Lab Automation Markets

Transcription

1 Lab Automation Markets Rures adquireret umbraculi, etiam tremulus matrimonii libere senesceret app July 2008 Kalorama Information A division of MarketResearch.com 38 East 29th Street Sixth Floor New York, New York t t f

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5 THE WORLDWIDE MARKET FOR LAB AUTOMATION JULY 2008 A KALORAMA INFORMATION MARKET INTELLIGENCE REPORT The Worldwide Market for Lab Automation has been prepared by Kalorama Information. We serve business and industrial clients worldwide with a complete line of information services and research publications. Kalorama Information Market Intelligence Reports are specifically designed to aid the action-oriented executive by providing a thorough presentation of essential data and concise analysis. Editor: Bruce Carlson Author: Joseph A. Constance Publication Date: July Avenue of the Americas New York, New York (800) Outside the U.S. (212) FAX: (212) [email protected] KLI

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7 T A B L E O F C O N T E N T S CHAPTER ONE: EXECUTIVE SUMMARY...1 Perspective... 1 Pressures to Automate in the Clinical Lab... 2 Variety of Processes... 4 Automating the Drug Discovery Lab... 4 Variety of Processes... 5 Emerging Trends... 5 Advantages and Trade-Offs... 6 World Market Summary... 7 Methodology... 8 CHAPTER TWO: INTRODUCTION...11 Why Automate The Clinical Laboratory The Drug Discovery Laboratory An Evolving Market Key Issues Work flow...17 Labor Issues Operating Costs...22 Compatibility Targets for Automation Health care Trends Impacting Automation Automation Equipment Trends Total Lab Automation Modular Automation FDA Regulation Reimbursement CHAPTER THREE: RECENT MARKET DEVELOPMENTS...49 Labcyte and Allegro Combine Operations Agilent Acquires Velocity New Closed-Loop Smart Gripper Tecan-VWR Alliance New Sample Processing Platform Automate Sample Preparation Modular Platform... 53

8 Table of Contents v Test Liquid Handling Instrumentation High Throughput Flexibility Robotics Research Lab Established Hamilton purchases TekCel Workcell Enhancements Low Temperature Sample Storage Automated Microplate Processing Automation Partnership CHAPTER FOUR: MARKETS...59 Overview Clinical Lab Automation Markets Sample Transport Systems Storage-Retrieval Systems Work Stations Specimen Handling Systems LIMS Drug Discovery Lab Automation Markets Plate Readers Automated Liquid Handling Systems Robotics Dissolution Testing LIMS Storage-Retrieval Systems CHAPTER FIVE: CORPORATE PROFILES Abbott Diagnostics Agilent Technologies Inc Ai Scientific Aurora Biotechnologies Beckman Coulter Inc BioTrove Inc Caliper Life Sciences Dynacon Inc Eppendorf AG Hamilton Storage Technologies Inc

9 InnovaSystems Inc Labotix Automation Inc LabVantage Solutions Inc Molecular Devices Motoman Inc Olympus Corp PerkinElmer Life and Analytical Sciences Inc F. Hoffmann-La Roche Ltd RTS Group Siemens Medical Solutions USA Inc Sotax SSi Robotics PaR Systems Inc The Automation Partnership Tecan Group Ltd ThermoFischer Scientific Inc Xiril AG

10 Table of Contents vii L I S T O F E X H I B I T S CHAPTER ONE: EXECUTIVE SUMMARY Table 1-1: World Market for Clinical Laboratory Automation Systems Table 1-2: World Market for Drug Discovery Laboratory Automation Systems CHAPTER TWO: INTRODUCTION Table 2-1: Median Hourly Wages in the Clinical Laboratory CHAPTER FOUR: MARKETS Figure 4-1: NAACLS-Accredited Educational Programs in Clinical Laboratory Sciences Table 4-2: World Market for Clinical Laboratory Automation Systems Table 4-3: North American Market for Clinical Laboratory Automation Systems Table 4-4: European Market for Clinical Laboratory Automation Systems Table 4-5: Asian Market for Clinical Laboratory Automation Systems Table 4-6; Rest of World Market for Clinical Laboratory Automation Systems Table 4-7: Clinical Laboratory Automation Systems US Installed Base Major Systems Table 4-8: World Market for Clinical Laboratory Automation Sample Transport Systems

11 Table 4-9: World Market for Clinical Lab Storage-Retrieval Systems Table 4-10: World Market for Clinical Lab Work Stations Table 4-11: World Market for Clinical Lab Specimen Handling Systems Table 4-12: World Market for Clinical LIMS Table 4-13: World Market for Drug Discovery Laboratory Automation Systems Table 4-14: North American Market for Drug Discovery Laboratory Automation Systems Table 4-15: European Market for Drug Discovery Laboratory Automation Systems Table 4-16: Asian Market for Drug Discovery Laboratory Automation Systems Table 4-17: Rest of World Market for Drug Discovery Laboratory Automation Systems Table 4-18: World Market for Drug Discovery Lab Plate Readers Table 4-19: World Market for Drug Discovery Automated Liquid Handling Systems Table 4-20: World Market for Drug Discovery Robotic Systems Table 4-21: World Market for Drug Discovery Dissolution Testing Systems Table 4-22: World Market for Drug Discovery LIMS Table 4-23: World Market for Drug Discovery Storage-Retrieval Systems Table 4-24: Laboratory Automation Market Leaders Percentage of Market Share

12 C H A P T E R O N E Executive Summary New technologies based on manufacturing automation have been transforming hospital clinical laboratories and corporate drug development laboratories. Laboratory automation systems and technologies generally involve any device, software or process that improves the efficiency of a laboratory. Ever since the Japanese introduced lab robotics and automation systems in the early 1980s, many laboratories in North America, Europe and elsewhere have installed fully functional automation systems. PERSPECTIVE Systems that automate the laboratory are indispensable for laboratories facing difficult market competition. Lab automation technology includes integrated hardware and software designed to process and analyze specimens. In the case of drug discovery, lab automation systems speed the identification of drug targets. Automation hardware can be installed in the form of a complete automation system total laboratory automation (TLA) or as discreet hardware devices that perform specific tasks modular automation. The purpose of laboratory automation systems is to improve the quality and efficiency of laboratory operations. These systems may provide a solution to the quality demands and staff shortages faced by today's clinical laboratories. On the drug discovery front, lab automation has facilitated drug development by reducing the potential for error

13 2 The Worldwide Market for Lab Automation and by facilitating high throughput screening (HTS). Several vendors offer automation systems. The benefits of automation in the clinical laboratory are well documented. They involve replacing manual, potentially dangerous, error-prone steps with automated processes requiring minimal operator intervention. This approach can increase productivity, decrease turnaround time, improve staff safety, minimize errors, improve the handling of specimens, and allow labs to reallocate personnel to more important and productive tasks. Furthermore, by providing rapid turnaround time for critical tests, the intralaboratory tracking of specimens, and preventing errors in specimen aliquoting, the benefits of automation can reach outside the laboratory to provide a positive impact on patient safety. For drug discovery, bringing a new drug to market has been both a very timeintensive, laborious and expensive undertaking. Thousands of compounds are typically identified in the drug discovery process, but only a few make it to clinical trials with human subjects. Once a drug reaches clinical testing, another three to six years on average are needed to complete the commercialization process. All in all, developing and introducing a new drug to the market costs about $900 million and takes about 15 years. Given such lengthy development cycles and high research costs, big pharma is always interested in more cost-effective and timely approaches to drug discovery. Lab automation can be used throughout the pre-clinical drug discovery process, involving microtiter plates, automated analyzers, HTS, robotics and liquid handling systems, among other systems. Automation is not always harnessed to lower labor costs, but also to improve experimental accuracy and work flow efficiency. In drug development, scientists test many samples to measure a drug s characteristics so the quality of results is crucial. Automation also allows highly qualified researchers to properly analyze results or develop new areas for research rather than undertaking the laborious and repetitive manual steps of an experimental set-up. Pressures to Automate in the Clinical Lab Many clinical laboratories are facing a number of issues that are challenging their ability to remain competitive. These challenges have been caused by the reduction of government reimbursement rates for laboratory tests, cost-restraint measures established by the managed care industry, and the continuing trend toward containment of national health care costs. As pressures increase for clinical labs to become more productive and

14 Chapter One: Executive Summary 3 cost efficient, their management must examine more closely their labs internal processes to find ways to increase productivity with smaller budgets. In order to survive in the future, it will be necessary for labs to run more tests; test in fewer sites; operate with less equipment; maintain lower operating costs; hire less skilled labor; and harness additional automation. Automation will increasingly become crucial for clinical laboratories that want to achieve higher productivity and cost efficiency. Automation helps streamline the work flow and results in a more reproducible process with less hands-on interaction, which can significantly reduce costs and errors, and decrease the need for skilled labor. Automation can help alleviate pending labor shortages caused by retirement. Current professionals are reaching retirement age in disproportionate numbers. Forty percent of medical laboratory employees are between the ages of 46 and 66 according to the American Society for Clinical Pathology, and nearly half of the current workforce will be ready for retirement by The US Department of Labor's Bureau of Labor Statistics estimates that 13,800 medical laboratory professionals are needed each year through 2012 to fill vacant positions. One of the main motivators for harnessing automation in clinical laboratories involves minimizing those non-value-added steps, including such processes as sorting tubes, decapping, centrifugation, loading analyzers, and prepping and sorting materials for storage. Non-value-added steps usually can be addressed by automated systems. This frees up a medical technician s time. Because labor accounts for more than 60% of the cost of producing test results, automation and better information management systems effectively can reduce the manual, hands-on procedures in a lab and optimize the efficiency of labor in the laboratory. Automating a lab increases the available time for value-added steps the tasks that technologists perform that help make a difference in the quality of the test results and a diagnosis such activities as reviewing critical results and deciding whether to rerun or perform reflex testing based on a specific result. When the trend toward clinical laboratory automation first began, in the early to mid 1990s, much of the talk about automation focused on automating all lab functions total laboratory automation (TLA). Targeted to the largest, highest-volume laboratories, TLA requires a major financial commitment several millions of dollars and the space for installing equipment. But TLA is not an affordable nor practical solution for the majority of small to mid-sized hospital and other diagnostic laboratories. The trend for most clinical labs, and for many automation system manufacturers, is toward modular automation, which includes consolidated and integrated analyzers, independent work

15 4 The Worldwide Market for Lab Automation cells or self-contained work stations, and automation for transport, handling, and pre- and postanalytical processes. Variety of Processes Sample processing is the most labor intensive aspect of a laboratory and is a logical point at which to implement automation. Much automation occurs at a lab s preanalytical front end. Here, the idea is to increase productivity and achieve faster testing turnaround times. Such automating tasks as sorting samples, loading and unloading centrifuges, decapping tubes, and sorting samples to specific analyzers can quickly improve turnaround times, decrease human error and reduce labor costs. Consolidating to fewer work stations that have broader menus is an initial step to a more efficient laboratory. This often works best by moving routine analyzers closer in a central sample processing area. The processes that can be automated in a clinical laboratory most often include specimen management, analyzers, modular work cells, and pre- and postanalytical work stations. Of course, controlling automated systems involves the use of software, and for this reason, laboratory information management systems (LIMS) are coming into greater play. Automating the Drug Discovery Lab Automation has transformed the drug discovery process by making it feasible to identify many targets through combinatorial technologies that have facilitated compound collection. Automating compound management has minimized late stage drug rejections. The automation market brings an array of tools for the pharma community. Automation eliminates bottlenecks in many processes downstream, facilitating target identification and screening. The completion of the human genome project heralded the start of HTS that made feasible the screening of close to 100,000 assays per day. Automation has truly given labs a good edge to screening capabilities over traditional processes. TLA has been implemented by some big research laboratories and the top pharmaceutical companies. However, automation has led to the development of few safe and efficacious drugs. While more data can be generated more rapidly, that capability cannot replace the process of asking the proper scientific questions. Automation and the data explosion must be accompanied by increasingly optimized processes for knowledge integration, information flow and decision-making.

16 Chapter One: Executive Summary 5 Variety of Processes Drug company laboratory automation systems range from simple semiautomated liquid handling devices to fully integrated automated systems that consist of several pieces of robotics, pipetting stations, incubators, plate washers and detectors. Many laboratory managers initially buy semiautomated work stations that can pipette and deliver small volumes of reagent or wash samples in microwell plates or other vessels for virtually continuously on a daily basis. By freeing lab technicians and scientists from such boring and mundane tasks, these work stations allow workers to spend more time on more valueadded activities, such as designing experiments. Semiautomated work stations can also facilitate the study of drug absorption, distribution, metabolism, and elimination mechanisms that help assess a compound s ability to penetrate such biological barriers as the intestine, the skin, and the blood-brain barrier. Robotics also has also found its place in the drug discovery laboratory, often finding application in HTS and assay development. To reduce screening costs and conserve precious compounds and reagents, assay miniaturization has become a critical issue in the laboratory. New liquid handling technology is available to allow the precise measurement and dispensing of liquid quantities in the 10 nanoliter range. Several companies, among them Packard BioScience and PerkinElmer, offer instruments and systems for HTS that incorporate homogeneous assay formats. Applied Biosystems has a wide range of instruments that automate many of the routine laboratory procedures, including chromatography, mass spectrometry, and DNA and peptide synthesis. Emerging Trends Certain trends appear to be significantly influencing the future of laboratory automation. These include smaller, more-flexible analyzers and automation based on next-generation technology including microfluidics; powerful software for lab management; and webbased real-time services. These trends will enable successful labs to offer speed and flexibility. Labs will no longer need to make huge investments in large systems to achieve the required productivity. Powerful, smaller systems will do that. Labs will no longer need to wait for the next monthly summary of quality control results to find out how their performance compares with their competitors. Moreover, the technologies that are emerging in microtechnology and information systems will allow in vitro diagnostic (IVD) manufacturers to partner with labs to provide needed productivity.

17 6 The Worldwide Market for Lab Automation Laboratory automation and robotics are transforming, and will continue to transform, the typical lab workday. Scientists are now able to set up, run, and analyze the results of experiments in a fraction of the time they needed in the past, with little handson intervention. As a result, medical technicians who used to spend their days performing tasks of tedious repetition now have the time to think creatively about the implications of their experimentation and to design effective follow-up projects or develop alternative approaches to their work, or to examine more effectively diagnostic results. At the corporate level, and particularly for firms involved in drug discovery and clinical diagnostics, automation and robotics are helping companies squeeze the maximum results possible, improving productivity. Automation in the drug discovery lab will continue to be driven by the need for consistency and to reduce errors. Lowering error rates can impact the conclusions made downstream. In addition, organizations increasingly want their research scientists to concentrate on their areas of expertise. With automation, the world of laboratory medical technicians will change from one that requires them to be on their feet much of the day, running from one system to another, monitoring the progress of the analyzers, and intervening when maintenance or service is required, to one in which they remain seated and monitor the activities of the analyzers. More importantly, the dwindling resources of skilled laboratory technologists will be better used for more-valued activities, such as reviewing test results and analyzing different processes. Manufacturers will continue to give several of their lab automation products the maximum flexibility in application. And look for the trend to continue toward modular automation rather than TLA. The modular approach offers labs the opportunity to automate only those processes they may need to optimize in order to increase efficiency and productivity. TLA requires a heavy investment in complete lab automation to be applied, potentially automating areas of a laboratory that do not require much of an increase in efficiency. Advantages and Trade-Offs Automating a laboratory and all of its processes is not simply a matter of automating a few machines and setting samples up for testing. Lab management and employees must understand what automation entails and how it fits in with their specific situation. There could be some drawbacks to incorporating automation into a laboratory setting. It is possible that lab management could rely entirely on automation to the neglect of written

18 Chapter One: Executive Summary 7 procedures and following protocol when a system interruption occurs, because of computer, not mechanical problems. What might bring a system down is the failure of computer systems that support and run the entire lab operation, such as a network connection between the lab and the main system. And automation should not be used simply as a tool to introduce worker layoffs to a laboratory. It might be used to save head counts from growing in the future. But it must be harnessed for making improvements in work flow efficiency and productivity, as well reductions in operating and some labor costs. The advantages of automation lie in generating tests that have multiple advantages over traditional assays, including generating accurate, information-rich data. WORLD MARKET SUMMARY A shrinking number of medical technicians, an increasing need for diagnostic procedures for aging baby boomers, new testing requirements, and the drive to reduce costs are combining to push hospital and clinical laboratories to incorporate more automation. And while drug development labs are already well automated, the drive to further automate them will continue. Automation will continue to be a critical component of pharmaceutical drug discovery, biotechnology and clinical specimen processing. Laboratories are increasingly investing to automate pre- and post- analytical processes because of the long-term cost advantages they offer. With increasing demand for more intensive data gathering and comparison, such as for genomics and other advanced studies, technology continues to rely on automated systems. Generally, there is more room for automation growth in the clinical laboratory market than in the drug discovery laboratory segment of the market. Pharmaceutical and biotechnology company labs are already heavily automated. There is some room for automation, especially if it optimizes product discovery. But the greatest growth in automation technology in the near future will occur in clinical laboratories, most of which have depended on manual processes and systems in the past. The market for automation systems in the clinical laboratory will grow in the 6% to 9% range annually in the next few years. Automation technology for drug discovery and research laboratories will grow, but in a lesser 3% to 4% annual range. The markets are seen in Tables 1-1 and 1-2.

19 8 The Worldwide Market for Lab Automation Table 1-1 World Market for Clinical Laboratory Automation Systems Revenues (in billions) $5.0 $5.78 $6.87 Source: Kalorama Information Table 1-2 World Market for Drug Discovery Laboratory Automation Systems Revenues (in billions) $3.24 $3.50 $3.78 Source: Kalorama Information METHODOLOGY This report analyzes the current and potential world markets for medical laboratory automation systems and equipment both for the clinical diagnostics lab and the drug discovery and research laboratory. This report generally offers forecasts future growth to Market segments covered include: sample transport systems, specimen and liquid handling systems, storage and retrieval systems, work stations, plate readers, robotics, dissolution testing and laboratory information management systems. This report also reviews the nature and direction of research and trends, and gives insight into some issues facing the industry. The report profiles several companies involved in developing and marketing these systems: Abbott; Agilent, Beckman Coulter, Motoman, PerkinElmer and Siemens, among others. Market forecasts are based on an examination of current market conditions and on investigations into the development of new products by key companies. The market data provide multiple year forecasts for different product segments covered in the report. The information presented in this report is the result of data gathered from company product literature and other corporate brochures and documents, as well as information found in

20 Chapter One: Executive Summary 9 the scientific and trade press. In addition, interviews were conducted with company executives and researchers.

