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Applicare seeks global growth for its NT-based workstation software


Applicare seeks global growth for its NT-based workstation softwareFirm tries to leverage added exposure from DIN-PACS The U.S. military's Digital Imaging Network-Picture Archiving and Communications Systems (DIN-PACS) project has

Applicare seeks global growth for its NT-based workstation software

Firm tries to leverage added exposure from DIN-PACS

The U.S. military's Digital Imaging Network-Picture Archiving and Communications Systems (DIN-PACS) project has already done much to advance the concept of PACS since its request for proposal was first issued in 1996. And companies participating on winning DIN-PACS teams have also seen their profiles raised considerably in what is an increasingly competitive industry.

Dutch workstation developer Applicare Medical Imaging is one of those firms. While the company has experienced success in the private sector, it's difficult to overestimate the impact DIN-PACS has had on Applicare, said Ruud Kroon, managing director.

"DIN-PACS is going to change the face of medicine on the planet, and we're right at the heart of it," he said.

In what was one of the big stories in the PACS market in 1997, a team of companies led by IBM was awarded one of the two DIN-PACS awards, beating out consortia including established PACS vendors such as Siemens and Cemax-Icon. Many industry observers believe the Windows NT-based workstation software contributed by Applicare played a big role in the award to IBM. To date, the IBM team has landed DIN-PACS purchase orders totaling $32.3 million.

Applicare was founded in 1987 by Kroon and began its corporate life initially as a relational database management software company. In 1992, the firm decided to move into more of a niche market opportunity where competition wasn't as fierce, and chose medical imaging.

The first product developed by Applicare was a low cost 3-D volume-rendering software package, which was demonstrated at the 1992 meeting of the Radiological Society of North America. Although that product was never commercialized, engineers that developed the software were contracted to work on a project for ISG Technologies of Mississauga, Ontario.

With revenues earned from ISG, Applicare in 1993 initiated development work on PACS software based on the Windows NT platform, which had just been released by Microsoft.

Applicare was one of the first firms to release NT-based PACS software, the first version of which was a teleradiology offering completed in the summer of 1994. That product benefited from the input of a new shareholder, Dr. Fritz Barneveld Binkhuysen, a well-known radiologist and authority on PACS issues. Demonstrated at the 1994 RSNA meeting as RadWorks 1.0, the product generated strong interest at the meeting and triggered further R&D company investment, Kroon said. Shipments of RadWorks began in Europe in 1995.

The company got its big break in 1996, however. When the U.S. military was beginning its planning for DIN-PACS, a subordinate of DIN-PACS pioneer Capt. Jerry Thomas came across a RadWorks workstation that was being evaluated by Johns Hopkins University in Baltimore. The military liked what it saw with the NT-based RadWorks software and helped speed the product's 510(k) application through the Food and Drug Administration by calling the agency and requesting an expedited review, Kroon said.

Final marketing clearance was granted 38 days after submission in November 1996.

In addition to its U.S. sales efforts through Linthicum, MD-based distributor Meta Solutions, Applicare has also been successful at landing substantial OEM agreements in the private sector. In late 1996, Eastman Kodak of Rochester, NY, chose the firm as its OEM source for NT workstations, which were released at the end of 1997 (PNN 12/97). Proceeds from this arrangement have played a big factor in funding Applicare's future growth, without the need for bank financing, Kroon said.

Another OEM client, Picker International of Cleveland, began marketing RadWorks workstations in the U.S. in March, and began selling the products around the world in July, Kroon said. Applicare would like to see its workstation software become a commodity in the PACS arena, and is interested in adding more OEM deals.

Around the world, Applicare's products are distributed by a network of 20 independent distributors. Applicare has no plans to begin direct sales, he said.

Besides military installations, Applicare now has its workstations installed at over 450 hospitals worldwide in more than 60 countries. U.S. sites account for 60 of those customers.

Despite its solid growth, Applicare has no plans to go public, preferring to avoid the specter of a hostile takeover. Down the road, Applicare may consider acquisitions in other PACS realms, such as the archives and RIS sectors, Kroon said.

New software

Last month, Applicare unveiled a beta version of RadWorks 4.0, which includes features required by the DIN-PACS request for proposal, but also has functionality applicable for use in the private sector, Kroon said. RadWorks 4.0 includes a quality-control module that is designed to function as a gatekeeper for a PACS network. The module allows data, such as DICOM header information and image order, to be edited or adapted before being placed into the PACS network.

Another feature of RadWorks 4.0 is Applicare's integrated multiplanar reformat (MPR)/maximum intensity projection (MIP) module, which was demonstrated as a work-in-progress at the 1997 RSNA meeting. The MPR/MIP module allows for elaborate 3-D postprocessing and the creation of 3-D cine loops, according to the company.

The release also includes RadWorks WebViewer, a Web-based image viewing product that was released in June (PNN 6/98). RadWorks WebViewer employs the same user interface with all other RadWorks offerings.

Other new capabilities include hanging protocols that allow users to set individual and study-related preferences at different monitors. Each user can have his or her own profile. Users can also mark relevant images in the study, which allows them to be presented first when the exam is reviewed again.

The new release can provide support for a DICOM worklist or use worklists generated by QuadRIS from ADAC Laboratories, a fellow member of IBM's PowerPACS DIN-PACS team. The report window of RadWorks has added functionality, including the ability to type in reports, launch a word processor or a Web browser, and use IBM's MedSpeak for Radiology voice recognition offering. Other functions, such as a low-cost print option for NT printers, have also been added.

For the immediate future, Applicare will focus on meeting the product improvement specifications required by the DIN-PACS project. As part of the DIN-PACS contract, the military requires that vendors meet regular product development milestones.

The firm is also studying the feasibility of a large-scale, NT-based archive software product, which would complement the company's existing low-cost archive offering (PNN 12/97). Also, the company is looking at integrating its viewing technology as part of an electronic patient record. Finally, Applicare is evaluating data mining technology to assist in adding computer-aided diagnosis capability to PACS, Kroon said.

Future prospects

Applicare has come a long way from its modest beginnings as a relational database management software firm. In addition to solid OEM agreements and a distributor network, the company has a strong revenue stream from its participation in the DIN-PACS project. With a solid market position in place, Applicare appears poised for even more growth in the PACS sector.

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