Proscia Pushes Pathology Down the Digital Path

In most hospitals, the practice of radiology went digital years ago. Today you’ll rarely find a radiologist examining a broken bone or a fluid-filled lung on a sheet of old-fashioned X-ray film. But pathology isn’t as computerized.

For a variety of cultural, technical, and regulatory reasons, many pathologists still prefer to look at tissue samples the old-fashioned way, on a slide under a microscope.

Philadelpha-based Proscia is working to change that—and open up pathology to the power of remote work and automated image analysis—by building a cloud-based infrastructure for storing and sharing scanned pathology images.

Harry’s guest today is Proscia CEO David West, who says there are still strong cultural barriers to the adoption of digital pathology, but “the community is realizing this can be really great for them and their discipline.” West says easier scanning, higher resolution, faster image delivery, and the ability to review images from anywhere and tap the power of artificial intelligence are powerful advantages driving adoption of Proscia’s platform.

Here is the full transcript of this entertaining and educational episode;

Harry Glorikian: Hey, David, welcome to the show. 

David West: Thanks so much for having me, Harry. 

Harry Glorikian: Yeah. You know, always fascinated to learn about somebody or some, you know, their company and digital pathology, which is where I started my career. 

David West: Yeah. 

Harry Glorikian: 100 years ago at this point. Or it feels like 100 years ago, you know, when we were trying to talk people into imaging things and it was, oh my God, the pushback was crazy. You would think that we were stealing their jobs. Yeah, but let’s start. I mean, I’d love to hear your, like, your personal path into this area. Like what first drew you to this particular challenge?

I mean, you’re sort of young. I can’t imagine the pathology, bringing pathology into the computer age and make it more data driven sciences. I mean, what life experiences prepared you to see digital pathology as an area that needed new solutions? 

David West: I’m a software guy at heart. My background is in computational biology, and I was at Johns Hopkins where when I caught the bug for digital pathology. I was working with a group of scientists there, a guy by the name of of Don Coffey and his colleague, Bob Beltry, who were brilliant scientists that had at at that point, decades of work demonstrating that we can use computational techniques to predict cancer outcomes.

They were doing work in prostate cancer research, but this is this type of technology where you could use computer vision algorithms to identify features within an image of a biopsy that normally would be reviewed under a microscope and feed that data into machine learning algorithms and predict cancer outcomes.

I mean, this is is something that could be transformative. And, you know, for me, on a personal level, my mom is a cancer survivor. I’ve had other family members that have gone through the journey with cancer with positive outcomes and not so positive outcomes.

So on a personal level, my passion is, is at the intersection of of computers and cancer. And this this was this field of medicine that seemed so obviously ripe for for technology. And it felt like, you know, the gap between what was possible in the academic world and what real pathology practice looked like was huge. And and yet, to chart a course between what pathology looked like back then and in many cases still looks like today and what it could look like—the technology was made this possible.

We could chart a course from point A to point B and I started building I teamed up with my with my co-founders. And we had very humble beginnings, humble project, always with a big vision. And within, you know, around 2016, we, we raised some outside capital and turned into a real company. 

Harry Glorikian: Yeah. I mean, you know, I remember when I would send slides to two different pathologists and get two different answers, and I’d be like, shaking my head going, yes, this is just wrong. But to help people who are listening understand the problems that Proscia is trying to solve, can you start talking a bit about the state of pathology prior, let’s say, to founding of the company? 

David West: Yeah. You know, the person who’s attributed with being the father of modern digital pathology is a guy by the name of Rudolf Virchow, who, if you read, if you were to read the book Emperor of All Maladies or see the documentary by by the same name, they’d give him credit for more than just the father of digital pathology or modern pathology.

They’d say, he’s he’s the guy who gave us our modern understanding of cancer as this disease that’s based in the division of cells that starts within us. It’s not like this virus that comes from from the outside. And so pathology has this deeply, deeply rooted position in medicine. It’s really at the core of both both science and clinical practice. And since Rudolf Virchow peered down the barrel of his microscope in the 1800s to look at cells, we’ve been kind of doing it roughly the same way since then.

