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Emergence of a Professional Services Division at Aperio

Posted Oct 05 2009 10:02pm 1 Comment

I attended a workshop entitled Multisite Integration in a Global Environment at the recent Pathology Visions conference in San Diego. The workshop faculty included representatives from the global medical research/pharma corporations Quintiles and Merck. Also on the panel was a representative of the Aperio professional services division that was launched in February, 2008, and responsible for IT integration, configuration, and compliance consulting. I was intrigued by the apparent success of this Aperio business unit thus far and decided to explore the idea a little further. Please keep in mind that I had concluded in a previous note that software development was the core competency of digital pathology companies like Aperio so I consider these companies to be first cousins of the LIS vendors (see: Software as the Core Competency of Digital Pathology Companies ).

LIS vendors have attempted to launch professional services divisions over the years but the success of these ventures has been limited. This is not to say that hospitals do not require professional services support from their LIS vendors for their integration and configuration challenges. For example, such support is a necessity when two hospitals merge and decide to convert one of them to the LIS used by the other. The problem with hospitals is that the lab leadership usually assumes that the cost of designing the new system will be included in their system licensing and support fees. I think that we can conclude that these fees are set at levels to cover such professional services consulting. However, they are not always identified as such and the company may not show a professional services unit on their organizational charts.

The development of such a unit unit within a digital pathology company such as Aperio, I think, reflects the two arms of this industry. One consists of pathology departments and pathology reference labs and the other can be identified as pathology/health research, both for-profit and not-for-profit. They correspond to the two tracks of the recent Pathology Visions conference. For-profit companies such as Quintiles and Merck are large multinational enterprises and require an integrated digital pathology architecture as part of their technology adoption plans. The IT demands of such companies are rigorous and they are willing, and accustomed, to budget for various types of consulting services. Their corporate cultures are very different from non-profit hospitals, even those that are large and complex. The Quintiles launch of digital pathology with Aperio is described in a recent press release (see: Quintiles Advances Cancer Treatment Through New Digital Pathology Service s).

The most interesting question for me relating to this whole matter is whether Aperio and other digital pathology companies, once they establish professional service divisions to serve their corporate and research clients, can establish a value proposition regarding such services for pathology departments and hospitals. It's worth noting that hospital CEOs and CIOs are accustomed to paying large sums of money to consultants relating to their hospital EMR deployments but generally not for their "ancillary" information system installations.

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Bruce,

Great writeup on this workshop, I attended it also. We are seeing similar challenges in the biopharma and research community, integrating with their existing LIS systems, and also in using the technology more effectively. Unlike in hospitals, where the driver is primarily reading slides remotely, most pharma pathologists have to set up complex workflows in image analysis and quantitation. This requires not only integration to an LIS, but also to a biostatistics program like SAS or Oracle Clinical. We are keeping pretty busy with digital pathology services in this area.

Trevor Johnson
Flagship Biosciences LLC

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