Welcome to Go/No-Go. I'm Jon Bruner.

And I'm Alex Hao.

Go/No-Go is a podcast about design, manufacturing, engineering, and the calls that can make or break great products. It's brought to you by Lumafield, which makes a manufacturing intelligence platform that uses X-ray CT technology and artificial intelligence to give engineers and manufacturers total confidence in the products that they ship. You can learn more about Lumafield at lumafield.com. And while you're there, you can see interesting X-ray CT scans of all sorts of products out there in the modern world that are way more complex than you would expect. In this episode, we're going to talk about some recent headlines from the world of manufacturing and product development. Alex, what are we starting with?

The first headline I have today comes from the Financial Times by Susannah Savage. It's about how Cargill uses AI to get more meat from the bone as beef prices soar. They have a system — a machine vision system they've called Carve, C-A-R-V-E — and it spots red pixels, basically specks of meat on the carcass as they move down the line. It sends real-time performance data to the people at the cutting tables: green, yellow, red to say if they've left too much meat on the carcass. There's a great quote in the article from Florian Schattenmann that says it's not like assembling a car. Every Toyota Camry looks the same and it's all automated. Every cow is slightly different.

So this is a manufacturing execution system for carving meat.

And because beef prices are at an all-time high, it's very lucrative. Cargill produces 11 billion pounds of beef per year. With this tool they can get half a percent more meat. But because the volumes are so high, that's about 55 million more pounds of meat — around $200 million worth.

And just to be clear so our listeners aren't too frightened: AI hasn't been taught how to wield a giant carving knife. It's just looking at images and telling workers where they could produce a little bit more meat off the carcass.

Even though the name is a little threatening, Carve is not carving the meat. It's just providing feedback on how the humans are doing. They also have another AI tool they're implementing to predict worker attendance, because that can be a big issue. They've put in weather patterns, even the local high school football schedule, and they're able to predict how many people are going to show up for their shifts.

This is a reality in a lot of manufacturing in the US, especially where unemployment rates are very low. It's hard to keep your workers in your factories. There's a lot that can cause you to come into work one day and find that you're very short-staffed.

I think it's always a question of how manufacturing can really implement AI when it can't necessarily wield the knives. But there are some really effective methods, as we can see with this Cargill example.

That's interesting. I hadn't considered what MES looks like for meat processing plants, but it totally makes sense. The modern factory is full of touchscreens using computer vision and other inspection technology, guiding workers on steps they need to take. So perhaps it's only natural that these things make it to carving houses. The biggest news dominating just about everything in geopolitics and the economy right now is the conflict with Iran. Iran is practicing asymmetrical tactics — using cyber attacks to be very disruptive without necessarily crossing the line you'd traditionally cross by launching an ICBM at the United States.

These cyber attacks can have real impacts on manufacturing, and they end up having a very real physical impact. An Iran-linked hacking group called Handala launched a large attack against Stryker, which is a medical technology company based in Michigan. This was a wiper attack. They claim to have wiped over 200,000 devices — phones, laptops — really disrupting their entire workforce, their manufacturing operations, and their ability to ship to hospitals that depend on these products.

This is a type of product where you can't just walk up to a warehouse and present a paper order. A lot of this is regulated. You have to have records showing the provenance of each part, serial numbers for some things, before they go out into the field. This is a type of distribution that's hard to replace with offline tools.

There were a lot of levels of disruption. The first thing when it happened was a lot of fear, because these products go into hospitals and many of their products are connected. A lot of hospitals were not opening any emails from Stryker. They were disconnecting devices and not using them. Their shipping platform, which manages all of that carefully moderated movement of their products to hospitals, also cut them off because they didn't want to catch the disease, essentially. Now that those things have been resolved, it seemed it was a problem with Microsoft Intune — device management infrastructure — that led to the attack. So it's not contagious to customers or partners. They're still working to get their manufacturing back up to speed so they can resume shipping.

Any indication of whether Stryker was a deliberate target, or if this group in Iran just went across the web and tried knocking on a lot of doors and found that Stryker was vulnerable?

It's a little unclear. The attack happened last Wednesday, but earlier in the week they had announced they were going to go after big tech. I have a friend who works at Stryker and they saw that and thought, too bad for them. Then they woke up to complete chaos. They were like, why did you hack us? You didn't say you were going to go after us. Compared to the names they had cited initially, Stryker is relatively smaller, even though it's a huge company.

