VISICU's technology creates a remote control
room--the eICU--with video links and feeds from equipment in physical
intensive care units (ICUs) and hospital IT systems. All this
information goes through a rules engine that delivers alerts to the
doctors and nurses staffing the eICU. VISICU says its solution of
remote perpetual management, based on the alerts, leads to better
patient outcomes compared to traditional ICU management in an era of
Despite some challenges from Cerner and iMedsoft
to VISICU's patents defending its process, VISICU essentially created
this market. Therein lies part of the tale. VISICU had a lucrative IPO
in April, featured in BusinessWeek,
and saw its stock top out at nearly $26. But soon Wall Street noticed
that selling a new type of IT system to hospitals meant a long sales
By mid-September the stock was well below its IPO
price, yet the company was still valued at over $240 million -- pretty
high considering its revenues for 2007 will only be about $40 million.
Worse news was to come. Kaleida Health, a hospital in Buffalo, N.Y., was giving up its eICU, claiming that it hadn't seen the hoped-for results. Maybe the bubble had burst?
Major changes to the delivery of care are never easy. It seems the root of Kaleida's problems were implementation and not eICU itself.
Recently VISICU released studies showing dramatic reductions in mortality and morbidity
for patients in the ICUs of its current 67 clients. It has seen more
beds added to its contracts by existing clients, and has expanded its
services to other parts of the hospital.
It has also revised up its 2007 revenue forecast. But VISICU still
needs to persuade Wall Street; analysts on the recent conference call
were clearly looking for greater velocity of sales. Rosenfeld foresees
the inflection point for eICUs arriving "in the next two years," and
says the data its clients are now generating will make it "glaringly
apparent this is very effective."