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22 C H A P T E R T W O Introduction Lab automation technology essentially involves any hardware or software designed to perform complete specimen processing and analysis, and in the case of drug discovery, systems that speed the identification of drug targets. Automation hardware can be installed in the form of TLA a complete automation system or as modular automation devices that perform specific tasks. Clinical laboratory testing plays a crucial role in the detection, diagnosis and treatment of disease. Clinical laboratory technologists and technicians, also known as medical technologists and technicians, perform most of these tests. Clinical laboratory personnel examine and analyze body fluids, tissues and cells. They look for bacteria, parasites, or other micro-organisms; analyze the chemical content of fluids; match blood for transfusions, and test for drug levels in the blood to show how a patient is responding to treatment. They also prepare specimens for examination, count cells and look for abnormal cells. They use automated equipment and instruments that perform a number of tests simultaneously, as well as microscopes, cell counters and sophisticated laboratory equipment to perform tests. Then they analyze the results and relay them to physicians. The complexity of the tests performed, the level of judgment needed, and the amount of responsibility workers assume depend largely on the amount of education and experience they have. For the drug development community, automation has impacted the traditional drug discovery process, making it possible to identify many targets through different combinatorial technologies that facilitate the collection and analysis of thousands of

23 12 The Worldwide Market for Lab Automation compounds. Compound management automation has minimized late stage rejections of drug candidates. The automation business offers a variety of tools to the biotechnology and pharmaceutical industries. Such tools can help remove many bottlenecks on the route to downstream target identification and screening, and new product introductions. WHY AUTOMATE The Clinical Laboratory Automation has evolved into a critical factor dictating the progress and evolution of medical laboratories. Automation is a proactive process, involving a laboratory s management to an extensive degree beyond the initial decision to purchase equipment. Managers must understand the complexities of automation, and how it fits their own situation. Most lab managers understand that automation is vital for confronting the challenges that lie ahead and recognize the importance of leveraging the opportunities it creates. Automation can help alleviate labor shortages but should not be used simply positions. Still, the shortage of medical technologists is becoming more significant every year as fewer students enter the field. Annually, only about 4,000 people in the US are graduating in the field. Schools are graduating 30% fewer students than about a decade ago and 56% fewer students than about two decades ago. Current professionals are reaching retirement age in disproportionate numbers. About 40% of medical laboratory employees are between the ages of 46 and 66, according to the American Society for Clinical Pathology, and nearly half of the current workforce will be ready for retirement by The US Department of Labor's Bureau of Labor Statistics has estimated that 13,800 medical laboratory professionals will be needed each year through 2012 to fill vacant positions. Automation can help respond to the increased demands that will accompany an aging population. The aging baby boomer population is generating increased demand for medical testing. By 2040, 26% of the US population will be at least 60 years old, up from 16.3% in 2000, according to the Center for Strategic and International Studies, Washington, DC. Automation optimizes the functioning, effectiveness, and accuracy of a laboratory. Laboratory automation allows for more testing to be performed in a shorter period time. It optimizes work flow processes to provide rapid, accurate and cost-

24 Chapter Two: Introduction 13 effective test results. Work station consolidation, which reduces the amount of manual testing that is necessary, often is a result of automation. Automation can produce a more dynamic and robust laboratory. Automation frees medical technologists to spend more time on the difficult cases that require careful analysis and assessment. Automation can also help a laboratory move from being viewed as an expense into being viewed as a revenue-generating resource. With an increased capacity for testing, a laboratory can expand its client base by serving outside health care facilities in addition to accommodating in-house needs. An automation system reduces the amount of manual testing required and produces a corresponding improvement in the accuracy of test results. If stringent rules and algorithms are incorporated, there will be less need for further manipulation of samples. Less sample manipulation means fewer opportunities for error. Labs can use the transition time to automation to reevaluate their work flow rules and processes. They can review their autoverification rules or implement new tests that were previously unavailable, whether such tests offer improved precision or provide entirely new testing capabilities. As the amount of throughput increases, more data are generated. The laboratory has to analyze more samples in less time, so decision rules, protocols, and priorities surrounding the data, as well as filtering of the data, need to be taken into consideration. The Drug Discovery Laboratory The evolution of genomics, proteomics and systems biology has changed the nature of life science, enabling investigators to study many molecules simultaneously. That ability has led to the creation of large numbers of new potential drug targets and related volumes of information and data. In turn, these events have caused researchers to harness automated procedures that free them from routine tasks and lower the cost of research and development. Lab automation offers benefits beyond allowing scientists to carry out more tasks faster. Automation makes possible a much higher reproducibility of data and better documentation of that information. It enables the production of more data points more easily. Improving the quality of the data makes it possible to perform analyses that were more difficult to perform previously. The market for lab automation has emerged only in the last decade or so. The evolution of lab automation parallels the development of modern drug discovery. But what really spurred on lab automation s development was the arrival of a standardized

25 14 The Worldwide Market for Lab Automation format microplate. The microtiter plate the microplate was originally developed in the 1950s. The plate usually has 6, 24, 96, 384 or even 1536 sample wells arranged in a 2:3 rectangular matrix. Some microplates have been manufactured with 3456 or even 9600 wells. Each well of a microplate typically holds between a few to a few hundred microliters of liquid. The 96-well microplate format was applied to scientific assays in the 1970s, and has become a ubiquitous tool since. Today, the 384-well format became the norm in high throughput screening (HTS) by increasing the capacity of the original as well as offering less usage of sample, solvents, and reagents. The trend continues with the 1536-well plate. While keeping that number within the same external dimension, the resulting density stretches the ability of most of today s available liquid handlers and other robotics. To increase throughput and limit human intervention, equipment suppliers have developed several laboratory automation tools. These range from simple semi-automated liquid handling systems to fully integrated automated systems that consist of robot arms, pipetting stations, incubators, plate washers and other components. To reduce the costs of screening and to conserve compounds and reagents, scientific groups increasingly rely on miniaturized assays. High density formats can reduce assay volumes to low- or even submicroliter ranges. Researchers can purchase microwell plates from several vendors. Many of the procedures involved in drug discovery are routine and repetitive. For this reason, they are targets for automation. Semiautomated or automated work stations can deliver small volumes of reagent or wash the samples in microwell plates or other vessels constantly for 24 hours. Instruments are on the market that can free researchers from the need to perform or even oversee mundane tasks, permitting them to work on more value-added tasks, such as experimental designs. Handling small volumes of reagents can be difficult because the physics of moving and measuring small volumes differ significantly from what is involved with transporting larger, more conventional volumes. But vendors are moving toward improving that situation. By incorporating unit automation and some basic techniques, such as the use of microplates and column- and row-wise reagent addition, significant reductions in development times for research have been attained.

26 Chapter Two: Introduction 15 An Evolving Market The lab market requires continuous improvements in automation, as was made clear by Andy Thomson, senior vice president, Centralized Diagnostics, Roche Diagnostics Corp. in IVD Technology, January/February This is prompting manufacturers to provide open automation products. Mid-volume labs require flexible, powerful analyzers that can function as stand-alone instruments or be linked to other analyzers. Such an approach can minimize sample touches, achieve predictable turnaround times and decrease errors. This trend in expanded connectivity is leading labs back toward total lab automation. IVD manufacturers are responding by releasing new instruments and technologies that meet such needs. At the same time, many mid-volume labs are beginning to accept automation. As the complexity and cost of automation increase, labs are looking for flexibility in their automation solutions, possibly open solutions that will connect to numerous competing instrument platforms, and offer more testing options and choices. One vendor cannot provide all of the automated testing solutions that labs require. The vendors that can offer cost-effective open automation solutions will gain a disproportionate share of the lab instrument business. Meanwhile, the IVD companies that continue to market closed systems will find it more difficult to meet their customers connectivity demands. In the past, high-volume automation solutions could not be justified in midvolume labs because the benefits could not outweigh the costs. Large analyzer footprint was another barrier that could not be overcome. IVD manufacturers have been slow to respond to the needs of mid-volume labs due to high development costs. They have either made their equipment less expensively or built it smarter by reengineering their existing equipment. However, by rethinking their existing instrumentation, IVD manufacturers can offer cost-efficient automation products to mid-volume labs. Essentially, to remain competitive, IVD manufacturers must continue to develop integrated platforms that accommodate multiple reagents and detection technologies, handle multiple-sized tubes, and support intelligent connectivity to automation systems, according to Thomson. To the extent that such features can be synchronized, the resulting platforms will become more compact, more efficient, and less costly. As the required investment for developing new automation technologies increases, laboratories will look for vendors that have the economies of scale to make such significant investments, and the commercial operations and project management resources to deliver and implement complete automation solutions, according to Thomson.

27 16 The Worldwide Market for Lab Automation Key Issues To be successful in the market place, manufacturers of automation equipment must be aware that automating a clinical laboratory involves a number of decisions. Helping labs to address their concerns can facilitate equipment sales. Among the concerns are which areas to automate, what volumes are necessary to justify automation and how to sell automation to management. If automating the lab does not address an organization's major concerns, it will be difficult to sell the initiative to upper level management. A lab must realistically assess its needs. It might be more affordable for a laboratory to automate only high-volume, labor-intensive areas of operation. When a lot of capital is involved, management wants to see immediate results. Quick results are possible, but only if the most critical area is addressed first. This might be a preanalytical area where inefficiencies were most readily apparent, due to poor work flow design. Equipment suppliers should work with labs to enable them to consider current equipment and to plan for the future. What might be best is an open, non-proprietary laboratory automation system that is modular and scalable. Into such a system can be incorporated existing equipment. Even small labs with staffing problems can benefit from automation if an open, modular system is utilized. A significant amount of training may be required to break old habits. Until technicians feel comfortable with new processes and procedures, they may slip back into doing things the way they used to. When work flow changes, work styles must also change. Meanwhile, molecular diagnostics, including proteomics, and computer-assisted image diagnostics, are two big areas that will change the future. As science identifies the genes and their products that impact directly on carcinogenesis and inflammatory conditions, researchers will want to identify these molecules in tissue and essentially create patient-tailored diagnoses. They will examine tissue-gene profiles, which will stratify people in terms of therapeutics. When there is a new therapeutic modality, people will want to know if a gene comes into play. Regarding the management of lab data and information, laboratory information management systems (LIMS) manufacturers are moving to bring more products to market. Laboratories are generating increasing amounts of data as analytical techniques become more sophisticated. Thus, there is greater pressure on these labs to automate and integrate systems to make use of the additional data. LIMS are key to the enablement of automation, the sharing of information, collaboration and integration across several data

28 Chapter Two: Introduction 17 sources. Forward thinking LIMS vendors must form partnerships with software vendors, to ensure that information sharing through LIMS will be possible and easily accessible. Many companies stress that connectivity, internet-based communication, standardization, and automation will continue to be key topics over the next few years. Lab management continues to look for new solutions. Fueled by growing community testing programs, lab consolidation and a diminishing labor pool, labs are asking for greater productivity from their systems. They can no longer afford to run the bulk of their workload manually or on instruments that merely mechanize the reading steps of the analysis. IVD manufacturers have responded by developing larger systems with larger footprints, but with higher costs. This approach was not too effective, and manufacturers are approaching the limits of improvements on current technologies. Achieving higher throughput by enlarging capacities, replicating instrument resources, increasing the size of the analyzers, and consolidating tests is facing the physical constraints of lab space availability and lab budgets. The next generation of analyzers must address the size issue by adopting emerging microtechnologies. New technologies, such as microfluidics, will make it possible to create consumables that are much smaller per test unit and which will accomplish functionality that is currently achieved by hardware, such as pumps and tubing. IVD manufacturers are developing new detection and separation schemes that offer improved sensitivity. Manufacturers will also have to improve microfabrication techniques to support such goals. Working with small total reaction volumes, 100 nl to 50 µl, new analyzers will operate with smaller samples, potentially reducing the amount of blood drawn from patients. And the mechanism involved in sample preparation, sorting and retrieval will evolve to be more cost-effective and offer greater flexibility than current solutions. The smaller lab automation systems will be flexible, offering labs the choice of targeted solutions that provide the greatest advantages while minimizing the costs of additional instrumentation. Labs must also have the option of selecting the automation solutions that best meet their unique needs. Work flow Automation helps streamline the work flow and results in a more reproducible process with less hands-on interaction, which can significantly reduce costs and decrease the need for skilled labor. In the future, regardless of their size, more laboratories will be using more automation. Automation optimizes the functioning, effectiveness and accuracy of a

29 18 The Worldwide Market for Lab Automation laboratory. It enables technicians to undertake more testing in a shorter period of time. It optimizes work flow processes. This generates rapid, accurate and cost-effective test results. Many laboratories use the transition to automation as an opportunity to reevaluate their work flow rules and processes. While the transition to automation causes operational and management changes in the laboratory, there are ways in which the conversion requires surprisingly little change. If the changeover is successful, laboratory customers will not see any disruption in services, since the outgoing system can typically be run in parallel with the automated system during the final transition stages. The switch to automation can be surprisingly quick, and preparation usually takes no more time than it does to bring standalone units online. Many laboratory staff can continue to perform the same functions as before, such as providing samples that are ready for testing and receiving results, although the new speed with which results are returned may be surprising. In order for laboratory management to determine the need and potential benefits of automating laboratory processes, it must undertake a thorough, detailed analysis of the current, preautomation, laboratory processes. Such work flow analyses demonstrate the strengths and weaknesses of the existing process so that an informed decision can be made as to whether automation will lead to a real improvement. As a supplement to internal reviews conducted by laboratory personnel, competing vendors may bring specialists into the laboratory to study and report their findings. In addition to identifying and enabling the correction of some process flaws, these findings reinforce the potential benefits of automation and lay the important basis for developing weighted criteria on which to base the evaluation of competing products. As an example, a work flow configuration that can make more efficient use of space and is better suited to automation may involve a series of concentric circles representing specimen processing, automated analysis, semiautomated analysis and manual procedures. One feasible configuration would place closest to the specimen processing area the assays for which rapid turnaround time is necessary. Semiautomated analysis can reside in a second concentric circle outward from specimen processing. Most assays performed in this area require a reasonable turnaround time but are performed on semiautomated instrumentation. The last concentric circle would contain manual assays or assays that can potentially be automated, such as highperformance liquid chromatography systems, other chromatographic procedures and radioimmunoassay procedures. The implementation of such an organizational strategy

30 Chapter Two: Introduction 19 may be further individualized into specimen flow by type of specimen, for example, whole blood, plasma, or serum. Optimal automated specimen flow through the clinical laboratory is based upon proper product line organization. All blood specimens are sent through the specimen receiving area to a line where assays are performed on a whole blood matrix. The tests ordered, such as blood gas analysis, whole blood glucose, total calcium, and ionized calcium, may then be performed. After the whole blood matrix product line is complete, specimens are sent to the specimen processing area, where centrifugation and separation of serum or plasma occur. After centrifugation, the specimens may be sent down a serum or plasma product line, where the appropriate tests are performed based upon previously placed orders. Once assayed, specimens may be sent to a specimen archive for further testing. Whole blood analysis may also be performed on a cell-counting instrument. Implementing the proper product line configuration for moving specimens eliminates the need to sort all specimens in the specimen receiving area and may obviate aliquoting specimens until they have arrived at the location at which the assay will be performed. Following such a work flow approach will support the successful implementation of an automation platform into the laboratory operation. Generally, once the policies for a lab have been determined, lab management should examine the work flow model that describes how the lab should function. Different labs will have different structures depending on their mission and how they decide to carry it out. Diagnostic labs are going to have a different structure than research labs. Following up on a point made previously, equipment suppliers should collaborate with potential lab customers in helping them model their lab s processes. Modeling laboratory processes results in a graphical description of how the lab works, what the major structural elements are (databases, work flow management systems, document management, etc.), and how they are used. The modeling exercise also provides a means of determining if a potential area is ready for automation. If it is not, the areas where issues exist can be analyzed to determine how much effort and cost it will take to overcome those issues and whether it is worth it. This type of work flow analysis will enable a lab s management to determine the ability of each process to be part of an integrated work flow system. Rather than using automation products to fix bottlenecks, lab managers should look ahead and determine how they want their labs to operate.