Some new technologies have come along. But if you go into a pathologist’s office, you’re going to see a mahogany desk covered in sticky notes and paper clips and a microscope not too different than the 1937 Olympus behind me, and a cardboard box with glass slides on and slide trays and and you kind of scratch your head, at least as an outsider, especially as a patient or someone that’s connected to patients and say, “Geez, this is where the action is happening.

This is where that pathology report that I was so nervously awaiting is is coming from?” And it’s very different, honestly, from even the rest of medicine, let alone the rest of our lives, where you and I are able to jump on a Zoom and talk to each other. 

David West: Pathologists can’t do that. And it’s made it this very brick and mortar, geographically local and and and and sort of lacking in in a data and software kind of approach that we see in the rest of of our lives.

You made this point that pathology is subjective. The study that to me really was eye opening when I first got into this space was one in prostate cancer where pathologists agree on Gleason score or aggressiveness of prostate cancer, something like 54% of the time. That means the other 46% of the time, if you take two pathologists, pathologist A is saying something different than pathologist B. And say, okay, well, you know, maybe it’s a little bit off. Someone says three plus four and another says Gleason, four plus three.

Well, the difference between those two is total removal of your prostate and active surveillance. Very, very different treatment pathways. And in the age of precision medicine, when we have better and better treatments, you really expect and hope that at the diagnostic level and at the scientific level, when we’re developing those medicines, that we have really good objective data and it’s hard to get with the modern pathology paradigm.

So we think that software and, and this new image based discipline or data driven discipline can really change the way that we think about cancer and other diseases. 

Harry Glorikian: Yeah, it’s funny that you picked prostate cancer because that was the exact set of slides that I sent. Yeah. One set to the head of pathology at Johns Hopkins way back when. Yeah. And one was a local pathologist for my wife’s uncle. And the numbers came back different and I was like, How is this possible? 

David West: Right. 

Harry Glorikian: Yeah. So but when you decided you wanted to, quote, revolutionize pathology, right, I am sure you ran into all sorts of pushback. I mean, I’d love to hear first about, you know, the biggest institutional challenges. Was there any skepticism or fear from pathologists? I mean, you know, the historically entrenched role of old fashioned microscopy, microscopy and pathology, you know, what did you run into? 

David West: Yeah. You know, pathologists play a very, very central role in medicine. They say something like 70% of the data in the electronic medical record is coming from the laboratory. They’re the doctor’s doctor.

You know, it’s a field of medicine that is deeply committed to a standard of of care. And while their peers, like radiology, have been have shifted from film to digital 20 years ago, pathology has not. And there are technology reasons why that’s been the case. There are financial and regulatory reasons why that’s been the case, and there are cultural reasons why that’s been the case. You know, the pathologist workforce is is an aging demographic.

We need younger pathologists. We need to attract pathologists from medical school into into this discipline. And and yet when you look at the challenges with change management, when you have your leaders in pathology are maybe a few years from retirement, why do they want to learn how to, the ergonomics of of image based pathology or reading cases on on a computer screen rather than a microscope where they’ve been very comfortable? They have very fine tuned motor skills.

These are kind of these these nuanced aspects of the job that change when you move into an image-based discipline or a computer-driven discipline. 

David West: So so I think those cultural barriers are certainly strong, but we’re seeing that we’re seeing that change very quickly right now. We’re seeing how there is I think that the community is realizing that this technology can be really great for them and their discipline. It’s an opportunity to play an elevated role in the age of precision medicine, and that’s what we’ve had to do as a company.

We’re not here to, you know, put in place a new system to make your life harder, certainly not to take your job. Right. That is that’s not going to happen. It’s not gonna happen in my lifetime. Right. This isn’t this is an opportunity to take a very significant field of of of knowledge work and augment them with the type of technologies that they can work at the top of their license. They can maybe do more with less. They can play a more impactful role to other doctors as the doctor’s doctor, if you will. 

Harry Glorikian: So your bet back in 2014, which is funny, because, I don’t know, I might say that’s a little early. Right. But like almost I might have said 2016, but when you started the company, you were essentially making a bet that key technologies had reached the stage where you could create a new digital pathology platform that would be so much better than the old way that people would pay you for it. 

