Medical Images Get Cloudy

3/14/11

The revolution of cloud computing is poised to have a major impact on the healthcare technology market. Perhaps nowhere is this more evident than in the developments surrounding medical imaging. While concerns over availability and privacy have slowed adoption to date, those are issues are highly addressable and the market is moving forward.

Medical imaging is a $170 billion a year market that includes tools like MRIs (magnetic resonance imaging) and CT scans (X-ray computed tomography). It is full of inefficiencies and redundant imaging which lead to unnecessary radiation exposure.

The American College of Radiology created a standard for medical imaging in 1993 called DICOM (Digital Imaging and Communications in Medicine). This is a standard for handling, storing, printing, and transmitting information across medical imaging. DICOM enables the integration of scanners, servers, workstations, printers and network hardware from multiple manufacturers into a PACS (Picture Archiving and Communication System). While General Electric, McKesson and Philips are the primary suppliers of imaging equipment, the PACS market is highly fragmented. A system comprised of imaging equipment and a corresponding PACS system has traditionally been very hardware intensive and expensive, and access to image studies has been relatively limited. This industry is about to be significantly disrupted.

Over the past several weeks I had the chance to meet with executives from 3 companies looking to transform medical imaging by moving it to the cloud. Each company intends to eliminate the need for patients transporting CDs around with their image studies. Each company also states their intent to expand image availability beyond the 30,000 radiologists in the industry to reach specialists, surgeons, primary care physicians and even patients. Despite the similar stated goals, each company is approaching the solution differently.

SeeMyRadiology: Arman Sharafshahi, one of the two founders of the Atlanta, GA-based company, describes their approach as straight out of the Salesforce.com playbook. Their platform provides three methods for getting images into the cloud including an option for high volume uploads from hospitals or image centers. They set out to build this cloud-based system after years in the imaging space under their corporate name Accelerad. The system includes a basic cloud viewer with a social networking element under the hood. There is no cost to have a basic account and to upload images. All that’s needed is a browser. Generally, larger hospitals and imaging centers are the paying clients while most physician offices access the system at no cost, the thought being that specialists and surgeons are actually benefiting financially from a new patient and the corresponding study. The SeeMyRadiology system will be embedded in some HIE products, and announcements about those partnerships are forthcoming this Spring. The company did announce the introduction of an API at the Healthcare Information and Management Systems Society (HIMSS) conference and Mr. Sharafshahi made a point that they will make a strong push to get images into the hands of patients. The company has venture capital backing and may seek another round of funding at some point this year.

LifeImage: Jackie Walsh of LifeImage shared that things are moving at a very fast clip for LifeImage, a company formed by alums from Amicas, a PACS company based in Boston. LifeImage recently closed a $12M Series B Venture Capital round with Cardinal Partners and Galen Partners, and boasts EMC as a strategic partner. Like SeeMyRadiology, LifeImage includes an appliance option for accounts with higher volume requirements. The company is working with clients to determine the optimal revenue model. At present, each of lifeIMAGE’s services (lifeIMAGE Enterprise, lifeIMAGE DropBox and lifeIMAGE OutBox) are priced as monthly subscriptions, rather than fee per upload or share. LifeImage has integrated its system with Microsoft HealthVault which allows a patient’s images to be easily transferred to their PHR (personal health record).

eMix: Florent Saint-Clair, the eMix General Manager, explained they are taking a different approach than the other two companies in several ways. First, eMix is being incubated inside DR Systems, a long-term leader in the PACS market. It’s worth noting that a client does not need to be customer of DR Systems in order to use eMix. Additionally, the company formed an alliance with virtualization and cloud computing company VMWare and uses its technology at the center of its solution. Interestingly, eMix also uses EMC storage systems in the background. The company is making head-way with 150 customers and counting and how now launched in Germany. Once an organization becomes an eMix customer (which requires no hardware or software), their users may send images to others outside the system. Recipients get a notification prompting them to respond for security verification. Once an initial “handshake” has been completed, a recipient does not need to repeat the process for future image studies.

As of the time of this writing, I am aware of at least two more cloud solutions on their way to the imaging market, but not ready to go on record. One is from an innovative group of technologists and the other from an industry powerhouse.

The increased activity in the space is indicative of the disruptive influence cloud computing will have. Despite a handful of players in the cloud medical imaging space, and more to come, it’s a fragmented market and there is a lot of opportunity to go around.

Tobin Arthur is the founder and CEO of Seattle-based iMedExchange. Follow @

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  • http://www.allaboutpacs.com Colin Magor

    Thanks for the article but a few points.

    - McKesson is different than GE and Philips in that McKesson does *not* make the “imaging equipment” aka modalities like GE and Philips do. McKesson is the largest Healthcare IT company in the world and make the PACS and HIS but not the scanners themselves.

    - It would help to know why you selected those 3 companies as they would not be considered to be the leaders. I would put McKesson (Managed Svcs Org) and Iron Mountain, TeraMedica and new kid Symantec as well as the telco’s such as AT&T (reselling EMC atmos) way ahead of these 3. Another *Seattle based group* OneMedNet is very interesting in that they are an inter-hospital cloud based network. And finally private hospital groups that build their own cloud (such as Iowa Health that created a cloud for the whole state that survived massive flooding).

    Anyway just some feedback – thanks again.

    Colin

  • Tobin

    Colin – Great points and thanks for passing them along.

    I picked the three companies mainly because I, and more importantly physicians I consulted with, view them as the early leaders in pursuit of “pure” cloud solutions. I am also using “cloud” as a broader concept than transporting &/or storing files/images over the Internet, which is where many like of IronMountain, Symantec etc. play. That is not to say that “inter-hospital” efforts can’t lay claim to being cloud-based, but they are more of a hybrid and thus far niche oriented. Arguably no company in this space is a pure cloud solution yet, but these three seem to be pushing hardest in that direction.

    Over the coming months we’ll see even bigger shifts as several significant new entrants to this space will appear.

    I’ll keep an eye on OneMedNet. There is certainly more room in the market and the competitive landscape is only getting warmed up.

  • http://www.chilmarkresearch.com John@Chilmark

    Agree with Colin that McKesson is most certainly not in the imaging hardware business, instead you could put down Siemens, Toshiba or even Fuji. That wrong start had me questioning the validity of the rest of the article.

    One company you missed was cloud image archiving vendor InSite One which was recently acquired by Dell. Expect other acquisitions of leading players, not necessarily the ones you mentioned, in the future as you are correct in that this is a very large market opportunity with some fairly significant needs to be met.

  • SP

    Good article. Is there any data around market share these companies currently have, and also the market share of other players like McKesson, Siemens, etc for cloud offering?