31 20 The Worldwide Market for Lab Automation Setting policies and practices that are used to develop all automation projects and a developing a work flow model that shows how each automation element fits into the larger picture will result in a more stable and streamlined operation. And equipment vendors can consult with labs in doing this, and possibly garner equipment sales in the process. As a lab s productivity improves, it can add advanced data management capabilities for additional automation. Then, as a budget allows, other systems can be added, including everything from table-based, robotic work stations all the way to linear automation systems that use a conveyor track to move individual sample tubes through the lab. Several large automation vendors offer incremental modular automation solutions. Automated systems and integrated work flow solutions will improve laboratory processes. For instance, many anatomic pathology laboratories utilize some automated or semi-automated equipment to perform routine tasks. Many laboratories continue to utilize labor intensive work flow procedures that are organized as discrete processes. Both tissue staining procedures and patient record keeping are performed manually. As a result, the quality of tissue staining may vary. Records may contain inaccuracies and differences of interpretation are can occur. However, the real breakthrough in laboratory automation will occur when several different pieces of automated equipment are seamlessly integrated to provide a continuous work flow environment. Integrating work flow through automation and information technology significantly improves the practice of anatomic pathology, for example, improving the quality and consistency of stained slides, reduce labor costs and eliminate errors in patient records. LABOR ISSUES Clinical laboratory technologists and technicians held about 319,000 jobs in the US in More than half of jobs were in hospitals. Most of the remaining jobs were in offices of physicians and in medical and diagnostic laboratories. A small proportion was in educational services and in all other ambulatory health care services. But there are labor shortages, and automation can help alleviate them. The attrition of laboratory professionals can be ascribed to a number of causes, among them the coming retirement of those from the baby boom generation; dissatisfaction with

32 Chapter Two: Introduction 21 salaries and the position; inadequate training programs; and a lack of awareness among young people about the laboratory professions. In most institutions, an aging laboratory workforce is a great concern. The baby boom generation is nearing retirement age, which will doubly impact the shortage by expanding the demand for health care while at the same time increasing the shortage of laboratory professionals. Wages are another cause of attrition for laboratory personnel. These have not kept pace with other allied health professions. Because the present workforce is driven more by money than in years past, salary is often the determining factor when selecting a career. The median hourly wages of staff clinical laboratory technologists and technicians in 2005 in various specialties and laboratory types can be seen in Table 2-1. Table 2-1 Median Hourly Wages in the Clinical Laboratory Hospital Private clinic Physician office laboratory Cytotechnoligist $26.39 $31.64 $25.69 Histotechnologis Medical technologist Histotechnician Medical laboratory technician Phlebotomist Source: American Society for Clinical Pathology Job satisfaction is tied to workload, recognition and salary. In many institutions, staffing shortages require the remaining workforce to perform the same volume of tests as a fully-staffed lab. Technicians are asked to work overtime and double shifts, and they are expected to maintain the same turnaround times. This can lead to exhaustion, burnout and increased potential for error. Temporary workers can sometimes help bridge the vacancy gap, but they are difficult to locate and come at a significant cost to the facility. Clinical laboratory work also remains a hidden profession. Workers are not commonly viewed by the public, thus recognition of their role and responsibility in patient specimen collection and processing is limited. The lack of public knowledge about professional lab opportunities another problem involved in many shortage situations is evident when people are questioned about what careers are available in

33 22 The Worldwide Market for Lab Automation the medical field. Very few are aware of the variety of careers available in the medical field other than doctors, nurses and paramedics. Another cause of the lab labor shortage is the increased demand for laboratorians in alternate and complex lab testing facilities. Laboratory personnel are being hired in physicians' office laboratories, clinics, veterinarians' offices, industrial laboratories and research laboratories. For employers, these represent more competition for the limited, available pool of candidates. The volume of laboratory tests continues to increase with both population growth and the development of new types of tests. Technological advances will continue to have opposing effects on employment. On the one hand, new, increasingly powerful diagnostic tests will encourage additional testing and spur employment. On the other, research and development efforts targeted at simplifying routine testing procedures may enhance the ability of nonlaboratory personnel physicians and patients in particular to perform tests now conducted in laboratories. Although hospitals are expected to continue to be the major employer of clinical laboratory workers, employment is expected to grow faster in medical and diagnostic laboratories, offices of physicians and other ambulatory health care services. OPERATING COSTS When automating, several important questions must be asked, including what changes will affect delivery of laboratory results, how can automation improve services, and how can automation decrease operating costs. A laboratory often considers automation when it is under pressure to reduce operating costs and improve its efficiency. Automation has the potential to enhance the economic survival of a lab, reduce its operating costs, improve the quality of services, and provide a safer work environment. The need for automation should be assessed in the context of whether the institution is planning to expand or to just cut costs. Every ramification must be considered. For example, contractual arrangements with unions must be taken into account. This will become particularly important when the system is fully implemented because contracts may determine who may be laid off. Additionally, needs for upgrading or changing information systems and analytical instruments must be assessed. A successful automation project depends on stakeholder acceptance the staff and administration, as well as physicians. The employees are most concerned about job

34 Chapter Two: Introduction 23 security, but it is important to let them know that automation is a tool that will help improve their job performance. For the administration, the focus needs to be on the financial bottom line, with emphasis on the opportunity for both revenue enhancement and expense reduction. Physicians are primarily concerned with turnaround times of test results as well as enhancing the information provided by the tests. The financial planning involved in estimating the cost of a lab s automation investment requires projections of revenue and expenses. Equipment vendors may help labs by helping them perform a break-even analysis that shows that automation will reduce costs or enhance revenue. Various approaches may be used. A traditional return on investment (ROI) analysis relates net income to investment capital. The formula for calculating a ROI may be refined to take into account sales as well. This approach recognizes that it might not be beneficial to tie up assets, thereby lowering profitability. The same formula can be used for an expense analysis by keeping sales constant. The net profit margin increases with a reduction in expenses, and with automation, the key expense reduction is for labor. Productivity can be calculated by dividing the number of tests performed by the total number of paid full-time employees. The calculation of labor savings should take into account how the number of employees will be reduced. With layoffs, there often will be severance or retraining expenses to equip the laid-off employees for other jobs. There has been a trend away from justifying automation solely on an ROI analysis because not all of the benefits can be quantified in financial terms. Automation provides added value by improving efficiency and reducing processing errors, by improving turnaround times, offering automated repeat and reflex testing, enhancing safety and optimizing specimen tracking all of which directly or indirectly benefit the cost of operations. COMPATIBILITY One vendor s piece of equipment should be able to connect to and communicate with another vendor s equipment. Labs are looking for more standardization and improved compatibility among different vendor s systems. Ideally, a laboratory automation system should combine the best components from a variety of equipment vendors. In fact, this is almost a necessity as most vendors are small and specialize in certain versions of automation and analysis equipment, and with the rapid progress in equipment

35 24 The Worldwide Market for Lab Automation capabilities, changing components is a frequent occurrence. However, this could be complicated by a lack of standards in component operation and communication. The laboratory automation community has recognized the need for standards and as a result, there is a trend towards open standards in programming languages and communications protocols to improve the interoperability of devices and software within a system. Standards cover aspects of automation ranging from bar code labels, specimen containers, and carriers to the electromechanical and computer interfaces between devices, automation systems and information systems. Automation platforms should integrate instrumentation and work stations. An associated challenge is ensuring that systems are compatible. One response to the need for standardized communication is the development of the Health Level 7 (HL7) Standards Development Organization, an international community of health care experts and information scientists that have collaborated to develop standards for the exchange, management, and integration of electronic health care information. A related issue is the need for compatibility among laboratory robots. Compatibility also comes into play when an automated system would need to work in conjunction with multiwell plates of 384, 96, 24 and 6 wells. Integrated imaging would need to be applied to each well to determine cell growth and clonality, making possible customizable treatments. Full integration with external data systems for the automated selection of positives and the recording of cell line history would be a requirement too. On the drug discovery front, standards have been developed for specific instruments, such as high-performance liquid chromatographs, mass spectrometers, nuclear magnetic resonance spectrometers, infrared spectrophotometers, and ultraviolet spectrophotometers. But many standards have been successful only in very narrow areas. Economic drivers for broad standards are not strong in small volume, highly fragmented markets. Some systems differ with regard to which size and type of tubes can be processed. Some systems have tube carriers or racks that can handle any size of tube, but the centrifuge, decapper, aliquoter, or recapper may not be so versatile. In some systems, larger tubes must be decapped or centrifuged manually. Some vendors may be able to accommodate different sizes, but laboratories may have to standardize to a single tube size. Laboratories, especially those with many outpatient or off-site locations, should not underestimate the challenge of standardizing tube size and type. In addition, some

36 Chapter Two: Introduction 25 systems handle previously spun, uncapped tubes differently from capped, unspun samples, such that the former need separate, manual handling. The capacity and functionality of each centrifuge in a lab may differ, depending on the system. Some tracks can accommodate all types of tubes, but some centrifuges cannot. A mechanism that balances different-sized tubes is important because prebalancing the tubes or placing the tubes individually in the centrifuge may delay processing. The number of centrifuges that can be connected to the track must be considered, especially in higher-volume laboratories or in laboratories with a high frequency of stat test requests. In addition, multiple centrifuges may be necessary for laboratories contemplating automation of coagulation testing. The design of an automation system and analyzers dictates how an analyzer will connect to a track. Two different types of connections are common. Point-in-space sampling involves the direct sampling of the primary tube or an aliquot from the track, and robotic arm sampling involves removing the specimen from the track temporarily. Each option has slight variations, including the amount of sample manipulation required and the length of travel to the analyzer. Point-in-space, direct-from-track sampling decreases turnaround time by reducing the distance a sample must travel and eliminating or reducing a line up of samples at each analyzer. But shunting samples to long dedicated queues or using a robotic arm for each analyzer can lead to delays and impair ability to perform stat assays without manual intervention. Although most laboratories experience little downtime for the tracks themselves, it is important to understand the mechanism by which specimens can be loaded onto the analyzers when the track is inoperative. The processing of pediatric microtainers, urine and fluid specimens is generally different from routine blood samples, and laboratories with a high percentage of these samples may find themselves processing a lot of samples manually even after automating. No automation system can process these nonstandard specimens. Manufacturers of several systems claim to accept analyzers from other vendors. The option to integrate different vendors on the track may warrant some thought, although it would be important to specify how troubleshooting and intercomponent communication would occur if multiple vendors were used. Commitment of individual vendors to long-term support of third-party analyzers connected to their automation system, including both hardware and software upgrades, also needs to be clarified. Interaction between different software programs occurs at many levels in an automation system, and successful systems require smooth, seamless, and fault-free

37 26 The Worldwide Market for Lab Automation integration of these programs. Multidirectional, coordinated communication must link the management information system, preanalytical processing components, the specimen transportation system, analyzers, and the postanalytical archiving system. Ideally, an operator should be able to use one screen to monitor and manage the entire system. Middleware is software that connects various components or applications. It is software that can help a lab s large information system communicate and assign special processing tasks to equipment. Most vendors offer middleware that enables automatic release of results, which can be customized as needed by the laboratory, but the ease of programming these rules may differ, depending on the middleware solution. If other vendor systems can be connected, the different software systems must be integrated seamlessly. TARGETS FOR AUTOMATION Although it may still seem radically innovative in the context of many clinical laboratories, automated production in the manufacturing sector had been the norm for many years. In laboratory science, however, a technician-intensive work process has remained commonplace. Some labs are aggressively catching up. Dwindling reimbursements, evolving technology and the persistent shortage of qualified technologists have stimulated decisions to automate an increasing number of pre-analytic functions. Lab automation entails a broad array of processes that occur in the lab from the receipt of the sample to the reporting of the validated results. These processes range from labeling and transporting tubes to reagent reloading and sample storage. Any or all of these processes can be automated, whether the lab's goal is to have system-based, modular work cells or TLA. One target of automation in clinical diagnostics is to minimize non-value-added steps, such as processes like sorting tubes, decapping, centrifugation, loading analyzers, and sorting for storage. Such non-value-added steps can all be handled by automation components. This, in turn, frees up the technician s time. Because labor accounts for about two-thirds of the cost of producing test results, automation and better information management can reduce the manual, hands-on steps in a lab while improving a staff s productivity. Another automation target: laboratories handle and process several types of test tubes. The test tubes vary in shape, length and diameter. Their caps vary in size, shape

38 Chapter Two: Introduction 27 and functionality. Most importantly, however, the tubes contain different additives. Vacuum test tubes commonly used for blood collection have color-coded caps indicating substances that may have been added to pre-treat blood or preserve it for processing. The additives in each tube are designed to optimize the results for specific tests and should not be intermixed. So, the color of each cap must be accurately identified to achieve a successful outcome. It is important to perform cap inspection, and automation can help with this task. Studies have shown that a significant majority of all laboratory errors are caused during the pre-analytical phase. Test tube handling prior to the analytical process can directly affect the outcome of a test. While clinical labs already use bar codes to automate the identification of test tubes and reagents, much of the preliminary sorting of multiple sized tubes is still performed by hand. Cap inspection advances the tube identification process by avoiding sorting errors. On one front, megapixel imaging technology can provide important tube and cap information before laboratory testing is performed. By applying data about each test tube and cap, lab automation can automate the handling and sorting of differently sized tubes by identifying colors and providing diameter measurements. Increasing instrument intelligence can also help automate complex sorting applications. In order to automate 80% of a large, international reference lab s test volume, the automation system may need to sort more than 1,000 different tests each day. The data provided by cap inspection makes this challenge much easier. Lab automation can prevent pipette crashes by determining if a decapping operation is successful or, if closed container sampling is implemented, whether a given cap type can be pierced. Automation can streamline the fluid aspiration process. Test tube and cap data make it easier and faster to perform the calculations needed to determine the distance the probe or pipette must travel after the liquid is detected. Automation also can reduce carry-over by giving lab instruments the data needed to calculate the precise distance to extend the probes. By minimizing excess exposure of the probe to serum, labs can reduce the amount of liquid waste generated by washing the probes after each aspiration. To perform cap inspection, an imaging system measures each test tube and cap and matches the dimensions to test tube profiles stored in a database. Once the imager finds an exact match, it transmits the tube and cap data, along with the decoded symbol data, to an instrument. A well-engineered imager can inform the instrument with the

39 28 The Worldwide Market for Lab Automation status of the test tube s position in relationship to the automation process. If the tube is present, the instrument can proceed with the next step. If it is absent, it can send an alert message to the host. By identifying the presence or absence of a cap, the imager helps determine whether the pipetter can proceed. It can also identify test tubes missed by an automated de-capper. By measuring the cap s diameter, the imager helps the instrument determine if the cap can be pierced. This data also provides the decapper with valuable feedback. Additional information about the cap, such as its color and shape, enable the instrument to identify it from a library of many different cap types. Providing data on the location of the top of the test tube, combined with data on the cap, allows the system to identify the height of the tube and whether a tube is properly seated in the carrier. By providing instruments with additional data about each test tube and cap, cap inspection systems make it easier to automate even the most complex sortation applications while preventing many potential automation errors. Automated decapping is a welcome addition to any laboratory. Versatility in cap removal is a key selling point for a decapper because tube heights and diameters vary, and there are pressure fit and screw cap tubes. Engineers of decappers have achieved relatively high throughputs. So, only one unit is generally required for most lab automation lines. The best systems are those in which the disposal chute (where the contaminated caps are deposited) and the waste bin are easy to clean and maintain. The basic dimensions of an automation component are important from a flexibility standpoint. Modular hardware and various devices can operate in track and manual mode. Long track systems offer little flexibility in tight spaces and limit the selection of analyzers that might be interfaced if lateral floor space is required near the track. Most systems accommodate parallel or perpendicular attachment of analyzers. One approach to process efficiency is for manufacturers to standardize the size of tube that customers use to send blood and body fluids to the laboratory. This results in the greatest institutional savings and greatest gains in process efficiency. However, not all laboratories can achieve this degree of influence over their customers. Thus, laboratories may not wish to limit the tube sizes accepted by the automation system. Pediatric tubes are rarely accommodated directly. They are generally poured off into a smaller conical tube placed in the top of a standard 5-mL or 10-mL test tube. Once the tubes are placed on the automation system, conveyor throughput is important because it can become a rate limiting step over which the laboratory has no further control. A conveyor system usually cannot be speeded up once it is purchased and installed. Intelligent specimen rerouting

40 Chapter Two: Introduction 29 systems make it unnecessary for a technologist to help determine where specimens have to be moved in subsequent processes. Another target application that presents itself for automation is the reading of bar codes used to identify microplates and the individual compounds located in their wells. Unless microplates are uniquely labeled and their labels read, their storage and retrieval would not be possible. This suggests an important opportunity for manufacturers of automatic bar code scanners. The opportunities for machine vision in drug discovery lab automation need not stop there. Other machine vision applications extend to high throughput protein crystal inspection and micro-array inspection. For the study of the formation and structure of protein crystals, protein crystallography has become an important drug discovery tool. It involves a multi-step process consisting of protein expression and purification, crystallization, x-ray diffraction and structure solution. Within this process, machine vision makes possible the automated inspection of crystallization trays. Microarrays consist of a large number of biological samples, such as DNA or proteins distributed in rows in a very small space (usually on a glass slide). Machine vision can automate the inspection of the samples by using imaging equipment and software algorithms. Using pattern matching software, samples that are outside the desired tolerances in terms of shape and position can be identified. Meanwhile, the automation of histology and cytology tests has become fairly routine in the developed world and will gradually spread to the larger urban centers in developing countries. It is not a large market, but one where significant benefits to patient outcomes can be realized. Automated image analysis and advanced histological techniques have been available for almost two decades, however digital optics and the artificial intelligence algorithms and high capacity processing power necessary to really make these systems work have only recently become available. Another target of automation is to increase the time available for technologists performing value-added steps. These are tasks performed to help make a difference in the quality of test results and, ultimately, the diagnosis. Value-added steps include such activities as reviewing critical results and deciding whether to rerun or perform reflex testing based on a specific result. Preanalytical processing is one of the most labor-intensive aspects of clinical work, occupying up to two-thirds of the total time spent by personnel on clinical laboratory procedures. Many labs are choosing to automate gradually, beginning with this front end of the test cycle sorting, decapping, barcode labeling, placing sample tubes

41 30 The Worldwide Market for Lab Automation in racks that may originate from a wide range of manufacturers, aliquoting and centrifuging. Although some progress has been made in automating the preanalytic phase of testing, much of the work in this phase is still performed manually. In some settings, such as within the hospital, specimens are transferred efficiently using a pneumatic tubing system. In most settings of care, specimens are collected and labeled with identifying information and are entered into the laboratory computer system manually. In addition, most decisions about the adequacy of the specimen s volume and whether the specimen is in the correct type of container are made by a laboratory technician, not a piece of equipment. There are many opportunities to automate preanalytic processes. For instance, specimen containers can be prelabeled with bar codes that link specimens to identifying electronic information. The container may also contain substances that automatically prepare the sample for processing. A number of medical device companies are producing equipment in this category. The Tecan Group manufactures the Genesis FE500, which combines all pre-analytical functions including pre-sorting, centrifugation, volume check and clot detection, decapping, secondary tube labeling, aliquoting and destination sorting into analyzer racks, on a small footprint instrument. The analytical processing that takes place in a lab probably constitutes about 80% of the testing that occurs. Analyses can include high volume analytical immunoassays, chemistry, hematology, urine chemistry and coagulation analyzers, all of which can be automated. Post-analytical processes that are candidates for automation include recapping, and storage and retrieval. In most laboratory settings, the analytical stage of testing is more automated. Beginning in the 1960s, several rounds of sophisticated automation resulted in multianalyzers, which are multichannel instruments that measure many different analytes. Automation also makes possible groups of tests -- panels or profiles -- to be run on the same sample. A similar evolution has occurred in the hematology laboratory, where the counting of different types of blood cells is consolidated and expanded to include automated differentials on the same instrument. A chemistry, hematology, coagulation, or urinalysis analyzer can generate highly precise and accurate results in only a few minutes. The consolidation of tests and testing equipment is possible in part because operator activities for each type of test are interchangeable. Running tests is simplified by redesigning equipment, such as analyzers, to look and function similarly on the outside,

