Greyledge CEO Dave Karli MD, Biotech Startup & Optimizing the Process of Regenerative Medicine

 BLP Karli | Greyledge

Greyledge Technology is a biotech company that works with the patient’s own tissue samples. They take a tissue from you, typically blood or bone marrow tissue, and they manipulate that into a sample in a therapeutic that’s placed back either via injection, or as part of the surgical technique where our surgeon implants it. There are therapeutic cells within these preparations that can be used to promote and support natural healing.



Greyledge CEO Dave Karli MD, biotech startup & optimizing the process of regenerative medicine.

We’re incredibly fortunate to have Dr. Dave Karli on the show. He is the CEO of Greyledge. Greyledge is located out of Vail, Colorado in Denver. Dave is responsible for all aspects of the company development, including the integration of a strong team of professionals to support Greyledge’s innovative approach to regenerative medicine. A bit of background about Dave; after attending med school at the University of Maryland, Dr. Karli, completed his residency at Physical Medicine and Rehabilitation at Harvard Medical School. Subsequently, he joined the facility at Harvard serving as an attending physician with the Department of PM&R at Spaulding Rehabilitation Hospital as well as working in the department of Orthopedic Surgery at Mass General Hospital.

After joining the Steadman Clinic in Vail, Colorado in 2003, Dr. Karli began to adopt the use of autologous-based therapies that were emerging in the field of regenerative medicine. He has continued to lead the effort required to refine the practice of regenerative medicine. He has published pivotal clinical results and lectured extensively. His practice has grown substantially and includes treating elite-level and professional athletes. As a result, Dr. Karli has been featured in publications such as the Wall Street Journal, New York Times, ESPN Magazine and the Denver Magazine. Dr. Karli recognized early on that understanding the composition of regenerative biologic preparations used in treating his patients would be critical to refining his practice of medicine. He also realized that a one size fits all approach to creating the therapeutic preparations wouldn’t meet the need for an evidence-based precision medicine approach. In support of his concept for regenerative medicine, he completed the COLA Laboratory Director training course and obtained his MBA at Daniels College of Business, University of Denver. Greyledge has achieved sustained profitability ready for scalable expansion. Dr. Karli is positioning the company to maintain its unique technology platform offering by tracking regulatory activity, advancing biologic sample analytics and quality measures, and creating protocols that allow for customization of patient biologic preparations.

Dave, welcome to the show.

Thank you so much for having me. It’s an honor to be here.

What is Greyledge Technology?

Greyledge is an early-phase biotech company that works with the patient’s own tissue samples. You mentioned the word autologous earlier, a lot of people may not know what that word means. Autologous means from the self. It’s your tissues that are put back into you. We’ll take a tissue from you, typically blood or bone marrow tissue, and we manipulate that into a sample, a therapeutic, that’s placed back either via injection or as a part of a surgical technique where our surgeon implants it. I hesitate to use the word stem cell. There are stem cells in these preparations. That’s not a very accurate term to be using anymore, it’s been antiquated, but there are therapeutic cells within these preparations that we can use to promote and support natural healing. Our company promotes healing at the end of the day. We apply it towards orthopedic applications, arthritis, sports injuries, and things of that nature.

There are other applications that we’re not actively involved with, other active areas of research like cardiovascular medicine and wound healing, cosmetic applications and others. We’ve stayed in our wheelhouse in orthopedics, which is my background, musculoskeletal medicine, but it’s an interesting tech play. It’s something that continues to evolve in part due to advancements in science and in part due to public demand. This was something that the patients wanted. They didn’t want to go through big and dangerous procedures. They want the medical and scientific community to come up with alternatives for them and this is one of many, many companies that’s working towards that end.

We talked about what you’re doing and what Greyledge does. Specifically for Greyledge, that’s the underlying science side, but what does Greyledge bring to the table? What do they do?

We set up a laboratory processing facility within a hospital, a practice, or an academic institution for example, where we produce the sample that is implanted. We coordinate with the providers to obtain a sample, process it, analyze it, and we’ll get into the quality control component of organization, which is the unique piece, and then re-implant it via the provider. Greyledge cannot practice medicine. We’re not a medical provider. We are a service provider, so it’s a collaborative effort with the clinician. In my own practice, that clinician is me, with our partners, it’s the docs that we work with. Greyledge can’t tell the doctor what to do with our product. The field, research, and clinical judgment determines what to do with the product. We produce the product in a unique way at a very, very high level that also sets up the platform from which we can track it in research methodology that is superior to what has developed the field or lead the field to date.

We are a collaborative service provider and we’re also, at the end of the day, becoming more of a data management company as well because it’s our responsibility to validate that our products work, just like any company. In this case, it’s a biotech and medical apps company, so we have to create a platform from which we can track our outcomes with our associates or with our network. It’s multiple arms of the company and that’s been an evolution over time. The field is growing so quickly. It’s been hard to keep up with it scientifically and the public demand has created a bit of a pull instead of a push. That has led to a faster development probably than we would have liked in terms of applications and where this is being used across the country.

GL, almost in a way, maybe slowed that down a little by saying, “Let’s put on the brakes here for a second. Let’s do this right. Let’s figure out how to do it ethically, legally, correctly, and also create a platform with science that works.” At the end of the day, if our products aren’t effective, then we’re not doing our job. It was a complicated time to develop the company, but a really important one because we were seeing development that I didn’t like the direction that it was going and this was our solution.

There’s a lot of people in this arena. What makes Greyledge different? What’s their value proposition? What’s your MO?

The field was driven and it matured with very little quality control. For example, medical devices are responsible for driving utilization in the early days on the field. In that situation you would input a sample, the device would process it, a final product would come out the other end, and you had no idea what was in it. There was no measurement, there were no analytics, there was no quality control whatsoever. I started out using these devices a number of years ago just like everyone else, and even with no quality control, we were still seeing trends towards some reasonable and healthy outcomes.

Were you still within the range of what was legal or ethical to do?

At the time, it was the best we had. Utilizing that, I just didn’t feel it was acceptable as a practitioner. The concepts of Greyledge came from feeling that that was inadequate. We had to do better. We had technology that could allow us to do better. Greyledge’s value proposition is that we provide the quality control and analytics. We have a quality management program that is set up based on something called CLIA. CLIA is a federal body that oversees hospital laboratories. When we started this, there was no one to oversee us. There was no one to regulate us. We had to go to what we felt was the closest model. We are a lab, so we went to the gold standard, which was CLIA. We set up our operating procedures in a quality program based on a CLIA standard, the organization that would come in and audit your hospital lab. We invited CLIA to come in and take a look at our stuff, and they did. They showed up and they were great. They went through and provided some useful feedback and at the end of that first audit of many audits, they said, “Dave, you would meet our criteria but technically you don’t fall under our jurisdiction.” It gave us our foundation. That was important. We looked at good manufacturing practices and good laboratory practices and different quality control measures. Then we looked at the FDA. When we organized Greyledge, we said we wanted to create an analytical platform that would allow us ultimately look at dose-response relationships.