David West: That’s right. Yeah. 

Harry Glorikian: What, what were those say foundational advances, right. I’m guessing, you know, I’m asking you to lay out the fundamentals of the company’s technology approach. 

David West: Yeah. So. So, you know, the interesting thing is that when, when, when I first got into the field in 2014, I couldn’t blame a pathologist or a scientist who was doing pathology work for saying, I don’t know if I really want to use this technology, I don’t know if I really want to use digital pathology. It was worse than using a microscope. It was the tech.

You were spending more time wrangling with the technology than doing your job. And I view that as a failure of Silicon Valley, if you will, a failure of the software technology community to build technology in a way that was, that could bring to these people who are on the front lines of fighting big enemies like cancer the technology that we use to govern the rest of our lives with really intuitive user interfaces and powerful technology that makes it simple and easy to use.

So just to give you an example, if you were to, when I was working with some of these scientists at Johns Hopkins, we were literally physically sending hard drives with these gigabyte sized images on it to our colleagues at collaborating institutions. And you might as well just ship the physical glass slides, right, to simply move, we’re talking a couple of hundred images, right?

A single case could be dozens of images. To even move that data was expensive, arduous, etc., because it’s a lot of data. We’re talking about a billion pixels in every single one of these images. But at the time, it was clear that the underlying technology infrastructure that would support this shift from physical to digital and unlock the new kind of software and data driven technology stack, this kind of new layer that lives on top of the brick and mortar layer, that was becoming possible, the worlds of Amazon, of cloud computing. 

David West: So Amazon Web Services was on an absolute tear at this time. You had Microsoft getting into the space, Google getting into the space, and you’re seeing kind of the Moore’s law effect continue, but also in terms of our ability to to store and compute. And you’re seeing this become really accessible too.

For an average for someone like me, I could kind of build a web application and build this on top of the world’s largest supercomputer and storage infrastructure. And so those were some of the enabling technologies like cloud computing and generally advances, kind of the underlying it that made this economical, made this accessible. And the early on, the innovation that we that we would have, that we had, that became like our first patent and became the foundation for our technology and user experience, was a way to deliver this data to a pathologist no matter where they were in the world with the click of a button and to look at these images the way you would on a microscope in a very seamless way where it wasn’t laggy.

So it was kind of like satellite image. It’s like satellite imagery. So if you were to go on Google Maps and you could kind of look at a a very, very high altitude sort of view and and zoom in down to you might be able to make out people I don’t know, I haven’t really looked into what the what satellite imagery is is like these days. 

David West: But you could get you could get pretty pretty high resolution. You need that same kind of approach. And we built some technology that made it really easy to stream this data from the cloud or from any other sort of infrastructure. And what that means for the end user who doesn’t care about the infrastructure, right?

The pathologist, it doesn’t matter cloud or what the back end is or et cetera. All the pathologist cares about is can I view this image in a really smooth and seamless way, or do I have to have some sort of desktop workstation that when I zoom in, it takes a couple of minutes to or a couple of seconds to resolve that image?

That’s not that’s not a great user experience. And I don’t blame a pathologist or a scientist from saying for saying, I don’t want to use this technology. So we had a couple of early technology breakthroughs that enabled that. And I think we saw early on that we just had to make it really easy for for the end users.

Our first product was kind of like Google Drive for pathologists and scientists. It was just a really easy way to manage this data and not have to wrangle with with the I.T. and to share collaborate. We built this on a modern technology stack where we could integrate AI algorithms, and that was the foundation for the future of our company. 

Harry Glorikian: Yeah, I remember. I mean, you’d be like, is it done scanning yet? I mean, you know, that was one problem. And then can I see the feature resolution that I really need to see? I mean, people don’t appreciate the human eye, like, how how good it is and, you know, certain things like that.

But let’s jump to the product, right? So your main product is Concentriq, if I’m pronouncing that correctly. Right. Which. I believe that comes in two versions. One is for diagnostics and one is for research, correct? Now, you don’t sell scanners. You sell the software that scanners feed the data into. So, you know, I don’t know. Tell us about the software’s main capabilities. How is the workflow different in a lab that runs your digital pathology software versus old fashioned, you know, glass slides. 