42 Chapter Two: Introduction 31 even though very different operations are done inside. And, coming into the market in the early 1980s, consolidated work stations contain several instruments in one area. Typically, the area is managed by one technical person supervising several nontechnical staff. The technical staff member monitors all instruments, and reviews and releases the test results. The work station approach increases the productivity of the laboratory, reduces personnel costs, and dramatically decreases testing turnaround time. Replacing manual steps with automated processes virtually eliminates the potential for mistakes and reduces testing errors. Enhancements in automated processing resulted in improved technical precision and accuracy. During the past two decades or so, post-analytical lab processes have become more automated. In the 1980s, test results were often transferred by courier or mail. In the 1990s, they were sometimes conveyed over the telephone or via fax. Today, in some laboratories, the completed results are automatically forwarded to the appropriate area of the hospital or physician office electronically through the use of dedicated printers, and billing and utilization report generation is computerized. Use of the internet to report results would likely reduce costs by eliminating the need for designated fax and telephone lines. In addition, quicker turn around times may lead to reduced episode-ofcare costs. Add-on tests are tests ordered on the same sample after the initial tests have been conducted. Many analytic and postanalytic tasks are now automated using process control software. For instance, repeat, reflex, and add-on testing are managed through electronic systems. Add-on tests are tests that are ordered on the same sample after the initial tests have been conducted. Reflex tests are tests that are reordered by a physician after an abnormal test result. Electronic systems may also manage specimen transportation, storage, and disposal. These systems monitor consistency of results and ensure that panic values are called to medical staff s attention. Although not a focus of this report, collecting and analyzing patient outcome data may become more essential in the marketing of laboratory services as third-party payers increasingly demand evidence that new health care services are cost-effective and positively affect patient outcomes. New hardware and software have increased the laboratory s ability to store and process data. In addition, it is significant to note that information technology (IT) has created new marketing and advertising opportunities for laboratories. Increased consumer

43 32 The Worldwide Market for Lab Automation empowerment, new testing techniques that are simple enough for home use or home sample collection, and IT have combined to create new direct-to-consumer marketing opportunities for laboratory tests. Laboratories may follow the pharmaceutical industry s lead by marketing directly to consumers and by making products directly available to consumers over the internet. For instance, there is a consumer-based market for drugs-ofabuse tests, home-based HIV tests, glucose monitoring, pregnancy and ovulation tests, and genetic tests. Consumers may prefer to bypass their personal physician for convenience and to keep test results out of their medical records. Most of these types of tests are paid for by consumers, so they do not have the incentive of insurance coverage to obtain these tests through their health care provider. HEALTH CARE TRENDS IMPACTING AUTOMATION Clinical laboratories today are facing many challenges in order to remain competitive. These challenges are a result of a combination of market forces, including the continued reduction of government reimbursement rates for laboratory tests and cost-restraint measures from the managed care industry. There are several important health care trends that will impact the clinical lab, generating increases in workloads. In the US, the aging baby boomer population will create increased demand for medical testing. As of July 2007, the North American population was estimated at nearly 524 million people. The US population was estimated at 301,139,947 in July 2007, and the world population was estimated to be 6,602,224,175. The world's population, on its current growth trajectory, is expected to reach nearly 9 billion by the year By 2040, 26% of the US population will be at least 60 years old, up from 16.3% in There also appear to be changes or shifts in the diseases in the current population. Rheumatologic diseases continue to increase and, as expected, will parallel the increase in average age. Neurological diseases are also on the increase, as are age-related disorders. Autoimmune disease affects more than 5% of the population, and it is estimated that up to 50% of the population may eventually be tested for autoimmune diseases. Another major trend in health care is the continual pressure to reduce costs. By several measures, health care spending continues to rise at the fastest rate in US history. In 2007, total US health expenditures were expected to rise 6.9% more than the rate of inflation. Total spending was $2.3 trillion in 2007, or $7,600 per person. Total health care spending represented 16% of the gross domestic product (GDP).

44 Chapter Two: Introduction 33 US health care spending is expected to increase at similar levels for the next decade, reaching $4.2 trillion in 2016, or 20% percent of the GDP. In 2007, employer health insurance premiums increased on average by 6.1%. The annual premium for an employer health plan covering a family of four averaged nearly $12,100. The annual premium for single coverage averaged more than $4,400. Experts agree that the health care system is riddled with inefficiencies, excessive administrative expenses, inflated prices, poor management, and inappropriate care, waste and fraud. These problems significantly increase the cost of medical care and health insurance for employers and workers and affect the security of families. Financial pressures are one of many issues that have catalyzed the mergers and acquisitions within the clinical lab industry. Phenotypically targeted therapies may also have some impact on the lab as the result of additional testing that may occur to determine whether a particular drug or pharmaceutical preparation has an optimal effect in a patient. These health care trends may lead to decreased revenue and decreased expense budgets for clinical laboratories as well as demands for new testing and support technologies. During the past several years, outcomes optimization has been an important focus of patient care. The concept of outcomes optimization centers around the management of a course of patient care, either inpatient or outpatient. The continuum of a patient s care is maximized for clinical benefit while striving to minimize the cost and use of invasive treatment. As operators learn more about lab results and incorporate them in the outcomes optimization schemes, the laboratory will play a more pivotal role in both the management of patients and their eventual outcomes. Lab results are becoming more the focus of managed care, health maintenance and disease management companies. AUTOMATION EQUIPMENT TRENDS The key to improving services involves applying proper automation technology. The design of this technology should be driven by required functionality. Design issues should be centered on understanding the laboratory and its relationship to health care delivery and business and operational processes. In recent years, the trend in automation equipment design has evolved from a hardware-based approach to a software-based approach. Process control software that supports repeat testing, reflex testing and transportation management, and overall computer-integrated manufacturing approaches to laboratory automation have matured over time. It is clear that hardware and software

45 34 The Worldwide Market for Lab Automation are functionally interdependent, and that the interface between the laboratory automation system and the laboratory information system is key. The trend in has moved from a total laboratory to a modular approach, from a hardware-driven system to process control, from a novel to a standardized product, and from an IVD novelty to a marketing tool. Many vendors are present in the marketplace, many of whom are IVD manufacturers providing an automation product coupled with their systems. Then there also exist companies that manufacture automation products. These true automation companies have continued to help define open-systems approaches to automation problems. On the drug development side, the trend will continue toward miniaturization and the ability to handle tiny volumes efficiently and accurately, namely innovative technologies, such as microfluidics, that render liquid handling systems extremely capable of moving small volumes. An important evolution has come in the miniaturization process, driving from 384 well plates to 1536 well plates and beyond that. Spurring this miniaturization is the ability to dispense reagents in a range of 1 microliter to 2 microliters per reagent and the ability to dispense compounds in the range of 25 nanoliters to 50 nanoliters. Microarrays, microfluidics lab-on-a-chip technology based on the transport of nanoliter or picoliter volumes of fluids through microchannels within a glass or plastic chip -- and other new technologies will make it possible to streamline automation systems and procedures down to include fewer pieces of equipment. Then there might be less need for transport and robotics to move samples between work stations. Specifically, there has been an ongoing trend towards miniaturization. The first implementation was in the form of the 384-well plate. The 384 density is achieved within the same external dimensions as the original 96-well microplate by reducing the size of the individual wells. This impacts almost any microplate-based device that is used to automate processes based on the 384-well format. Liquid handlers must be able to pipette accurately and reproducibly into the smaller wells. Washers and dispensers must also be able to handle that format, and readers must be able to perform their detection as well. Robot grippers can handle the 384-well plates since the external form factor is the same. But in many cases more accurate positioning of the plate is required on the target device because of the smaller wells and higher density of wells. This trend is being continued with even higher densities. The 1536-well plate is seeing more common use. Keeping that number within the same external dimension

46 Chapter Two: Introduction 35 produces a density that stretches the ability of liquid handlers and other devices. Then, even higher densities are being developed. In drug research, the trend is to screen ever higher numbers of samples, leading to ultra HTS, which involves the analysis of more than 100,000 samples per day. Now, as processes become more precise, standards become more important. The Microplate Standard initiative has been led by the Society for Biomolecular Screening on behalf of, and for acceptance by, the American National Standards Institute (ANSI). The mission of the Microplate Standards Development Committee has been to recommend, develop, and maintain standards to facilitate automated processing of microplates. Another trend has been away from a focus on the physical movement of samples among devices toward better interpreting the vast amounts of data that are involved. For example, on the drug discovery front, HTS has created huge databases that are reservoirs of potentially valuable information. Intelligent systems could help automate the analysis of this data by inspecting results, evaluating the quality and promise of active data points, and identifying leads. An ideal lab automation system would combine the optimum systems from a number of vendors. However, this is complicated by a lack of standards in component operation and communication. There is a trend towards open standards in programming languages and communications protocols. Standards cover aspects of automation ranging from bar code labels, specimen tubes, and carriers to the electromechanical and computer interfaces between devices, automation systems, and information systems. The design of a lab system and its architecture are closely linked. For large-scale systems, facility layout will continue to be important, with each part of a laboratory designed and built to fit its ultimate function. As a result, there has been a trend away from discipline-specific, bench-intensive laboratories to consolidated core laboratories serving several disciplines. In some of these instances, an automation system has been used as a way to force or expedite the redesign of a laboratory. Also, the number and complexity of tests done at one time is increasing. So, automation systems are being designed to move plates or specimens faster, with higher reliability. Motors are being designed for distributed motion. Servers are accommodating third party equipment. Systems are shrinking in modular form to smaller systems that can do more. There will be scalable automation of assays, greater use of vertical space as robots transition vertically because of a premium on laboratory space.

47 36 The Worldwide Market for Lab Automation Analyzers become more complex instrumentation, requiring the design and implementation of greater levels of embedded intelligence for performance monitoring. Analyzers utilizing advanced sensor and detection technology are better able to manage every step of sample processing, with quality and precision. Such systems give labs and manufacturers new opportunities to obtain much real-time data that automation software may use to efficiently manage the testing process. And, labs are in constant need of new solutions to help them meet increased demand for their services, as they seek greater productivity from both their workforce and equipment. It will be ever more difficult for these organizations to operate the bulk of their workload manually or on instruments that only minimally mechanize certain tasks. And microfluidics are leading to consumables that are much smaller per test unit and which will accomplish functionality that had been reached by using pumps, fittings, manifolds and tubing. What are needed are new detection, separation and microfabrication techniques that go hand-in-hand with microtechnology. These should economically improve the precision and sensitivity of analysis. In a session at Lab Automation 2007, presented by the Association for Laboratory Automation, Geneva, IL, a panel of experts agreed that because ongoing changes in technology and global business trends have an unpredictable impact on where, how and when scientific research is conducted, laboratories must plan to maximize flexibility and mobility to ensure future effectiveness and efficiency. The panel fused insight from architect Eric Ferret, director of laboratory planning and design at KlingStubbins, Cambridge, MA; corporate space planner Shawn Pixley, director of research and development planning at Amgen, Thousand Oaks, CA; and userscientist Richard Rodriguez, manager of research automation technologies at MDS PharmaServices, King of Prussia, PA. Grandsard established the goal for the Lab of the Future as space and work flow, including enabling technologies that cultivate innovation and productivity. He noted that laboratories of the past and present were typically designed from the outside in, for specific functions, and were value-engineered with a fixed infrastructure. Ferret emphasized an open space concept designed from the inside out. The ideal open concept is based on warehouse design. It eliminates fixed casework, and features customizable and movable overhead service delivery systems for water, electricity, gas, and other utilities.. Ferret recommended that laboratories begin new designs with small

48 Chapter Two: Introduction 37 capacity units, plan for current and expected requirements, and then allow extra room for unexpected requirements. From a corporate space planner's point of view, Pixley concurred with Ferret, noting that today's volume of work necessitates a capital-conscious approach with predictable metrics, delivery practices and scope management. When planning a laboratory workspace, planners should begin by thinking differently about problems; embracing uncertainty; challenging established processes; forcing corporate, site and functional strategies; and defining boundaries. He stressed that planners must keep current global business and technology trends in mind. He noted that the way in which laboratories and their staffs produce data, evaluate and interpret data, and use data has changed dramatically since the 1970s and 1980s. The laboratory is no longer restricted to the space or people or equipment within its four surrounding walls. Corporate productivity is being achieved through virtual collaboration between multiple global research sites on an around-the clock basis. As a working scientist and laboratory manager, Richard Rodriguez concurred. Adapting to new priorities and outdated equipment make an open design imperative. Rodriguez defined an ideal open concept laboratory as having a minimal number of weight bearing columns and walls; automation systems in the center; mobile lab benches and equipment tables on the periphery; and equipment that maximizes vertical space, and not horizontal space. And the trend continues with robotics being increasingly used in pharmaceutical development to help increase productivity, decrease development time and reduce costs. Robots, which can move objects, identify and weigh specimens, are further classified based on the type of movement that their robotic arm can perform. Three of the most common geometries are: cartesian (three mutually perpendicular axes); cylindrical (a parallel action arm pivoted about a central point); and anthropomorphic (a multijointed, human-like configuration). Each has been used in the pharmaceutical industry with varying degrees of success. Cylindrical and anthropomorphic robots generally provide more flexible human-like automation that includes transfer, weighing, extracting and filtering samples. Most laboratory robotic systems will continue to be harnessed to automate the sample preparation stage, the most labor-intensive step of the analysis process. Automation generally will continue to be applied in pharmaceutical analysis in raw materials release; in-process testing; the release of finished products; and stability testing

49 38 The Worldwide Market for Lab Automation the dosage form. Although the application of laboratory robotics continues, such limitations as high capital cost, the relative complexity of operation and connectivity issues between the robot and laboratory information management systems, may hinder many implementations. Other trends in lab medicine impact directly on the evolution of the clinical chemistry lab. All of these trends are connected to reducing costs, and trying to get the work done with fewer lab personnel, mainly because lab technologists are a rare resource and there is pressure to maintain quick turnaround. The first effect of these trends is to automate the preanalytical sample preparation steps of registering the sample in the LIMS and centrifuging the blood tube. The major IVD manufacturers offer preanalytical automation. Beckman Coulter's Power Processor preanalytical automation system has gained the lion's share of this market with at least a 45% market share. The second effect of these trends is to consolidate high volume immunoassays on to a single work station with clinical chemistries or linking a clinical chemistry analyzer with an immunoanalyzer by a belt or robotics system. This level of integration is achieved by Roche's Modular system, for instance. The result is the same fewer errors due to mislabeling aliquotted samples and less time spent on the aliquoting task. At the same time, many of these combination systems are beginning to offer cap piercing capability that has been a standard feature of hematology analyzers. As the post-genome era unfolds, increasing numbers of specimens will arrive in the laboratory for molecular testing. Laboratory automation will need to evolve to maintain closed-tube sampling for DNA analysis because of the increased possibility of cross-contamination. It is expected that just about all automated lab instruments will have cap piercing techniques. Also, an emphasis on better management of cancer, diabetes and cardiovascular diseases is driving the discovery of new markers and their faster migration to work station systems. In the area of consolidation, the most affected tests are cardiac markers and turbidimetric immunoassays for autoimmune disorders, proteins and lipids. In the last few years, most major instrument manufacturers has put a HbA1c, homocysteine, Vitamin B12/folate BNP and CRP assays onto a chemistry or immunoassay systems. Maintenance of analyzers is also crucial. With so much of a lab's workload concentrated on a few instruments, downtime due to a malfunction is a disaster. The result: what was once a value added feature has become a standard instrument component. Beckman Coulter and Siemens Diagnostic Products Corp. pioneered device

50 Chapter Two: Introduction 39 relationship management (DRM), then known as remote diagnostics. In the past few years remote instrument analysis via DRM has become an integral part of instrument quality control. DRM is software that enables interactive the monitoring, diagnostics and servicing of lab instruments over the internet. It allows manufacturer personnel to run routine instrument maintenance and inspection activities from a remote location. It saves service costs and has proven to be critical to maintaining work flow. Vendors of DRM software include Axeda Systems Inc., Mansfield, MA, and Questra Corp., Redwood City, CA. TOTAL LAB AUTOMATION Total laboratory automation (TLA) refers to the complete automation of devices and processes in the clinical laboratory. TLA usually involves combining several instruments, work cells, work stations, or integrated modular work cells that are coupled to a specimen management and transportation system, and software to automate a large percentage of or all laboratory work. TLA systems can include sample sorting, routing, centrifugation, aliquot preparation, analysis, and post-analytical storage and retrieval. TLA's history began with the development of the AutoAnalyzer by Technicon Inc. in the 1950s. A comprehensive TLA system can serve any or all areas of the laboratory and perform such functions as specimen labeling; identification; preparation (centrifugation and aliquoting); transportation; introduction to and removal from analyzers; storage and retrieval; retesting; pipetting; and specimen disposal. In the 1950s, the first major instance of automation used in the clinical laboratory took place. The AutoAnalyzer was introduced by Technicon under the leadership of Edwin C. Whitehead. Since then, more complex systems operate in most areas of the clinical lab. While the majority of these instruments automate the analytical phase of testing, they do little to automate pre- and postanalytical aspects. These extra-analytical phases have continued to be labor-intensive, costly and subject to errors. In 1984, Masahide Sasaki, M.D., of Kochi Medical School Hospital, Kochi, Japan, embarked on a major venture to automate his entire laboratory. His efforts continue today with the addition of advanced software and robots and analyzers. Many Japanese labs have followed in Sasaki's footsteps. TLA handles specimen-processing operations automatically and efficiently with few or no errors. The same cannot be said when these functions are performed by humans. Such tasks as specimen labeling,