For the audience that don’t know what a dose-response relationship is, can you dig into that a little?

To go back to my earlier analogy, you have a device which puts out a product and you don’t know what’s in it. How do you determine if it worked when ten different patients will produce ten totally different samples? If we could at least know what was in it, we can look at the components of the biologic and we can break down the different cells, cell populations, the number of platelets, different analytical measurements, and then we can run that in parallel with outcomes. How does the patient do? Then you can say, “This group of patients did well. What was it about their biologic that we might identify as a trend that would alert us or trigger us to make it better? This group didn’t do so well. Is there something as a common thread that we could find in that group that would trigger us maybe to identify a patient that may not do so well, or we have to alter their protocol or we have to process it differently or do something different?” It was dose in this case, measuring the numbers of cells and cell populations. That’s our dose and the response, “How did the patient do?”

That’s your data collection effort.

That’s the platform that’s set up now to improve the quality and statistical relevance of the research. Here’s the analogy I use. If you have a blood pressure problem and you have five different blood pressure medicines and you give that to a bunch of patients, but you don’t know which dose you gave, how do you prove what’s an effective dose? That’s the situation we were in when this whole field started probably around ’04, ’05. It didn’t feel it was acceptable, so we wanted to create a platform to address that particular problem. Let’s at least know what’s in it, if for no other reason than to provide safety measures to more patients.

We also knew that the FDA would view this not in the same way it would view a drug. We can get into later the difference between what we do and drug development, but we knew if we followed or track that standard in a language that they knew, they were less likely to be concerned about what we were doing. We designed the company from day one to meet the FDAs expectations based on our interpretation of what they wanted. We went out and found CLIA, we went out and found elements of good manufacturing practices, we went out and found elements of good laboratory practices, and we melded it into this standard operating platform and quality management platform that satisfied elements of each. Then we invited the FDA to come and have a look by registering.

I’m thinking as you’re talking about the approach that, “We’re going to go through and we’re going to create standards based on acceptable CLIA,” and going to the FDA. For many entrepreneurs, I don’t think that’s the approach necessarily. They’re trying to get to market and you’re trying to get to market correctly quickly, or correctly anyways, through standards. What do you think contributed to that thought process?

Any startup is vulnerable, especially early on, but through the business cycle, until they achieve a critical mass. If there was a problem, we wanted to know early because we still had an opportunity to change it. As a general rule in the biotech or pharma industry, there are very specific rules you got to follow. Ours was hazy. It wasn’t completely clear because this was such a new area, the FDA literally didn’t have time to get guidance prepared for exactly what we were doing, and then it exploded and it was a situation where it couldn’t keep up and we had to do the best we could to meet a standard. We wanted to set the bar as an industry leader in terms of quality, but we had no playbook so we had to make it up. We cherry picked elements from what we felt were ideal to do create that platform.

Medical devices are responsible for driving utilization in the early days on the field.

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We took a different approach. We didn’t want to guess, have the FDA show up and be wrong, and then have to reverse engineer all kinds of different things. That would have been a cumbersome and challenging path. I guess we had to guess on some respects on what we thought they would want to see based on the Code of Federal Regulations and our interpretation and consultants and all these kinds of things that we did for background, but we wanted them to come so that we could pivot or adapt or morph the company in a direction that was harmonious with the FDA. The industry has seen a lot of the equivalent of a cease and desist letter from the FDA coming to companies or practices because they guessed wrong, where they pushed the boundaries of what the code of federal regulations allows.

We don’t want that. Greyledge was designed to provide a quality product for its users. In addition, they don’t have the time to dig into FDA protocols and Code of Federal Regulations and all the stuff that we had to do. We wanted to do that for them. We wanted this to be a turnkey model that allowed them to focus on practicing medicine, which is what they do best, and trust us to make sure that they’re in compliance with what the FDA expected and, at the state level, what their expectations were as well. Then have the confidence that our product was the very best it could be and that they trusted enough to put it into their patients.

I thought that was important to dig into because we talked about that at length before. For an average practice or potential client, they’re looking at a range of expenditure. What could they look at it as a range of expenditure to adopt your technology?

The field developed without a billing channel. As with any new medical technology, a fair amount of research has to be done before a third party payer will adopt a coding channel to be able to bill an insurance company. It was a fee for service model. That in and of itself creates a number of challenges and potential for misuse and all kinds of problems. Our challenge was to create a cost-effective platform and dump in as much value for the reasons we talked about as we could. In terms of costs, the provider sets the cost to the patient. It’s a fee for service model, which some people like and some people don’t. I personally liked the model and this is why. If I treat a patient and they spend their hard-earned money on a technique, their treatment that I’ve recommended and performed on them and they don’t do well, I’m the one who’s accountable. I’m going to hear about it.

One level, from a quality perspective, it forces us to be on our game. It forces us to be doing the best we can in providing that and also educating them correctly on the decision whether or not to do the treatment in the first place because if you push the boundaries knowing that your outcome isn’t likely, you’re going to have lousy outcomes. In that respect, it’s a good thing but it also creates the potential for misuse. We talk about the business of medicine and the doctor-patient relationship and the unique challenges we face in commercializing something that’s a medical treatment. It’s difficult. It is a unique relationship between the doctor and the patient. There is potential to do it incorrectly. We said Greyledge doesn’t practice medicine but as a clinician, my personal approach was let’s educate the patient as though they were consumer because they are investing in this, we’re going through a third party. We tell them what we know from research, we tell them what we know anecdotally, we tell them the risks, we tell them the likelihood or potential for success, and go through everything in context, and then every single patient hears for me, “It is possible that this will not work. We’re not perfect. 80% of patients do well based on what we know, but that’s not 100%.”

They need to hear that and they need to know it because they’re trying to make it a consumer decision. It’s a little different from, “Let’s run this through the insurance company and if it doesn’t work, we tried it and we’ll try something else.” It’s different now. This is an educated investment and we are ethically bound, to be fair, and that gets into your original question of price point. The physician dictates the price point to the patient. Greyledge’s costs are fixed. For us to produce a biologic depending on what we do, it can vary from several hundred dollars to a little over a thousand dollars, so relatively inexpensive compared to a surgical implant, which can be $50,000,$60,000,$70,000 or something like that, just an example. It’s relatively cost effective when we do that for a reason because we knew those costs were going to be transferred right to the patient.

We wanted to create a model that was profitable. We have to make money. We’re a business. If we don’t make money, we’re not going to be around very long, but also what’s fair to the marketplace that we were serving, which is at the end of the day is the patient even though we can’t practice medicine. We had to consider the end consumer even though that’s not our client. Our client is the physician. The end result, the consumer, is the patient. We have an intermediary to deal with there. We can control our part, we can control the doctors part, but it was in a unique position to be able as a physician to counsel them as a peer. I can counsel them as an executive for Greyledge technologies. We can’t practice medicine. We are limited in that regard, so it was a very unique position to be in and we wanted to provide a good product that again was an industry standard and part of that industry standard was ethically providing the service in a fair way.

