technology that is truly innovative. "The first rule is I want to stay private, but the second rule is you cannot build companies that are game-changing with a treatment modality unless you have sufficient cash to do it," Arun notes. Public markets offered the necessary capital to fully develop TULSA-PRO without cutting corners.

Beyond simply accessing capital, Arun emphasizes the importance of finding the right investor base. Rather than pursuing any available funding, Profound sought investors who understood the long-term development cycles of medical devices and could appreciate the technology's potential beyond quarterly results.

A balanced approach to funding represents an important strategic consideration. While private funding may offer more flexibility during early development, accessing public markets at the right time can provide the substantial capital needed to fully realize disruptive technologies — provided you find investors aligned with your long-term vision.