51 40 The Worldwide Market for Lab Automation handling, preparation, and storage are labor intensive. They may be performed by staff who graduated from college and who are licensed or certified medical techs. But the work may also be done by laboratory assistants with high school diplomas and on-the-job training, thus increasing the error rate. Because of human error, mislabeled, misidentified, or mis-aliquoted specimens may be sent to the wrong work stations. Occasionally, specimens are lost or misplaced. The number of persons performing these extra-analytical functions on three daily work shifts is large and accounts for a substantial portion of the lab payroll. Automation of these crucial, yet technically undemanding, activities can result in a significant reduction in costs. TLA systems are designed to handle specimens -- blood, urine and body fluids -- contained in standard, bar code-labeled, evacuated tubes. The bar code label contains an accession number coupled to demographic information that a clerk enters into a clinical laboratory information system together with test orders and any other information desired. An operator places the labeled tubes in the TLA system, which performs all functions automatically. TLA offers the maximum range of functions for small clinics and labs. TLA makes it possible to uniformly control laboratory systems that require little or no additional operator control from the lab staff. In many cases, lab management must first begin to think about TLA when the lab needs to replace outdated equipment. New and larger menu-driven analytical systems with high throughput cannot only help consolidate work stations, but can reduce costs as well. In addition, labs can improve sample processing by incorporating the latest generation of modules that automate many pre- and post-analytical functions. While shopping for new instrumentation, the thought usually surfaces of how automation could help position the lab for the future and address the growing shortage of qualified and skilled lab professionals. When the trend toward clinical laboratory automation first began, much of the talk about automation centered around TLA. Targeted to the largest, highest-volume laboratories, by its nature TLA requires a multimillion dollar investment that requires a lot of space to implement. By looking for solutions to minimize labor further, today s total lab automation systems integrate multiple analyzers, automate sample preparation, and facilitate sample retrieval when additional testing is required. The resulting systems often require labs to spend millions on complex, rigid automation systems to achieve the much needed productivity improvements. Manufacturers are reaching the limits of

52 Chapter Two: Introduction 41 current analysis technologies as high-volume instruments have become too large to fit into some labs. The simplest goal for a TLA system is sorting specimen tubes by type, but this process hardly seems complex enough to justify automation in a typical hospital lab. In a large commercial laboratory, however, where 5,000 tubes might be delivered in a few hours, automatic tube sorting is highly desirable. Automatic sorting also eliminates misdirecting tubes to the wrong work station and saves on personnel time. Elaborate, mass production, front-end automation of the sorting process has been used by many large Japanese commercial laboratories. The TLA system must be cost justifiable. The system must improve laboratory operations, reduce costs, and make the facility more competitive in the marketplace. It may be possible for a lab to meet its objectives best if it automates those areas where tubes of blood, urine, or body fluids are routinely processed or tested on automated analyzers. This process starts with the entry of patient demographics and test requests into the laboratory information system. The first automated function is to download patient information and test orders from the LIS to the TLA system. Among the goals of TLA are: Reduce the overall cost of tab operations and the unit cost of tests, enabling a lab to price services at a competitive market level. Consolidate procedures. Perform repetitive, extra-analytical lab procedures wherever cost can be justified. Consolidate procedures by technology, not discipline (perform all ELISA testing in one automated area rather than dispersing the work to microbiology, immunology and chemistry). Reduce staff dedicated to the automated portion of the lab. Increase test volume with no additional personnel. Reduce in-lab turn around time to less than 30 minutes for all tests. Discontinue queue of specimens at analyzers, eliminating analysis delays. This requires an adequate number of analyzers to process for peak loads. Operate the TLA system continuously. Avoid scheduled downtime that compromises continuous operation of the system.

53 42 The Worldwide Market for Lab Automation A TLA system could make it possible to process specimens, transporting them from specimen receipt to specimen arrival at an analyzer in 2 to 10 minutes. Dwell time in the analyzer then becomes the limiting factor in turn around time. One option would be to implement a hospital-wide network of bedside analyzers that perform blood gases, electrolytes, and hematocrit, which, together with capillary glucose, serve the needs of acute care units for fast results that can be available in 2 to 3 minutes. A TLA system can be operated around the clock to provide the same comprehensive test menu on all three shifts while at the same time reduce personnel and overhead costs. This requires careful management of scheduled downtime as well as minimal unscheduled downtime. But while a shrinking pool of lab technologists, the growing demand for testing, new testing requirements, and the drive to reduce costs are combining to push hospital and clinical laboratory operations to incorporate more automation, enthusiasm for TLA has slowed. More often, labs have recently preferred to adopt incrementally adding hardware and software, opening up the design of their labs, and consolidating work stations as test demand rises and budgets allow. The vast untapped market for automation presents new opportunities for companies of all sizes and technologies. MODULAR AUTOMATION Most automation system manufacturers address the trend toward modular automation. Modular systems consist of consolidated and integrated analyzers, independent work cells, and automation for pre- and postanalytical processes. Modular equipment can either operate as stand-alone instruments independent of other devices, or modular systems can be grouped together to form work cells. Many modular automation devices incorporate centrifuges, decappers, aliquoters, specimen loaders and unloaders. The modular approach is to automate in customized, incremental steps, based on a lab's individual needs and budget. As productivity improves, labs can add advanced data management capabilities. As finances allow, additional systems can be added, such as robotic work stations and conveyor tracks that move individual sample tubes through the lab. Several large automation vendors offer incremental modular automation solutions. Smaller labs, with throughputs that will never require TLA, will be able to afford to automate.

54 Chapter Two: Introduction 43 Estimates suggest that only 8% to 10% of laboratories will be able to afford TLA systems. Modem software information management and process control tools will complement modular hardware. Proper standardization and compatibility will allow vendor-independent modular configurations to exist for those labs that determine only certain areas and tasks should be automated to optimize their work flow. Commercial laboratories and regional laboratory networks may have the financial resources and the test volumes needed to justify the several million dollar investment in a totally automated system and its operation. However, diagnostic laboratories prefer a more gradual, pay-as-you-go approach in which automation is accomplished in several smaller steps. TLA is not the goal at all. Small laboratories may have a strategic advantage by implementing less costly, more modular systems. Modular stepwise automation has evolved into a common strategy for diagnostic testing, especially for medium-sized clinical laboratories and specialized sites, such as children's hospitals or other focused institutions. Early on during the health care laboratory automation revolution, commercial manufacturers considered the large consolidated laboratories the biggest market for their products. However, the vendors eventually realized there are many smaller laboratories that could benefit from automation as well. Large automation systems require a high degree of customization, but modular systems can be sold in a pre-configured state for the average laboratory. In addition, the analytical instrument is evolving to become more adaptable to the needs of modular automation. For example, analyzers are on the market that combine the analytical functions of chemistry, immunoassay and toxicology into a single platform. When a group of laboratory tasks are linked together through a common user interface and a single LIS connection, one has created a work cell. According to Dr. Robin Felder, Director, Medical Automation Research Center, and Professor of Pathology, University of Virginia Health System, Charlottesville VA, when evaluating a modular work cell system, there are several areas to consider. Among the issues to address: What type of testing is performed? What are the optimal tube sizes and workload characteristics of the lab? How are sample tubes handled? Is there direct sampling or cap piercing? What is the rack size? Are bar codes used? How is the information transferred? How are data transferred to and from the laboratory information system, and how are data managed? Is there an expert system? How are the control and status monitored?

55 44 The Worldwide Market for Lab Automation What types of automation are accommodated by the lab? Was equipment purchased from different vendors? What are the acceptance criteria? Does it perform internal reflex testing? How does the process controller operate? What is the number of tests run before being replenished? What is the sample size? What is the liquid level sense? How does the work cell integrate? What are the measures for quality control and quality assurance? How is the process controlled? How is scheduling the process performed? How is the process optimized for efficiency? Selected portions of TLA systems also can be sold in smaller units and thus, in some cases, become modular analytical equipment. Modularity assures that the laboratory can add additional automated devices to the system backbone as automation needs increase. For most small clinical laboratories on limited capital equipment budgets, or for those that who do not want to incur much risk, modular automation can be implemented conveniently and efficiently in a stepwise manner, to match needs. In this way, large benefits are gained from automating, while incremental costs are relatively modest. Equipment makers should consider the connectivity of each modular unit in the design of the system. Independent devices must be engineered to accept tubes and racks from other units. The conveyance mechanism that transports the racks can be built into each modular unit. If the laboratory wishes to complete tasks, such as tube sorting and centrifugation, in tandem without the need for the manual labor associated with transferring tubes from proem to process, then each component should be able to be linked together to create a larger automated system. The greatest initial gains in efficiency following modular automation usually reside in the automation of pre-analytical processing. Prior to analysis, there occur many manual steps, such as sorting, centrifugation and aliquotting. Calculating a return on investment is difficult for some aspects of modular automation. However, economical configurations of pre-analytical processors are considerably less expensive than a totally automated laboratory. A minimally configured pre-analytical processor can save up to 2.5 technologists in a medium sized clinical laboratory. Implementing automation yields other benefits to the laboratory aside from the calculable reduction in full-time equivalent employees. Labeling and filling aliquot tubes from primary specimens are not only tedious, error-prone tasks, but also dangerous ones for personnel. There is a higher likelihood of direct contact with the primary specimen at through aerosols, splashes of blood and cuts from glass tubes. Automated aliquotters

56 Chapter Two: Introduction 45 reduce the labor associated with specimen aliquotting, as well as the dangers. These systems exist in various configurations. Modular automation also can shorten the pre-analytical process much more than humans are able to, so most laboratories that acquire automation will have the opportunity to eliminate the need for a separate stat laboratory. This redesign can decrease the turnaround time for all tests performed in the automated system. The financial benefits of improved turnaround time, decreased laboratory errors, reduced exposure to contamination, and improved operator morale are difficult to assess. However, the elimination of the stat laboratory will reduce the need for full time personnel dedicated exclusively to stat functions. There are many systems on the market that can incorporate modular automation. The key is to remain efficient and flexible. Modules should be attachable to the basic system backbone. For example, modular units can be obtained for robotic transportation, sorting and aliquotting and centrifugation. Much of the technology operates independently of other automated systems in the laboratory. Modular automation will be increasingly effective as standards are adopted that allow simplified coupling of modular units together to form systems capable of more complex tasks Laboratory automation will be truly practical when sensible standards are adopted uniformly. FDA REGULATION The FDA is involved in regulating clinical lab automation systems. The systems that are part of clinical laboratory automation essentially facilitate the diagnosis of health conditions in a timely and cost-effective manner. The FDA Office of In Vitro Diagnostic Device (OIVD) Evaluation and Safety uses a risk-based regulatory approach to these products to ease the burden on industry while ensuring public safety. Based on FDA regulations, stand alone automated clinical analyzers are exempt class I devices and do not require Premarket Notification [510(k)]. When an automated clinical analyzer measures a specific analyte, the analyzer plus the associated reagents become a test system. These test systems are considered combination devices and are classified in the highest of the predicate device classifications. Therefore, automated clinical analyzers are not exempt from premarket notification when they include any class I reserved device or a class II device. Automated clinical analyzers that include class III devices are subject to premarket approval.

57 46 The Worldwide Market for Lab Automation Laboratory information systems and laboratory automation systems meet the definition of combination devices when a manufacturer makes an integration claim to a specified analyzer (non-stand-alone), with the following exceptions. If the device only receives information for the patient record and neither transmits any instructions to any interfaced device nor controls any device functions or alarms, no premarket notification is required. If the device performs only simple physiological and clinical calculations, as long as the algorithms are fully explained and made readily available to the health care practitioner, no premarket notification is required. Regardless of classification, devices automated with software are subject to design controls under the Quality System Regulation. REIMBURSEMENT The growth of managed care has had a significant impact on the operations and profitability of clinical laboratories. Cost reduction is the major driving force in the industry, and laboratories are always in the process of planning strategically to adapt to changes. As a result, the key market trends in clinical testing services reflect the heavy influence of managed care. Dwindling reimbursements, evolving automation technology and the persistent shortage of qualified technologists have stimulated decisions to automate an increasing number of pre-analytical and other functions. Clinical laboratories are facing a number of issues that are challenging their ability to remain competitive. These challenges are being caused by such market forces as the reduction of government reimbursement rates for laboratory tests, cost-restraint measures from the managed care industry, and the continuing trend toward containment of national health care costs. As pressures increase for clinical labs to become more productive and cost-efficient, their management must look more closely at their labs internal processes to find ways to increase productivity with smaller budgets. In order to survive in the future, it will be necessary for labs to run more tests; test in fewer sites; operate with less equipment; maintain lower operating costs; hire less skilled labor; and harness more automation. The commercialization of sophisticated new IVD products and technologies comes as a two edged sword. Many of these new devices and technologies are expected to carry a high price tag and the payment infrastructure in most countries has not evolved to cover many of the newer approaches to patient management. The result, as is often the case, is that technology is far ahead of health care regulations and reimbursement plans.

58 Chapter Two: Introduction 47 The onus is on manufacturers to prove their new intervention is not only effective but also supplies a cost effective treatment alternative. Managing costs and patient outcomes are the largest problems faced by the health care industry today. One approach being taken to limit spending is the establishment of reimbursement schedules for all patient services. Reimbursement schedules will continue to have a major impact on the market success of new technologies and the continued usage of established products. The schedules detail the amount paid to health care providers for a specific class of products and for a specific use. As cost management pressures continue to increase, health care systems base their decision whether to reimburse a new product on its impact on patient care. No new product can expect to be reimbursed simply because it provides a technological improvement over what is already on the market. This trend is already in place in the US. In the past, European and Japanese payor groups have been considered more amenable to new products, however with concerns about their growing health care budgets, they too are beginning to evaluate the reimbursement of new therapeutics, tests and devices with more scrutiny. The reimbursement challenge is felt most acutely by the new generation of genomic-based products because they generally are more expensive than the status quo. They face the threat of poor market penetration unless they can prove to payer groups that they will improve patient outcome and be cost efficient compared to incumbent techniques. Despite market clearance from the FDA and CE Mark accreditation, it can take years before government third party payor groups agree to cover many tests and therapeutics. After having spent millions of dollars developing new drugs and tests, companies expect to amortize the research and development costs in the final market price. Among manufacturers, it is suspected that these generally high priced new products are refused reimbursement based on price and not lack of medical effectiveness. But the payors say that this is not so. They emphasize that manufacturers have not provided evidence that their new product meets the criteria of medical necessity. The definition of medical necessity is critical to reimbursement. The definition used by the major US payers including Medicare states that an intervention is medically necessary if, as recommended by the treating physician and determined by the health plan s medical director or physician designee, it is: for the purpose of treating a medical condition, the most appropriate supply or level of service, considering potential benefits and harm to the patient, and known to be effective in improving health outcomes.

59 48 The Worldwide Market for Lab Automation The assessment of outcomes is a critical point. But there is a basic philosophical difference in how regulatory and payor groups evaluate outcomes. Outcomes for market clearance relate to product safety and efficacy. Outcomes assessment for reimbursement means health outcomes that affect a patient's health status as measured by the length or quality (primarily as perceived by the patient) of a person s life as well as improved functional status. Blue Cross Blue Shield guidelines for reimbursement emphasize that products that succeed in being reimbursed are those that "bring value to the health care consumer and payor in the eyes of the consumer and not the seller." Further, US Medicare's correlation of value with reimbursement is sometimes unclear at best. For example, the Pap smear has been the mainstay of cervical cancer testing for at least 40 years. Over that time and with recent improvements, the test has proven itself as an valuable screen for cervical cancer. Where the test is available and women have it done every one to two years, the incidence of cervical cancer drops dramatically. In July 2001 that the Department of Health and Human Services announced that screening tests for breast cancer, cervical cancer and colorectal cancer will be covered by Medicare. The new coverage comes under a law passed by Congress December 2000 that calls for The Centers for Medicare and Medicaid Services to phase in coverage for certain tests and therapies that detect diseases early, when there is the best chance for treatment.

60 Chapter Three: Recent Market Developments 49 C H A P T E R T H R E E Recent Market Developments LABCYTE AND ALLEGRO COMBINE OPERATIONS Labcyte Inc., Sunnyvale, CA, and Allegro Technologies Ltd., which conducts business as Deerac Fluidics, Dublin, Ireland, have reached agreement on the terms for combining the two companies. Both are leaders in precise low-volume liquid dispensing technology for life science applications. As pharmaceutical companies, genomic service providers and other life science research organizations desire to perform larger numbers of assays within fixed budgets, there is a drive to reduce the volume of each assay in order to reduce cost and minimize waste. Although products from both Labcyte and Deerac address the growing market of low-volume liquid handling, each company utilizes a unique technology. Labcyte is a leader in providing acoustic droplet ejection technology for pharmaceutical and life science applications. The Echo 500 series liquid handlers and Portrait 630 reagent multi-spotters are used in most of the largest pharmaceutical companies, as well as in leading academic and research institutions and contract research organizations. The Echo liquid handlers use acoustic energy to transfer 2.5 nanoliter droplets and are most useful in the 2.5 to 200 nanoliter range. The Labcyte acoustic droplet ejection technology has broad applications including compound management, assays, arraying, particle manufacturing, imaging mass spectrometry, and live-cell transfer. Labcyte also provides a range of unique microplate consumables. Labcyte has 29 issued US patents, three issued European patents and additional international filings.