For the physician, that sounds interesting. What does the adoption of this particular technology look like to them? Timeframe, space use, or bringing it into their practice?

We’re a little different; a majority of the models for producing this type of product. There are two primary products that we use. One is called PRP or platelet rich plasma. It involves us taking a blood sample and concentrating some of the cells from the blood and the platelets from your blood into an implantable product that then is used again either by injection or by surgical implantation. The second is a bone marrow concentrate. We take blood from a bone marrow cavity, and in that sample are what we call multi-potent cells or cells that have the ability to promote healing. The platelets release factors that promotes and stimulates healing, and the cells in the bone marrow concentrate for example also stimulates healing.

I don’t want to get too far into the science but the model of scientific thought changed while we were developing Greyledge. If you think about the standard stem cell and how stem cells work, the thought was stem cells are placed, they attached to whatever it is you want them to attach to, and then they become that tissue. In an arthritis model for example, we inject them into a knee, they attach to the cartilage, then they become cartilage. That was the thought for years as to how these cells worked, but that has changed entirely. What we’re learning, and this is an evolving process, is that those cells now act as a manager, as a tissue manager. Some of them actually attach and differentiate or become the tissue that they want to become, but most of them release proteins that tell the other cells what to do. That’s the mechanism that appears to be gaining strength scientifically in terms of how these things work.

Greyledge was designed to provide a quality product for its users.

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One of my colleagues, Arnold Caplan, coined the phrase medicinal signaling cells. These are active cells. They’re sensing their environment, “What’s going on here?” and they’re releasing signals to tell the other cells how to behave. Why doesn’t that happen normally? Because there aren’t high levels of these cells or platelets in the area. In orthopedics for example, we deal with tissues that don’t have a blood supply. If you don’t have blood supply, these things can’t ever get to the area that needs them, so we put them there and we put them there in doses and in concentrations that can have a positive effect. There’s a premise behind how all this works.

There is no rejection because it comes from the patient, because it’s your own.

That created a natural safety profile that we liked and that was attractive. Also, from an FDA perspective, allowed us to move our development forward a little bit more quickly without having to go through the typical pathways that a drug for example would go through, which is pre-clinical animal testing and then several phases of testing. That can take years and millions or hundreds of millions of dollars to do. The Code of Federal Regulations said because it’s your own, and we follow a couple of simple rules, we’re allowed. It’s not FDA approved. We’re allowed to use these based on the practice of medicine, so the clinician’s discretion. Greyledge can provide it in the clinician decides what to do with it.

There were two critical features that we had to meet to satisfy the FDA. The first is something called minimal manipulation. We couldn’t do a lot to them. There are limits to what we can do to them when they’re outside of the body. We can concentrate them and then we have to immediately put them back in. The second was something called homologous use. That’s a fancy word, but it means you’re taking something from the body and putting it back into the body in a situation that it would normally find itself. There’s pretty much blood in almost every part of our bodies, so taking blood from one area of the body of vein or the bone marrow and putting it back into another part of the body met homologous use. For example, you can’t take a neuron from a brain and put it into a knee, or you can’t take a liver cell and put it into the brain. That would be non-homologous use. We had to meet those criterion and that allowed the safety profile to be fairly strong.

There are still very little adverse events that are reported in the literature or anecdotally to my knowledge, so the safety profile has been good. Now our task is to improve the composition, the dose for a particular patient and a particular indication. The way we would process a sample for a 75-year-old smoker is different than we would a 23-year-old professional athlete or the way we would process, someone with diabetes is different from someone who doesn’t have diabetes. The way we would process the sample for a bone is different from a tendon, it’s different from a ligament, and is different from a muscle. The way we process for acute problem is different from a chronic problem. The only way we could determine or at least move towards that model of precision medicine was to create a platform where we could study the trends that will allow us to make alterations, and that gets back to the original premise we talked about earlier. The first step was measured and validate your measurement, what you measured was accurate. Measure, validate, and then adapt as we study.

The feedback from the patient is critical to know what you’re doing.

The provider has to make the commitment to track the outcomes. We’re getting to that point where we’re developing the platform to allow our providers to be able to do that effectively. I must admit that came a lot slower than I’d hoped. I hoped we would have a large database already in play, but it took a long time to develop a platform that was user-friendly enough that doctors would adopt it in their busy lives and busy practices.

Some of the folks that are going, “That’s interesting, how do I find you?” How do they find you on social media?

Social media has become a job in and of itself these days and some of my colleagues do it better than others. We outsource help there and it’s an important thing that I have to do personally. I’ve been active on LinkedIn. We didn’t market this very much. We didn’t want to market this until we felt we had it right. Rolling now, getting to the point where we’re marketing, scaling this thing, we’re only doing it about a year. This was piloted for almost six years before we scaled it out and started to develop our network. LinkedIn is an easy way to find me. It’s just my name on LinkedIn, David Karli. You can track me down on LinkedIn or Google search Greyledge Technologies and it’ll get you to me. That’s the best way. We’re looking at some other channels.

The thing we have to be careful of with Greyledge, because we’re a regulated industry, is the language that we use on the web has to be very carefully planned. The way we market and the way we promote our organization is under guidance. We’re a little limited in what we can say. I’m investigating as a clinician and as a provider some other ways that we might be able to help promote our message that obviously meets the FDA’s expectations, but again, that’s using my unique leverage as both a clinician and as an executive with this organization to try to help develop the field responsibly and move it forward responsibly and ethically.

For you, you had your career going to college, athletics, med school, and went to the faculty at Harvard. You practice there for a period of time. Then there was a period of time where you transitioned from the East Coast, which many might consider a fairly good spot at Harvard Medical School, and you came to Steadman Clinic in Vail, Colorado. What was the thought process when you left there?

I just wasn’t thinking. It was completely unplanned. I was on a career development path at Harvard, and I had a good relationship with my chairman who wanted me to come along in the system, and that’s a fine career. I was put in touch with a provider in Vail. I have never been to Vail, never been to Colorado, and I was curious. The clinic had a very strong reputation in the orthopedic community. As a young guy, I was 29 years old, came out, and it’s an incredibly beautiful place.

What time of year did you come out?

It was not winter, but it was fall. I came out and I must admit I wasn’t much of a skier or anything like that. Dr. Steadman, who has since retired but who was still very much a founder and an active force in the clinic and leader of the clinic at that point was a tremendous person and tremendous clinician. He had created something that was so unique. I had no concepts of Greyledge Technologies when I came out. I was just doc; I was a kid. It was an impressive place. They had set up an impressive clinical and research platform, and it was a great opportunity and a challenge for a young guy to take on. My chairman wasn’t too happy about my decision and I respect that, but in hindsight, it has allowed me to engage in things that in an academic track would have been much more difficult to do because you have obligations in that academic center that take up a lot of your time and take up a lot of your energy. This entrepreneurial bug would have been more difficult to satisfy in that environment.

