Aiforia enters into new partnership to offer competitor's image analysis models on its own platform
Translation: Original published in Finnish on 11/4/2024 at 12:48 noon EET.
Aiforia announced a strategic partnership with Paige, a competitor developing AI models for pathology. The partnership will make Paige's diagnostic AI applications available on the Aiforia Platform. The collaboration will begin in the coming months with the development of integrated solutions for clinical and preclinical laboratory workflows. The partnership includes joint commercial activities but does not bind the parties to exclusivity. The collaboration will also include product development initiatives around advanced AI models (foundation models).
In our view, the partnership is indicative of the strong position of Aiforia's platform in the pathology image recognition market, but we do not expect it to have a material direct impact on the company's market position. Therefore, the release does not affect our forecasts or view of the company.
Partnership reflects Aiforia platform's strong initial market position and fits with broader industry evolution
Paige is one of Aiforia's primary competitors in the market for digital pathology image analysis solutions. Paige operates in both preclinical and clinical markets and has a marketplace where other applications can be imported. The company has raised 220 MUSD in funding (according to Crunchbase). Paige has one FDA-approved AI model (prostate cancer, binary cancer/no cancer and risk area detection) and one FDA breakthrough designation for approval (breast cancer, similar functionality).
We do not believe it makes sense for pathology laboratories to adopt image analysis platforms from multiple software vendors, as this adds additional integration costs and unnecessarily complicates the sample analysis processes in laboratories. Therefore, we believe it makes sense for image analysis vendors to work together and make their models available on popular platforms. To date, the industry has seen relatively few customer wins in the clinical segment, and Aiforia has been one of the few winners in this segment. So, it comes as no surprise that Paige is now partnering with Aiforia.
We see the partnership as part of the broader evolution of the industry. Paige signed a similar partnership with Indica Labs in August and most recently with PathPresenter in October. In August, Aiforia's other competitor, IBEX, entered into a similar partnership with Tribun Health. We believe it is likely that Aiforia will later form similar partnerships with other players in the sector and offer their solutions on its platform.
The product development cooperation included in the partnership is also interesting. Regulatory approvals and model development require investment, and to date it has been expensive to obtain regulatory approval, particularly from the FDA, although we expect the FDA regulatory framework to become more like Europe's in the future. In any case, partner models can strengthen the competitiveness of Aiforia's platform, and we believe that Aiforia will take some kind of recurring distribution fee for other vendors' models on its platform, so the starting position of the partnership is interesting for the company. To our knowledge, Paige has only published binary models (cancer/non-cancer), which are less valuable in automating the pathologist's work than the cell-level identification provided by Aiforia's solutions, as the pathologist still has to perform manual calculations on them to confirm their opinion. Thus, the usefulness of Paige's models for clinical users of the Aiforia Platform remains unclear as far as we can see. On the other hand, the news is a positive sign for Aiforia's customers, as the arrival of image analysis models from other vendors on the Aiforia Platform will provide an easy way for pathology labs that choose the platform to effectively deploy them.
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Aiforia Technologies
Aiforia Technologies equips pathologists and researchers in preclinical and clinical laboratories with software to translate images into discoveries, decisions and diagnoses. The company's products and services are used for medical image analysis, across a variety of areas from oncology to neuroscience. Aiforia Technologies is headquartered in Finland.
Read more on company pageKey Estimate Figures02.10.
2023 | 24e | 25e | |
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Revenue | 2.4 | 3.4 | 5.8 |
growth-% | 49.32 % | 41.17 % | 71.08 % |
EBIT (adj.) | -12.9 | -12.1 | -11.8 |
EBIT-% (adj.) | -537.07 % | -358.38 % | -204.40 % |
EPS (adj.) | -0.50 | -0.42 | -0.41 |
Dividend | 0.00 | 0.00 | 0.00 |
Dividend % | |||
P/E (adj.) | - | - | - |
EV/EBITDA | - | - | - |