At a partnership seminar held recently at its European headquarters, LabWare set out a striking vision of the company's future development. Tom Wilkie was there
Laboratory Information Management Systems (LIMS) have always been closely associated with analytical instrumentation. In search of new markets, LIMS companies are branching out into the drug discovery lab or into forensic science. But one company, already well established in the quality control aspects of process industries and pharmaceuticals, is extending from its traditional business into clinical trials - where there will be not a chromatograph in sight.
It is a distinctive strategy and there was no doubting the confidence and the clarity of vision displayed by Bob Hillhouse, the managing director of LabWare (Europe and Middle East), at a company seminar in May, held at its new European headquarters building in the leafy English county of Cheshire. The company specialises in Laboratory Information Management Systems (LIMS), but of a highly specific type.
'LabWare is in the enterprise LIMS business,' Dr Hillhouse said. 'A lot of our competitors started small and happened to grow big. We did it the other way round: we started partnerships with big companies. We want the corporate stuff, not the departmental. We are very much focused on large, complex, regulated, enterprise LIMS.'
'Regulated' in this context almost immediately means the pharmaceutical industry, where keeping a tight grip on quality throughout the manufacturing process is vital. According to Ron Weaver, a consultant to the company, there are more than a hundred LIMS companies in existence, but only a handful operate internationally and there are only a few that can operate in the pharmaceuticals and life sciences market. LabWare's system satisfies the US Food and Drug Administrations regulations on electronic record-keeping, known as 21 CFR Part 11, and offers the security, auditing, authentication and approval controls necessary to ensure compliance. The firm claims an extensive list of pharmaceutical companies among its customers - 'big-ticket LIMS across several sites,' Dr Hillhouse said.
But the company's systems have found applications in many more sectors than just pharmaceutical: from cement makers to tobacco companies. Ron Weaver noted that among the target markets for its LIMS are process manufacturing, including chemical and mining, as well as environment and water, and forensic applications.
Shift to corporate LIMS
Across all industries in recent years, there has been a major shift, driven by technology, from departmental to corporate LIMS. The advent of Citrix systems for big corporate deployment has driven this change. Dr Hillhouse warned that smaller LIMS players would also suffer pressure from a different direction as the providers of Enterprise Resource Planning (ERP) software, such as SAP, extend their product range and capability to 'bear down on the LIMS market. Not on the large, complex, enterprise stuff' but on small LIMS companies.
The threatening possibility of competition from ERP providers was in the minds of the company's managers some five years ago, when they decided to tackle the life sciences market. Because it is such a highly regulated area, bound by rules and procedures set down by the US Food and Drug Administration or its European and Japanese counterparts, it represented a specialism where giants of generalism, such as SAP, would find entry difficult.
At about the same time, instrument manufacturers also turned their attention to the life sciences, but tended to focus on the discovery area. Those that had their own bundled LIMS took their eye off that particular ball, opening the way for the specialist companies to flourish. The recent announcement that Beckman Coulter is divesting itself of its LIMS business (see news story) was made after Dr Hillhouse set out his analysis, but seems rather nicely to bear it out.
In life sciences, LabWare does not see the discovery lab as a big target market. The natural place for LIMS is rather in the quality assurance side of the life sciences. Two international pharmaceutical companies, Wyeth and Schering-Plough, can testify to the importance of quality assurance.
In 2000, Wyeth had to pay $30m to the US Government as part of 'consent decree' proceedings by the Food and Drug Administration (FDA) after FDA inspections found deviations from its regulations on good manufacturing practice (GMP) in the company's drug manufacturing plants. The FDA specifically highlighted quality control issues as part of the proceedings.
In May 2002, however, Schering agreed to pay a record $500m to the US Treasury after its 'consent decree', the highest monetary settlement in FDA history. Among many departures from GMP, the FDA again cited quality assurance as an issue. Both companies are now installing quality control systems, of which a significant component is a global LabWare LIMS.
Sometimes companies and organisations end up buying a LIMS system even though that was not what they thought they needed. Fears of bio-terrorism in the USA have led to the development of extensive testing programmes and the US National Institutes of Health have bought a LabWare system to collate all the results, even though this predominantly research-oriented organisation did not realise at first that a LIMS was what it needed.
The most recent version - number five - of the company's software was released earlier this year, and it is a matter of company pride that this is only the fourth upgrade in eight years. It is part of the technical and commercial strategy to ensure that as much code is conserved from one release to another, so that when customers install upgrades, the process takes as little time as possible. 'Many LIMS companies flourish like flowers in the desert and then perish. Their systems were not upgradeable, and it would be as expensive for a customer to install a new LIMS as to upgrade,' Dr Hillhouse said. In contrast, LabWare upgrades are very fast, he claimed.
Much of the installation work is done by experienced consultants, who are qualified by the company, rather than by staff. 'Deep down we're technology people - although we have taken on competitors' marketing people. We'd be happy if our partners could implement the systems themselves - we do not want a large implementation and sales force,' Dr Hillhouse remarked. In keeping with the enterprise-wide strategy, he noted: 'We do not want to put a lot of money into salespeople selling LabWare in penny numbers. We're going to grow but if we do it the wrong way, then we'll do it and not make money. It's the selling cost.' Both technology and market demand will accentuate still further the need to provide more 'out of the box' LIMS in the future, offering quicker implementation, more rapid validation, and easier upgrades, he believes. The company wants to maintain the core technology itself, but is interested in seeking partnerships with others to develop and grow - the purpose of the Cheshire meeting.
However, the company has identified a synergy with the software used to manage and record clinical trials of prospective drugs in humans. It has acquired the Aventine Group, a company making software for the management of oncology trials, revamped the system within the LabWare LIMS context, and added a 'patient manager' module. The modular approach lies at the heart of the company's development of its products. Dr Hillhouse recalled that during the 1990s, there had been much discussion among LIMS vendors as to whether you could have one product to cover all market sectors. Some companies, such as Thermo LabSystems (now subsumed as the informatics division of the parent company, Thermo Electron), chose the multiproduct approach, with both Sample Manager, which is the enterprise LIMS, and the Nautilus system aimed at smaller, 'out of the box' applications. LabWare chose a different path, creating one product but with different modules.
Speeding drug development
Clinical trials and QA/QC procedures are both very much downstream of the discovery laboratory in drug research and development but Dr Hillhouse believes that an enterprise LIMS combined with the Aventine approach will allow pharmaceutical companies to cut as much as 18 months off the time to bring a drug to market by shortening the clinical trials and the 'new drug approval' application stage.
Although its initial development was in the field of clinical trials for cancer, the Aventine Group now produces a general Clinical Data Management System (CDMS). It allows staff to manage patient demographic information, their health insurance details (particularly important in the US context), together with medical diagnosis, and treatment. For clinical researchers, it provides data management to support protocol definition, patient recruitment, sampling/testing, and electronic adverse events reporting.
Clinical trials may be about developing new drugs to cure human disease, but in a market economy this is achieved by commercial means, so a significant factor in the clinical trials package is the claim that the software 'significantly reduces administrative effort and cost' by increasing the productivity of administrators by up to 40 per cent and up to 10 per cent for clinicians. The system is also claimed to increase revenue by a more streamlined and integrated billing process.
Just as much of conventional LIMS in the life sciences area is dominated by regulations such as 21 CFR 11, so clinical trials too have to be compliant with regulations carrying fearsome acronyms such as HIPAA and HL7. But for a company like LabWare, which has specialised in ensuring regulatory compliance of its software, it fits with the culture to apply the same process to the clinical trials module.