61 50 The Worldwide Market for Lab Automation Products from Labcyte and Deerac are used for different applications. They may be used together when one component of an assay is added in the low nanoliter range and others are added in larger amounts. The Deerac products are based on a patented feedback control system, which is rapid, parallel and most effective in the 50 nanoliter to 20 microliter range. This technology was conceived at Trinity College, Dublin. AGILENT ACQUIRES VELOCITY 11 Agilent Technologies Inc., Santa Clara, CA, has completed its acquisition of Velocity11, which is involved in automated liquid handling and laboratory robotics for the life sciences market. The acquisition of privately held Velocity11 enables Agilent to offer a more comprehensive suite of work flow products to its life science customers in the pharmaceutical, biotech and academic research markets. Specifically, Velocity11's technology strengthens Agilent's offering of automated sample-preparation solutions across a broad range of applications. "With the acquisition now complete, we look to developing strong synergies between Velocity11 and Agilent," says Nick Roelofs, vice president of Agilent's Life Sciences Solutions Unit. Agilent can now offer customers an enhanced set of comprehensive work flow solutions in the pharmaceutical, government and academic segments, leveraging a strong portfolio in automation, detection, measurement and informatics. Velocity11 designs, manufactures and markets robotic solutions that range from standalone instrumentation to bench-top automation solutions to large, multi-armed robotic systems. The company also develops software to control the robotics. Velocity11's customers comprise most of the major pharmaceutical and biotechnology companies as well as leading genome centers and academic institutions. Velocity11 broadly covers the life sciences automation market, with a concentration in drug discovery, genomics and proteomics applications, through direct distribution, reseller channels, and a multi-continent customer service, applications, and support organization. Velocity11 works to maintain an intimate relationship with each of our customers across more than 3,500 installations, including major pharmaceutical companies, biotechnology companies, and leading academic institutions.

62 Chapter Three: Recent Market Developments 51 NEW CLOSED-LOOP SMART GRIPPER Able to integrated with commercially available robots, Smart Gripper 2.1 from Applied Robotics Inc., Glenville, NY, features a universal operating platform and closed-loop, encoder-based positioning of robotic fingers. Operated using 24 Vdc (volts of continuous current) discrete signals, it offers adjustable grip force and has a built-in controller. Up to 32 motion programs can be selected from its non-volatile memory, and its status can be transmitted back to the controller by means of three discrete output lines. The Smart Gripper is designed to deliver precise gripping capabilities with a powerful programming interface, and offers easy integration with most commercially available robots. The gripper features accurate robotic finger positioning, adjustable grip force, easy installation and requires no external controller. The Smart Gripper offers varying levels of force and can be integrated with most commercially available robots. Its gripping fingers can be designed by the user, or provided by Applied Robotics, a global manufacturer of robotic end-of-arm tooling and connectivity products. The user can pre-program motions into the Smart Gripper's nonvolatile memory, for recall later, triggered by the robot controller's discrete output lines. Founded in 1983, Applied Robotics designs and manufactures end-of-arm tooling and connectivity solutions intended to solve complex automation problems and improve efficiencies. The company's wrist-down solutions can be found in manufacturing, welding, assembly, material removal and material handling applications in the US, Canada, Pacific Rim, Europe, Mexico, South America and Australia. TECAN-VWR ALLIANCE Tecan and VWR International Inc., West Chester, PA, have entered an alliance to unite the strengths of each company and provide Tecan's microarray instruments and microplate readers to the global research market. The collaboration takes advantage of VWR's BioSciences program. VWR distributes a diversified product mix, including chemicals, glassware and plastic ware, equipment and instruments, furniture, protective apparel, production and safety products, and other life science and laboratory products and supplies. VWR has a comprehensive sales network including more than 120 sales representatives worldwide and 15 BioSciences managers in Europe alone. Tecan's range of microarray products and microplate readers offer solutions for customers of the BioSciences program working in drug discovery and life science.

63 52 The Worldwide Market for Lab Automation Tecan's products and technical expertise complement the VWR BioSciences program very well, and the companies can build on their respective strengths in high end instrumentation. VWR International is involved in the research laboratory industry with worldwide sales in excess of $3 billion. VWR's business is highly diversified across products and services, geographic regions and customer segments. The company offers products from a wide range of manufacturers, to a large number of customers primarily in North America, Europe and other locations. VWR's principal customers are major pharmaceutical, biotechnology, chemical, technology, clinical, food processing and consumer product companies, universities and research institutes, governmental agencies and environmental testing organizations. NEW SAMPLE PROCESSING PLATFORM Qiagen NV, a marketer of sample and assay technologies for life sciences, applied testing and molecular diagnostics, has received the New Product Award (NPA) from the Association for Laboratory Automation (ALA) for QIAcube, the company's new platform for sample preparation. QIAcube is a compact platform incorporating proprietary technologies that allow users to fully automate the processing of almost all of the company s consumable products that are used manually in more than 40,000 laboratories worldwide. The compact system in the low throughput range creates a new level of utility and opportunities to free up time, reduce costs, and increase performance for customers in laboratories conducting molecular biology research in life science, applied testing and molecular diagnostics. The platform was launched for use with up to 100 protocols that address almost any need in sample processing. The protocols are based on the identical Qiagen consumable products used manually. The company also is marketing QIAsymphony SP, the first system in its new series of modular instruments which can be integrated to automate entire work flows in a broad range of molecular sample and assay applications. It features touch screen operations, and bar-coding of samples and reagents. The process allows continuous loading of one to 96 samples per run. It makes possible random access processing of multiple protocols without reloading reagents.

64 Chapter Three: Recent Market Developments 53 Qiagen, KJ Venlo, the Netherlands, is a provider of sample and assay technologies and products. The products are considered standard in areas, such as preanalytical sample preparation and molecular diagnostics. The company has developed a portfolio of more than 500 proprietary consumable automated products to be used for sample collection, nucleic acid and protein handling, separation, purification and open and target specific assays. AUTOMATE SAMPLE PREPARATION Symyx Technologies, Santa Clara, CA, has released a product designed to automate the sample preparation stage of active pharmaceutical ingredient solubility experiments. This step is a new application for the company s Benchtop System. The system automates parallel processing of multiple steps of experimental procedures to speed drug development. Automating some of the more laborious and tedious tasks in drug discovery also frees time for scientists to concentrate on more in-depth experiments. This new solubility application from Symyx integrates solid powder and liquid dispensing on the same platform with weighing capabilities. Each bench top comes with a number of configurations and applications as standard. These include miniaturized material preparation capabilities (dispensing capabilities for low viscosity aqueous and organic solutions, viscous vehicles and powder materials), sample processing capabilities (heating, cooling, mixing and filtration), sample analysis capabilities (weights, ph and imaging), and automated instrument control. Modular Platform A modular approach to automating laboratory techniques could ease the process of scaling small-scale manual methods to high-volume commercial production. The m:pal (modular process automation laboratory) platform, developed by the Fraunhofer-Institut für Produktionstechnik und Automatisierung, Stuttgart, Germany, is composed of many different building blocks, which are automatically compatible and easily connected together by USB cables to form a desired system. Software then allows the user to program the exact process to be performed, automatically, by the system. This modular approach makes it easier for companies to test many different techniques before finally deciding on the best set-up, which would then be built based on this design.

65 54 The Worldwide Market for Lab Automation Test Liquid Handling Instrumentation Liquid handling instrumentation has become essential in the pharmaceutical industry for laboratory tasks ranging from assay development to plate replication. However, the consequences of instrument misperformance are unknown. A liquid handler variability of just 10% in a screening environment can result in any number of missed hits or false negatives. Many companies dedicate resources to extensive quality control downstream in the drug discovery process, such as at the clinical trial stage. However, identifying and correcting liquid handling errors upstream, such as in target discovery and highthroughput screening stages, can save time and money, and increase efficiency. Ensuring proper liquid handler performance early in the drug discovery process can also lead to higher quality data and reduction in costly errors. With this in mind, Artel, Westbrook, ME, has introduced a new feature to its Multichannel Verification System (MVS), which includes an automation function that allows for time savings and reduces human error. The enhancement allows automated liquid handler users to test instrument operation on a continuous basis, reducing the tendency for laboratory error. Traditionally, quality control techniques used to ensure liquid handler performance have been time-consuming and not well standardized, causing the process to be often overlooked. With MVS, laboratories have an easy-to-use tool for rapid volume verification, which makes it possible for liquid handling quality control to begin earlier in the drug discovery process. The new MVS integration feature makes it possible to check the quality of in-process liquid handling systems by measuring dispensed volumes in multiple microtiter plates without repeated manual input. The feature allows users to store each step of their liquid handler quality control protocols in the MVS system software for future access. Once the liquid handler quality control method is programmed, users can begin each subsequent performance verification process without repeating preparatory steps, such as scanning barcodes for each microtiter plate and reagent bottle. The MVS is based on ratiometric photometry, a technology that uses the absorbance values of two proprietary dye solutions to calculate the dispensed volume in each well of a microtiter plate. The MVS provides NISTtraceable accuracy and precision data to ensure that a standardized volume dispenses across instruments and across laboratories.

66 Chapter Three: Recent Market Developments 55 High Throughput Flexibility CyBio, Jena, Germany, is marketing its next generation integration platform, the CyBi- Screen-machine. CyBio's plate handling system CyBi-Ways is now enhanced with the option to integrate articulated robots for automation applications. This provides a new stage of flexibility. The system can be easily adapted to work for various laboratory automation tasks, such as ultra HTS, compound replication or reformatting. The new hardware options of the adaptable system are accompanied by the CyBio Composer, software for system and device control. CyBio Composer brings easy database connection and system monitoring via a web browser-like user interface. Dynamic scheduling is available with CyBio Scheduler. Robotics Research Lab Established Motoman Inc., Dayton, OH, a provider of robots and robotic systems, is helping to establish the Motoman Robotics Laboratory at the University of Dayton School of Engineering. As part of this long-term commitment, Motoman is furnishing $371,000 worth of state-of-the-art robots, including a revolutionary seven-axis, actuator-driven IA20 robot; a 15-axis, actuator-driven and human-like dual-arm DIA10 robot; a four-axis YS450 high-speed SCARA robot; two six-axis HP3 articulated robots and one HP3C sixaxis, articulated robot with a compact controller. The new laboratory will allow hands-on research work and provide classroom space for lectures. The new laboratory will enable the university to conduct more research into cutting-edge technologies and products and speed the commercialization of these innovations into the marketplace. The new robotics laboratory is expected to be in operation in late HAMILTON PURCHASES TEKCEL Magellan Biosciences, Chelmsford, MA, has sold Tek-Cel, a provider of laboratory sample management and storage solutions, to Hamilton Laboratory Workstations, Two Rivers, WI, which sells laboratory robotics, chromatography and fluid subsystem products. Hamilton is expected to keep TekCel's headquarters in Hopkinton, MA, and to grow Hamilton's US East Coast presence. Magellan President and CEO Dr. Robert J. Rosenthal says Magellan s strategy is to expand its presence in clinical diagnostics, specifically in hospital-based labs and the point-of-care setting. While TekCel has made significant progress designing new offerings that are also relevant to the needs of clinical

67 56 The Worldwide Market for Lab Automation customers, its primary customer base and its focus in the foreseeable future will likely remain pharmaceutical, biotech, and life-science research customers, where Hamilton brings significant global distribution and customer access. Magellan's emphasis on clinical technology was not a good fit with TekCel, which supplies storage equipment for drug development. This is a new area for Hamilton, but like Tecan, which acquired Remp, this area provides Hamilton with a broader range of products to offer its biopharmaceutical customers. WORKCELL ENHANCEMENTS Siemens Dade Behring group introduced several enhancements to its scalable automation product, the StreamLAB Analytical Workcell. The new enhancements will enable clinical laboratories to install automation in a smaller space and also to take advantage of new capabilities, such as connectivity to a new middleware data management solution. These enhancements reflect the company s focus on developing the future of clinical laboratory automation technology. The enhancements to the StreamLAB Analytical Workcell include: a 90 degree track-turn configuration so that it fits in smaller spaces; and flexibility with the configuration to enable a laboratory to install the system in corners and around columns, minimizing renovation costs commonly incurred when installing automation and additional analyzers. Connectivity to the EasyLink Informatics System, a middleware software program, improves data management capabilities between the StreamLAB Analytical Workcell, multiple diagnostic systems and a laboratory information system. A tube sealer applies a seal to patient samples. This allows for hands-off sample management, accommodates a variety of tube sizes simultaneously, protects the integrity of patient samples and helps minimize laboratory personnel's exposure to biohazards. The StreamLAB is designed to evolve with a clinical laboratory's changing needs. It is a scalable system that provides for work station consolidation while automating preand post-analytical functions. The StreamLAB has the ability to connect to multiple Dimension Integrated Chemistry Systems and to the Sysmex CA-7000 high-volume coagulation analyzer. It also has an open connectivity feature allowing customers to connect it to other selected manufacturers' systems.

68 Chapter Three: Recent Market Developments 57 LOW TEMPERATURE SAMPLE STORAGE Micronic BV, Lelystad, Netherlands, has introduced a new starter pack for laboratories looking to implement high integrity, traceable storage of samples in freezers and vapor phase liquid nitrogen below -80ºC. The new low temperature storage starter pack includes a selection of screw top tubes (0.5 ml, 1.1ml and 1.4ml) to suit most low temperature sample storage applications. The pack incorporates a single turn capping mechanism -- accessing and securing samples in a Micronic screw top tube is a simple and rapid process. To prevent tubes from rotating during opening and closing, each screw top tube includes an anti-twist feature. A unique two-dimensional code on the bottom of each tube provides an easy and unambiguous means of storing and identifying samples. To optimize the use of valuable freezer storage space, 96 individual tubes can be stored in a single Micronic rack. Micronic Starter Packs contain everything needed to start using 2D coded (or noncoded) sample storage tubes, enabling laboratory workers to ensure a secure sample logistics system and eliminate false sample identities. The low temperature storage starter pack contains an easy-to-use tube scanner, operating software, a case of racked screw top tubes and caps, a screw cap remover and a manual tube selector. The Starter Pack offers a substantial saving over buying the products individually. AUTOMATED MICROPLATE PROCESSING Porvair Sciences Ltd., Leatherhead, UK, is marketing microplate sealing work stations that provide fully automated plate processing able to handle plates in batches of 100 at a time without manual intervention. Combining the flexibility of a three-position turntable with unattended loading and unloading the TriSeal High Throughput and Ultra High Throughput systems deliver productivity benefits to busy screening or compound management laboratories. Featuring the Scorpion stacker and loader, the TriSeal High Throughput system uses a single Scorpion to both load and unload the TriSeal. As the first plate is sealed inside the TriSeal, a second plate can be automatically added to the turntable prior to the ejected sealed plate being removed by the Scorpion and returned to the sealed stack. A single interface box is used to control the stacker-loader and the TriSeal.

69 58 The Worldwide Market for Lab Automation In the TriSeal Ultra High Throughput system, two Scorpion stacker-loaders are employed. In this configuration, one Scorpion is dedicated to loading unsealed plates while the second is used only for retrieving and restacking sealed plates. Both Scorpion units and the TriSeal are programmed and controlled from one interface box as before. The TriSeal has been proven to produce an accurate and tight seal on any SBS proposed standard microplate from 5 mm to 47 mm in height. Offering adjustable temperature heat sealing from 50ºC up to 185ºC, the TriSeal is able to operate optimally with most foil and film seals. AUTOMATION PARTNERSHIP Molecular Devices, Sunnyvale, CA, has launched an Automation Vendor Partnership Program for the life science and drug discovery markets. By working with its partners throughout the different product development stages, Molecular Devices has developed the capacity to integrate its plate reader systems and liquid handlers with all leading partner robots. This "out-of-box" automation solution benefits customers by saving upfront integration time and resources.

70 C H A P T E R F O U R Markets OVERVIEW Technologies based on manufacturing automation have evolved in recent years to make clinical laboratories more efficient and productive. And the market for clinical lab automation will continue strong in the immediate future, spurred on by the desire of these laboratories to become profit centers, not just points of service. Many clinical labs have installed some form of automation, leaving the door open for future equipment purchases that will further automate their operations. Some labs are more thoroughly automated, and some have even achieved total laboratory automation (TLA). The future for automation in clinical labs is today. Automation is indispensable for laboratories facing difficult market competition. The market for laboratory automation systems in drug discovery and life sciences research has grown in recent years as well. This segment of the lab automation market is tied to drug research and life science spending, by the pharmaceutical and biotech industries. Although these industries have curtailed their spending in general, the demand for lab automation instruments has increased in the past due to new products and automated solutions for newer techniques, such as microarrays, as well as cell-based assays. But this automation segment is slowing as the market for drug and biotechnology companies is limited. Moreover, automation on this front has not necessarily led to the commercialization of new pharmaceutical compounds.

71 60 The Worldwide Market for Lab Automation CLINICAL LAB AUTOMATION MARKETS Clinical laboratory diagnostics plays a crucial role in the detection, diagnosis and treatment of disease. Clinical laboratory technologists, also referred to as clinical laboratory scientists or medical technologists, and clinical laboratory technicians, perform most of these tests. They examine and analyze body fluids and cells. They look for bacteria, parasites and other microorganisms; analyze the chemical content of fluids; match blood for transfusions; and test for drug levels in the blood that show how a patient is responding to treatment. Technologists also prepare specimens for examination, count cells, and look for abnormal cells in blood and body fluids. They use microscopes, cell counters and other sophisticated laboratory equipment. They also use automated equipment and computerized instruments capable of performing a number of tests simultaneously. One result of increasing automation and the use of computer technology: the work of technologists and technicians has become less hands-on and more analytical. The market for clinical lab automation systems will continue to grow in part because these systems standardize work flow and eliminate many manual steps, reducing the opportunity for error due to fatigue, which in turn saves time and money for the lab. There has been hesitation on the part of some labs to invest in automation as they are uncertain of its cost benefits. Although automation is a relatively new technology in the diagnostic lab, those that harness it quickly gain a return on investment in terms of error reductions, improvements in efficiency and productivity, and other cost savings, often in a few years. Essentially, an ever-shrinking pool of lab technologists, the growing demand for testing for aging baby boomers, new testing requirements, and the drive to reduce costs are combining to push hospital and clinical laboratory operations to incorporate more automation. In addition, an increasing demand for more intensive data gathering, including genomics and other advanced studies, is dictating reliance on automated systems. In recent years there has been a growing concern among employers, educators, professional associations and policymakers that there is a significant shortage in the number of clinical laboratory workers. There is great concern that the shortage will worsen in the next decade as older workers retire, and vacated and new positions are not filled due to an insufficient number of new graduates coming into the field. The US Bureau of Labor Statistics (BLS) projects about 138,000 openings for medical technologists (MTs) and medical laboratory technicians (MLTs) by 2012.

