Ear It Out

It was an unusual lunchtime conversation topic to be sure. Over the ranch comestibles at the Fort Worth’s Michaels Cuisine & Ancho Chili Bar last year, Elyse Stoltz Dickerson and Joseph M. Griffin - two ex-Alcon veterans looking for a first product to launch a new biotech firm off of – dug in on an idea with Dr. Janice Knebl, a respected University of North Texas Health Science Center geriatrician. Earwax.

Little innovation had been done over the years on treatment for impacted earwax, a problem that afflicts an estimated 57 percent of seniors in nursing homes and, to a lesser extent, children and other adults. Dickerson and Griffin, who had heard from meetings with other experts that earwax might be a strong way to go, soon pushed into tests on potential formulations, looking for one that would dissolve earwax within 15 minutes or allow it to be easily rinsed out in the same time. And without irritation and other risks.

The solution could be more difficult to reach than it might sound, Knebl warned. “It’s not just wax in the ear,” Knebl says. “You’ve got hair in there. Sometimes, dirt. Bugs. It really gets clumped. In a dry environment, it cakes.”

The revelation to Dickerson and Griffin: “How different wax is,” Dickerson says. “We just laughed the whole time,” Knebl says. “I mean, earwax.” But, she adds, “It’s a very serious thing.”

Dickerson and Griffin and their Fort Worth company – named Eosera, inspired by Eos, the Greek Goddess of dawn and new beginnings, and Era, or time – late this spring completed a human clinical trial into the efficacy of the several formulations they came up with. More than 82 percent of patients experienced resolution with Eosera's Earwax  MD, with no safety issues, Dickerson and Griffin report. "These are incredible results and are definitely a game-changer for the category," Griffin says. Winning a $50,000 Comerica Bank-sponsored pitch competition last fall helped Eosera raise $1.2 million in first-round financing they believe will take the product to market. Their goal: to get it to market by January next year.

ACCIDENTAL JOURNEY And it wasn’t necessarily a journey the two, both colleagues at Alcon, had envisioned as they came up through the big eyecare products company. Dickerson, 41, a Notre Dame graduate and SMU MBA, managed a $1.7 billion portfolio of products at Alcon, working her way up to senior director over 13 years. “Once I was in a big company, I kind of sensed I would just constantly work my way up,” says Dickerson, whose father, Michael Stoltz, is a Fort Worth physician, and mother, Elaine Stoltz, a longtime Fort Worth image consultant.

Griffin, 49, who has a PhD in toxicology, was of the same mindset. Griffin, whose dad was a research scientist and mother once owned a clothing store in Arkansas, had worked at Alcon for 16 years. Of going out on his own, “it was always in the back of my mind,” Griffin says. But “I enjoyed (Alcon), and I was thinking I could do this until I retire.”

Then, as Dickerson says, “things changed. I began to understand how difficult it was for women to make it to the C-suite.”

Both were asked to leave Alcon within two months of each other in early 2015. Dickerson, first, had been looking into ideas. Dickerson was one of the first calls Griffin, who had run clinical studies for products in Dickerson’s portfolio at Alcon, made after he was laid off. “I sensed he was happy to start over,” Dickerson says.

Neither Dickerson nor Griffin was under pressure to find something immediately, even though the job losses were big hits on their families’ incomes. Dickerson’s husband, C.D. Dickerson III, was curator of European art at the Kimbell Art Museum in Fort Worth. (He has subsequently taken a job as head of sculpture at the National Gallery of Art in Washington, D.C., and commutes on weekends to Fort Worth.) Griffin’s wife works in global training at Alcon.

“Over these 24 years (of marriage), my wife said we are going to save money,” Griffin says. “We’re going to save for our retirement. We’re going to save for our kids’ college. It just became a habit.”

“I was raised always being told to pay yourself first,” says Dickerson, who, after she left Alcon, joined a colleague in filing a federal suit against Alcon in New York, alleging gender bias, which she is pursuing. “From my first job making $24,000, I was still putting away money and saving.” She and her husband moved money from investments to replace her salary for a year. “Then that money was spent and gone,” Dickerson jokes.

From their first conversation, Dickerson and Griffin decided to build a company around “Conscious Capitalism,” a model championed by Whole Foods co-founder John Mackey that asserts businesses best serve themselves by looking out for customers, employees, investors, suppliers, communities, and the environment.

“We said, what’s next?” says Dickerson, Eosera’s CEO with 51 percent of the company to Griffin’s 49. The answer: “Put people first. All stakeholders will be treated equally well.”

HUNTING FOR PROBLEMS TO SOLVE Dickerson and Griffin started meeting with physicians, asking them what kinds of problems they were seeing. They don’t have non-compete agreements with Alcon, Dickerson said, but opted not to enter the ophthalmic space. In their interviews, “this one problem of impacted earwax kept coming up over and over,” Dickerson says.

Impacted earwax, if left untreated, can cause hearing loss and lead to depression. Symptoms include dizziness, ringing in the ear, discomfort, and a feeling of fullness in the ear. “They go to the doctor, and it’s packed in there,” Dickerson says. In seniors, the problem can be exacerbated by hearing aids. About 10 percent of small children have the problem, and it's believed earbuds can raise the likelihood of problems in adults, Griffin says.

Over-the-counter treatments, long on the market, typically work to soften the wax but not dissolve it in a short period, said Knebl, who uses an ear spoon to dig wax out of her patients’ ears. Technology for extractions has improved, with tools such as a lighted speculum and pulsating syringes now on the market, she said.

