Digital Pathology’s Takeaways from #ECP2024

Publication Date: 17/09/2024

Cranfield, UK, 17th September 2024, Written by Imogen Fitt –

Hello everyone! I hope we all had a wonderful time at ECP – I was certainly grateful to catch some sun after the stormy weather on Sunday!

After meeting with 50+ vendors over three days, I’m sharing some thoughts on my main takeaways from the event…

Industry ‘Fog’ is Getting Thicker and Clear Information is Required to Light the Way Towards Success…

After a few initial discussions, it quickly emerged that there remains a significant amount of obscurity within the digital pathology market today, this is primarily centred around the following three areas:

  1. There is a lack of clear case studies and references for customers to follow during the digitisation process. Whilst generic guidance and ROI calculators are valuable, nothing trumps clear peer-to-peer communication which can help support decision-making with clearly defined examples of success. These case studies are also likely to be much better received if publicly available and collated in one place for ease of comparison.Whilst customers today expect their vendors to act as partners and guides in the digitisation journey, vendor-neutral sources of information can act as additional, unbiased reference points to reiterate and add credibility to messaging – this is where vendor-neutral individuals and industry associations can offer support!
  2. As the market evolves it’s also becoming harder for both customers and vendors to clearly distinguish between various product and market announcements. A prime example of this lies within vendor partnerships, where it can be difficult to ascertain through press releases what each announcement really means. Not all partnerships result in success, and not all vendors mean the same thing when using buzzwords like interoperability; this also rings true when comparing vendor products, especially AI solutions.
    New AI vendors are entering the market each month, making it harder for both customers and vendors to keep track of developments and compare solutions – this is part of the reason workflow software is beginning to incorporate multi-algorithm overlays, which can be used to compare the output of different solutions. However, as vendors seek to integrate their solutions tightly with third-party AI, further support is needed to ensure that such costly investments are made with only the right partners.This leads to another question: ‘Which AI companies are generating clinical revenue?‘. Recent industry announcements have many vendors curious about the future of vendors focusing on clinical AI, and it’s no secret that although pathologists are interested in AI’s potential, not many can commit funds at this point! Several press releases exist announcing customer adoption of solutions, however often what is unclear is how and when such solutions are incorporated into clinical use. The market has come to expect ‘free trials’ that can last a significant amount of time, and whilst some vendors may be able to cite high numbers of users of their products, this doesn’t mean that all are paying full price.
  3. Finally, the return on investment (ROI) labs can get from digitisation is still largely unclear. I’ve discussed before the various indirect and direct benefits labs gain from digital pathology, however, applying these to real-world settings is difficult. This issue will eventually be alleviated through the availability of case studies as mentioned above, but as more and more labs explore the potential of de-identified asset monetisation and telepathology consulting, further benefits are expected to become clear. Unfortunately, as I’ve mentioned before, obscurity around ROI and a lack of financial incentive/support within clinical domains is likely to mean that the market will consolidate in the near term, however, this doesn’t mean that the overall digital pathology market isn’t moving forward. As networks like NHS Wales and the Veneto (Italy) region prove, clinical markets do see the potential AI has to improve clinical care. It’s just a matter of timing and funding.

Digitisation is no small investment, so whilst the industry is nascent it’s only natural for adoption to be slowed as labs tread carefully. But as mentioned, there are ways the industry can help support this transition.

Return on Investment for Digital Pathology Doesn’t Just Centre on Laboratories – Digital Pathology Operates Within a Complex Ecosystem

Context however is important, and digital pathology in both clinical and research labs operates within a wider environment that must be considered to truly understand the industry’s future evolution.

For example, in healthcare settings, digital pathology is already being heavily influenced by radiology through vendor partnerships and existing practices (think DICOM adoption!). However, even in the more established (and far better-funded) radiology digital strategy, there is uncertainty around workflow, care pathway evolution and the underlying need for interfacing with digital pathology and other imaging-led departments. Thus while radiology may look attractive because of its potential to act as a budgetary sponsor for digitalisation of the pathology lab, in reality without robust outcome assessment and changes to care delivery, it’s easy for pathology to fall down the strategic “to do” list for enterprise imaging consolidation.

However, there are further trends that are likely to act as drivers and barriers to the industry’s success in the near term. For instance, a wider trend impacting many healthcare markets is the slow evolution towards what is known as ‘value-based care’. This is a healthcare model wherein providers are reimbursed not for performing specific procedures, but instead are compensated according to the overall health outcomes of patients.

Many digital pathology AI vendors are seeking to develop models and products paired with such outcomes data to move beyond quantification and into predictive care. Whilst vendors in the market today choose to justify investment in digital pathology with measures of efficiency gains, products of the future will be able to shift focus to more comprehensive outcomes data and directly tie digital pathology analyses to better patient outcomes.*

*For a comprehensive report on the dissemination of value-based care across healthcare systems globally click here.