It doesn't really seem like they were after data — like when North Korea hacked Sony. They claimed to have taken some, but it mostly seemed they just wanted to paralyze the organization. They weren't really trying to take anything interesting.

Medical devices aren't the only industry being disrupted by the situation in Iran. It's also having a huge impact on the automotive industry — both the experience of driving a car, because gas prices are way up, and the product mix in automotive, as consumers face the possibility of very high gas prices for a very long time.

Here in California, where we've always had considerably higher gas prices than the rest of the US, the issue has made it into the governor's race. A couple of candidates have suggested suspending California's gas taxes while prices are especially high. The interesting thing is California's gas taxes, as direct costs, don't account for that much of the gap in gas costs between California and the rest of the country. The California Energy Commission analyzed this back in 2024 and looked at what goes into the cost of gas in California. Typically gas in California might be $1.50 to $1.75 per gallon more expensive than the national average, but only about $0.40 per gallon of that is from direct taxes imposed by California. The rest is regulatory compliance costs and a hidden layer of regulatory compliance on top of that. The California Air Resources Board specifies a different blend of gasoline be sold in California, and it changes between summer and winter. These blends are different from the rest of the country, so there's an isolated, islanded market here that drives prices up, and it's a little more expensive to produce these blends.

That's fascinating. I've noticed at the gas station they have little signs when you're checking out — gas is $1.50 more and it's all because of taxes, vote differently. I didn't realize it's so much more nuanced than that.

Even if you take into account the regulatory compliance costs for these specialized blends, the California Energy Commission found those only account for about $0.40 to $0.50 per gallon in direct regulatory costs. So that's about $0.90 of the $1.50 to $1.75 we're looking to account for. The rest is just the dynamics of operating in a state where it's difficult to build infrastructure and increase distribution networks. California has had a series of refineries close, and ideally you would open new ones to replace them. But imagine the permitting, licensing, and environmental review that would go into opening a new oil refinery in California. The oil refining infrastructure in California really only goes in one direction. On top of that, the Energy Commission found that a big source of increased prices in recent years is the retail margin. California retailers are able to earn close to a dollar a gallon in margin, which is about three times higher than it was a few years ago. In outlying areas where it's easier to build gas stations and you can have name-brand and discount retailers, the market is more competitive. But in cities like San Francisco and Los Angeles, the market is pretty much constrained to existing gas retailers and they're able to take more margin.

Gas is also interesting in that it's so emotional. If you really look at the impact of a $0.30 a gallon increase — of course no one likes to pay more, but it's not meaningfully different when you're filling up. My car takes about 12 gallons. But there are so few products we buy that way that it just has an outsized mental impact compared to its actual financial impact on your wallet.

You see gas prices on signs everywhere you drive. And when you're purchasing it, you're watching the tally go up on the meter, thinking about that money flying out of your pocket.

Because if you're buying even a carton of eggs, people are sensitive to that, but you're buying it with other groceries so the impact is diluted. When you buy gas, you're only buying gas. You're seeing that one number fluctuate.

It's very emotionally resonant and there's a lot of outrage with even small variations. An extra $0.30 a gallon if you're buying ten gallons is three extra dollars. And ten gallons of gas in a modern car is enough to go over 300 miles. It's a pretty small cost when you consider what you're getting. But a very salient political issue. You'd also expect increasing gas prices to motivate some changes in the product mix — the types of cars that consumers want to buy. You have a headline about this?

There's an article from The Verge called "The Uncomfortable Truth About Hybrid Vehicles." EV sales have been stagnating, some incentives have gone away, and they're politically unpopular right now. Hybrid vehicles are becoming that new growing platform. But there's a growing body of research showing that owners of plug-in hybrid vehicles rarely plug the cars in, which ultimately negates the advantages. If you're not actually plugging in the battery, you're just lugging around a very heavy battery and you're actually less fuel efficient with the gas you're burning.

It's the worst of all worlds. You're using all the rare earths that go into EVs just to produce a car that's only marginally more efficient than a pretty efficient internal combustion car.

It's very aspirational — this idea that you're going to do something that will save you money, but then changing the behavior is a lot more challenging. There's a separate study that shows this is actually having a negative impact on full electrification. They say it's depressed EV market share by 24% over 20 years, which ultimately means you're putting something less efficient on the road instead of moving directly to the better, more optimal solution.

Do you drive an EV, Alex?

No, I don't.

How aggressively do you shop for gas? Do you go way out of your way for a little bit cheaper?

This is always a source of conflict between me and my husband. I will just put gas where it's convenient because we don't drive that much — only a $3 difference. He hates that.

