Agilent celebrates spin-off with new Web-based strategy

May 17, 2000

Agilent celebrates spin-off with new Web-based strategyWireless medical products provide point-of-care data accessAgilent Technologies has completed its spin-off from Hewlett-Packard, a process begun early last year (PNN 4/99),

Agilent celebrates spin-off with new Web-based strategy

Wireless medical products provide point-of-care data access

Agilent Technologies has completed its spin-off from Hewlett-Packard, a process begun early last year (PNN 4/99), and has punctuated its declaration of independence with a new Web-based and wireless strategy for the patient-monitoring division of its Healthcare Solutions Group (HSG). This strategy includes several product enhancements designed to expand the company’s established position in the point-of-care market and give physicians and other healthcare providers secure access to critical patient data from any location within the hospital environment.

“Our goal is to put data in the hands of clinicians so they can make better informed, more timely decisions,” said Tony Ecock, general manager of the HSG’s patient monitoring division. “With the addition of wireless capabilities to its overall patient information system, Agilent is supporting protocol changes in emergency and progressive-care environments.”

The company has launched new versions of its M3 and M4 portable monitors, which incorporate industry-standard technology developed by Proxim and deliver two-way wireless communication between the patient’s bedside and the Agilent Information Center, a decentralized data monitoring and analysis system. The AIC itself has been upgraded to provide access to patient data via standard Web browsers. In addition, the CMS 2001 and V24/26 series of patient monitors now feature Web Link, which brings Web-enabled applications and hospital Internet/intranet information to the patient’s bedside.

This new strategy should further bolster the company’s already healthy bottom line. Agilent reported net revenue of $395 million for the HSG in the first quarter of 2000, a 34.4% increase over $295 million for the same period in 1999. The company’s core product lines—patient monitoring, ultrasound imaging, and cardiology—were the driving force behind this revenue growth. HSG’s net revenue accounted for 17.6% of Agilent’s total first quarter earnings of $2.25 billion. The HSG reported revenues of more than $1.6 billion for all of 1999.

Agilent claims to be the number one or two player in each of these core markets, as well as in defibrillators, and has retained its customer relationships and sales force from its HP days. But the Andover, MA-based firm is positioning itself as a growth company whose core businesses will go from a single-digit growth rate of 3% to 7% to a more respectable 10% to 12% rate. Agilent HSG intends to achieve this by responding to customer needs for healthcare-related measurements, pushing less expensive and more easily operable products into new geographic locations, investing in next-generation modalities, and driving standards adoption.

Agilent is also using its newfound freedom to pursue alliances and acquisitions in the medical industry, in part because the company faces a major challenge in trying to break into new markets without the help of the HP name. Although Agilent was christened in August 1999 and completed its IPO in November, its products are a continuation of HP Medical’s and are known under the HP brand. There appear to be no plans to rename the product lines, aside from replacing the HP logo with that of Agilent.

“We’re starting from scratch with customer segments that we did not address as HP,” said David Ataide, worldwide marketing manager for Agilent HSG. “We have created a new company, now we need to firmly establish our brand identity.”

This effort should be enhanced by the company’s new services-oriented strategy. Services is one of Agilent’s fastest growing business segments, and the firm intends to leverage this in its strategic plans with offerings in systems integration, workflow consulting, and benefits realization. However, unlike many of its competitors, the company is not planning to jump onto the application service provider bandwagon just yet. According to Kevin Appareti, product marketing manager for HSG’s Imaging Systems Division, the former HP division has offered customers pay-for-use and various leasing options, but plans to wait for customer demand to rise before moving into the ASP market.

“We will be looking into facilitating that service with products like EnConcert and our Sonos Systems,” Appareti said. “The ASP environment offers risk sharing that is potentially attractive to customers.”

In addition to launching the new wireless and Web-based product lines, Agilent continues to invest in point-of-care diagnostics with such products as Paratrend and Neotrend TrendCare, which provide continuous monitoring and analysis of blood gases and pH values in the acute-care environment. TrendCare has the added benefit of testing blood without requiring that any be drawn, since its sensor is fed into the patient’s body through a catheter.

The Point of Care Diagnostics division also markets IRMA, a blood analysis system that enables clinicians to run laboratory tests at the patient’s bedside, and IDMS, a central server that houses the point-of-care data from IRMA and allows users to trend, manage, sort, and upload the data to the hospital’s laboratory or other information systems.

TrendCare and IRMA have RS232 ports that can upload data to the hospital’s information systems; Agilent plans to provide Ethernet connections for this equipment by midsummer. A VueLink connection is also offered with the point-of-care devices. With VueLink, clinicians can view laboratory parameters and physiological information simultaneously. Agilent selects the most rapidly changing assays to include on the menus so the most volatile information is provided to clinicians for decision support.

“Point of care raises issues because the lab person is still held responsible for the data, and that person is interested in making sure that their license is appropriately covered,” said Deborah Matthews, worldwide marketing communications manager for Point of Care Diagnostics.

At the recent HIMSS conference and the American College of Cardiology meeting, Agilent demonstrated the newest version of EnConcert, its echocardiographic image management system (HNN 4/5/00). The firm has added the ability to import spatially calibrated DICOM-compliant images from other ultrasound devices, connectivity to support HL7 demographics, the ability to export images to AVI, DICOM, and BMP files, and the requisite Web server option. Based on standard tools such as Windows NT and SQL Server, this EnConcert version is being beta-tested at five sites and will be rolled out commercially this fall. The next step for Agilent’s echocardiography products will be noncardiology applications such as vascular imaging and other multispecialty applications, according to Appareti.

Agilent is also developing less expensive medical devices to serve rapidly growing non-U.S. markets, including Latin America, Korea, and China. These products should come to market in 12 to 18 months, according to Ataide.