Lab Soft News

Dr. Jared Schwartz Joins Aperio as CMO

Just after stepping down from his post as president of the CAP, Dr. Jared Schwartz has joined Aperio as the chief medical officer (CMO). Here are are few of the details (see: Jared N. Schwartz, M.D., Ph.D., Joins Aperio as Chief Medical Officer):

Aperio Technologies...has appointed Jared N. Schwartz, M.D., Ph.D, as its Chief Medical Officer (CMO). Dr. Schwartz, former president of the College of American Pathologists, is a leading advocate for improving patient care using technologies such as digital pathology. In his new role as Aperio’s CMO, Dr. Schwartz will continue to interact with the pathology community—including key opinion leaders, professional medical and advocacy societies, and medical directors of major clinical and regulatory organizations—about the benefits of digital pathology. In addition, he will develop and drive execution of Aperio’s clinical strategy in all medical and clinical efforts for scientific publications, product investigations and regulatory submissions. Dr. Schwartz will also provide medical input, perspective and vision to the executive management team and provide senior-level leadership for related functions.

Very interesting pick and surprising in some ways. Dr. Schwartz has been a dynamic leader of CAP and a visionary but with more skills on the clinical lab side than the surgical pathology side. Note the reference above to develop a strategy in "all medical and clinical efforts." Much of Aperio's growth has been in the pharmaceutical industry lately. My guess is that Jared will be able to work in an equally skillful way on both the clinical service and research/pharmaceutical aspects of the digital pathology industry.

Respiragene as a "Not So Useful" Lung Cancer Risk Test Comes to Market

We are entering the golden era of diagnostics ushered in by new biomarkers with greater specificity, measured alone and in also in groups called IVDMIAs. For me, the value of any lab test is whether the integrated result provides key diagnostic or therapeutic information that is otherwise unobtainable. A recent story appropriately questioned the value of a new lab test now being marketed for lung cancer (see: Questioning a Test for Cancer). Below is an excerpt from it:

Christopher Taylor says he never lasted more than a week when he tried to quit smoking in the past. But it has been four weeks and counting this time, since a genetic test indicated he had a much higher risk of developing lung cancer than the average smoker. Of course, said Mr. Taylor, a 45-year-old salesman who has smoked for 25 years, he already knew that cigarettes were dangerous. But he thought, “It’s not going to happen to me.” Then came the gene test....Scaring people into quitting is the marketing rationale for that new genetic test, called Respiragene, which purports to identify which smokers have the highest risk of developing lung cancer. The test, developed by a company called Synergenz BioScience in New Zealand, where Mr. Taylor lives, is now being offered over the Internet in the United States for $700....Respiragene has not been approved by the Food and Drug Administration, which usually does not regulate such tests. Some states do, however, and the test has not been approved for use by residents in New York, California and Maryland....The justification for many of these tests is that knowing one’s risk will prompt people to change their behavior. Such is the premise, for example, of the genome scans offered by 23andMe, costing $400, and one by Navigenics, for $1,000, that are meant to tell one’s propensity for numerous diseases. Navigenics and an organization affiliated with the Scripps Research Institute are now monitoring 4,800 people to see if the Navigenics test results prompt them to eat better, exercise more or get more medical checkups. But smoking could prove the clearest test yet of the behavior modification pitch.

As far as I can determine from this story, Synergenz BioScience developed this test by choosing a list of biomarkers that can purportedly determine whether one is at "high risk" for lung cancer. I take this to mean that one is predisposed to the disease and that this predisposition can be exacerbated by smoking or by being exposed to other risk factors. The company then markets the test based on the premise that it's more "scary" than having your physician say that you are at higher risk. Although not referenced in the story, the picture of the Respiragene report shows the MDL logo, referring to what I assume to be the performing laboratory for the test, Molecular Diagnostic Laboratories. This lab's web page also displays the Respiragene logo.

This notion of using a genetic test to assess whether a current smoker or a previous smoker is at risk for cancer strikes me as sketchy, particularly for a price $700. Here's what I would recommend instead. Stop by one of the local panhandlers on the street, hand him $10, and tell him that you have a 20-pack-year history of smoking. Then, ask him if you have an increased risk of developing cancer. I also suspect that some smokers who don't want to quit smoking are using the test to determine if they are in the lucky minority who have a low cancer risk and can thus continue with their addiction. It's not worth it, pal.