David West: When we first got into the space, some of these scanners existed and they were largely used in academic research settings like at Hopkins or in pharma companies. And basically you would scan these glass slides, it would generate a gigabyte sized image. And most of the scanners had some sort of desktop viewer that was proprietary to their scanner and could just view their images.

With our digital pathology software, we’ve built this in a way that it’s open and it’s scanner agnostic. So as you mentioned, these scanners can feed data from any one of the scanners. So there’s a number of manufacturers, major kind of imaging companies and and lab companies that are building and selling these scanners.

We can integrate with these scanners. And for the pathologists, they just log into a web app and they see all of their images and they see all the corresponding data that’s been pulled from the lab information system, which is sort of a child system of the electronic medical record.

So you can think that type of patient information, demographic, patient history, etc., and we’re kind of marrying these two things together, the image data and the non image data. And for as you mentioned, there’s, there’s two versions, there’s two products built on a common platform.

The common platform is the thing that manages all the heavy lifting around ingestion of these images to viewing of these huge images to the APIs that allow us to integrate AI algorithms and integrate into their other information systems. But we have purpose built products on top of that, one designed for biopharma companies and academic research called Concentriq for Research.

It’s not a regulated product. In the same way that Concentric Dx, the diagnostic product is, that’s a medical device. The FDA has regulated this technology, including the software technology, as as a medical device, the FDA and other regulatory bodies. 

David West: So we serve two segments of the digital pathology market. The life sciences side of the business is naturally more mature because scanner penetration has has grown faster. The lack of regulation that you see on the diagnostic space has allowed for a flourishing and a penetration of the scanner technology in the data and the software, etc. over the past ten, 15 years. And we’ve been able to come to our customers and say, hey, you’ve been dealing with these point level solutions.

You might have a an image viewer that came with this scan or another image viewer that came with this scanner, some open source image analysis algorithms, some proprietary image analysis algorithms, etc. And we can come on as this enterprise kind of unified hub for all of your digital pathology work. And that’s been a really successful strategy for us. We’ve been able to get customers like BMS, AbbVie, Amgen, Bayer, etc., some of the biggest pharma companies in the world. Ten of the top 20 pharma companies are using the Concentriq platform to manage all of their digital pathology work.

And over the past year and a half, two years, we’ve been pushing aggressively into the diagnostic side, which is growing very quickly. We had a number of accelerants across regulatory landscape and maturity, new scanner technology that’s available for diagnostic use that’s faster, more economic, easier to use. And, you know, cultural changes, honestly, driven by driven by by the COVID 19 pandemic.

So that’s been a huge push for us as a company and for our industry. And we’ve seen the adoption of this technology broadly in our software, in the diagnostic space over the past two years. 

Harry Glorikian: So, you know, one of the themes of this show is always like the analytic side coming together with the data side, right? So A.I., machine learning or whatever, however you want to frame it. Right. But on your platform, how do AI techniques come into the workflow. I mean, I understand that the automated quality control is one of the tasks that the A.I. technique can handle. I mean, can you explain the problem and the solution there? 

David West: Yeah. You know, really the promise of digital pathology is that we have this totally new data medium that did not exist before that was, you know, sitting on it was basically information that was on glass and was reduced down to a usually unstructured pathology report, like a PDF or something like that. And then that piece of glass would sit on a shelf and it would collect dust and do nothing for us. Digital pathology can change that.

And I think that’s this is the real opportunity of computational and digital pathology that we can use this data to totally rewrite the the nature of how we do pathology, both in scientific settings and in diagnostic settings. And there are hundreds of problems to be solved with AI. So to give you an example, one of the things that you touched on is our automated quality control application.

So we have now dozens of customers across life sciences and and diagnostic labs that are using our platform. And they’re taking this data, these images from all of these scanners. And one of their big challenges that that they have is that the data will have quality issues.

These labs, both in scientific settings and diagnostic settings, are quality obsessed. So that should give you some confidence as as a patient, they are very quality-centric organizations. So they, whether there’s a maybe blurriness on the image or folds in the tissue or issues with the staining, we can automate the detection of that. 

