RFID Vendor PanGo Raises $10 Million in Series B Funding
From the press release:
PanGo Networks Inc.
is expected to announce today [October 18, 2005] that it's raised $10
million in a Series B up round led by
Investcorp SA's
Technology Investment Group.
Joining
the Bahrain-based lead investor were previous investors
Columbia Capital
in Alexandria, Va., and
IDG Ventures Boston,
which lifted Framingham, Mass.-based PanGo's total
investment to $18.5 million. Mike Braatz, vice president
of business development, declined to disclose a
valuation on the round but said it was up over its
previous round.
The
company scored its $8.5 million first round of funding
in two tranches back in late 2004 after Jeff Bussgang, a
general partner with IDG Ventures Boston, met the two
founders in Pittsburgh, the company's original
headquarters. Bussgang said the fact that these two guys
had a company that already had scored a partnership with
Cisco Systems Inc.
in San Jose, Calif., was compelling evidence of the
quality of PanGo's technology and the need for PanGo's
system.
Select Hospital's Experience with RFID
This story in CIO Insight uses Cisco's recent “introduction”
of the Clinical Connection Suite as a jumping off point to look at what
hospitals are doing with RFID. Not surprisingly, they're doing some
pretty interesting stuff. While not much is said about specialized
applications that benefit from RFID, like OR management software Surgical Information Systems or Picis, this story does dive into how some hospitals are using RFID to solve other more general problems.
tracking 20 ventilators. But [Gary] Bayston [manager of biomed] plans to ramp up the system
quickly. He has a purchase order to update software and purchase an
additional 600 tags, and the hospital has budgeted to add 1,000 tags a
year.
Bayston first saw the need for an asset-tracking system four
years ago. His department has to make sure 9,000 pieces of equipment
receive preventive maintenance, but engineers had trouble finding the
equipment.
He then interviewed all the other department managers to see
what they needed. “The results I got back opened your eyes up wide,” he
said. “We were just a little portion of it.” He took the results to his
human resources department. Together they calculated that the system
was losing $4,000 a day in wages due to time spent looking for
equipment.
Not all of it was medical, said Bayston. When planning an
asset-tracking program, he advised, “don't just limit to the nurses.”
His hospital is considering whether items like food service carts
should be tagged too.
Bayston thinks Rockford Memorial will see a return on
investment within 12 months, and that returns will grow as technology
improves. He expects the cost of RFID tags (about $75 each) to drop by
half in a year. Battery life is also expected to improve dramatically.
In first-generation tags, batteries last only 60 to 90 days, said
Bayston. In next-generation tags, batteries should last a year or more.
Interesting comment about the tags. The tags he refers to are WiFi tags
and much more expensive than dedicated non-802.11 tags from Radianse
and others. From what I've seen recently, Gary's estimate of cost and
battery life are too conservative.
The story mentions some hospital RFID market data, a couple of hospital pilots and several RFID vendors. Here's the link.
Criticare Systems Licenses Technology to Nellcor
Criticare announces the
licensing of technology to Nellcore in this press
release. Sadly there's no mention of just exactly what technology was licensed — what better excuse could there be for some wild
speculation?
Both Nellcor
and Masimo have had SpO2 patient monitors and central stations for some time.
With JCAHO's 2003 National Patient Safety Goal #6 on clinical alarm systems
(recently
reduced in scope) and continued interest in effective
pain management, hospitals have had a need to improve both
surveillance and alarm notification.
Nellcor
has had a central station product for some time. Their
solution is wired and wireless, but the wireless radio used is 802.11
FHSS (Frequency Hopping Spread Spectrum) that has been discontinued by
manufacturers. They have a central station and two nurse-carried
solutions, a PDA and pager. I haven't looked at their 510k, so I don't
know if the PDA provides primary alarm notification, but the pager
does not. Masimo did a deal last year with Welch Allyn that resulted in
the AACN/NTI roll-out of the Micropaq ECG and SpO2 wireless patient
monitor and Acuity central station as a rebranded Masimo central
station solution (RadNet). Presently, Masimo seems to have the upper
hand,
with a ruggedized device that includes ECG in addition to SpO2 at a
price competitive with Nellcor's SpO2 only system.
So finally the speculation: both Nellcor and Masimo are looking to
improve their dedicated SpO2 monitoring systems. Both systems are in
need of some serious updating in the areas of wireless radios, nurse
carried alarm notification and systems integration (not to mention
foundational system architecture). The requirement that will be the
biggest challenge for vendors will be the last, systems integration.
Systems
integration here refers to the ability to integrate alarm notification
from different devices and vendors; users don't want multiple central
stations or multiple nurse-carried alarm notification devices for SpO2,
ECG, infusion pumps, and vents. Now if Criticare would only share with
us what they've licensed.
Interesting Sensor Company
Sensors for Medicine and Science, Inc.
provides sensors based on fluorescence sensing. Currently they offer an
oxygen sensor and glucose sensor. Founded in 1997, the vendor developed
proprietary technologies for optical sensors.
sensors utilize fiber optic circuits in combination
with fluorescent indicator molecules.
Excitation light passes from the source through one
leg of a bifurcated fiber bundle to the sensing element
(a permeable polymeric matrix that contains the fluorescent
indicator molecules). A portion of the fluorescent light
emitted by the indicator is captured within the second
leg of the fiber bundle and delivered to a detector.
A key problem with such systems is poor optical efficiency
(i.e., how much of the energy provided by the initial
excitation light source is ultimately delivered to the
detector): the highest optical energy efficiency reported
in the scientific literature is 0.03%. As a result,
the signal-to-noise ratio is very low and sensitivity
is impaired. In order to compensate for this intrinsically
inefficient design and obtain higher signal strength,
very high quality components must be used. In addition
to the high cost of such components, high intensity
light sources destroy the indicator molecules, resulting
in a need for frequent recalibration and/or replacement
of the sensing element. The essence of the original SMSI™
invention was to embed the excitation source in the
sensing element. Specifically, the invention places
a tiny, low cost LED in a matrix containing the fluorescent
indicator molecules (fluorophore).
Picis Gives Customer Hospital-of-the-Year Award
Picis, the subject of recent acquisition rumors, names Rockingham Memorial Hospital
user of the year (press release). This may seem like another vacuous marketing gimmick
at first blush, but there's an interesting lesson to be drawn. Vendors
like Picis have complex and highly flexible products designed to
provide benefits to as broad a range of hospitals as possible. During
the sales and implementation process, vendors assess needs and
configure their product to provide the greatest benefit. Sometimes
hospitals think they know best and pass on the vendor's advice, using
the system in their own way. Hospitals rarely know the vendor's product
better than they do, and I've seen examples of hospitals misusing
products to the detriment of patient safety.
So really, it's a worth while effort to find exemplary customers who
can be held up as examples of good product use. If you check out the
Rockingham link above you'll see the hospital seems pretty well run in
general; no big surprise there.