Some Laboratory Managers Getting Carried Away by Lean/Six Sigma Projects

Don't get me wrong. I am just as enthused as the next person about correcting lab errors and work product defects. The bone that I have to pick with some of the Lean/Six Sigma experts is that this approach to lab management seems to becoming the answer to all lab problems. Some aspects of Lean/Six Sigma have always seemed to me to be vaguely ominous -- turning lab professionals into automatons who paste tape outlines on benches so that the scotch tape dispenser does not wander around the lab. All of my concerns came to the surface when I read a recent article in the Wall Street Journal (see: How Labor Is Liberated). Here is the excerpt from the article that caught my eye:

"Jean-François Zobrist ...captured his leadership philosophy with a distinction. There are, he said, two kinds of companies: 'Comment' in French, or 'how' companies, and 'pourquoi,' or 'why' companies. 'How' companies spend their time telling workers how to do their jobs—where to place the machinery, when to come to work and when to leave, and so on.The second is that it becomes difficult, if not impossible, to change any of the myriad rules about how to get things done. You want to move that cart to a different spot on the shop floor? You need clearance from your manager, who may have to ask his manager, and so on, creating a never-ending 'chain of comment.' The result, as Zobrist put it, is that it becomes impossible to get the work done without disobeying somebody in the chain of command. A pourquoi company is different. It replaces all the myriad 'hows' with a single question: Why are you doing what you're doing? The answer is always the same: to keep the customers happy. As long as what you do satisfies that commandment, Zobrist doesn't worry about how you do it. Freedom at FAVI meant replacing the chain of comment with a single pourquoi." This has two consequences. The first is that you end up judging employees by everything except what counts, which is whether the job gets done and the customer is happy.

So, for me, lab personnel who spend most of their time worrying about "how" or "comment" questions may be too involved with improving daily work processes and perhaps avoiding some of the more challenging "why" or "pourquoi" questions. I am sure that lab executives who specialize in Lean/Six Sigma can readily point to customer feedback to buttress their claims that they are pursuing goals that please their customers. For a change of pace, however, how about responding to this question: Is your laboratory sufficiently innovative in addressing the questions of tomorrow that many clients may not even be asking about? In order to begin to explore some of these strategic "why" questions, it might help to begin with consideration of the four rapidly developing fields that I think will pose the greatest challenges for labs in the upcoming years: (1) molecular diagnostics; (2) information technology; (3) digital pathology; and (4) ultra-fast histology processing. Here's another "why" question. Is your lab a regional or national leader in these four areas?

Physicians Using an iPhone Application to Triage Their Patients

John Moore, who blogs over at Chilmark Research has discovered an iPhone application that reinforces my belief that smartphones may soon rival the stethoscope as an essential healthcare delivery tool (see: iTriage: A Business Model Gaining Traction). iTriage assists physicians in referring their office patients to regional hospital emergency rooms when necessary. I have posted previous notes about the myriad healthcare applications that can potentially be deployed on smartphones and this is certainly a good example of the potential of these devices. Below is an excerpt from his note:

iTriage is a slick iPhone app.... Since its launch in April 2009, iTriage has maintained an enviable position as one of the top downloaded apps in the iPhone AppStore, currently in the top 10% of all apps downloaded....The parent company’s (Healthagen) business model is to solicit providers, mostly large integrated delivery networks (IDNs) to become premier sponsors who pay an annual subscription fee...to Healthagen to have their facility listed along with some brief marketing content, including the ability to upload videos, as to why one would want to go to their facility (typically ER) versus others. Thus, Healthagen is tapping into the marketing budgets of IDNs....On October 5th, HCA announced that they would become a premier sponsor as well for their facilities in South Florida.  What is particularly cool about this announcement is that in addition to the standard promotional marketing content that one may find in iTriage on a given HCA facility, HCA will also be providing real-time information on expected wait-times in ER, right there in the palm of your hand on your iPhone and in a recent upgrade of the software, a Blackberry as well.  (In November, they’ll release versions for Android and PalmPre.) This is all part of a larger push by HCA, which includes posting wait-times on billboards in this region to drive consumers seeking medical attention to their facilities as a significant percentage of those admitted to ER wind up being admitted for more extensive care.