David West: And right now, labs spend a lot of time and money either hiring people to just scrutinize every single slide or image. That’s expensive. It increases turnaround time by hours to days, and it puts a financial burden on and an operational burden on the laboratories. It also means that pathologists or scientists end up getting bad quality data and and it might affect their their work.

So we built AI algorithms, applications that identify these common artifacts that you might see in one of these in one of these images and flag those images and say for the end user, usually the history technician, to say, let me go re scan or re stain that slide or re cut that slide or whatever steps you might take. And we view that as kind of an early workflow application that has downstream impact both to human end users and also to computer end users, if you will.

So downstream AI algorithms need high quality data in order to operate. You know, the old phrase is garbage in, garbage out. So this is, we view this as a very foundational application to be able to open up an ecosystem of downstream AI algorithms that can do more advanced tasks like identify tumor or, or score a case.

This is likely to have malignant melanoma, and it’s this this percent likelihood or whatever that might be. Right? Those types of algorithms are the next generation of algorithms and we’re starting to see those come into market. 

Harry Glorikian: Well, that that sort of slides in the next question, which is you have an algorithm called Derma AI that automatically classifies dermo pathology slides, which for everybody who’s listing that possibly means skin cancers, right? How does that work? What stage is it at and. What does that signify for the future of the platform? Do you think you’ll add more algorithms specialized in classifying more types of cancers? 

David West: Let me start with the last part of that first. The answer is 100% yes. The frontier of innovation in this space is in how we use this data to build technologies that do things that we couldn’t do with the human eye alone. And we’re going to see the next five, ten years growing ecosystem of these types of precision medicine applications and workflow automation applications that bring tremendous value to diagnostic labs and and pharma companies that are building the next generation of therapeutics.

When I look at when we look at at the dramatic digital pathology challenge at derm path or skin pathology represents something like 25 to 30% of global pathology volume. It’s by far the highest volume subspecialty of pathology, naturally.

It’s very easy to take a skin biopsy relative to other, more invasive procedures. And in skin pathology, you have something like 1 or 2% of cases that are melanocytic, or melanoma, that are very, very dangerous. And you have a lot of volume that is less dangerous clinically. And if you’re a laboratory that is like most laboratories are stretched thin for for resources, don’t always have pathologists subspecialty expertise, you want to be able to quickly identify what cases should warrant the attention of a pathologist early on. 

Harry Glorikian: You know, I keep, it’s been at least two or three years now, I keep trying I keep talking myself out of writing the paper that says, if you’re not using this stuff, you’re bordering on malpractice. Like it’s getting to the point where if I’m a patient and the institution that I’m going to isn’t incorporating, not just here, but it could be in radiology, it could be in a lot of other places, these advanced technologies, you’re just not providing the level that modern technology is…it’s like, I don’t know, I’m going to equate it to like, your hospital doesn’t have an X-ray machine. That would be a problematic, right? 

David West: Absolutely. I mean, I think that the the sort of, you know, the precedent for this here is what you’ve seen in the electronic medical record space, where at a certain point, providers were penalized for not using electronic medical records. And that’s a relatively recent phenomenon.

If you think back, this is like ten, 15 years ago when electronic medical records were effectively mandated. That’s going to happen in pathology – turning it into digital pathology. And we’re seeing the the sort of tectonic shifts happen right now, both in a maturing regulatory landscape or regulators like the FDA and European regulators, etc., are are are maturing their frameworks for both digital pathology, the hardware component, the software component and the AI component.

We’re also seeing actually news in just the past few weeks, new CPT codes dedicated to digital pathology and that will allow payers and the broader community to be able to better study the clinical and economic impact of this type of technology. 

Harry Glorikian: Oh, yeah. I mean, I’m. The Reinvestment and Recovery Act was sort of an anomaly for me, right? In a way of, you know, seeing the government step up and say, you know, you need to do this. But I think like moving towards a outcomes based payment system is what will all of a sudden technology adoption goes up because you can’t hit the metrics without some technology assist.