72 Chapter Four: Markets Many hospitals, which had been the primary site of educational programs in the clinical laboratory sciences, closed their programs during the 1970s and 1980s due to both declining reimbursements and enrollments. The BLS projection of 138,000 job openings by 2012 for MTs and MLTs is supported by data on vacant positions. Vacancy rates range from 7% to 13% in clinical laboratories in the US. Educational programs in clinical laboratory science programs have been declining for more than 30 years. Figure 4-1 indicates the number of National Accrediting Agency for Clinical Laboratory Sciences (NAACLS) approved educational programs from 1975 through 2003 for medical technologist (MT), medical laboratory technician (MLT), histotechnology (HT), and phlebotomy (PBT) programs.

73 62 The Worldwide Market for Lab Automation Figure 4-1 NAACLS-Accredited Educational Programs in Clinical Laboratory Sciences Source: NAACLS In 1970, there were 791 MT programs. By 2003, about 70% of these programs had closed, leaving only 240 programs in the US. The number of MLT programs (associate degree or less) increased from 210 in 1970 to a peak of 281 in 1985 and subsequently declined to 210 in Histotechnology programs also peaked in 1985 at 43 programs, and diminished to 24 programs by Data on the number of approved phlebotomy programs is available from 1987 to 2003, showing growth from 9 to 58 programs. Programs have closed because of the decreased attractiveness of MT as a career choice, the advent of prospective payment systems (PPS), managed care and budget cuts, and an increase in the expense of running a clinical laboratory training program. Most of the closed MT programs were hospital-based. Data from NACCLS indicates that nearly 25 hospital-based programs closed each year from 1995 to The advent of PPS for hospitals, which changed their basic cost and revenue functions, is the most cited reason for the decline of hospital-based clinical laboratory training programs. A PPS is a method of reimbursement in which Medicare payment is made based on a predetermined, fixed amount. The US Health Care Financing Administration

74 Chapter Four: Markets 63 switched from a retrospective fee-for-service system to a PPS. Under PPS, hospitals receive a fixed amount for treating patients diagnosed with a given illness, regardless of the length of stay or type of care received. Prior to PPS, clinical laboratory tests were allowed costs under Medicare cost-based reimbursement and hospital laboratories were an important revenue center for hospitals. In such a fiscal environment, in which reimbursement for each test performed was ensured, more testing per patient was promoted. As the shift from fee-for-service to prospective payment took place, the revenues generated for hospitals by their clinical laboratories decreased. In the current environment of reimbursement on a per case basis rather than on a per test basis, more laboratory testing per patient can result in a financial loss for hospitals. The resulting fiscal strain has made it difficult to maintain hospital-based clinical laboratory science programs because revenue that previously was used to support training is no longer available. With overall decreases in hospital revenues, paying for the staff needed to support training programs is a burden. Clinical laboratory practitioners work in a variety of settings, most often hospitals, but also in physicians offices, colleges, and the biotechnology industry. Table 4-1 National Employment of Laboratory Workers by Industry Setting, 2002 Government and Other 4% Research and Manufacturig 4% Education 3% Medical Laboratories 14% Physician Offices 15% Hospital and Clinics 60% Source: Bureau of Labor Statistics, 2002 High standards of quality and customer service are required from clinical laboratories. Meeting these requirements, however, is becoming increasingly problematic

75 64 The Worldwide Market for Lab Automation because of decreases in staffing and efforts to control cost. Laboratory directors are faced with the challenge to balance cost with the goals of quality, patient safety and clinical service demands. Laboratory automation offers a potential solution and has become routinely implemented in clinical laboratories. According to recent reports, 32% of laboratories in the US have installed form of automation, 17% of which is total laboratory automation (TLA). The benefits of automation are well documented and emanate from the replacement of manual, potentially dangerous, error-prone steps with automated processes requiring little human operator intervention. This can increase productivity, decrease turnaround time, improve staff safety, minimize errors, improve the handling of specimens, and allow the reallocation of personnel for growth and expansion of services. Furthermore, by providing rapid turn-around time for critical tests, intralaboratory tracking of specimens, and preventing errors in specimen aliquoting, the benefits of automation can have a positive impact on worker safety, an issue that has been given increased attention by government regulations and accrediting organizations. Ultimately, the benefits of automation can be realized as improvements in service to both caregivers and patients. Regarding worker safety in the lab, in several states, the government has enacted bloodborne pathogen and sharps-injury legislation that is pushing hospitals to implement strict guidelines to better protect health care workers. The language in these bills includes protecting lab workers from biological and biohazard exposures. These laws will affect the design and sales of automated equipment as labs look for key features, such as automated decapping and recapping, which can protect lab technicians from being splashed by samples. As worker safety is increasingly legislated throughout the US, closed-tube systems will become more important. These systems access the sample by automatically piercing through the caps rather than using a decapping method. As more labs move toward automation, there will also be more demand for standardized interfaces that will allow different manufacturer's instruments to connect and work together. This will particularly be an issue with the growth of modular automation. When a lab's needs grow, requiring further automation, it will be important that individual pieces of equipment can be upgraded or connected to customize laboratory growth. Over the past few decades laboratory automation has significantly decreased the hands-on nature of the work. Today, many experienced laboratory scientists spend more

76 Chapter Four: Markets 65 time analyzing results, developing and modifying procedures, and establishing and monitoring quality control programs than they do performing tests. In the last two decades, clinical laboratories have seen substantial growth in testing volumes. However, nearly all labs in the US and Europe are experiencing difficulties in hiring qualified technologists. Labs are looking for more automation and increased productivity from their products. They can no longer afford to run the bulk of their workload manually or on instruments that merely mechanize the reading steps of the analysis. And, the next wave of automation software is evolving away from fragmented, complex systems. New software is integrating all aspects of lab management, from sample logistics to results management, archiving and retrieval. Labs will achieve productivity gains by consolidating data and instrument management, and not requiring lab personnel to monitor and manage various data feeds on multiple screens. Back in the 1990s, there were two distinct competing schools of thought for lab automation: total lab automation (TLA) and modular, or task-targeted, automation. In some instances, the capital cost, maintenance and complexity of TLA did not make that choice appealing. When equipment vendors found that many laboratories could not afford TLA, modular automation appeared on the scene. In many instances, automation has become a customized process that may range from automating only a few steps of the analytical process, depending on the needs and resources of each laboratory. Technology is also available to automate core laboratories, which combine chemistry and hematology testing for further efficiency. Each laboratory must decide for itself whether or not automation should be implemented and, if so, when, and to what extent. Now, even newer improvements to lab automation are becoming a necessity as the market becomes more established. Even more open solutions are becoming available. Mid-volume labs desire flexible, small powerful analyzers that can function as standalone instruments or be linked through automation to other analyzers. The idea is to reduce as much as possible any human touching or manipulating samples. Systems now must achieve quite predictable turnaround times and decrease errors. Many smallervolume labs are beginning to accept automation. Regardless of their size, labs are realizing that in order to overcome the obstacles in today s market, they must consider automated solutions. Labs are demanding flexibility in the automation systems. They are seeking open solutions that will connect to instrument platforms, many of them from competitors, and

77 66 The Worldwide Market for Lab Automation offer more testing options and choices. Simply put, one vendor alone cannot provide all of the complete automated testing systems that labs require. The vendors that can offer economic open automation will gain a greater share of the lab automation market in the years to come. With the marketing of smaller, cost-effective integrated products, viable automation has become available for smaller and mid-volume labs. Such solutions give these operations the ability to consolidate their routine clinical chemistry and immunoassay testing into one smaller integrated platform. With a new generation of analyzers, automation is not only targeted to the larger lab operations. And new middleware will continue to optimize the performance of automation systems. Middleware -- software that connects various components or applications -- can help a lab s main information system communicate and assign special processing tasks to equipment. Middleware enhances performance. This software is applied to technology platforms. The software allows individual labs to significantly customize various aspects of their installed automation systems. Labs considering middleware must be certain that any new system can communicate with its LIMS. Middleware consists of a set of enabling services that allow multiple processes running on one or more machines to interact across a network. This technology has evolved to provide for interoperability in support of the move to client-server architecture. It is used most often to support complex, distributed applications. It includes web servers, application servers, content management systems, and similar tools that support application development and delivery. This software sits "in the middle" between application software working on different operating systems. It is similar to the middle layer of a three-tier single system architecture, except that it is stretched across multiple systems or applications. Examples include database systems, telecommunications software, transaction monitors, and messaging-and-queueing software. The distinction between operating system and middleware functionality is, to some extent, arbitrary. While core kernel functionality can only be provided by the operating system itself, some functionality previously provided by separately sold middleware is now integrated in operating systems. Middleware generally consists of a library of functions, and enables a number of applications simulations or federates in HLA terminology to page these functions from the common library rather than re-create them for each application Middleware is needed if labs want to automate reflex, repeat and add-on testing. Doing so produces time and labor savings for labs. Rather than hunting down samples in

78 Chapter Four: Markets 67 storage and putting them back onto the analyzers for testing, a technologist in an automated lab with middleware only needs to review the results from the desired samples at the middleware work station. Robotics and middleware take over and do the rest, from finding the samples in storage to putting them back on the automation line, as well as testing and reporting the results, including any requisite checks. With its potential for strong growth, the world market for clinical laboratory automation systems will fare better than the drug development lab automation market. Expect to see annual growth in the 6% to 9% range, given the clinical lab s labor and productivity issues. While there are many clinical-diagnostic laboratories that have harnessed automation in some shape or form, many more, especially the smaller-volume labs, have yet to install any automation. With the availability of modular automation, these smaller-volume labs now have a greater choice of automation product options. Tables 4-2 through 4-6 indicate the expected growth in this market in the near term worldwide by geographical segment. Table 4-7 estimates the installed base of major clinical laboratory automation systems in the US. The market is expected to experience a 25% to 35% annual growth rate, given in part to the lack of automation in clinical labs. Table 4-2 World Market for Clinical Laboratory Automation Systems Revenues (in billions) $5.00 $5.30 $5.78 $6.30 $6.87 Source: Kalorama Information Table 4-3 North American Market for Clinical Laboratory Automation Systems Revenues (in billions) $2.75 $2.92 $3.17 $3.46 $3.77 Source: Kalorama Information

79 68 The Worldwide Market for Lab Automation Table 4-4 European Market for Clinical Laboratory Automation Systems Revenues (in billions) $1.25 $1.32 $1.45 $1.58 $1.72 Source: Kalorama Information Table 4-5 Asian Market for Clinical Laboratory Automation Systems Revenues (in billions) $0.50 $0.53 $0.58 $0.63 $0.69 Source: Kalorama Information

80 Chapter Four: Markets 69 Table 4-6 Rest of World Market for Clinical Laboratory Automation Systems Revenues (in billions) $0.50 $0.53 $0.58 $0.63 $0.69 Source: Kalorama Information Table 4-7 Clinical Laboratory Automation Systems US Installed Base Major Systems ,029 1,338 1,739 2,348 3,170 Source: Kalorama Information SAMPLE TRANSPORT SYSTEMS Between 65% and 80% of the laboratory budget is targeted to personnel costs. A reduction in personnel through automation to improve productivity may be difficult to achieve, but the pressure to cut staff continues, with an increasing focus on automating pre-analytical functions and sample transport to work stations within the laboratory. A key component of a laboratory automation platform is the transport system conveyor belts, automated guided vehicles or other specimen transporting devices that are involved in the transportation, and the loading and unloading, of samples. This can be accomplished using linear tracks, stackers and cylindrical robotic arms. The choice of transport system often is a trade-off between throughput and flexibility in adapting to changes in the system configuration. Although some progress has been made in automating the pre-analytical phase of testing, much of the work at this point is still performed manually. In the TLA approach, samples arrive at a reception area, are logged in or identified automatically for further processing, and the sample preparation process begins. After centrifugation, samples in primary tubes can be dispatched directly to the work station, usually by a sample transport system.

81 70 The Worldwide Market for Lab Automation The transport track for samples can be routed around the periphery, down the middle, or along parallel tracks to specific areas using different levels of automation and interfacing to the transport mechanism. This can be based on the extent of automation of the analytical equipment in place as well as the geometry and layout of the laboratory area. The automation of medical laboratories will be heightened with the development of a laboratory automation platform which will effectively integrate instrumentation and work stations in clinical laboratories. The automation platform can feature conveyor belts or robots to transport specimens, bar coded-specimens that can be tracked easily and software that determines specimen movement in coordination with robots and other equipment. A sample transport system carries specimens to analyzers and automatically activates the analyzers. In recent years, these systems have been programmed to handle specimens with more "intelligence". In many laboratory automation systems, analyzers and the sample transport systems are linked. Through the use of the transport systems or robotics, it is possible to allocate specimens depending on the status of each analyzer or the need for reruns. Since commercially available analyzers were designed to be integrated with sample transportation systems, communication between the transport systems and analyzers was unnecessary. Nevertheless, many began to see the benefit of separating analyzers and transport systems and standardizing the communication procedure between them so that analyzers can be connected to a transport system regardless of its physical configuration. For a transport system to control specimens with greater efficiency, it has become necessary for them to handle requests and test results. If sample transport systems could be controlled by utilizing data managed by LIMS, such as test requests and results, then many useful applications can be constructed. For example, when STAT specimens arrive at a lab, analyzers may be in down mode or performing maintenance procedures. Since a certain amount of time is usually required before a test is performed, regular maintenance such as reaction solution exchange, calibration and warming-up can be temporarily suspended. Because the lab s information system controls the flow of specimens, it can send commands to have the necessary analyzers to be ready for tests from a remote control. Subsequently, when specimens arrive, via transport, the necessary tests can be performed promptly.

82 Chapter Four: Markets 71 Sample transport systems comprise a little more than one-fifth of the clinical lab automation market. They are a valuable component of any lab automation system and often have a payback period of at most three years. These systems streamline the work flow and help make a lab s operations consistent and repeatable. Because of their importance, as more labs on the clinical and diagnostic side seek to automate, expect the market for sample transport systems to increase at about a 6% to 9% annual rate, as can be seen in Table 4-8. Table 4-8 World Market for Clinical Laboratory Automation Sample Transport Systems Revenues (in billions) $0.50 $0.53 $0.58 $0.63 $0.68 Source: Kalorama Information STORAGE-RETRIEVAL SYSTEMS Automated storage and retrieval systems often referred to as ASRS or AS/RS are a variety of computer-controlled techniques for automatically depositing and retrieving loads from specific storage locations. Systems of this nature have been used for years in industrial manufacturing and warehouse facilities. Now they have made their way into the clinical laboratory. Advancements in biotechnology and medical science require the analysis of everincreasing numbers of various biological samples. Many biological samples must be stored at below freezing temperatures in order to preserve them for future reference, analysis or use. For example, DNA, RNA, cells and protein samples, as well as the reagents necessary for conducting various analyses of these samples, must be stored at highly cold temperatures to prevent degradation that would interfere with reliable analyses of the biological products. Storage below -80 o C is generally required to preserve biomolecules, cells and tissue (morphology and viability) for extended periods of time. However, shelf life and the ability to recover living cells are dramatically improved at about -196 o C.

83 72 The Worldwide Market for Lab Automation There are many problems associated with the placement and retrieval of samples from ordinary laboratory freezer compartments. For instance, in an ordinary compartment, containers of samples must be stored in the front of and on top of each other to maximize use of the available space. Even if the containers are of standard size, and easily stackable and even if a positional inventory of the samples is kept, it is still necessary to shuffle the containers around manually in order to retrieve a desired container. This is problematic because it requires keeping the freezer door open for extended periods of time. Keeping the freezer door open causes the interior temperature of the freezer compartment to rise temporarily, which can cause thawing of samples housed near the door of the freezer. Once the freezer is closed and the temperature decreases, the samples refreeze. This repeated freezing and thawing can cause more rapid degradation of the samples. Keeping the freezer door open also allows frost to build up in the freezer compartment. With repeated openings of the door, the frost eventually can freeze containers to the bottom of the freezer compartment or to each other. As a result, the door must be kept open longer in order to break containers out of the frost, which only exacerbates the problem. The need for high quality biorepositories in hospital labs, research institutions and pharmaceutical clinical research laboratories provides a market for automated storage and retrieval technology that will improve sample quality, organize storage, provide rapid access to all specimens, and maintain electronic records of all specimens stored within the container. Automated storage and retrieval systems can lead to a more organized storage and retrieval process, less accumulation of moisture and frost within the cold storage compartment, less temperature fluctuation from sample withdrawal and rapid random access to all specimens. The laboratory sample storage and retrieval process is a time-consuming problem for many clinical laboratories, especially when samples must be stored at ultra low temperature. This has generated a growing need for clinical lab automated storage and retrieval systems. The market for the systems will see strong growth, as indicated in Table 4-9. In many cases, the volume of samples to be stored and the records to be kept become difficult and frequently impossible. The installation of an automatic storage and retrieval system that utilizes bar code technology that maintains a sample database is a practical solution for many laboratories. Upfront planning and clear definition of objectives and constraints is primary for the conceptual and final design of the system.

