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Signify Premium Insight: Clarius gets a Handle on Ultrasound AI

This Insight is part of your subscription to Signify Premium Insights – Medical ImagingThis content is only available to individuals with an active account for this paid-for service and is the copyright of Signify Research. Content cannot be shared or distributed to non-subscribers or other third parties without express written consent from Signify ResearchTo view other recent Premium Insights that are part of the service please click here.

Handheld ultrasound vendor Clarius recently announced the launch of an AI marketplace. Clarius says the platform has been established to enable algorithm and software developers to bring their solutions to market more efficiently thanks to integrations with Clarius’ wireless ultrasound systems.

The marketplace is launching with six partners, including ThinkSono, DESKi and Deepecho, and is available to users who have subscribed to Clarius’ Membership programme. As competition hots up in the handheld ultrasound market, will Clarius’ new marketplace enable it to stand out?

The Signify View

The potential AI holds to improve patient care means that it is among the most eagerly watched areas of medical imaging technology. In radiology settings, where many of medical imaging AI’s vendors are focused, algorithms have been used to increase the efficiency of performing imaging procedures and delivering the diagnoses, or as a way to avoid invasive diagnostic procedures, improving  clinical workflows. In ultrasound, however, and particularly handheld ultrasound, there are other more pressing clinical priorities.

Chief among these is enabling less experienced ultrasound users to effectively make use of the growing abundance of handheld ultrasound systems. While there are numerous tools that can fulfil this role, solving the last-mile challenge of making them accessible to ultrasound users is one that is yet to be conclusively solved. Clarius’ platform seeks to make great strides in this regard. While handheld ultrasound vendors have sought to add image guidance capabilities to their products through bespoke AI partnerships, such as that agreed between Butterfly Network and Caption Health, Clarius has sought to offer a more open approach.

There are advantages to the partnership model. There can be more information sharing between partners, and solutions and hardware can be better tailored to one another. However, such advantages come at a cost. Creating such partnerships and ensuring tight-knit integration between the products of two or more companies can require significant resource. What’s more this investment could be for nought if the partner exits the market, or a competitor releases a drastically superior product.

Adopting a broader platform-play approach such as Clarius’ marketplace, however, means that the vendor can more quickly and more flexibly bring a greater range of AI capability to its hardware. It is not only a rapid method but a flexible one too. Its “try before you buy” programme, gives Clarius customers confidence to use AI models within their own imaging environment.

Ultrasound’s Guiding Hand

This is significant. Compared to other ultrasound segments, the price of handheld systems is low. As such Clarius, and other handheld ultrasound vendors require high sales volume to derive significant revenues. To achieve such sales, however, vendors are going to have to entice significant numbers of new customers to purchase systems, many of which are inexperienced or novice ultrasound users. Vendors therefore must facilitate the use of handheld ultrasound to these users, with AI being one of the most promising methods of enabling this use.

Such a requirement means that unlike most radiology AI, which is used after image acquisition on the PACS, handheld ultrasound AI is most useful on the device itself, to guide in real time the capture of images and assist with diagnosis. In offering a platform for AI, Clarius is able to efficiently supply a range of algorithms to assist in this aim. Having this capability will both encourage customers who have not yet purchased a handheld ultrasound system to make the leap with Clarius, but also help persuade users to choose Clarius over one of the increasingly numerous alternatives in the handheld space. Other vendors may have strength in specific applications (e.g., Butterfly Network’s three-way partnership with Caption Guidance and Ultromics), but Clarius’ platform means it can partner with a wider array of AI vendors, enabling its probes to be used across a greater range of clinical applications, making it an arguably more versatile solution.

These benefits, however, may not be realised right away. While Clarius’ platform makes it easier for users of the scanners to find, purchase and utilise AI capability, there must also be a desire from customers to actually use it. This has often been a stumbling block for marketplaces in radiology. While one of the main reasons many radiology AI marketplaces have failed to gain traction, challenges around integration, are less of an issue on handheld ultrasound due to the AI being embedded on the modality, other challenges such as the support needed to fully realise a solution’s potential and a lack of framework to assist providers with algorithm selection could still be barriers to the platform’s success.