Yeah. And so I’m hoping that Medicare and Medicaid keep moving in that direction so that everybody else gets on board. And that will drive this thing. But your system, if I understood correctly, you don’t have to develop all the algorithms yourself. Right. I understand you have a partnership with IBEX around, say, prostate cancer. So is it right? How do I think about it? Is it a. You know, iOS that now I can have apps sitting on top of it, or are you doing your own apps and it’s more of a closed system. 

David West: Yeah, that’s right. So it’s sort of like, I think about our, we’rea platform first company that is building our own proprietary algorithms, that is enabling partner algorithms and customers to build on our platform. So you can think about it like, like Microsoft Windows as the core platform and Microsoft has Excel and PowerPoint and other kind of key Microsoft developed applications, but they’re also allowing and encouraging an ecosystem of other applications like Adobe, etc., and their end users to be able to build on their operating system.

That’s how we think about our role in this in this ecosystem. And for a really important reason. Our thesis on the future of this space is that there will be hundreds or thousands of applications developed in the research space. Already there are 100 commercially available applications on the market and we’re going to see the same thing in the diagnostics space as well.

Everything from workflow applications like our quality control application, like, you know, applications like our derm application to companion diagnostic application or digital diagnostics. And we’re in the very early stages of that. So we want to be able to enable that ecosystem and and both empower our customers to adopt this technology, but make it really easy for them to to future-proof their investment in digital pathology, if you will, because right now, they can’t predict what future commercial applications will be available, what this data might be able to do for them.

I’m sitting here I’ve been doing this for some time. I think I’m kind of an expert in this space, and I’m continuing to see the frontiers being pushed further and further and see applications that I couldn’t have thought of before seeing that. So I think that that’s bodes really well for the space. And our strategy is that we want to we want to enable that that long term ecosystem. 

Harry Glorikian: I feel the same way. I mean, I live, eat, sleep, you know, this whole digital space. And every once in a while I’m like, Oh my God, I didn’t realize, like, we could actually do that. Like, I didn’t think of that one. It is truly exciting, the direction that things are taking. And I mean, I think the hospital systems and the physicians will benefit. But I, you know, we’re not doing this just for them. I think the patients are going to get the most out of this as as the technologies advance. There’s a lot of competition in this space or there seems like there’s more and more every day. Are there are certain features that differentiate you from other systems? 

David West: You know, it’s it’s it it bodes well for the promise of this technology and I think is reflective of the growth in this space, how much investment has gone into this field and the ecosystem of technology players that are enabling this the growth in this space. And I think there are you know, there are there are certainly scanner first companies or hardware first companies, and that’s kind of one class of players. And we work really closely with them.

Right. As a vendor neutral platform, sometimes they have their own proprietary software, but as an open as an open platform, it’s really important that we that we that we work closely with them. And I think one of the things that we’ve been able to do, do well as a software company, first of all, we’re 100% focused on software and 100% focused on digital pathology.

And we are as a platform first company, it’s allowed us to be partners to players that are like IBEX, that are developing their own AI applications to to work closely with them. It’s allowed us to partner with the scanner companies. It’s allowed us to partner with companies that are offering solutions for pharma that might want to develop companion diagnostics or build out biomarker programs on this. And selfishly speaking, we kind of view ourselves at the center with our Concentriq platform. It’s where the data lives. It’s where the work happens. We’re laser focused on it, and it’s allowed us to establish a really strong product market fit, to grow really quickly, to be able to attract some outside venture capital.

We just raised our series C, which brings our total funding to just shy of $75 million. And we put that capital to use to fuel continued growth in our digital pathology technology and investment in our customers. And we’re a very customer-centric company. We’ve always been. It’s allowed us to it’s allowed us to work, work to establish product-market fit early on and to take and to solve real challenges that these end users deal with on on a day to day basis. 

Harry Glorikian: So, you know, and I know this is a moving target, but are there parts of the space that you think are, let’s say, better suited to digitization and automation? And there are other parts that you’re just like, you know, we need a human to do that. 

David West: Yeah, well, I think this technology is going to cover and rewrite every single corner of of this field. Your point earlier that it’s eventually will be bad practice not to be using this technology. Right. And you’re seeing this and certainly in, you know, in in the research use of this technology, particularly in life sciences and pharma, it’s near universal.