It does feel hard to let the money fly out of your wallet. There's a pair of gas stations here in San Francisco that I ride past on my bike — I'm a self-righteous bike commuter. On one side of Divisadero and Fell is an Arco gas station, a big discounter. On the other side is a name-brand retailer that's always about a dollar more per gallon. There's always a huge line at the Arco to get the cheaper gas. But there are always two or three cars filling up across the street, where sometimes it's $2 or $3 more — like $8 a gallon gas. You can see very clearly the measure of consumers who are just like, anything to save a few minutes.

But your time is worth money.

That's right. I would pay more, I'm not going to lie. It would be interesting to see the demographic breakdown of who shops at the premium station across the street from the Arco. The Arco also used to have an inconvenient feature where you had to withdraw money from an ATM on site and buy your gas in cash. I'm told by our producer Austin that you can now use a credit card at Arco.

Expanding on EVs, Uber recently struck a $1.25 billion deal with Rivian to build a robotaxi fleet — investing up to $1.5 billion to buy 50,000 autonomous vehicles, starting with an initial $300 million investment.

In addition to their electric pickup trucks and SUVs, which we see quite a lot of here in California, Rivian has this fleet business. They sold a lot of electric delivery vans to Amazon a few years ago. The latest estimate I saw is that around 20% of Rivian's business as of 2024 was commercial vans. That's a much more stable counterpart to selling luxury vehicles to consumers.

EVs also make so much sense for rideshare. I remember when I first moved back to Palo Alto after undergrad and lived pretty close to where Google X had all the Pacifica Waymos. On my commute I would always see this one gas station packed with Waymos. There was something so hilarious about seeing a minivan with millions of dollars of sensors on it filling up at a gas station. Whereas now when you drive in San Francisco you can see the big charging area for Waymo — you have so much more control over usage and monitoring.

It's very hard to build new gas stations in California. That's polluting land use, almost unrecoverable sometimes when you consider the amount of gasoline that winds up in the soil under a gas station. Cities are reluctant to let new ones get built, but it's a lot easier to build EV charging infrastructure. The Waymo charging lot is around the corner from Lumafield's previous office in San Francisco, and it was always funny to see a huge line of Waymos waiting their turn to charge.

I'll find one of my old photos of the gas station packed with old Waymos.

The incongruity of old technology and new. Rivian has also been very active online. They signed on Mark Rober, the biggest science and technology YouTuber, as a partner. They're going to be talking a lot about how EV technology works and automotive technology in general.

That'll be super cool. Another area seeing a lot of activity given the situation in Iran is defense acquisition. Skydio announced that the Pentagon ordered 3,000 of its X10D drones — a contract worth about $52 million, completed in just 72 hours from start to finish. Drones are such a massive area of focus for the military right now. China has seen such an explosion of innovation in that area, and there's so much concern about managing supply chains elsewhere. Skydio manages all of their production in California, so that's secure.

These are very different drones from the kinds the Pentagon has been operating for a couple of decades. The Predator drone, the Iraq War era workhorse, and its successor the Reaper — the MQ-9 — cost on the order of $20 to $30 million apiece. This contract for 3,000 drones comes out to about $17,000 per drone. These are drones that start with a consumer electronics foundation and build up their capabilities from there, rather than the older Predator and Reaper type that start from an aerospace foundation.

It's interesting that you mention the consumer electronics baseline, because Skydio no longer makes any consumer electronics drones. They've ceded that market because Chinese drones are so much cheaper. But the military is an application where it can sustain higher prices for that technology. And there's a lot of interest in onshoring this manufacturing. A few years ago it would have seemed completely natural to buy drones from China, but now there's a lot of concern that being able to manufacture things like drones is a key strategic interest for a nation. Something Skydio highlights is that their factory in California runs 550 quality checkpoints per unit and assembles one every nine minutes. So this order would be about three months of their current output.

We visited the Skydio factory — they're a Lumafield customer. And we interviewed Skydio CEO Adam Bry on a previous episode. Listeners who are interested should go back and find it — it's episode three of Go/No-Go. This is a really interesting strategic shift in how we think about manufacturing, and it exposed a gap in American capabilities. Initially it was very difficult to make this kind of product in the US.

The next headline I want to talk about is a recall. I'm not sure if everyone has seen, but we have on our First Article platform a Recall Radar, where you can see in real time what the latest recalls are across consumer and automotive products. Insulet has reported 18 serious adverse events and recalled their Omnipod 5 insulin pumps.