 I am not surprised that the executives at HCA immediately understood the value of iTriage for their hospitals. What a clever way to market their emergency departments to community physicians! Adding expected wait-times will provide added valuable information for healthcare consumers who download the application. I pointed out in a previous note how emergency departments are an important portal for inpatient admissions to hospitals (see: Hospital Admission of Patients with Chronic Disease from the Emergency Department). Here is a quote from that note:

In 2005-2006, hospital admissions through EDs accounted for approximately 60% of acute care hospitalizations in Canada (excluding hospitalizations in Quebec and those among women admitted for childbirth and infants born in hospital). These patients accounted for 65% of in-patient days, 11% of which were alternate level of care (ALC) days.

We have only scratched the surface of smartphone applications that are directed to both physicians and healthcare consumers. For example, it would be relatively easy to adapt content currently on the web concerning the interpretation of lab tests for smartphones (see: The Mobile Web and the Future of eHealth). Here is a quote from this blog note:

...[I]t's now time, in my opinion, to begin to adapt [the content of] consumer-oriented web sites about the significance and interpretation of lab tests to the mobile web. One good example of such a site is Lab Tests Online. Such modification would allow, for example, patients who have just completed a physician visit to use their cell phones to query [their smartphones to] obtain a better understanding of their test results.

Smartphones as the New PCs; Connecting to Healthcare Professionals and Consumers

I have been using my new smartphone, a Palm Pre, for about a month now. I have posted a number of previous notes about the use of such devices for educating healthcare consumers and reporting lab test results to physicians (see: Making e-Health Information Accessible with Smart Phones; The Mobile Web and the Future of eHealth). Various features of this device have greatly impressed me, not the least of which has been the ease of surfing the web and the ability to quickly download new applications. A recent article referred to "smartphone apps" as the foundation for a new gold rush and I completely agree (see: Smartphone apps are the technology world's new gold rush). Below is an excerpt from it:

Credit Suisse recently projected that total smartphone sales for 2009 will end up at around 176 million units. In the years ahead, Credit Suisse expects the smartphone market to balloon to around 1.5 billion units. By comparison, worldwide unit sales of all mobile phones in 2009 will be about 1.2 billion and worldwide unit sales of all PCs in 2009 will be about 300 million....Beyond smartphone applications, there are several additional forces at work that are going to drive the growth of the smartphone market:

• This next generation of mobile broadband will unleash a new wave of software applications and video services on smartphones. It will also enable augmented reality software to let smartphones interact with the real world.

• [T]he mobile phone will become [the PC for people in emerging economies] because cellular towers are much easier and cheaper to deploy and there are inexpensive ways to generate small bursts of recharging power....
  

• [A]ll mobile phones will naturally become smartphones as their underlying software takes on more advanced functions and vendors become less likely to build their own OS and more likely to use an open source mobile OS like Android or license Windows Mobile or Palm’s webOS.

Vendors and developers are already anticipating the day when there will be over a billion smartphone users on the planet. Having seen the runaway success of the iPhone App Store (which, frankly, happened as much in spite of Apple as because of it), mobile platform vendors do not want to concede this huge competitive advantage to Apple. Thus, all the big ones are building their own app repositories and are wooing software developers to write applications.

Let me simply restate the obvious by saying that smartphone will be an essential means by which the clinical labs will communicate test results to physicians. Rotating my smartphone by 90 degrees changes the screen format to landscape. Although I have commented in the past that cell phones did not provide enough screen "real estate" to display lab reports, I have now changed by mind about this. With "hand gestures" that can be used to magnify text or images, a touch-sensitive screen, and superb screen resolution, it will be a simple matter for physicians to read lab reports using these devices. The next step, clearly, will be the development of applications running on smart phones that will assist clinicians in "digesting" a set of lab test results and provide diagnostic support.

