Lowering the Cost of Ultrasound Equipment Through Digitalization

The ultrasound unit has been an important piece of di-agnostic equipment in hospitals for some time. Ultrasound units use the physics of sound to produce images of soft tissues in the human body. Ultrasounds can produce detailed, three-dimensional, color images of organs and, by using contrast agents, track the flow of fluids through them. A cardiologist, for example, can use an ultrasound in combination with contrast agents injected into the bloodstream to track the flow of blood through a beating heart. In addition to the visual diagnosis, ultrasound also produces an array of quantitative diagnostic information of great value to physicians.

Modern ultrasound units are sophisticated instruments that cost about $250,000 to $300,000 each for a topline model. They are bulky instruments, weighing approximately 300 pounds, wheeled around hospitals on carts.

A few years ago, a group of researchers at ATL, one of the leading ultrasound companies, proposed an idea for reducing the size and cost of a basic machine. They theorized that it might be possible to replace up to 80% of the solid circuits in an ultrasound unit with software, and in the process significantly shrink the size and reduce the weight of machines, thereby producing portable ultrasound units. Moreover, by digitalizing much of the ultrasound (replacing hardware with software), they could considerably decrease the marginal costs of making additional units, and would thus be able to make a better profit at much lower price points.

The researchers reasoned that a portable, inexpensive ultrasound unit would find market opportunities in totally new niches. For example, a smaller ultrasound unit could be placed in an ambulance or carried into battle by an army medic, or purchased by family physi-cians for use in their offices. Although they realized that it would be some time, perhaps decades, before such a unit could attain the image quality and diagnostic sophistication of top-of-the-line machines, they saw the opportunity in terms of creating market niches that previously could not be served by ultrasound companies because of the high costs and bulk of the product.

The researchers later became part of a project team within ATL, and thereafter became an entirely new company, SonoSite. In late 1999, SonoSite introduced its first portable product, which weighed just 6 pounds and cost about $25,000. SonoSite targeted niches that full-sized ultrasound products could not reach: ambulatory care and foreign markets that could not afford the more expensive equipment. In 2010, the company sold over $275 million of product. In 2011, Fujifilm Holdings bought SonoSite for $995 million to expand its range of medical imaging products and help it over-take the dominant portable ultrasound equipment producer, General Electric.

1. Why is an advancement in ultrasound technology critical for modern medicine?
2. What other advances can you imagine would be similarly beneficial?
3. The medical industry is sometimes criticized for being slow to adopt new technologies - what other industries do you think are sometimes slow to adopt? Why?