Sanjay Parekh, PhD, senior market analyst at Signify Research.

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Artificial Intelligence

AI Investment Shift

VC investment in the AI medical imaging sector has shifted notably in the last couple years, says a new report from UK market intelligence firm Signify Research. The report offers a fascinating look at an industry where almost $5B has been raised since 2015. 

Total Funding Value Drops – Both investors and AI independent software vendors (ISVs) have noticed reduced funding activity, and that’s reflected in the Signify numbers. VC funding of imaging AI firms fell 32% in 2022, to $750.4M, down from a peak of $1.1B in 2021.

Deal Volume Declines – The number of deals getting done has also fallen, to 42 deals in 2022, off 30% compared to 60 in 2021. In imaging AI’s peak year, 2020, 95 funding deals were completed. 

VC Appetite Remains Strong – Despite the declines, VCs still have a strong appetite for radiology AI, but funding has shifted from smaller early-stage deals to larger, late-stage investments. 

HeartFlow Deal Tips Scales – The average deal size has spiked this year to date, to $27.6M, compared to $17.9M in 2022, $18M in 2021, and $7.9M in 2020. Much of the higher 2023 number is driven by HeartFlow’s huge $215M funding round in April; Signify analyst Sanjay Parekh, PhD, told The Imaging Wire he expects the average deal value to fall to $18M by year’s end.

The Rich Get Richer – Much of the funding has concentrated in a dozen or so AI companies that have raised over $100M. Big winners include HeartFlow (over $650M), and Cleerly, Shukun Technology, and Viz.ai (over $250M). Signify’s $100M club is rounded out by Aidoc, Cathworks, Keya Medical, Deepwise Shenrui, Imagen Technologies, Perspectum, Lunit, and Annalise.ai.

US and China Dominate – On a regional basis, VC funding is going to companies in the US (almost $2B) and China ($1.1B). Following them are Israel ($513M), the UK ($310M), and South Korea ($255M).  

The Takeaway 

Signify’s report shows the continuation of trends seen in previous years that point to a maturing market for medical imaging AI. As with any such market, winners and losers are emerging, and VCs are clearly being selective about choosing which horses to put their money on.

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The Wire

• UK Studies National AI Platform: The UK’s NHS is launching a pilot project for an AI Deployment Platform that will act as an app store for accessing AI within radiology workflow. AIDP’s goal is to enable NHS organizations to choose AI algorithms from a range of vendors. The project will be piloted at two NHS imaging networks, East Midlands Imaging Network and Thames Valley Radiology Network. A national AI platform could serve as a competitor – or a complement – to existing vendor-based platforms. 

• Model Predicts Contrast Injury: Researchers mined a database of over 46k CT scans in more than 25k cancer patients to develop a clinical risk model to predict those who could experience contrast-associated acute kidney injury. In American Journal of Roentgenology, they showed how clinical factors like hematologic malignancy, diuretic use, and serum albumin could be bundled to create a 53-point risk score; patients with the lowest scores (≤4) had lower rates of kidney injury than those with the highest scores (≥30) (2.2% vs. 32.7%). 

• Software Reduces Contrast Use: One way to lower the risk of contrast injury is to use less of it. To that end, data presented at EuroPCR 2023 showed that Philips’ Dynamic Coronary Roadmap (DCR) software significantly reduces contrast media use and total angiograms during PCI procedures. The DCR4Contrast trial randomized 371 patients to undergo PCI with or without Philips DCR navigation, finding that per procedure the DCR group used an average of 28.8% less contrast media and required 26.3% fewer angiograms.

• Hyperfine Expands Malnutrition Study: Portable MRI developer Hyperfine has received a $3M, three-year extension of a grant to study the neurological impact of childhood malnutrition in low- and middle-income countries. The Bill & Melinda Gates Foundation first issued the grant in 2020 and provided an extension in 2021; this new funding will enable Hyperfine to make improvements to its Swoop scanner to optimize neuro MRI sequences for neonates and infants, especially those at risk for delayed, impaired, or suboptimal neurodevelopment.

• BMI Linked to Brain Health: At the other end of the spectrum, researchers in JAMA Network Open used MRI to discover that children with higher BMI had worse measures of brain structure, connectivity, and development. They scanned 1,567 kids from 2016 to 2018 and correlated BMI and waist circumference to brain health measures on MRI, finding that higher BMI was associated with worse development in the prefrontal cortex (P = 0.003) and structural measures of the corpus callosum (fractional anisotropy P = 0.01, neurite density P = 0.02). 

• FDA Clears Neurophet Brain AI: South Korean AI developer Neurophet has received FDA clearance for Neurophet Aqua, an application for analyzing brain atrophy on MRI scans. Aqua targets neurodegenerative conditions like Alzheimer’s disease, and could be used to track treatments with anti-amyloid antibody drugs. Neurophet in December 2022 got FDA clearance for its first product, Neurophet Scale PET for brain PET analysis. The company is now looking for AI platform partners for US sales of both applications.

• Deep Learning Finds Prior Exams: AI and deep learning are being touted as tools to help radiologists work more efficiently – and reduce burnout. In a new study, researchers in Academic Radiology described TimeLens, an NLP-based DL algorithm that automatically finds prior exams. In testing on 246 CT and MRI studies in 75 patients, TimeLens reduced average time to assess a finding by 40.1% (107 vs. 65 seconds), and also reduced mouse clicks by 17.2% and mouse travel distance by 38%.

• GPT-4 Codes MRI Sequences: Is there anything ChatGPT can’t do? In a prepublication paper posted as a Google Doc, German researchers describe how they used an adapted version of GPT-4 to help program MRI pulse sequences – a “challenging and time-consuming task.” Called GPT4MR, their algorithm functioned as an MR coding assistant, developing correct sequences for spin-echo and Lissajous EPI scans. While it wasn’t always 100% correct, GPT4MR served as a “sparring partner” for fast MR prototyping.

• MediView XR Secures $15M: Surgical AR developer MediView XR has raised $15M in a funding round that brings its cash total raised to $29M. The company is working with GE HealthCare (which participated in the round) on the OmnifyXR Interventional Suite, and is also working to integrate its MediScout head-mounted display with GE’s ultrasound scanners to enable users to view images in augmented reality. Besides GE, Cleveland Clinic and Mayo Clinic participated in the round.

• The Cost of Prior Authorization: A new article in Medscape details the growing cost of prior authorization on healthcare organizations, in particular in radiation oncology. Texas Oncology is spending $960,000 a year, with one FTE dedicated to prior auth for every five doctors, a situation that has radiation oncologists deferring treatment decisions to business managers. The situation exemplifies how prior authorization has expanded from mostly being used for new or high-risk services into a gatekeeper for routine care.

• Telefield Raises $5M for Scoliosis Imaging: Telefield Medical Imaging of Hong Kong has raised $5.1M to further commercialize its Scolioscan technology for 3D ultrasound-based scoliosis imaging. The firm sees its Scolioscan products, which include the SCN803 stand-up system and handheld Air device, as alternatives to X-ray-based spinal imaging systems, eliminating radiation exposure in children being examined for scoliosis. The systems can also be used for other musculoskeletal disorders. The company has installed Scolioscan systems in China and Europe.

Merative’s Best in KLAS

Merative’s Merge Imaging Solutions had a big Best in KLAS 2023, winning the Cardiology and Hemodynamics categories, while scoring second place honors in the Large PACS, Universal Viewer, and VNA categories. Merge Cardio previously scored Best in KLAS for six consecutive years, while Merge Hemo has been ranked #1 for 10 years.

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The Resource Wire

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