BLP Karli | GreyledgeGreyledge: The provider has to make the commitment to track the outcomes.

That’s not to take anything away from tremendous resources and things in academics. In fact, we’re looking at academic institutions and clinical partnerships right now, which is incredibly exciting to be able to work with some of the best minds in research and some incredibly dedicated people that take on that life in academia, which I respect tremendously. A little constraining for me, I must admit, but kudos to them. They’re terrific people.

You’re at Steadman and figuring out how to operate in a big practice. Somewhere along the line, the notion of the entrepreneurial bug arrived. What do you think was the trigger or the genesis of that?

I didn’t know it existed, quite honestly. It was a bit of an evolution. My career has followed, “Let’s do what makes sense.” At the time we would do things like steroid injections. Steroids were developed 40 years ago and haven’t changed much since. That doesn’t mean they’re not effective, but I felt there had to be at least a different way of looking at this. Instead of working to block the body’s response to disease or pathology, maybe there’s a way we could work with it. Dr. Steadman was kind enough to introduce me to some colleagues of his in Europe where I had a chance to go to Europe and observe some things they were doing that involved totally different mechanisms, but they were trying to support the body’s ability to heal instead of blocking it or preventing it from inflammation, anti-inflammatory and things.

I knew coming back that we couldn’t use what they use because they weren’t licensed products in the United States, so we had to figure out a way to conceptualize that treatment opportunity. Let’s work with the body, but create something that was allowed in the United States. I certainly wasn’t alone. There were many colleagues who also were working on similar things at the time. There was some research coming out in animal models and I wasn’t alone by any means, and that helped promote the progression. We found this thing called PRP, which is where we took blood and concentrated the platelets, which are our growth factors, and let’s put it for sports injuries into an area that might make an athlete heal faster so you can get back to sports faster. For a pro athlete, that can be worth millions of dollars.

Do you remember what it felt like the first time you did it?

The first time I did it, it was on me. It might have been. We had to do a lot of homework. There was a lot of homework before we started doing this. We want to make sure weren’t going off the wrong path here. Back in the early days, no one knew much about this. It was a leap of faith. It made a lot of sense, but the biggest thing that allowed me to at least start to do it was I didn’t see a lot of risk. I couldn’t see much potential to cause more problems than we were going to solve, so we started working with it and we kept it to very simple, low-risk types of applications, and we were seeing some positive results.

What was the timeframe between the application and you could see results?

It’s different. In a steroidal situation, for example, you do a steroid shot and within three to five days someone’s feeling better. With this, it took a little paradigm shift in the thought process. It’s weeks until we see effects. Think about it. If you injure something, if you sprained an ankle, it’s six weeks until that feels better. We were mimicking those same healing pathways, so the timing was the same.

But your expectation was different from the steroid?

Correct, and we had to counsel differently. When we were counseling a patient in terms of what to expect, it wasn’t, “You’re going to feel better in three days.” We’ve got to stay with this thing for a while. We talk about when we’re concentrated in cellular therapeutics or stem cell-based medicines, it’s even longer. It’s months until we can see affect in some cases, so it’s not only a financial investment for a patient, it’s a time investment as well. For a professional athlete, that time is money for them. They use their bodies to make a living, so we have to be sensitive to that in our decision making.

You’ve arrived at Steadman, you’ve been to Europe, you’re starting to look at this application of this technique. Somewhere along the line, there was this thought that, “There’s a business in here.” What was that like?

It was a necessity. I started like everyone else using tabletop devices that were very simple and would process the sample. I didn’t know what was in it. We didn’t feel comfortable with it. We had to be able to do it better. We started digging and looking as to how could I at least know what’s in it. Before any thoughts of a company or before thoughts of a field or before thoughts of anything, I had this little tool that seemed cool and it seemed to make a lot of sense and we were seeing some improvement in patients. I want to know what’s in it. How do we do anything with it if we don’t know what’s in it, so it started as that.

We looked at technology to measure what was in it. There was no guidance and we had to try different things. We started out in their early days looking through a microscope counting with a manual counter, which at the end of the day, you can imagine the headache that you had. Brent Robinson, my first technologist who’s now a plastic surgeon, would look at this thing for hours on end. He was a fantastic guy. We started with that and it evolved and evolved in volume. We’re several generations into technology now to analyze what’s in there. We can do it in 30 seconds and get in an incredibly sophisticated analysis of every cell, cell population, the number of cells, the concentrations, an incredible breakdown. That’s just the tip of the iceberg. Now we’re digging into this sub cellular layer, what proteins are involved in, and what other biologically active substances are involved in addition to the cells. There’s a Greyledge 1.0,Greyledge 2.0,Greyledge 3.0 is yet to come and that will take time, but the first step was let’s know what’s in it, for no other reason than to make sure a patient was safe.

GL started out as an answer to a potential question. You started answering the question of what’s in it and started developing the data from what’s in it. Then there was the thought for you within the practice, “I’m going to launch Greyledge or at least start Greyledge.” How was that discussion with the practice and your ability to continue to practice medicine as a partner?

I looked to Dr. Steadman for the early guidance. Dr. Steadman, back when he was still practicing, he was really the first regenerative medicine doctor. Dr. Steadman developed a technique called micro fracture, where we use a surgical instrument to pick into an arthritic area to cause it to bleed from the marrow. What was in that blood? Stem cells. They didn’t know it at the time, but he was the precursor to all of this stuff that exists. He used to laugh when I would tell him that, but I went to him and said, “We’ve got this idea.” He was supportive. He was internationally known, he treated patients from all over the world, he lectured all over the world, so he knew what was going on all over the world. When I spoke to him and looked for council about doing it first as part of the Steadman Clinic as a provider there then morphing it into an actual entity that initially was just designed to provide products for the Steadman Clinic and a hospital, Vail Valley Medical Center, he saw the potential value. His expectations are that we would do it ethically, and he challenged us to be such. He was the one who supported, “Let’s give it a go and see where it goes, as long as you do it right and you do it right the first time.”

You can learn as you go and through grit figure it out.

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You’ve got it set up and there’s a point where you decide to establish the lab. As I understand it, you established it there at the Vail Valley Medical Center, so you’ve got your lab.

We use a lot of consultants for that. I didn’t magically come up with this. I was looking for any help I could get, so we were using a lot of consultants who had expertise in the laboratory industry, in the quality industry, and in other areas. I had PhD colleague from Colorado State, John Kisiday, who’s a researcher at CSU, was kind enough to help set up those very initial protocols on how do we do this accurately and safely. I have them to thank for setting up that original platform.

’We’ve covered the emphasis on compliance, FDA and approval, lab policies and procedures, SOPs and so on to take in and make sure that you are coloring within the lines and also to be ethical. I understand somewhere in that process as Greyledge was starting to get a little bit of momentum, you went and picked up an MBA at Daniels School of Business at University of Denver. What was the thought process behind that commitment to time?