There must also be attractive algorithms available. At launch Clarius has secured six partners targeting some important use cases such as teleultrasound or cardiac image capture guidance. However, the partners themselves are not the most established and have limited brand recognition, so may be of limited attractiveness to owners of Clarius’ handheld system. There are also more significant barriers preventing their clinical use. As written about in Premium Insights passim, regulatory approval is a significant milestone for aspirant AI vendors, as well as being an essential commercial step. None of the algorithm developers whose products are featured on Clarius’ marketplace have received regulatory clearance. So, although they can be utilised for some tasks such as training, their clinical diagnostic use is limited.

Variety Counts

This limited clinical utility is a challenge that Clarius will have to face if its AI platform is going to become a significant differentiator for customers. Longer term, Clarius would also do well to host a greater range of algorithms from a greater range of vendors on its platform. Increasing the number and variety of partners available in the marketplace will enable the marketplace to become almost a testing ground for Clarius. Through its platform it will have oversight of which algorithms are popular, which gain traction among users, and which represent opportunities for tighter integration, or more bespoke partnerships.

A greater number of partners will also help increase the visibility of Clarius’ platform. Each individual algorithm vendor is motivated to engage in market education and promote their own solutions. In encouraging potential customers to choose their products on Clarius’ platform, each vendor is also drawing attention to that platform.

Another challenge in the longer term is generating revenue from the AI solutions available on the marketplace. The affordability of Clarius’ scanners, with most models costing $3,400, and the budget limitations of most handheld ultrasound customers, means that the revenues derived from solutions on the marketplace will likely be modest for the algorithm developers themselves. With Clarius taking a slice of these revenues generated for hosting the AI solution on its platform, the actual value of a sale of an algorithm is, for Clarius, slight.

Hands-on Service

The handheld ultrasound vendor will instead derive value via another means. Instead of taking revenues from sales of algorithms, Clarius hopes that the inclusion of an AI platform, and the ready availability of solutions for customers will be enough to encourage customers to take the plunge on a Clarius handheld ultrasound system. As this happens, Clarius will hope to not only benefit from increased sales of ultrasound systems, but the larger customer base, and the restriction that the AI platform is only available to subscribers of Clarius’ ongoing service programme, will mean the handheld vendor will hope to grow its service revenues. Over the long-term, these service and subscription revenues become increasingly important, bringing subscribers onboard into an ecosystem that allows the continual up sale of opportunities of greater amounts, preventing customers from switching to another vendor’s products. What’s more, while hardware sales are crucial in helping establish a user base, sales of software solutions often offer a higher margin.

As such, while Clarius’ launch of its AI platform is notable, what is more important is what it signifies. While the handheld market is growing rapidly, and according to Signify’s upcoming Ultrasound Handheld Market Deep Dive is set to reach $589m by 2026, its full potential in attracting and enabling new users, has not yet been realised. Clarius’ platform isn’t the only answer, and other initiatives from other vendors also indicate the strategies being taken to reach these users. However, the fact that one of the most prominent specialist vendors in the handheld segment has launched a platform, stating its intent to solve the last mile challenges of AI use in handheld ultrasound, while giving algorithm developers a direct route to users’ hands is significant.

Amidst growing competition in the segment and an increasingly discerning customer base, Clarius hopes its platform will help close its fist on the handheld ultrasound market.

About Signify Premium Insights

This Insight is part of your subscription to Signify Premium Insights – Medical Imaging. This content is only available to individuals with an active account for this paid-for service and is the copyright of Signify Research. Content cannot be shared or distributed to non-subscribers or other third parties without express written consent from Signify ResearchTo view other recent Premium Insights that are part of the service please click here