“It would be phenomenal if they can come up with something for earwax (that works in) a couple of hours,” Knebl said.

Fifteen or 30 minutes is more like what Dickerson and Griffin have in mind. Griffin says there has been little innovation in existing over-the-counter treatments because the federal Food and Drug Administration would have to agree to expand the allowable ingredients, doses, formulation and labelling. “It would just drag on,” he said.

In May last year, Dickerson and Griffin rented a lab at the UNT Health Science Center, in partnership with TECH Fort Worth, the small business incubator that Eosera joined. Over the next nine months, they built what Griffin calls an “artificial earwax” and tested more than 100 formulas on it. As many as eight were working to dissolve the wax, Griffin said. The two started collecting human specimens of earwax from physicians who agreed to participate and tested their formulas on those specimens.

Knebl was one of the doctors who agreed to collect specimens, which meant they were required to ask patients for permission. “It’s the easiest study I’ve ever been recruited for, because it’s something I throw in the trash,” said Knebl in an interview at her office, showing off a full, black earwax “bud” she had extracted and put in a vial for Dickerson and Griffin. “When I can get a full bud, I’m thrilled,” she said, laughing.

“It was like gold to us, getting human wax,” Griffin says, matter-of-factly. “We found that there was a wide range of human wax types, so we had to come up with a formuation that worked on all of the wax.” Griffin narrowed the formulas further to three that he said were repeatedly dissolving earwax in a test tube within 15 or 30 minutes.

Dickerson and Griffin finally narrowed the field of formulas to one – they’re keeping the makeup confidential – and recruited a Plano geriatrician to run a human clinical trial, which started earlier this year and was completed in June. This summer, in a second study, Eosera may put its product in a head-to-head test with a competing product on the market.

Eosera’s product will be over-the-counter. Dickerson and Griffin won’t have to prove efficacy, but intend to do so anyway, they said. “We want to be a company that had efficacy data behind our product,” Dickerson says.

RAISING MONEY Winning the Comerica pitch prompted the start of calls from investors who were interested. Since February, the company has recruited more than two dozen, each investing $25,000-$100,000, Dickerson and Griffin said. “We’re going to raise enough to carry us a good 18 months (until) we have revenue coming in,” she said.

Their primary targets: friends, family and angel investors. The investments are structured as convertible debt. “We offered reasonable terms and structure; we tried to make it a win-win for the investor and company,” Dickerson said. One of the investors: Jim Hubbard, a longtime managing director at the Higginbotham insurance agency in Fort Worth, who already knew the Dickersons. “Elyse is a real go-getter,” he says.

Eosera’s strategy for getting Earwax MD to market revolves around publishing their clinical data and pitching the product  to ear-nose-throat specialists and audiologists at meetings and through the American Academy of Audiology. Griffin calls the approach “seeding the market.” Dickerson: “When we do launch, we’ve already got people interested in it.”

The two are working on selecting a third-party manufacturer and packaging. They estimate the U.S. over-the-counter market for earwax solutions currently at $63-$65 million. But the U.S. extraction market is about $600 million, estimated from billing coding, Dickerson said. “We feel we can take some costs out of the system.” 

Dickerson and Griffin also have to choose which FDA-allowed path they’ll take to bring their product to market. One they’ve ruled out: drug. “We early on decided not to go the full drug route,” Griffin says. “It’s the longest, most expensive path. We want our product to be available over the counter, so that people have easy access and we can keep the costs down for patients.”

One OTC route would be to follow the so-called “OTC monograph,” which would require them to “follow the FDA recipe” for ingredients, doses, formulas and labelling, Griffin said. They could also classify their product as medical device or cosmetic. Eosera is working with two regulatory consultants to determine what path the company will take.

Dickerson and Griffin kept seeking mentors as they developed their business model. “We knew what we didn’t know,” Griffin says.

They joined TECH Fort Worth, where the executive director, Darlene Boudreaux, who built her own pharmaceutical manufacturing company in Fort Worth before selling it, helped “pressure-test our business model,” Dickerson says. Eosera had already filed for a provisional patent to protect its formulas, and Boudreaux helped direct them to the UNT Health Science Center.

A certified public accountant, Boudreaux also helped Dickerson and Griffin with their projections and estimation of how much startup money they needed to raise. TECH Fort Worth also put the two in touch with contacts in the contract pharmaceutical manufacturing industry, regulatory consultants, potential investors, insurers, accountants, and attorneys.

Dickerson and Griffin have highly complementary skills, Boudreaux says. “It’s very good to see in a founder team,” she says. “They play off of each other’s skills very well.”

It’s easy for entrepreneurs who are in the position of Dickerson and Griffin to make significant mistakes, Boudreaux said. “It’s what they don’t know that can hurt them.”

One common mistake, she said: Giving up too much equity, too early, and overstating the value of services they get in trade for stock. It’s a common first question among TECH Fort Worth’s clients, she says. “Can you just give me a list of people who have money?” she says.

“People go out and get money when there are ways to bootstrap that company,” says Boudreaux, recalling her company hit $20 million in sales before she brought in an investor. (She sold the company at $30 million in sales.) “The longer you can go, the more value you can keep.”

With Dickerson and Griffin, the analysis quickly went to how much money they needed, Boudreaux said. “The more milestones we could check off, the better we were in the long run,” Dickerson says.