Terror. I started a company and I didn’t know how to run it. I had no training. You can make the argument that a fair amount of businesses intuitive, and I believe that’s true but there’s a language involved in business that I had no exposure to. It’s fascinating. People who are successful in business, there are two tracks. You can learn as you go and through grit figure it out. I have a tremendous respect for those people. I was used to learning, I was used to going to school and learning how to do something. That’s what I knew. That’s not better, nor worse. It’s just what I knew.

Either way you’re paying tuition.

That’s okay. That’s the model I knew. The fastest way I knew to learn that language was to go back to school. While I was full time practice, I was managing a very early-phase company at that point, and I had to drive to Denver every weekend for two years to get my executive MBA. For me it was a great experience, and Daniels is a terrific place with a lot of great resources. I met a lot of great people. One of my close friends and colleagues consults with Greyledge Technologies from my school in my class. He’s an incredibly talented guy. It was an investment in me that I felt was worth the time and money.

We talked a bit and we’re now five years or so away from when you got your degree. Looking back on it, you mentioned the key takeaway or benefit that you had from getting your MBA.

It was learning the language of business. As a startup CEO, you should be the chief officer of everything, you got to do everything. To do that, you had to understand a little bit about a lot. Coming out of an executive MBA program, that’s what you get. People in our class had more accounting backgrounds, have more marketing backgrounds, sales backgrounds or wherever. I was the odd duck. I was the doc. Interestingly enough, they’ve had a lot of docs go through the program, but for me, it was about learning to be able to communicate with those people that were going to be helping me run this organization and understand what my responsibilities as a CEO were and to be able to communicate effectively to help move the business forward. I needed to know enough and then use their expertise to help fill in the gaps where I didn’t know things.

Some of the folks will go, “How in the world did you go get early investors?” How did you fund this whole operation?

It has been self-funded from day one.

That’s a conscious decision. Digging into that conscious decision to fund it yourself, what do you were the key reasons that you did that work?

This was a gamble. In med tech, it is interesting. There’s a business curve. A sexy med tech comes out and there’s this huge upswing in interest and utilization. Usually what happens is we prove that it doesn’t work and then it dies, it falls off a cliff. That’s the track we’re on. I was in Wall Street Journal and this and that and the other things, and it’s because we were doing something that other people weren’t and it was interesting. Biologic regenerative medicine and biologic therapies were on that upswing. They started to plateau as we started researching them, but what happens is fascinating. Instead of dying, they came back to Earth a little bit. Now they leveled off and now they’re starting to grow again, so it’s a sustainability curve now. When we didn’t drop off the cliff, I knew maybe we had something, and that this was real and was worth continuing to put a lot of effort, money, and resources into developing, because if it didn’t do that, we would abandon this project long time ago.

Was there a moment along this path where you’re running your practice and you’re doing what you’re doing and you’re looking at the ongoing expense and going like, “I don’t think I want to do this anymore?” What was that discussion in your mind like when you said, “No, I’ll keep it up?”

Yes, weekly. I read something about an entrepreneurship, which I’m fascinated by. I’m fascinated by entrepreneurs. It said that startups are messy. It’s so true. It’s so tough. You’ve got to be prepared to walk in and know that they get slugged in the face with something you had no idea was coming. You got to worry, especially when you’re self-funding. We’re going to make payroll, we’re going to pay those bills, we’re going to be able to get through this month, especially when you enter a growth phase. It was profitable three months into the business. We had no debt, we had no investors, and it was doing great.

If I had kept it small, it would’ve done fine, but we saw an opportunity to help and we saw an opportunity in a field that I didn’t like all the directions it was going, and an opportunity to be impactful and disruptive on some level within an industry and help guide it in what we thought was a good direction, a healthy direction, and a direction that was in line with our responsibility as scientists and as clinicians and as business people as well to make sure everybody’s okay and make sure they’re safe. We want everyone to live forever with stem cells, but that’s not where we are. It’s not. This is reality, there are some things we can do, there are patients we can help, and there are some that we can’t.

BLP Karli | GreyledgeGreyledge: It’s months until we can see effect in some cases, so it’s not only a financial investment for a patient, it’s a time investment as well.

It seems like to me, for the focus on organic, what’s a better application than using what you already have to take and help yourself?

That’s true. However, our primary concern and competition is an off-the-shelf type of product that’s not yours. Those are subject to drug development pathway, so they’re going to take a long time, but there’s many in development.

That’s a different economic model. That’s where the company has a vested interest in selling you a particular solution and marketing.

Our comfort is that the immense expenses that are going to be needed to develop those models are going to ultimately lead to a price point that can’t possibly compete with the price point that we can make. The other thing is there is no comparative data. You can go to another country, for example, and you can get yourselves expanded into more cells, or you can get embryonic stem cells, or you can get another adult bank stem cells, but no one has actually looked comparatively at yours versus someone else’s, or genetically engineered cells, for example. All kinds of amazing science and things that are in various stages of development. Is the long-term play here, “We’re going to use yours. Your body knows yours, and we’re going to make those work,” or is it something like Combination Therapy where if you’re 75, while your stem cells may not be quite so good, what can we do to augment them to make them better? As opposed to using a baby’s cells or embryonic cells, I shouldn’t say baby cells, we can’t do that legally, but we can use amniotic cells for example. Less mature cells that are “healthier.” That’s a quote because we don’t know that for sure. There are potential problems with those models and that’s why they’re in FDA development pathways.

I was looking through some of the data and the assumption is if you have a certain concentration level that you apply, if the concentration is twice as good, then it must be twice as effective. That may or may not even be true.

How would you know that if you didn’t measure? You wouldn’t know. That was the premise behind why we started the company.

My take on all that is when you get that moment and you go, “I do need to know. I feel responsible to know,” that must have been an incredible timeframe or mental shift for you in the business.

It was an opportunity and that’s all it was. I knew there was a lot of work that would go into even just being able to measure, because no one had ever done it on that scale. We have the ability. I’ll give you an example. The technology we had to measure the cells was designed to measure normal concentration. We do a little blood test on you. We were concentrating at ten times that. How do we even know the technology will be able to measure? I found a research paper, a PhD out of Wake Forest had written on one hemo analyzer that was able to count platelets up to 2,000,000 platelets per microliter, which was a really high number. That’s the machine we used, the very first one. Even something as simple as finding a machine that could measure the levels that we were concentrating was a challenge at first, because it no one had ever done it. We had to figure it out. The challenge was it’s on you to figure it out and go make it work.

In 2015, you did a patent, the Patent 9164079. What was the thought process and objectives behind your patent?

I want to develop an IP platform for the company as any company wants to do, but I was financially limited because I was funding it and patents are expensive. We had two options at that time after meeting with our patent counsel. We could try to go and secure intellectual property on the processes that we use in the lab to make our products, or we could have some foresight to say, “Eventually we might be able to develop a device that can do this instead of having big giant laboratory, even though that device didn’t exist.” I couldn’t afford to do both at the time and made a conscious decision thinking at the time, and it was part guess, that maybe the long-term player is going to be a device play, not a lab play, which involves human capital management, inventory management, space, rent, and things like that.

