Digital pathology is driving precision medicine by turbocharging the analysis of tissue slides. Here are the five top startups turning microscopy into a data gold mine.
Traditional pathology typically involves manually analyzing a tissue slide for signs of disease. Although dependable when relying on trained pathologists, the process can be slow, laborious, and prone to human error. The slide may also need to be physically transported when more than one pathologist needs to give an opinion, consuming precious time from the diagnostics process.
To address these challenges, digital pathology was designed to let machines handle the tedious tasks in pathology, from slide preparation to microscopy and analysis. This saves valuable time in a pathologist’s busy schedule and can allow rural and resource-poor areas to remotely access pathology services.
The speed and accuracy of digital pathology is also becoming an important component of precision medicine, such as helping to quantify biomarkers of cancer in a biopsy. When used in conjunction with data science and artificial intelligence (AI), the technique can be used to discover new biomarkers, develop novel treatments, and hasten patient turnaround.
With digital pathology becoming a hot commodity in the pharmaceutical industry, the global market is predicted to grow by 16.4% per year, from $1.15 billion in 2024 to $3.86 billion in 2032. Meanwhile, investors and big pharma companies are piling on specialist startups. Check out our take on the top five emerging players to watch in digital pathology.
1. Clarapath
Founded: 2014
Headquarters: Hawthorne, New York
The preparation of tissue slides can take a lot of manual labor and time, a challenge compounded by a shortage of skilled experts in the workforce. Clarapath aims to address this bottleneck by building what it dubs the “lab of the future”: a lab deploying automation, robotics, and AI to streamline the pathology workflow.
Clarapath’s device is called SectionStar and automatically turns paraffin tissue blocks into glass tissue slides for use in digital pathology. This machine, which was inspired by the tape-transfer method of moving tissue sections to a slide, eliminates person-to-person variation in tissue sections and removes the need for a water bath step, which can risk contaminating or damaging the tissue section.
Clarapath, which is a spinout from the non-profit institution Cold Spring Harbor Labs, raised $32 million in two closings of a Series B round in 2021 to fund the development of SectionStar. It followed up last year by acquiring the Californian digital pathology company Crosscope to provide customers an end-to-end platform.
Earlier this year, Clarapath raised $36 million in a Series B-1 funding round led by Northwell Ventures, which will be used to fuel Clarapath’s R&D efforts in addition to its manufacturing and commercialization drives.
2. Ibex Medical Analytics
Founded: 2016
Headquarters: Tel Aviv, Israel
Ibex Medical Analytics’ co-founders set up the company based on a conversation with a pathologist, who said that radiotherapy had shifted from analog to digital in the past and that there were now startups applying AI to radiology. They concluded that they could apply AI-based tools to pathology in a similar manner.
The company’s tools are trained on datasets taken from more than 10 million tissue slides from around the world. The tools let pathologists detect and grade breast, prostate, and gastric cancer more quickly and accurately than normal by helping them prioritize cases, view tissue slides, and generate reports.
Ibex recently received an In Vitro Diagnostic Regulation (IVDR) certification of its prostate, breast, and gastric AI solutions, which lets the company market the technology for these indications in the EU. In the U.S., the technology can currently only be used for research purposes.
Ibex raised a $38 million Series B round in 2021, followed by a $55 million Series C round last year led by 83North. The company is using the cash to expand in the U.S. and grow its product portfolio. The firm announced last month that its efforts have led to a 178% growth in customer base.
Among its partner and client organizations are Roche, Dedalus, Proscia, and Philips, which tap into Ibex’s AI tools to bolster their own offerings.
3. Paige
Founded: 2017
Headquarters: New York, New York
Paige stands out for its impressive Series C round, which bagged $100 million in 2021. The round, led by Casdin Capital and Johnson & Johnson Innovation, was earmarked to speed up diagnostic decision-making in healthcare.
Paige’s diagnostic AI tool was borne of research conducted by its co-founders on applying AI to digitized pathology slides. The company has trained its tools on slide images from 1,000 institutions around the world, including the Memorial Sloan Kettering Cancer Center in the U.S.
Paige’s main offerings include the diagnosis and grading of prostate and breast cancer, for example, by flagging suspicious regions on a tissue slide and automatically measuring tumor characteristics. It can also be tuned to ignore high grade prostatic intraepithelial neoplasia, which does not always develop into cancer.
In 2021, Paige became the first company to receive FDA approval for its AI-based pathology product, which serves as a clinical-grade AI tool to assist with prostate cancer detection.
Earlier this year, Paige unveiled what it heralded as the first million-slide foundation model for cancer. The model, which was developed in tandem with Microsoft, is available as an open source tool and is intended to enable pathologists to accelerate the development of cancer treatments.
4. PathAI
Founded: 2016
Headquarters: Boston, Massachusetts
PathAI was founded in the basement of one of the co-founder’s homes in Massachusetts after the two met over coffee to discuss research on the use of computer vision and machine learning in digital pathology.
The startup’s AISight® Dx toolset is marketed to pathology providers to handle tasks such as caseload balancing and assignment, image viewing, and case management. PathAI also offers its services to biopharma clients that aim to develop new treatments for diseases like cancer and inflammatory bowel disease. Its algorithms can help with patient enrolment and stratification in clinical trials, and in developing companion diagnostics for a given treatment.
To bankroll the development of its AI-guided pathology tools, PathAI raised a $75 million Series B round in 2019, followed by a $165 million Series C round in 2021 led by D1 Capital Partners and the healthcare provider Kaiser Permanente.
The company launched a partnership with Quest Diagnostics earlier this year, in which Quest will acquire PathAI’s diagnostics and digital pathology laboratory services, while PathAI’s biopharma lab will continue to provide clinical trials services. In a separate part of the deal, Quest will in-license PathAI’s AISight image management system and algorithms to fuel digital pathology for its users in the U.S.
PathAI’s image management system received EU approval last month, allowing it to be used in primary diagnosis. The company is now working to expand into the European diagnostic pathology market.
5. Proscia
Founded: 2014
Headquarters: Philadelphia, Pennsylvania
Proscia was founded by a team of researchers at Johns Hopkins University and the University of Pittsburgh. One major problem they aimed to solve was that digital pathology was limited to very technical users, with the huge 1-gigabyte images difficult to access and share.
Their solution became Proscia’s platform Concentriq®, which is designed to help pathology laboratories digitize their operations and allow drugmakers to harness image data to accelerate drug development. It automates common tasks such as data capture and modeling and offers a variety of AI-based tools, both itself and from partner organizations, to flag potential cancerous tissue and provide quality control.
Proscia raised $37 million in a Series C round in 2022 with participation from investors like Highline Capital Management and Triangle Peak Partners. The money was used to scale the firm’s commercial operations and strengthen its market presence with increased sales, marketing, and support teams. Proscia extended the round by $9 million in March this year.
Earlier this year, Proscia’s Concentriq AP-Dx solution gained U.S. FDA clearance for primary diagnosis, setting the company up to bring its software to the local diagnostic pathology market. Additionally, Proscia’s clinical customer base grew by more than 100% over the past year, according to a study conducted by the company and Quest Diagnostics.
Acknowledgements: List tips from Fady Riad, CEO of Centurion Life Sciences
Jonathan Smith is a freelance science journalist based in the U.K. and Spain. He previously worked in Berlin as reporter and news editor at Labiotech, a website covering the biotech industry. Prior to this, he completed a PhD in behavioral neurobiology at the University of Leicester and freelanced for the U.K. organizations Research Media and Society of Experimental Biology. He has also written for medwireNews, Biopharma Reporter, and Outsourcing Pharma.