What is an Omnipod insulin pump? What does it do?

It allows people more freedom because it can auto-inject insulin on the go. People don't have to manually measure and inject their insulin once or twice a day.

This is an area where we've seen tremendous progress in the last decade around diabetes management. There are continuous blood glucose monitors — patches people wear on their arms or shoulder — that replace the practice of doing a blood draw on your finger periodically through the day. And this is the closed-loop companion to that, actually injecting insulin into your bloodstream as you need it.

It's really such a helpful device. My father has Alzheimer's and also has diabetes. Something I had to do when caring for him was measure and give him his insulin, which can be really challenging when you're dealing with the different moods and attitudes of someone who's dealing with other health issues. These kinds of automated devices are such a huge help — for the person themselves as well as for caretakers.

This type of technology has moved into the management of a lot of conditions — things that might have required a visit to a hospital or clinic to get a periodic injection. So it's a big deal when failure emerges in this type of device.

They're finding there's a small tear in some of the internal tubing that can cause a leak, which can result in someone not getting the correct amount of insulin — and that can have devastating effects. They expect to incur about $40 million in costs this year associated with the recall, and that only represents about 1.5% of annual global Omnipod 5 production. You can tell it's an enormous market.

These are very intricate devices. We've scanned a number of continuous blood glucose monitors and insulin pumps and they're really remarkable — extremely high-volume, very precise combinations of electronics and drug delivery. It's remarkable we haven't seen more of these recalls. If you're interested in a CT scan of one of these Omnipod devices, you can find one at Scan of the Month — we featured one in our installment about drug delivery devices. And if you happen to have one from a recalled batch, we'd love to scan it at Lumafield and share out the scan. It's very hard to get your hands on recalled medical devices. We shop a lot from websites that sell expired medical devices. What's the one that you use?

ExpiredSurgicalDevices.com.

I enjoy that the 90s was the era of Pets.com and Cars.com, and I enjoy coming across e-commerce platforms where the URL is just exactly what it sells. But it's very hard to find recalled medical devices because selling them is illegal.

You want to get those out so people can't accidentally use them. But we would like to scan them.

Shifting gears to another big piece of medical device news. The former chief regulatory officer of ExThera has been criminally charged. What is this company?

ExThera. There was a really long exposé about them by John Carreyrou, who also wrote the excellent book about Theranos, Bad Blood — what a thrilling read. This came out of a DoD initiative in the early 2010s focused on developing technologies to deal with potential pathogens that troops could encounter in the field. Two chemical engineers developed a filter with about 20 million tiny spheres coated with a particular chemical that works similarly to what's in your blood vessels — it can extract different types of pathogens from your blood. They deployed in the field and about six months later Covid started. It was found pretty quickly that the device could help reduce viral loads in Covid patients, and it was approved by the FDA for use with Covid patients experiencing severe respiratory issues. After a few years of solid multimillion dollar sales to hospitals during Covid, as that market declined they needed to find places to expand. So they moved into cancer.

The implication being that by filtering a cancer patient's blood through this filter and returning it to their body, the filter removes circulating tumor cells that cause metastasis.

And of course this treatment wasn't approved for that use case — they'd been approved to start some preliminary testing. ExThera wanted to look more deeply into the cancer market, which is enormous. They initially partnered with a doctor in Croatia to do a small study with about 12 patients and started misrepresenting some of those early results, especially given such a small sample size. One of their board members had a lot of contact with Alan Quasha, an American billionaire, who through his private equity firm bought about $10 million worth of ExThera devices and opened a facility in Antigua to begin delivering this as a cancer treatment. Even though it's legal to do the treatment in Antigua, it's actually illegal to promote it to US citizens on US soil, which Quasha's firm did.

There are recordings of phone calls with the person who's been charged — their former chief regulatory officer — telling families of patients that this is an extremely promising treatment they can depend on.

Quasha's enterprise was nominally independent of ExThera. They were buying the filters at $1,000 apiece and charging patients $45,000 for treatment, with each treatment using about three filters — a huge margin. But ExThera was ultimately involved, sending people to monitor and conduct the studies, even though some patients were concerned by the lack of apparent rigor, nothing that resembled what you'd expect from an actual study. Sanja Ilic, the former chief regulatory officer, is the one who's been charged with concealing two deaths — patients David Hadlow and Kyle Chubb, whose families are profiled in Carreyrou's reporting, which I highly recommend everyone read. She concealed that they died one day apart after traveling to Antigua for treatment. The thought is that the treatment may have potentially accelerated their cancer. Part of it could be that Ilic and the facility really discouraged people from pursuing chemotherapy in anticipation of the treatment — postponing chemotherapy can have a seriously harmful effect. And there's a possibility, though it's unclear, that it may have accelerated the immune response to create a kind of toxicity from the tumors that could have killed them sooner.