We decided to go that route also because our competitors were all device-based. If I develop Greyledge and a competitor creates a device that can do what we do, I’ve got a problem. It was part protective. We wanted some IP around a device hoping that we would maybe inhibit our competitors from going that direction, or we take that on. This morphs from a laboratory-based operation into a device-based operation, and that’s a pivot that may naturally occur in the future. It would certainly be able to do this out of a box that sits on this table as opposed to a lab that fits in this room, but that technology does not exist. We’ve gotten a lot of interest from outside the industry in maybe developing that product, but so far, there’s no movement on it.

Not much reaction currently to that in the marketplace?

It’s an issue of you need the right interest with someone who can really see that through. That’s a lot of technology to put in a box, and it’s going to require a partner with a lot of resources and a lot of scientific know-how to be able to engineer a very sophisticated instrument that has to have a price point that’s comparable to ours. If you spend $500 million developing this machine and your margin is a few hundred dollars on a case, you can probably make your money back. You need enormous scale. If Greyledge had scaled to 6,000 centers all over the world, it makes a lot more sense, but we’re only starting.

Taking a different attack, for the medical practices that are doing the PRP type regiment and so on that haven’t adopted your particular platform, perhaps compare and contrast between what you do and what maybe they do with your technology.

We know what’s in it, number one, first and foremost. Before we implant that product into a patient, we know what’s in it. If God forbid we ever had a bad outcome, a serious adverse event, something that we have to report, at the very least we knew that what we put into that patient was within the standard of care and safety that we know from science. There’s a liability piece here. We want Greyledge to build that liability protection into our users and our providers. You’re safe as far as we know. In the limits of science, you’re safe. If God forbid there is a problem, at least we knew we were within a standard. We’re setting that standard, but we were within a standard.

You’ve got the vehicle to create the data that’s going to even matter.

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You look at the folks that aren’t doing this, they could have an adverse event and have no idea whether they were up, down, left, or right.

I don’t want to be litigious, but let’s say a doctor is on a stand after an adverse event and the council says, “Dr. Karli, before you implanted that product, did you have any idea what was in it? Your patient had a bad outcome.” I would have to say no. We want to fix that. I wanted to be able to say, “I did know exactly what was in it, and based on what we know from scientific and medical research, it was within the standard.” That’s some level of protection, not perfect protection, but some level of protection, not only did the doctor but to the patient as well because we know what we’re putting in.

Progressing further down the path, in 2016, you started to staff up a bit. You started bringing on some key personnel. The thought process when you made the decision to start bringing on additional folks, what was that thought process like?

I ran out and know-how. When we started thinking about scaling Greyledge, I wanted to find people that I could surround myself with who would add value, add structure, add layers, and add some substance to the organization. It wasn’t just about me. It was about the company and it was about the product that we could improve moving forward because we had to put a whole lot of value in a pretty small price point, and I needed help doing that. We went to PhD level folks. Ted Sand is one of my lead PhDs and he was a cell therapist for 25 years. He brought in an incredible wealth of experience to make Greyledge stronger, make our scientific foundation stronger, and compensate for my limitations for sure.

Then we look to continue to do that as we grow and build. We still outsource quite a bit, but as we get through this growth phase and start to cashflow more effectively, we’re going to roll that back into the company to build the infrastructure from outsourced to insourced.

Coincident with that timeframe, you also did a website relaunch. What was your thoughts or impressions behind that?

Two-fold. One, we were more knowledgeable about the language that met federal compliance regulations, so we had to make some changes there. Two, we want Greyledge to grow up. One of the things, at least if you believe that perception is reality, that we wanted to do is to have a solid webpage that represented what we did and would potentially be an attractant to a doc out there or a practice out there or hospital system out there that had the same concern. “We’ve been doing PRP and we’ve done these cell therapy cases and we don’t know what’s in them.” Now there’s at least a potential solution out there that is worth investigating. We wanted a platform that would describe our company and what we do differently and the value in such as a starting point to at least maybe initiate a discussion or something we could direct people towards to learn. It was directed more to docs, not directly to patient consumers.

Docs are our clients, so we geared it more towards the clinician, but in the future we hope to build layers, whether it’s web or social media presence, that provide educational resources for patients as well. Even though we can’t practice medicine, that doesn’t mean we can’t provide resources to patients. Patients don’t know where to go. You Google something and eight million websites come up and is hard to weed through that process. There are a lot of other colleagues in the field who are working on similar things, but we want to create ultimately a place or a resource where patients can go, not necessarily for Greyledge’s sake but to have some counsel in terms of an ability to learn what is this. “Is it something I might want to investigate, and where should I go to it?” That’s still very much a work in progress.

In scaling now, which is an objective that we talked about, how do you see scaling in this operation from this point?

It was tricky. The early adopter accounts were strategic. We could have just blown this out and gone to talk to hundreds of practices and just see who would take us on to get that early growth. We didn’t do that. We went to practices that we felt were aligned with our values, let’s do this right, which was a little tougher, a little bit more cumbersome, and not necessarily more expensive, but involved more steps and phases. Not all of them were open at first. Eventually they’ve come around and we’re now starting to see a little faster adoption as the field matures, but also we get better. We had to figure how to sell this. We had to figure it out.

You mean they didn’t have a great sales course when you’re in med school?

I was still learning how to sell and spending a lot of time and effort on doing that because we are a business and we have a product that sells. It’s a service model, but it’s still something we have to sell, so I had to learn how to do that. We didn’t need a salesforce in the traditional sense of the term. We weren’t selling a widget, weren’t selling a product, we’re selling a service. The practices that we’re interested wanted to talk to me, so I had to take that on and I had to be on the road and I had to be meeting and shaking hands. It was interesting. On an average, it takes me about six to eight touch points, visits, to practice before they start to consider working with Greyledge. It’s a lot of time, a lot of effort, a lot of follow-up, it’s a lot of persistence.

Some very powerful people in the industry that are sales experts say if you believe in your product, it’s your obligation to sell it to that client, and you’re not walking out of that room until you make that sale because you believe in it that much. We’re dealing with a different client, so we had to morph our message to them a little bit, how we bring them along, how we drive home, what we represent, and why they should use us over something else. That took time.

I was thinking the average client that you come into and talk, there’s a series of objections or reservations that they have. What are the misconceptions or concerns that a potential new client might have?

The knee-jerk one is there’s not enough data, but there’s a great opportunity for Greyledge. Objections are opportunities. I didn’t come up with that, actually Grant Cardone came up with that, but that was an opportunity for Greyledge because I could agree with the client. Always agree with your client. “You’re right. There’s not enough data but you’ve got the vehicle to create the data that’s going to even matter. That’s why you should work with us. Otherwise you don’t know what’s in that product.” How are you going to prove that it works? You want to help. “You don’t believe there’s enough data. Let’s partner up on this and let’s try to solve that problem, and we’ve got the vehicle to do it.”