You know, most most of these organizations, almost every single one of these organizations and certainly every major pharma company is using computational and digital pathology 100%. And on the diagnostic or clinical side of the equation, we’ve seen the early adopters of this technology have been usually larger networked reference labs or hospital systems that have the economies of scale that come when you put in place this technology and you can sort of decentralize your operation and not be tied to one particular brick and mortar lab within within your network.

It can expand the reach, allow them to attract more customers, allow them to serve more patients, etc.. And I think you’re going to see that momentum translate into into, say, smaller, independent laboratories and smaller hospital systems and then even like community hospitals that have have their own labs. 

Harry Glorikian: Yeah, I’m I’m not sure that everybody has fully grasped the potential business model shifts that, you know, are now coming to be real or possible that the traditional places haven’t thought like that could possibly happen. They’re just sort of looking at automating or digitizing what they’re doing as opposed to thinking about like the whole thing could get flipped in a in some interesting ways, which I’m always looking at from an investment perspective. 

David West: Totally. And I think if you look at, like, there might be some subspecialties of digital pathology that are that are really ripe for the use of AI to automate workflows or to offer new kinds of diagnostic insights that maybe, say, lower volume subspecialties are are not. But if you say that there’s your digitizing, you know, your derm volume and your your colon or GI volume and your and your prostate volume and your breast volume, you’re already at like 70% of your volume. And so why leave the other 30%? You know, the gallbladder will be done digitally as well. Right? So eventually this momentum is, the economics of this can warrant full scale digitization.

We’ve seen the early adopters of this technology fall into one of two camps. It’s either go all in and digitize 100% or take a piecemeal approach. And usually the ones that do the piecemeal approach pretty quickly realize that it’s better just to lean in and do this. 

Harry Glorikian: Yeah. Why are those sitting over there on the side, right. 

David West: I mean, it’s so it’s you get the benefits of this when you can really rethink your entire operation and everything from how glass is prepared to where your pathologists work, whether they’re working from home or working from the office to the numbers and the skill sets of the histo technicians that you have in the laboratory. These are very process driven organizations, and you have to rewrite your processes, and it’s better not to bifurcate your processes at a certain point. 

Harry Glorikian: Yeah, but I mean, it’s nothing that the business community hasn’t sort of experienced before, which is, okay, we’re going to implement this and I just want it to fit into my workflow. And yeah, you always realize like I’m not getting the power out of it by just shoving it into my workflow. Like if I make a few changes, I can get 2x more out of the system than trying to make the system fit into my little rubric. 

David West: Yeah. And I think this is this is really why, you know, the I think this kind of speaks to the heart of the cultural or change management challenges, challenges of the adoption of this technology. And that it’s not just popping something on top.

To really get the benefits of this, you have to rewrite, rewrite your processes. And so for for us, as a technology player in this space, we take that responsibility to build the applications, usually applications and even the non intelligent applications that warrant the adoption of this technology for the whole laboratory.

And to be able to share best practices for digital transformation with the customers it takes buy in from financial stakeholders, IT stakeholders, clinical stakeholders, operations stakeholders. And if we can synthesize best practices from labs that have done this before, it makes it easier for labs that are used to just signing out cases, taking in, taking specimens and signing out cases and and not use of dealing with technology that’s incumbent on us. 

Harry Glorikian: All right. So obviously we can you know, these days it seems like we can’t get away from talking about the impact of COVID-19, but I’m assuming it was a positive, you know, impact. But I’m not going to make that. I’m not going to make that judgment. I mean, I’m assuming in some ways it was a disruption, but a huge accelerator. I’m wondering, you know, how did COVID-19, in your opinion, affect the world of digital pathology? 

David West: You know, just like many businesses realize that they had to go remote and that once they went remote, they could deal with that. And there were many advantages to that. We experienced this as a company, right? We have employees now all over the country and all over the world, and we use Zoom and Slack and these other technologies and practices to be able to build a great company culture and operate. Et cetera. Labs dealt with this, too.