Until such time as such diagnostic support apps are available, clinicians can always point their smartphone browser to the ARUP Consult, which is a "Physician's Guide to Laboratory Test Selection and Interpretation." I have highlighted this excellent resource in a previous blog note (see: ARUP Offers Lab Algorithms for Disease Diagnosis Support). Here are some more details copied from the web site:

• Nearly 2,000 lab tests categorized into disease-related topics
• Disease topics include clinical background information, test ordering suggestions, and concise diagnostic advice
• More than 50 algorithms support clinical decision-making
• New and updated content released 6 times a year
• Co-authored and maintained by experts at the University of Utah School of Medicine and ARUP Laboratories

Variations of "Integration" Relating to Lab Computing and Clinical/Anatomic Pathology

I have just returned from Toronto where I delivered a lecture at the Executive Edge conference which focuses on Canadian lab management. All of the conference presentations were outstanding and are available on-line. I will return to some of them in upcoming notes for a more detailed analysis. My own presentation addressed various type of integration as the term applies to lab computing and to Clinical and Anatomic pathology. In this lecture, I tease out the following for detailed analysis:

• Integration of Clinical Pathology with Anatomic Pathology; integration of upstream diagnostics with downstream therapeutics.
• Workflow integration of digital pathology with the LIS; introduction of the pathologist dashboard/console.
• Integration of Pathology, Lab Medicine, and Radiology to form the new medical specialty of Diagnostic Medicine; evolution of Integrated Diagnostic Centers.
• Development of lab networks (hospital LISs + esoteric reference lab LISs); pursuit of integrated clinical lab databases for patient care.
• Downstream integration of the expanding LISs with hospital EMRs; consideration of the technical and political challenges involved.
• Dis-integration of pathology, driven by reimbursement issues and upstream diagnostic integration by clinical office-based specialty groups.

A Scenario for Lab Computing in the Post-Classic-LIS Era

I think that we may now be working our way through what might be called the post-classic-LIS era. The classic LISs were designed to meet most of the computing needs of the major hospital-based clinical labs such as chemistry, hematology, microbiology, and blood bank. These multipurpose systems dominated the market for about three decades. The first crack in the facade of their functionality and invincibility was the emergence in the market of so-called middleware. These niche applications were supported and promoted by the IVD vendors and smaller software companies, installed as "black boxes" between analyzers and the LISs, and provided additional functionality not always available in the LISs. A second blow was struck when many of the LISs available in the market were unable to adequately support molecular diagnostics. In response, a small group of the LIS vendors finally developed molecular diagnostics modules. The third blow consisted of the digital pathology systems that have been been supplied largely by a new set of vendors, manufacturing both the requisite scanners and software. The fourth blow, now in its very earliest developmental stage, has been integrated diagnostics which may ultimately result in the emergence of blended diagnostic information system (DIS).

A similar pattern is occurring in the hospital EMR market. Successful vendors such as Epic Systems have been unable to provide EMRs that adequately accommodate to the increasingly complex data and images generated in the major diagnostic departments such as pathology, clinical labs, radiology, cardiology, and gastroenterology. The inadequacy of these nominally "global EMRs" has not raised any alarms because the purchasers of EMRs, hospital CEOs and CIOs, rarely if ever use them on a daily basis for their own work. To explain away this EMR functionality problem. the advocates for these systems declare that they have not been designed to store and report all of this burgeoning diagnostic information and, most particularly, diagnostic images.

In contrast, the daily users of the "ancillary" diagnostic systems continue to insist that they function at a very high level in order to accomplish their daily work. In my opinion, the classic LISs, in a manner similar to the hospital EMRs, will gradually evolve into front-end viewers for the complex molecular test results and images that will be managed by back-end modules and linked under a federated architectural model (see: The Value of a Federated Architecture in Pathology). HL7 will be inadequate as an standard for these modules due to the length of time and cost required to develop interfaces. The solution to this need for an on-the-fly interoperability solution will be LITS-Interop which is web-based, flexible, and inexpensive. Increasingly complex versions of this software were demonstrated at the Lab InfoTech Summit last March in Las Vegas and the just completed APIII conference in Pittsburgh.

I believe that lab computing of the future will resemble something like the following: the classic LISs will remain in-situ, primarily as viewers for the specialized back-end federated modules with LITS-Interop serving as the interoperability solution. These hospital lab mini-networks will be linked into larger regional or national lab networks with scattered reference lab nodes and with participation of panels of pathology and lab medicine consultants. The manner in which the hospital EMRs evolve will become largely irrelevant to lab professionals. The federated hospital lab mini-network will continue to pass to the hospital EMRs those top-level diagnoses that the EMRs can digest. If the hospital clinicians need to view detailed lab information or surgical pathology images, they will link to the web-based federated lab network described above. A similar situation obtains today if the clinicians want to view radiology images -- they sign on to the specialized radiology PACS, usually managed by the radiology department.