BLP Karli | GreyledgeGreyledge: It’s going to require a partner with a lot of resources and a lot of scientific know-how to be able to engineer a very sophisticated instrument.

I’m thinking about six or eight business to close and that’s not six or eight weeks. That’s a fair stretch of time.

It was a lot. It was a lot in doctors appropriately are skeptical, depending on what part of the country you go, this is still snake well. That’s changing. The culture shifts always take time as you know, and it’s our job to help influence and make that cultural shift happen with a great product at the end of the day, but there’s still a great deal of skepticism. It’s changing, and the patient drive is partly responsible for that. What we’re hearing when we meet with practices, I’ve had ten patients that asked me if I was going to give them stem cells.

I was talking to a friend of mine who said his wife was asking him about it.

What practices are finding out is, “If we don’t come up with a solution to answer this question, they’re going to go somewhere else.” From a business perspective, that’s certainly good for us, but we still want to create a platform. I harp on my employees, do it right the first time. It’s going to save us an immense amount of time, money, and headache later if we do it right the first time. That’s going to slow down the progression. Other companies have progressed a little more quickly than us, not because they did anything wrong, they did things differently. We took our time, maybe too much time, but we wanted to make sure we did it right the first time because this was a dynamic industry landscape. It was changing, and that’s also why we created the lab as opposed to a device. If the field totally pivots and we discover something scientifically that we have to change what we do in a lab model, you change an operating procedure. In a device model, you’ve got to completely re-engineer a device and that takes an immense amount of time and effort.

This model is designed to grow with a field that’s dynamic. The only way to do that was to create a more cumbersome model that we could change it and also allow to be dynamic. As we learn in Greyledge how to do things better, we can change that, but if the field itself changes, we can modify accordingly and adapt and continue to grow with the field.

The early adopters or many of the folks in the athletic community, professionals, athletes, what’s the typical reaction in the athletic community to this new technology?

That’s a tough question and you should ask an athlete that because their perspective certainly is different. Athletes use their bodies to make a living. As a general rule, athletes are going to seek out cutting edge technologies that are going to help them in the face of an injury or something which interrupts their ability to make money or may end their career or something of that nature. Our clinic is known for trying to help with that very problem, so it’s not a huge surprise to see something like this develop in that environment. At the end of the day, how’s that different from a plumber who hurts his shoulder, because he makes a living using his body also? While athletes are a unique model of the limits of human performance and trying to help them, the difference between the Olympic gold medal 0.000 something seconds. That’s an incredibly small delta between two different athletes, but the applications at the end of the day aren’t different from you or I, as it does from a pro-athlete.

The timing can vary. For example, the decisions we make with an athlete who’s in season maybe very different from an athlete who’s off-season or an athlete who has an important game in a week. We have to alter our thought process a little bit to work with that athlete, so long as they’re kept safe. Athletes are in the business of athletics, and that’s a tough business, so there’s a lot of pressure on them to perform and to be present with a lot of money on the table. That doesn’t mean they shouldn’t get good care and it doesn’t mean they shouldn’t be exposed to good decision making. I don’t counsel a pro-athlete any differently than I would any other patient with the exception of timing and how that factors into their particular decision.

In thinking about the potential customer or client for Greyledge, what would be the ideal profile of that potential client? What type of practice would be most likely to adopt this technology?

One that’s committed to providing a lot of value and safety to their patients. In my opinion, not knowing what’s in biologics is not acceptable. A lot of people feel differently. You could argue that the safety profile, despite not knowing what’s in it, is still good, so we’re not hurting anybody. In my opinion, it wasn’t good enough, so I want a practice, a clinician, a hospital system, a hospital network, or an academic institution to feel the way I do that we should be able to do better than that. Also moving forward, work with Greyledge to improve on what we’ve got now and make that better longitudinally in the future. That’s our next phase. We can’t stop here. We’re going to get overtaken if we stop here, so we have to constantly be reinventing ourselves in what we do based on what we know and what we develop, but that’s not an internal Greyledge opportunity. That’s an opportunity to work with terrific people in our field who are ethical and are willing to take on the responsibility and the effort necessary to move up brand new field forward.

The evolution of the process is no different than any other technology company as they develop. In thinking about a potential client sitting out there and go, “I’m in. I love what you said. I want to get involved,” what’s the process that that potential client would follow to adopt your technology?

It starts with coming to the table and looking at the opportunity and seeing if we do have common values and if Greyledge is a good fit. That’s a discussion we’ve had to develop over time, but from a business perspective, there are two things to factor in. We go to some practices who are doing a lot of this work, so it’s bringing Greyledge in and then moving forward. Other practices are interested but not doing much, so in Greyledge, they make an investment in that practice, knowing that they’re not cash flowing currently, thinking that they would be a good partner moving forward, deliver great care model, and also maybe help to develop ideas or ways of doing things especially on the clinical end, which we can’t do. Developing best practices for use of these biologics, how do you use it in a knee arthroscopy, or how do you inject it into shoulder best, Greyledge can’t do that so we need our clinical partners to help.

One of whom is me, in my practice, so that’s a nice thing. I get to work closely with Greyledge in that capacity. The ideal client is one who is willing to take on the responsibility to do this right, not simply for profits, that’s the wrong way to do things, that’s obvious, but provide not only the best clinical product to our patients, but also be committed to improving what we do longitudinally. When we look at research within Greyledge or within our research partners, we try to be translational, meaning we try to do research or conduct research that has applications in the next one or two or three years, not twenty years, because my patients who are sitting in front of you don’t want to wait twenty years. They want help now. While having the foresight to think of models that will be applicable, maybe not even in our lifetime, but another generation to follow, is fantastic. It doesn’t help Greyledge nor my patients that I’m serving today, so we’ve tried to keep our research focused on applications that have impact on our decision making in the very near future that our patients or supporters or people who are donating to research or other clinics who are engaging Greyledge to work with us can help people now today, because this is here now and it’s here today, so we’ve got to do the best we can with it.

The ideal client is one who is willing to take on the responsibility to do this right, not simply for profits.

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For the folks that would adopt the technology, if they adopted and say, “Yes, we’re going to go with it,” and you agree that they are a good fit, what’s the typical timeframe between, “Yes,” and being operational?

A lot of it is physical constraints. We need space. We have to create a lab. In most practices, space is at a premium, so sometimes practices have to ask to actually build out a space for us and that will slow things down. Other times we can convert some space into what we need. We have to be a little careful because the way we have to set up a lot of lab has to meet standards in and of itself. It’s the way the lab is set up for safety reasons and sterility and things of that nature. Is space available? The business there, are they doing this kind of work? If a practice of 36 orthopedic surgeons did five PRP cases last year, it’s going to take some time. There’s going to be education involved. We’ve got to develop educational pathways for them to learn and get up to speed, get to conference. Greyledge support some of those educational initiatives, but not all. Then if we settle the space constraints, then it’s an issue of identifying who’s going to staff the lab, whether that’s a Greyledge technician, or sometimes we’ll actually independently contract to use staff from that account who we train to operate as technicians to serve the laboratory and operate the laboratory. This is a turnkey model, so we handle everything else.

