IBM team wins first DIN-PACS award with $7.3 million sale to Navy hospital

IBM team wins first DIN-PACS award with $7.3 million sale to Navy hospital

Company continues remarkable string of good luck

IBM's streak of success in the PACS market continues. The computer giant's Global Government Industry division in Bethesda, MD, has been awarded the first purchase order under the U.S. military's Defense Imaging Network-Picture Archiving and Communications Systems (DIN-PACS) initiative. IBM will be the prime contractor, leading a team of companies that will install a $7.3 million PACS at Portsmouth Naval Medical Treatment Facility in Portsmouth, VA.

Portsmouth was one of three sites specifically mentioned in the DIN-PACS request for proposal, which was issued last year and detailed the military's specifications for installing PACS at its medical facilities. Consortia led by IBM and Agfa were awarded DIN-PACS contracts in November, giving these companies the right to sell their PACS and information systems products to military installations (PNN 1/98). The project has a purchasing ceiling of $250 million in 1998 and $1.25 billion over the next five years.

IBM was informed that it had received the Portsmouth award in early February, according to David Anderson, client executive for federal medical customers at the company. Portsmouth is building a new hospital, near its existing facility, which is scheduled to open in 1999, and the Navy is planning for the facility to be filmless, Anderson said.

Cooperating with IBM on the installation will be other members of the company's consortium, including Applicare Medical Imaging for workstation technology, Brit Systems for archives, DeJarnette Research Systems for connectivity products, and ADAC Laboratories for the RIS. Imation, Eastman Kodak, and Science Applications International are other members of IBM's team.

IBM will take a phased approach to the installation, first working on display technology, then the RIS, archives, and communications. The installation will require links to the military's legacy information system, the Composite Health Care System (CHCS), as well as the tweaking of the PACS network to the military's specifications under the DIN-PACS product improvement plan. For example, the military wants DIN-PACS installations to include quality-control workstations, through which image data are routed for formatting before being sent to diagnostic workstations.

The selection of the IBM team marks yet another coup for the company, which unexpectedly bested three other PACS vendors in making the final DIN-PACS cut. Even IBM's partner, Applicare, expected the Portsmouth award to go to Agfa, according to Ruud Kroon, managing director of the Dutch company. Applicare learned from U.S. military officials that IBM's networking benchmark test performed well, Kroon said, and the company's product improvement plan may have better matched the needs of the Portsmouth facility than Agfa's.

IBM is a systems integrator rather than a dedicated PACS vendor, which may have been a point in its favor, according to Anderson.

"IBM has been involved in a number of projects in the commercial and government sectors where mission-critical solutions have been installed and supported," Anderson said. "We have a track record with the government, as well as with commercial industry, in being able to deliver those kinds of solutions, even though PACS is a relatively new business area for us."

Applicare has 13 staffers working on its product improvement plan, which will include support for the DIN-PACS quality-control workstations, as well as hanging protocols specified by the military. Another major task will be building seamless integration between Applicare's workstations and ADAC's RIS. Applicare expects that much of the work it does for DIN-PACS will trickle down to products it offers to private-sector hospitals.

"It is a substantial amount of work, but it is very doable and there is nothing in it from a software development viewpoint that will present a problem," Kroon said. "The positive side of it, and one of the powerful effects of DIN-PACS, is that all these features will be available in our commercial offerings."

What comes next after Portsmouth? The two other installations mentioned in the DIN-PACS RFP were Elmendorf Air Force Base Hospital and the Pentagon Clinic, but Elmendorf has already decided to go with a PACS network from GE Medical Systems that is based on the Medical Diagnostic Imaging Support (MDIS) project, the predecessor to DIN-PACS. That leaves the Pentagon Clinic still up for grabs, although this installation is not expected to be as large as Portsmouth. The Agfa and IBM teams are also vying for sales among other military facilities that were not mentioned in the RFP, and Kroon reports that interest is high in PACS.

"There is more interest from other military hospitals than we expected," he said. "We had anticipated that it would take a year and half before we would see real money from this, but it looks as if things will go more quickly than we thought."

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