Professional Services Divisions as Potential New Profit Centers for Pathology Vendors

In a recent note, I commented on the professional services division of Aperio as a relatively novel component of digital pathology companies (see: Emergence of a Professional Services Division at Aperio). Ole Eichhorn, the CTO of Aperio, emailed me the following comment to this note, which I quote with his permission:

One key point about having a professional services team is that [this approach requires] a relatively open system to build on....The professional services team is a sort of “third party for hire” that [Aperio's] customers can use to create interfaces, customize the product, and otherwise work with them to craft a tailored solution.  Our team builds onto existing interfaces and plug-in APIs at each point, they never modify our baseline code. Another point which won’t surprise you: most radiology PACS vendors have professional services teams and they’re an important part of their businesses.  I remember meeting with [a PACS vendor that told me that] 25% of their revenue came from professional services.

Lot's of interesting food for thought in this short passage. First of all and in order to develop a professional services unit, the product being offered by a vendor such a digital pathology system needs to have an open architecture. Put another way, you can't make money and serve customers modifying an unmodifiable product. He also make mention above of plug-in APIs, which can be defined in the following way in the Wikepedia: an application programming interface (API) is a set of routines, data structures, object classes and/or protocols provided by libraries and/or operating system services in order to support the building of application.

The second concept raised by Ole is that a professional services division works with a customer to develop new applications without altering the "baseline code." The product keeps improving using customer input but without modification of the core hardware/software, which must be sold to other customers. Compare this with the Epic EMR with most modifications generated by the centralized corporate R&D rather than by customers (see: Some Additional Insights into the Epic Corporate Culture). Improvement cycles for such products tend to be slower and they also tend to drift toward "vanilla" over time, making them easier to maintain.

Lastly, he makes mention of a PACS vendor with 25% of revenue derived from professional services. It seems to me that with this type of contribution to the bottom line, a professional services unit starts getting some "respect" within the company. Put another way, the links between it and the company marketing & sales unit become weaker. The professional services consulting division becomes empowered to turn to products and solutions outside the company if and when necessary to increase consulting sales. This, in turn, leads to a virtual circle or cycle, a feedback mechanism whereby the customer sees the consulting services offered by the company as more tied to quality improvements for them and generates even more business. The company products, I am sure, will always remain as the central focus on the solutions proposed by the professional services unit but with alterations at the margins, based on the special needs of the customer.

The Use of Procalcitonin to Reduce Inappropriate Antibiotic Usage in Respiratory Tract Infections

Serum procalcitonin levels have been shown in the past to be elevated with bacterial infections but not with viral infections. It's important for physicians to be able to distinguish between these two types of infections because antibiotics are often the treatment of choice in the former but ineffective in the latter. Appropriate use of antibiotics can reduce the cost of care and also the likelihood of the emergence of antibiotic-resistant bacterial strains. A recent article revealed some new findings in this area of inquiry (see: Procalcitonin measurement may help reduce antibiotics overuse for lower respiratory tract infections). Below is an excerpt from the article:

The use of guidelines for treatment of lower respiratory tract infections such as bronchitis and pneumonia determined by measurements of a chemical in the blood known as procalcitonin [PCT] resulted in lower rates of antibiotic use and associated adverse effects, and similar rates of adverse outcomes compared to standard guidelines, according to a study in the September 9 issue of JAMA....[C]linical signs and symptoms are unreliable in distinguishing viral from bacterial LRTI [lower respiratory tract infections], and that as many as 75 percent of patients with LRTI are treated with antibiotics despite the predominantly viral origin of their infection....The researchers found that “the rate of overall adverse outcomes was similar in the PCT and control groups ....The mean [average] duration of antibiotics exposure in the PCT vs. control groups was lower in all patients ...and in the subgroups of patients with community-acquired pneumonia, ..., exacerbation of chronic obstructive pulmonary disease..., and acute bronchitis....Antibiotic-associated adverse effects were less frequent in the PCT group."....PCT guidance will have substantial clinical and public health implications to reduce antibiotic exposure and associated risks of adverse effects and antibiotic resistance.