Then it’s getting equipment, getting inventory, and then working with the clinicians as to how we’re going to roll this out. I’ll give you an example as to why that’s important. A really busy orthopedic surgeon may have to see 35 or 40 patients in a day, and if a bone marrow concentrate injection into a knee takes an hour and a half and we’re tying up a room for an hour and a half when they have 35 more patients to see, that’s a huge problem in patient flow and patient management. We have to work with that group to think about how we’re going to roll this out to make it efficient and cost effective for them to do so.

There’s going to be a certain quantity of the audience that are not physicians, but they may have some particular issue and they say, “We like what you said. We liked the idea of knowing.” How would they find practitioners that are adopters of your technology?

It’s very much a work in progress and an initiative moving forward. The hope with Greyledge growing and developing strategic partnerships is to create a network where we can have that resource to patients. What Greyledge is doing is, “Here’s a network of Greyledge providers,” but again, we’ve got to be careful because we’re regulated, we can’t endorse a practice. That’s also not fair to other network partners to endorse, so we’ve got to be fair and we’ve got to be compliant in that respect. The thought would be to develop a network of regional users of Greyledge where patients could go as a resource and hopefully continue to grow. There’s something that’s quality control whether it’s Greyledge or other that’s close by that they can get to in a reasonable distance in.

’’We talked before about data collection. You made a conscious decision about data collection and how you were going to take and frame that. Touch on that if you would.

If there’s one thing I’m disappointed, it’s how long it took us to be able to do that. We’ve collected data on every single biologic we’ve produced from day one, we did a good job there, but we didn’t do a great job in creating the platform that we could offer as a service to a provider to be able to collect those outcomes in parallel with what we were producing in terms of data. Collecting data on the biologic and collect the data on the outcomes that we talked about earlier. We’re only now getting to the point where we have an electronic format that’s a non-profit and a free service that we can offer to a clinic or a hospital or an institution that we partner with, to be able not only to utilize Greyledge products, but also to track our outcomes, which we believe is an important obligation of the industry, Greyledge and the provider, as a joint venture moving forward to validate what we do. The benefit to the user there is we create a database for the practice whereby they can counsel a patient more effectively. They can say, “Bob, we’ve treated 327 people with your type of knee problem, and here’s the results we’re seeing at our center.” Not in a research paper that has done something else. It has a lot of value to the patient in that they can be educated more effectively and to the provider to be able to counsel accordingly, and also to the provider to be able to say, “We’re doing pretty well here. Our outcomes are pretty good. They’re not so good here. Let’s take a look at that. How can we do better? How can we make that better? We needed to tweak something. We need to work with Greyledge. We need to come up with a different protocol or approach that might help a subset of patients who aren’t doing as well as we would like to do better so that their money’s more effectively spent.”

We’ve been from what you do to the genesis of where you are. As a parting piece of advice to some of the entrepreneurs, what advice might you offer them?

’It’s important to know what you don’t know. A mentor and a very dear friend of mine who has since passed away but was a very successful businessman once told me, “Dave, if I was the smartest guy in the boardroom, I knew we were in big trouble.” Take home message being surround yourself with great people, and as an entrepreneur when you’re having to do a lot of things, you need help. You can outsource that help, you can insource that help, it doesn’t matter, but make sure you get good people to fill in for your own deficiencies. Know what you don’t know.

The second piece is if you don’t know, you better learn quick, because it’s expensive to outsource. It’s expensive to use consultants. The more you can learn and tackle, especially early on in the startup where you’re having to wear multiple hats, you’ve got to be a quick learner. You have to be willing to learn and know that you don’t know a lot and adapt and morph, and then it’s grit from there on. You got to slug through those days that aren’t going well. You’ve got to be gritty. If you’re not gritty, entrepreneurship is not for you.

BLP Karli | GreyledgeGreyledge: A really busy orthopedic surgeon may have to see 35 or 40 patients in a day.

You wanted to give a shout-out to these kinds of folks that have allowed us to use their facility.

We are at Resilience Code in Denver. Resilience Code is hopefully a future partner to Greyledge. We’re very excited about the opportunity to potentially to work with them. It was founded by Dr. Chad Prusmack, who’s a neurosurgeon and it’s headed by a Chris Hetherington who’s a former NFL football player who’s the CEO of the organization. They’re doing some fascinating work in human performance, looking at genetic coding and how we might be able to use sequencing of our DNA to influence decision making, how we train and eat and supplement and make medical decisions. What we’re hoping to do with resilience code is add a cell therapy piece where we can study in parallel genetics and how that impacts your sell and how we might be able to make yourself better or more therapeutic based on your DNA. It’s an incredibly difficult data project but an unbelievably exciting futuristic future of medicine here today type of concept but they’ve done an absolutely incredible job here. I certainly hope that they’re a part of the Greyledge family soon.

Maybe we’ll get them on the podcast in the future as well. I sure appreciate you taking time. We have Zoe in here that’s been supervising both of us and she’s been very kind. Thanks to Zoe and Dave, I appreciate it.

My pleasure. We appreciate the work that you do and the opportunity for folks like us to get some exposure.

You bet.


About Dave Karli

BLP Karli | GreyledgeGreyledge operations are currently being led by company Founder and CEO – David Karli. He is responsible for all aspects of company development, including the integration of a strong team of professionals to support Greyledge’s innovative approach to regenerative medicine.

After attending medical school at the University of Maryland, Dr. Karli completed his residency in Physical Medicine and Rehabilitation at Harvard Medical School. Subsequently, he joined the faculty at Harvard, serving as an Attending Physician with the Department of PM&R at Spaulding Rehabilitation Hospital, as well as working in the Department of Orthopedic Surgery at Mass General Hospital.

After joining the Steadman Clinic in 2003, Dr. Karli began to adopt the use of autologous-based therapies that were emerging in the field of regenerative medicine. He has continued to lead the effort required to refine the practice of regenerative medicine, and has published pivotal clinical results and lectured extensively. His practice has grown substantially and includes treating elite-level and professional athletes. As a result, Dr. Karli has been featured in high-level media publications such as the Wall Street Journal, New York Times, ESPN Magazine and Denver Magazine.

Dr. Karli recognized early on that understanding the composition of regenerative biologic preparations used in treating his patients would be critical to refining his practice of medicine. He also realized that a “one size fits all” approach to creating the therapeutic preparations wouldn’t meet the need for an evidence-based, precision medicine approach. As a result, he founded Greyledge. In support of his concept for regenerative medicine, he completed the COLA Laboratory Director training course, and obtained his MBA (Daniels College of Business, University of Denver).

Greyledge has achieved sustained profitability and is ready for scalable expansion. Dr. Karli is positioning the company to maintain its unique technology platform offering by tracking regulatory activity, advancing biologic sample analytics and quality measures, and creating protocols that allow for customization of patient biologic preparations.


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