This is more remarkable reporting from John Carreyrou, who as you mentioned is also the investigative journalist behind the Theranos unraveling. And Elizabeth Holmes, speaking of Theranos, is still in a federal prison camp and very much online, developing a political perspective that seems to be positioning herself for a pardon from the Trump administration.

What's terrifying is she's also still advising her partner Billy Evans on his blood testing startup. It's crazy to think that people are so desperate to find solutions in this area that even a convicted fraudster can basically continue to consult and influence the development of the industry.

Billy Evans's company is called Haemanthus, which is Greek for blood flower — not sinister at all. He reached out to us on Twitter as part of a thread about a different medical device, which was interesting to encounter. But this area seems to attract people who are able to traffic in hope — understandably, for patients and families confronted with very troubling illnesses. In this case, with the offshore clinic in Antigua, it highlights the substantial trade in offshore medical treatments available for Americans, because the healthcare system here is very high quality but very expensive. There's an increasing sense of frustration with the amount of time it takes to get new therapies through the regulatory process, which is very stringent in the US and Western Europe. There are a lot of therapies you can access by going to Mexico or Thailand or, as we see here, Antigua. There's something compelling about the idea that there is a secret therapy being withheld from us that you want to go out into the world and find. We have one more headline that's considerably happier news than what's going on in the blood world — iFixit did a really cool teardown of the MacBook Neo.

They say it's the most repairable MacBook in 14 years, and it's also super affordable — priced at $499 for schools and $599 for consumers.

This is a laptop Apple just launched that aims to compete with Chromebooks in the education market. Low cost, and they've taken a careful approach to repairability. It's built on the A18 Pro chip, a processor used in iPhones rather than the M series used in Apple's MacBooks. But everything inside is basically bolted together rather than glued and riveted as we see in a lot of Apple's other products.

It makes a lot of sense when you think about the context for these devices. Children with electronics are a recipe for disaster. I'm too old to have used a Chromebook in school, but when I was in elementary school we had AlphaSmarts.

What are those?

It's a keyboard with two to three lines of basic text — a word processor. We'd use it to learn to type and write papers, sitting at our desks. No internet.

I'm also too old to have used a laptop in school. But I remember when AlphaSmart devices and similar word processors were marketed as distraction-free writing environments for creative people who found it too difficult to get work done on a real computer. My boss back in maybe 2012 bought one off Kickstarter and loved writing his papers and articles on it. What kind of computer did you have growing up?

At school in the computer lab we had the Apple plastic colorful —

The iMac.

Yeah. And at home, because both my parents worked in tech, we had all their old laptops. My brother and I had a lot of spare MacBooks to play computer games on.

Around third grade we had a computer lab full of Apple IIe computers — the kind where you put a giant floppy disk in, turn it on, and it boots into whatever software is on the disk. I still remember that the teacher instructed us that the way to turn on the computer was to give it a hug, because the CPU, which sat below the monitor, had a big power switch on the back right, and the monitor had a big power button on the back left. So you'd give it a hug and switch on both at once.

The MacBook Neo colors really give me a throwback to the computer lab of my childhood.

That was a real breakthrough in product design — making those things much friendlier. If you look at the bestselling PCs at the time from Compaq and Dell, they did not have that style. And there are CT scans in the teardown video that iFixit did, showing the modularity of this new MacBook. If you want to learn more about how iFixit works and how they do these teardowns, there's a great interview with Shahram Mokhtari, who's the head of teardowns at iFixit, right here on Go/No-Go — go back to episode six to hear from Shahram. That's all we have for today. Check out the show notes attached to this episode — you'll find links to the articles we discussed, as well as CT scans of things like Omnipod insulin pumps and MacBooks. If you enjoyed this episode, we'd really appreciate it if you'd leave a review. That helps this podcast reach people who would probably enjoy it. Check out Lumafield at lumafield.com to see X-ray CT scans and AI and how they come together to create a better world.

I'm Alex Hao.

And I'm Jon Bruner. Go/No-Go is brought to you by Lumafield, which was founded to upgrade manufacturing. You can learn more at lumafield.com. Go/No-Go is produced by Austin Carder and edited by Brian Tran, with additional assistance from Eric Petralia.