I mean, there was a point where you couldn’t put one more than one or two pathologists in the lab because we had a we had a, you know, a pandemic that would that affected pathologists too. It affected lab staff, etc.. And a couple of real things happened there. Regulation changed to allow for this, so CLIA allowed pathologists, CLIA regulates laboratories, not necessarily us, but our customers.

Allowed pathologists to read from home without having to get their labs, their home offices CLIA certified. And that seems like obvious in the digital world. And I think that’s one of these things that, you know, very likely will stick. I’m not in that world myself but you know, pathologists and laboratories, they like that. And it makes sense if you’re reading digitally. It’s not like you have a lab set up, a physical laboratory set up in your home, you’re just reading digitally. So they allowed for that. And that was a big benefit to to our customers. 

David West: And we also saw the FDA relax and bring maturity to the way that they regulate us as a vendor. So there was there was emergency use authorization for us as a software player that will remain through through the end of of this year. And that that allowed us to go after a new class of customers. And it also, you know, the FDA during COVID 19 kind of separated the way that they regulated the hardware from the way that they regulated the software. And they are kind of different components of of this of the of the tech stack.

So, you know, it it ultimately was a was a very real accelerant for the adoption of this technology. But I think, you know, those are some of the nitty gritty kind of hard core aspects of this. But this the soft aspect is the cultural aspect. Right. When you see that all of your colleagues or family or friends can work remotely from home, you want to be able to as well as a pathologist. And this is something that labs want, as they want to attract talent.

They want to be able to say, hey, we have digital pathology. You can read from home. You can use this technology that that some of our other peers don’t offer as as an employer. And and I think that that’s been really great for the community. It’s trying to change the thinking. And it’s changed the community from having kind of this fear based mindset around the adoption of this technology to an opportunity based mindset. 

Harry Glorikian: So. Two final questions. Although they’re not small. Right. What’s been your biggest frustration as you’ve grown the company, which is one? And then the second one is, because I know we’re coming to the end of some of these changes because of COVID, if you could wave a magic wand and change one thing about the US health care system that might benefit patients and accelerate the adoption of your technology, what would it be? Yeah, those two questions. 

David West: So with respect to the first question, the world of technology, you know, that the now metaphorical Silicon Valley mindset and the world of medicine are very different cultures and. I think it’s incumbent on technology players, particularly software players like us, to be able to bridge those worlds.

That’s a big challenge. It’s one that we it’s a responsibility that we take very seriously. As a company, you don’t want to be the sort of gung ho technologist that wants to force-feed technology down the throats of a clinical community that certainly knows what they’re doing. And at the same time, you want to make sure that that you’re maintaining some standard of care and great clinical practice.

There’s a reverence for the standard of care, which is which is a, you know, in many ways kind of the antithesis of the disruptive ethos of the of the of the Silicon Valley community. So, yeah, you know, they’re very different worlds. Bridging that gap is a big challenge, but it’s one that we have to do as as a software player, a technology company. 

David West: If I could wave my my magic wand change one thing about the US health care system? I think that there is a, we sort of touched on this kind of earlier in our in our conversation, a shift to value based care. It will have tremendous benefits for patients for the broader health care community and accelerate technology adoption and ultimately allow us to be more outcome driven.

That’s a big tectonic shift that’s happening, has been happening for a while. And I think that, you know, because health care is this big, complicated system, it it necessitates the adoption of standards and things like that in order for technology to to be adopted. And so I view those as as all kind of corollaries of a bigger tectonic shift that’s happening in US health care that I hope continues to accelerate. 

Harry Glorikian: I, I’m totally with you. And I just keep hoping, like I keep praying that the people in Washington don’t stick their fingers in it and just let it keep going in the direction that it’s going. And we see that impact.

But, you know, great having you on the show. I you know, I can’t wish you enough, you know, success and luck in what you’re doing. Like it’s benefiting a lot of people. I’ve been in pathology. I know the machinations that go on there. So any technology improvement, I think really changes step wise what happens to a patient from a diagnosis and or treatment perspective. 

David West: Yeah. Harry, thank you so much for having me on the show. It was great to be able to speak with you and and and your community and have the opportunity to share our story. 

Harry Glorikian: Thank you. 

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