GE HealthCare makes push into AI

GE HealthCare Technologies Inc. is making a big bet on an important challenge in healthcare: collecting the disparate data on patients generated by machines and medical records and making it useful to hospitals.

In pursuing a software platform that can help hospitals do things like find open beds and identify patients at risk for sepsis, GE HealthCare is taking on tech powerhouses such as Alphabet Inc.’s Google, Amazon.com Inc. and Microsoft Corp., which are already selling such services and bring the big-data and artificial-intelligence expertise the technology requires.

GE HealthCare hired a former Amazon machine-learning official to help pull off the initiative. The company said in January that Taha Kass-Hout would fill the role of chief technology officer.

The move is a shift for GE HealthCare, which makes most of its revenue from ultrasounds, MRIs and other medical equipment but is looking for new sources of growth and to boost the technological edge of its core business.

The software-development business “is central to our growth strategy,” GE HealthCare Chief Executive Peter Arduini said.

The global market for software to improve imaging analysis and business operations is $5.1 billion, according to Signify Research, a healthcare technology research firm.

Hospitals could find GE HealthCare’s software appealing given the company’s widely recognized brand and working knowledge of hospital operations and industry regulations, analysts said.

Yet developing a product that hospitals will want to buy won’t be easy, according to industry experts.

Gathering all the data requires pulling it from multiple devices and digital records across a hospital that usually store and communicate information differently, said James Stanford, managing director and partner at Fitzroy Health, which makes seed investments in healthcare companies.

Some previous efforts have hit technical snags, failing to weed out errors or organize all of the information accurately. Efforts have also stalled because of privacy concerns, or because hospitals considered their records proprietary and didn’t want to release their data.

“It sounds great, in theory,” said Matthew Todd, an S&P Global Ratings analyst who covers the company. “I still think it’s in early stages.”

The market is also competitive. Tech giants such as Amazon, Google and Microsoft have struck agreements with hospital systems to pull together patient information to help doctors improve care.

The tech companies bring greater depth of software expertise than GE HealthCare, which has more history in the healthcare industry, analysts said.

GE HealthCare, of Chicago, is the first spinoff under plans to break up General Electric Co. as a manufacturing conglomerate. Analysts and executives said the manufacturer’s decision to split would give the newly formed companies more focus and flexibility.

About $1 billion of the healthcare company’s roughly $18 billion yearly sales is from its software.

Software is GE HealthCare’s fastest-growing business, however, and the company has sought to emphasize its technology ambitions by listing on the Nasdaq stock exchange.

Moving into software that collects and analyzes data that a hospital gathers could help GE HealthCare tap into a fast-growing market in which hospitals use data to run their complicated operations and improve care, analysts said.

The company sees its software-development strategy as an extension of its existing work with hospitals and their daily operations, said Dr. Kass-Hout.

GE HealthCare has more than 40 Food and Drug Administration-authorized medical devices that use artificial intelligence to, for example, to speed up MRI scans and give priority to critical patients for treatment based on X-rays, according to the company.

The company already has an algorithm for diagnosing strokes that is housed on CT devices.

For the new initiative, company engineers will seek to develop algorithms for the software platform that would help doctors use imaging data and other patient data to diagnose a patient’s disease or tailor treatment, the company said.

GE HealthCare said it is developing the software to operate whether the hospital wants it hosted in the cloud or in the hospital’s own data storage.

Software companies could potentially access the data to develop applications that hospitals could use to analyze data or improve operations.

Hospitals would control access to the data, according to GE HealthCare, which would make money by charging a subscription and sharing revenue from apps that hospitals buy through its software. The Wall Street Journal