Furthermore, as more and more digital biomarkers are utilised to support drug development, digital pathology’s benefit in life sciences settings will move beyond early discovery to eventually support the launch of various drugs with digital companion diagnostics.

Examples like these showcase how the industry needs to move beyond the siloed view of value it has today, and examine digital pathology through a wider lens.

Funding Won’t Guarantee Success

The ECP show floor was abuzz with a raft of more recent funding announcements, which ramped up over the summer for several digital pathology companies. While investor confidence is a good sign of market potential, parallels in other industries also point to funding being a mere stepping-stone towards market success.

Beyond funding, regulatory approval is typically the next hurdle, for which the FDA continues to maintain a firm (and slightly controversial grip) on the potential for digital pathology in the world’s largest healthtech market. Then comes reimbursement, for which the rumour-mill around the potential for digital pathology in the US is increasingly spinning.

However, regardless of the scenario around when (or if) reimbursement is made available for digitalisation in pathology, reimbursement itself does not ensure market success. In fact, recent parallels across both radiology imaging and the adoption of AI tools in other clinical disciplines clearly show that ongoing market education, sales channel and business model evolution and studies demonstrating direct improvements in patient outcomes arguably matter more to vendor sales and technology uptake.

Given that investor sentiment is also changing by moving away from high-risk, cash-burning ventures towards backing vendors and emerging technologies that have clear evidence towards break-even and profitability, the shaky promise of reimbursement suddenly looks less like the golden arrow that propels digital pathology penetration to a whole new level.

Therefore, companies looking to raise, or those that have just raised, will need to double-down efforts on not just winning the right to play in a market (i.e. regulatory), but also consider the more complex trade-offs of whether market demand (with or without reimbursement) and the burden of market creation is enough to sustain lofty growth expectations; as recent history would suggest you can raise too much too soon.

I can’t Wait for #Pathvisions2024…

I’ve said it before, and I’ll say it again it’s an exciting time to be in the market and events like these are a valuable opportunity to meet face-to-face and discuss digital pathology’s future.

For those who made time to say hi in Florence, grazie! It’s always a pleasure connecting with colleagues old and new. 😊

Looking for Data and Analyses to Help Support Your Business?

If you didn’t catch me at the show and would like to discuss any of these points, or the market in general, further please reach out via Signify Research’s website.

Preliminary data is now available for our fourth Digital Pathology Core Market Report which can be used by a variety of stakeholders for an even wider variety of purposes such as:

  • Informing your growth targets and product investment strategy with quantitative data points.
  • Supporting you in evaluating digital pathology’s emerging competitive landscape to assess the impact of announcements and select potential partners.
  • Assist in understanding adjacent markets and wider healthcare ecosystems such as enterprise imaging, laboratory information systems and the influence these will have on Digital Pathology adoption.

Drop me a note if you’d like to discuss purchasing access…

P.S. One extra takeaway… I did manage to make time before the event to attend a pasta-making class – picture below – and for anyone visiting anytime soon I’d fully recommend this to get an authentic experience and learn some of Nonna’s recipes!

About Imogen Fitt

Imogen joined Signify in 2018 as part of the Healthcare IT team. She holds a 1st class Biomedical Sciences degree from the University of Warwick where her studies included molecular biology and pharmacology. Since joining the team Imogen has studied the medical imaging software and hardware markets and is now expanding Signify Research’s Diagnostics and Lifesciences coverage.

About the Diagnostics and Lifesciences Team

The Diagnostics and Lifesciences team provides market intelligence and detailed insights on the multiple healthcare technology markets where the clinical world intersects with the preclinical. Our areas of coverage include digital pathology, laboratory information systems, clinical Real-World Data (cRWD) platforms, oncology information systems, tumour board software, oncology decision support software and radiotherapy IT. Each report provides a data-centric and global outlook of its markets with granular country-level insights. Our research process blends primary data collected from in-depth interviews with healthcare professionals and technology vendors, to provide a balanced and objective view of the market.

About Signify Research

Signify Research provides healthtech market intelligence powered by data that you can trust. We blend insights collected from in-depth interviews with technology vendors and healthcare professionals with sales data reported to us by leading vendors to provide a complete and balanced view of the market trends. Our coverage areas are Medical Imaging, Clinical Care, Digital Health, Diagnostic and Lifesciences and Healthcare IT.

Clients worldwide rely on direct access to our expert Analysts for their opinions on the latest market trends and developments. Our market analysis reports and subscriptions provide data-driven insights which business leaders use to guide strategic decisions. We also offer custom research services for clients who need information that can’t be obtained from our off-the-shelf research products or who require market intelligence tailored to their specific needs.

More Information

To find out more:
E: enquiries@signifyresearch.net
T: +44 (0) 1234 986111
www.signifyresearch.net