I have discussed the term comparative effectiveness in previous notes as well as the key role of clinical lab testing for monitoring the effectiveness of various therapies (see: The Inclusion of Molecular Diagnostic Testing in Comparative Effectiveness Studies; Moving Resources from the Therapeutic to the Diagnostic Silo; Biomarkers Used to Assess Treatment Efficacy). The use of procalcitonin in the manner described about is another good example of how lab tests can be used in this way in the health delivery system. Procalcitonin can also be used to diagnose septicemia in intensive care units for patients suffering traumatic injuries (see: Procalcitonin can also be used to diagnose septicemia in trauma intensive care units). This latter article makes reference to the semiquantitative PCT-Q test, which is highly specific but far less sensitive than the LUMItest PCT, also available from Brahms International. Point-of-care availability of one of them would be necessary for the test to be useful in the triage of LRTI. Twenty minutes is cited as the time required for test result availability in the JAMA article above.

Software as the Core Competency of Digital Pathology Companies

I was mildly surprised to learn from an executive of a digital pathology company that he considers software development as the core competency of his company. I guess that my attention was focused on the development of scanners by them and I had underestimated the software side of the business. I have also been influenced by my opinion that the engineering and scientific culture of the IVDs has limited their competency in lab software. However and given the emergence of algorithms as a key product line for both BioImagene and Aperio, I now accept the fact that these are primarily software companies (see: A Blueprint for Blending Anatomic and Clinical Pathology). 

So why is this important? Please read on. A recent article in the Dark Daily discusses the digital pathology industry, describing it as entering a new phase (see: Three Trends Now Fueling Wider Adoption of Digital Pathology). Below is an excerpt from it:

Digital pathology is entering a new phase of adoption marked by three significant trends. This is the assessment of Dirk Soenksen, Founder and CEO of Aperio Technologies, Inc., in Vista, California. He believes these three trends are working together to accelerate the adoption of digital imaging and digital pathology systems by pathology laboratories across the nation...:

• The desire by some pathologists who already use digital pathology in niche settings to expand the use of digital pathology within their laboratories to partial or full adoption.
• A heightened interest by laboratory information system (LIS) vendors to integrate their software with digital image management (pathology PACS) software, as a way to improve their competitive advantage.
• Widespread support for the newly formed Digital Pathology Association (DPA) a not-for-profit group comprising industry and non-industry members, and its mission to focus on education, best practices, and increasing awareness....

“In fact, it is this interest (by customers of LIS systems) to integrate digital pathology into the workflow which caught the attention of several LIS companies,” continued Soenksen. “These firms view digital pathology as a basis for a competitive advantage, and that’s why more and more LIS companies are announcing relationships with digital pathology companies. They believe that an interface to a digital pathology system provides a basis of differentiation. Once digital pathology is integrated into the LIS, it is possible to share data with the LIS, setting the stage for more widespread adoption of digital pathology systems”. “The fact that two sponsors of the newly-formed DPA are LIS vendors is evidence of this important trend,” Soenksen noted. “For example, Sunquest Information Systems Inc. is a gold sponsor and McKesson Corporation is a corporate sponsor of the DPA. Other LIS vendors are expected to join the DPA as well.”

The LIS industry has never been able to develop an industry-wide trade association but has rather focused on the development of user groups as a type of "outreach" strategy. I put this term in quotes because communicating with customers doesn't get these companies too far outside the box. The article above mentions the development of the Digital Pathology Association and also the need to integrate digital pathology information and workflow into LISs and AP-LISs. If you accept my premise above that digital pathology is primarily software oriented, then the DPA is the first ever lab software business consortium.

Added evidence for the maturity of this segment of the pathology and lab medicine industry is that Pathology Visions digital pathology conference has evolved from an Aperio-launched user group to very successful vendor-neural event, another variant of this broad industry-wide theme promoted by the DPA. LIS companies, prior to this apparent catalytic effect of the digital pathology companies, suffered from a case of arrested development, never being able to get past their user group phase. I am now working on a lecture describing the various types of "integration" that are now at play in the clinical labs such as AP with CP and pathology/lab medicine into radiology. Let's hope that the DPA and digital pathology are signs that we are rapidly moving in this direction.