84 Chapter Four: Markets 73 With the correct middleware, specimen storage and retrieval functions can reduce the time it takes to locate and retrieve a specimen. Table 4-9 World Market for Clinical Lab Storage-Retrieval Systems Revenues (in billions) $0.26 $0.28c $0.31 $0.33 $0.36 Source: Kalorama Information WORK STATIONS In a clinical laboratory, a work station can be a single function device, such as a tube sorter, while a work cell has two or more functions, such as an automated centrifuge, decapper and analytical instrument. However, a multifunction pipetting station is indeed a work station, although it can perform many functions. The automation of clinical laboratories is being heightened with the development of automation platforms that integrate instrumentation and work stations. Emerging miniaturization technologies, such as microarrays, microfluidics, and lab-on-a-chip, may enable labs to function with fewer pieces of equipment. So there may be less need for transport and robotics to move samples between work stations. The purpose of lab automation is to provide a method by which instrumentation and work stations in the clinical laboratory will be interconnected. A lab s LIMS provides the mechanism to receive orders, identify tube types, and identify work station locations. The bar code is used to track and collate information with respect to a single specimen assayed at any work stations or work cells. Tests that once had to be conducted manually and laboriously can now be queued and managed by automated work stations. In a typical laboratory work flow, many steps require a technologist to move a sample from one station to another. Each step, be it placing or removing a sample from a centrifuge or loading the sample onto an analyzer, can delay the process flow. In some instances, a new chemistry-immunoassay analyzer work station can do more to save money than any other automation step. An instrument that automates procedures previously done

85 74 The Worldwide Market for Lab Automation manually for example, one with on-board dilution and automatic retesting can provide considerable savings. Given the limited market for TLA, automation vendors had little choice but to develop modular work stations that provide the scalability to accommodate the large variety of productivity needs. Laboratories can adopt automation and install work stations in a stepwise fashion starting with a simple specimen manager and transportation device and then expand to include an analytical work stations, such as for chemistry, hematology or coagulation. Automated work stations from such companies as Beckman Coulter, Caliper Life Sciences, PerkinElmer and Tecan can deliver small volumes of reagent or wash the samples in microwell plates continuously. A system s robotic arm can take specimens from lab racks and place them in centrifuges. After testing is complete, the specimens can be cataloged and stored by a storage and retrieval module. Integrated devices can include: an aliquotter, centrifuge, decapper, integrity monitor, loading station, recapper, sorter, storage and retrieval device, transport system and work station, all coordinated by process control software. Look for the work station segment of the lab automation market to experience growth in the 6% to 9% range, as can be seen in Table Despite the potential for work station consolidation to occur when labs are automated, strong growth can be expected in the overall segment because of the large number of clinical labs that will have to automate. Table 4-10 World Market for Clinical Lab Work Stations Revenues (in billions) $1.30 $1.38 $1.50 $1.64 $1.79 Source: Kalorama Information SPECIMEN HANDLING SYSTEMS Initially, the only automated solutions for labs involved TLA, in which sample handling and transport systems were configured to automate the preanalytical, analytical and post-

86 Chapter Four: Markets 75 analytical phases of sample processing. Medical technicians could load sample tubes into a TLA system, program the system, and the system would perform the multiple duties that otherwise would have to be done by lab personnel. Then modular automation appeared on the market, in which different, separate automated components of the sample handling process had be configured to meet a lab's specific needs, even if those needs might change over time. Typical front-end modules can track, centrifuge, decap, inspect, aliquot, label, recap, or sort sample tubes in preparation for testing on a variety of analyzers that can be either part of the integrated system or standalone equipment. These modules are connected by transport systems and operated by software that can be controlled from a PC, and easily interfaced with a LIMS. Labs will use modules by a single manufacturer for specimen handling applications, since a manufacturer s modules might not necessarily interface with another manufacturer's modules. However, as common standards are adopted, labs should be able to mix and match modules from different manufacturers. Despite advances in laboratory automation, many sample handling tasks remain a manual process in the under-automated clinical laboratory. The laboratory unit operation is the basis of laboratory architecture. It can include sample transport, sample processing, and data handling. In the early 1980s, roboticcentric models of laboratory automation transported samples and performed many unit operations. They were not very efficient. The work station model, which performed an automated function involving a limited group of operations, was efficient but limited. Now the robot-centric model is in the past, and the integrated system model, a collection of devices that perform an automated process involving a large number of operations by using multiple work stations serviced by a general-purpose handling system, is moving into the laboratory. A normal sample handling system can be comprised of various types of handling units, including a centrifuge, cap opener, aliquoter, bar code labeler, cap restopper, sorter, analyzer units, a built-in rack conveyer provided in each handling unit, and a transportation line which connects these handling units. The handling unit and another handling unit, the transportation line and the handling unit, or a transportation line and another transportation line are connected in series. Sample handling can be performed by an automated centrifuge unit that separates blood samples into serum and cells; a cap opener unit which automatically removes caps

87 76 The Worldwide Market for Lab Automation from sample containers; an aliquoter that aliquotes serum from mother sample containers to daughter sample containers; a bar code labeler which labels a bar code label with the same sample ID as the mother sample on the daughter sample container; a restopper unit that restops the sample containers with a cap; a sample sorting unit that sorts the sample containers into groups for testing; and a chemical analyzer which automatically performs a chemical analysis of samples. Many sample handling systems on the market can be tied into a transportation line for transporting a rack holding samples. They can include a rack loading device that supplies the sample rack to the transportation line; a rack storage device for storing the sample rack transported by the transportation line; and several handling units disposed along the transportation line for applying a treatment on the samples. Also part of the specimen handling system can be a reader that reads identification information of the sample rack being transported; and a central controller which monitors the operational status of each handling unit and determines when and where sample racks are to be moved, based on identification information at the inoperative handling unit. Other specimen handling systems can be based overhead, requiring virtually no floor space and only a minimal amount of bench space. They incorporate state-of-the-art conveyors suspended near the ceiling that transport, log-in and sort blood specimens in standard specimen containers. Specimens placed into the system at bench-level bins are automatically singulated and loaded onto cleated conveyors and lifted to the main conveyor belt near the ceiling. The barcoded labels are then read as the containers are rotated under an optical scanner. The specimens are then diverted to the appropriate branch conveyor and lowered back to the bench level by cleated conveyors. This type of specimen handling system is rapid and accurate, requires no special containers, allows laboratorians to move unimpeded below it, and is inexpensive by automation standards. The market for specimen handling systems used in clinical laboratories is expected to grow as automated systems continue to move into these labs. The market s growth is seen in Table 4-11.

88 Chapter Four: Markets 77 Table 4-11 World Market for Clinical Lab Specimen Handling Systems Revenues (in billions) $0.50 $0.53 $0.57 $0.63 $0.69 Source: Kalorama Information LIMS Clinical laboratory automation has evolved from an idea rooted in the mechanical aspects of specimen manipulation in the early 1970s to a more complex information systemsdriven technology today. Today, a laboratory information management system (LIMS) involves software that is used in the laboratory for to manage and direct samples, laboratory users, instruments and other laboratory functions, such as invoicing, plate management and work flow automation. The task of managing laboratory data is not a new one. Over the past two decades, the use of LIMS has revolutionized how laboratories manage their data. A LIMS is more than software. It is the workhorse of the laboratory that encompasses work flow combined with user input, data collection, instrument integration, data analysis, user notification, and delivery of information and reporting. The idea behind an LIMS is to create a seamless organization in which instrumentation is integrated in the lab network. Equipment can receive instructions and work lists from the LIMS and return finished results, including raw data, back to a central repository where the LIMS can update relevant information to external systems. Lab personnel will perform calculations, documentation and review results using online information from connected instruments, reference databases and other resources using electronic lab notebooks connected to the LIMS. Management can supervise the lab process, react to bottlenecks in work flow and ensure regulatory demands. External participants can place work requests and follow up on progress, review results and print out analysis certificates and other documentation. There are several important interdependencies between software and hardware. If the software functionality is absent, the hardware cannot be expected to perform. Similarly, if the hardware functionality is absent, the software cannot be expected to

89 78 The Worldwide Market for Lab Automation actuate that hardware function. To allow random access, one must have a single tube per carrier design so that each specimen has individual real-time access to any work cell or device. To allow for reflex testing, there must be real-time control of hardware and instruments by the software that manages the overall operation. To allow routing, there must be more than one transportation path to move a specimen to one or many instruments. Several software systems now include functionality for both the procedure and the process. At the procedural level, rules can be applied that allow only the performance of specific tests on an identified matrix, such as only to perform a complete blood count on EDTA-treated or heparinized whole blood. The rules processing aspect of the software component of an automation system should be able to: monitor quality using the process control system; monitor results; monitor the instrument and its operation; implement repeat testing decisions; implement reflex testing; cancel tests; and manage the workload of the entire operation based on the need for turnaround time, throughput, instrument utilization and instrument uptime. The ability to interface between the LIMS and the overall automation system has been enhanced by the implementation of Health Level 7 system-to-system interfaces. The National Committee on Clinical Laboratory Standards (NCCLS) issued a proposed standard (AUTO 3P) that specifies the Health Level 7 interface as the system-to-system communications methodology for connecting a LIMS and the lab automation system. Clinical laboratory automation technology derives its usefulness from functionality -- functions that are performed or supported by technology. Functionality is heavily dependent on the approach that is applied to develop automation technology. There are several automation design issues that are of importance, including the philosophy of automation systems design, the implementation of process control software, the relationship between hardware and software, user interfaces to the system, the interface with LIMS, and the interface between the automation system and other hardware components. Process control software used in today s laboratory requires several important components and functionalities, including: A basis in modern information technology, which requires hardware and operating systems that are vertically upgradable. Transportation system management at both the local device and overall system levels.

90 Chapter Four: Markets 79 Specimen container tracking so that any specimen can be identified in its physical location on or in the automation system. The ability to initiate repeat testing so that a specimen that may yield a certain result can be rerouted using the rules embedded in software to repeat the test on another instrument using a different methodology or to confirm the test on the same or another instrument. Reflex testing in which an additional test can be performed at the same work cellwork station, or a specimen can be trafficked onto another instrument for subsequent testing that is the result of applying a rule against the result of the first test. Information systems integration so that LIMS and other information components of analyzers can be combined to make a functional automated laboratory. In this instance, the instrument can be managed using rules and other software-driven parameters, essentially replacing the technologist at the individual instrument. For example, the system software would "know" through the information passed by LIMS that the patient with a high urea value is from the dialysis unit and that the test does not need to be repeated. A rule can provide the functionality necessary to make the determination. LabVantage, Bridgewater, NJ, ThermoFischer Scientific and LabWare are among the many companies that offer a variety of LIMS products. The market for LIMS in clinical laboratories is expected to grow as software management plays a greater role in controlling processes and work flow, as automation systems incorporate even more complex technology. The market s growth is seen in Table Table 4-12 World Market for Clinical LIMS Revenues (in billions) $0.40 $0.43 $0.47 $0.51 $0.56 Source: Kalorama Information

91 80 The Worldwide Market for Lab Automation DRUG DISCOVERY LAB AUTOMATION MARKETS Automation has transformed drug development and discovery by making it possible to identify many targets with the aid of combinatorial technologies. Automating compound management processes, with the aid of high throughput screening (HTS), have helped avoid compound rejections. For drug discovery, the automation market has a vast array of tools to offer. With the high cost of bringing a drug to market, lab automation streamlines drug discovery and research labs processes, eliminates downstream bottlenecks and speeds target identification and screening. Among pharmaceutical and biotechnology companies, automation is not necessarily implemented to reduce labor costs, but rather to improve experimental results and work flow. In drug development, scientists are testing many more samples in order to measure a drug s characteristics. So the quality of results is crucial. Automation allows investigators to focus on analyzing results or developing new research avenues rather than the laborious and repetitive manual steps of an experimental set-up. Lab automation sales are heavily tied to life science spending, especially spending by the pharmaceutical and biotech industries. Although drug companies have curtailed their spending in general, the demand for lab automation instrumentation has continued, although at a modified pace, in part because of new products and automated solutions for newer techniques, such as microarrays and cell-based assays. But spending in this segment of the laboratory automation market, while still healthy, will not be as significant as growth in the clinical segment of lab automation, as the drug discovery segment is closer to maturity. Moreover, HTS does not always lead to successful drug commercialization. From the early 1990s, the starting point for lab automation involved the refinement of the microtier plate, a plastic sample holder with 96, 384 or even 1536 sample wells arranged in a two-by-three rectangular matrix. Providing a simple platform for performing assays on larger numbers of samples, microplates have been a major enabler of HTS, which was developed to screen large numbers of compounds as potential drug candidates for activity against a specific disease. These potential drugs form compound libraries, which are the intellectual property of the drug company performing the tests. Before the advent of HTS, analyzing a maximum of 100 samples a day was not unusual. With HTS, much larger libraries consisting of at least 10,000 samples are routinely analyzed per day, making it more likely and cost effective to find positive

92 Chapter Four: Markets 81 results in an assay, indicating the existence of potential drugs. The need for HTS becomes still clearer, when one considers that only about 250 compounds tested make it to preclinicals for every 10,000 screened. Of these, only about 10 make it into clinicals, and only one of the clinically tested compounds reaches market. The screening of compounds by HTS is made possible by the use of lab automation systems. The first devices were pipetting work stations -- liquid handlers -- that exploit the microplate format. Before compounds can be tested, they have to be placed within the 96 or more wells of a microplate. This requires pipetting, a tedious, slow and error-prone transport of a measured amount of liquid, if performed by hand. With liquid handlers, on the other hand, it became possible to perform pipetting on a large number of individual compounds without human intervention, a necessary first step in the automation of assays. Another device that facilitates HTS is the microplate reader, which determines whether assays are hits. Different types of microplate readers are on the market. These vary by detection technology -- absorbance, fluorescence, chemiluminescence, bioluminescence or radioactivity. Other HTS-enabling technologies include microplate washers, dispensers, sealers, bar code labelers, incubators and autosamplers. Even with the use of these devices, many manual steps remained part of the process. In the past, microplates had to be removed by hand from liquid handlers and new ones added. The need to eliminate these inefficient steps helped give rise to laboratory robotics. Eventually, miniaturization is making possible greater densities in microplates. And automated storage and retrieval systems store library compounds as they wait for their next screening and retrieve them when they are ready for to be screened. The world market for drug discovery laboratory automation systems will not fare as well as the market for clinical lab automation systems. This is in part caused by a market that has somewhat matured and which is essentially limited by the number of drug and biotechnology companies and their success in commercializing new therapeutics. This market is evolving into somewhat of an equipment replacement market, unlike the clinical lab segment, in which many labs are looking for new equipment. Still, the drug discovery segment for lab automation will experience a 3% to 4% annual rate of growth. Tables 4-13 through 4-17 indicate the expected growth in this market in the near term worldwide by geographical segment.

93 82 The Worldwide Market for Lab Automation Table 4-13 World Market for Drug Discovery Laboratory Automation Systems Revenues (in billions) $3.24 $3.37 $3.50 $3.64 $3.78 Source: Kalorama Information Table 4-14 North American Market for Drug Discovery Laboratory Automation Systems Revenues (in billions) $1.79 $1.85 $1.93 $2.01 $2.08 Source: Kalorama Information Table 4-15 European Market for Drug Discovery Laboratory Automation Systems Revenues (in billions) $0.81 $084 $0.87 $0.91 $0.94 Source: Kalorama Information

94 Chapter Four: Markets 83 Table 4-16 Asian Market for Drug Discovery Laboratory Automation Systems Revenues (in billions) $0.32 $0.34 $0.35 $0.36 $0.38 Source: Kalorama Information Table 4-17 Rest of World Market for Drug Discovery Laboratory Automation Systems Revenues (in billions) $0.32 $0.34 $0.35 $0.36 $0.38 Source: Kalorama Information PLATE READERS Microplate readers, also known as plate readers, detect biological, chemical or physical events of samples in microtiter plates. Sample reactions can be assayed in well format microtiter plates. In most cases, a high-intensity lamp passes light to the microtiter well. The light emitted by the reaction in the microplate well is quantified by a detector. Common detection modes for microplate assays are absorbance, fluorescence intensity, luminescence, time-resolved fluorescence and fluorescence polarization. The first microplate readers on the market were filter-based units. Today, readers are tunable, enabling the use of any fluorophore and chromophore. Current day plate readers come with software tools for data analysis, automation, and the like. Microplates are used in a number of applications and markets: ELISAs. Protein and cell growth assays.

95 84 The Worldwide Market for Lab Automation Nucleic acid quantitation. Molecular interactions. To detect enzyme activity. Cell toxicity, proliferation, and viability. ATP quantification. Immunoassays. High throughput screening of compounds and targets in drug discovery. The devices on the market usually use optical or, in a few cases, label-free techniques to evaluate the contents of microtiter plate wells. An ELISA plate reader, for example, measures the intensity of the color formed in each well. The enzyme-linked immunosorbent spot (ELISPOT) assay is a common method for monitoring immune responses in humans and animals. ELISPOT plate readers count the colored spots that are formed in the course of ELISPOT assays. Using these plate readers can eliminate, or at least, help reduce, the amount of human subjectivity which goes into evaluating the plate contents. Originally, microplates had 96 wells arranged in 8 rows and 12 columns. In an effort to increase throughput while maintaining compatibility with existing automation equipment, the number of wells has increased to 384, 1,536 or more on the same size of plate. The resulting smaller wells have both advantages and disadvantages. In addition to increasing throughput, the smaller wells require lower reagent volumes, a potential cost saving in some situations. However, working with smaller volumes requires more precise, and expensive liquid handling equipment. Also, the smaller the volume, the more environmental factors will interfere with the ability to determine results. For example, 1,536 well plates are less frequently used due to associated evaporation problems. In many cases, more accurate positioning of the plate is required on the target device because of the smaller wells and higher density of wells. The 1,536-well plate produces a density that already stretches the ability of liquid handlers and other devices, and even higher densities are being developed. Multiwell plates also triggered advances in laboratory automation and miniaturization. Handling fluids more quickly and efficiently plays a fundamental role in pushing basic and applied research to ever faster speeds. Despite the increasing number of wells, the overall plates take up the same size.

96 Chapter Four: Markets 85 As the wells increase in microplates, scientists need automated techniques for routine and repetitive tasks. Automated work stations from companies including Beckman, Caliper Life Sciences, PerkinElmer and Tecan can deliver small volumes of reagent or wash the samples in microwell plates on a continuous basis. Tecan is marketing the Infinite M1000 microplate reader. The high-end detection system offers flexibility, sensitivity and speed for a wide range of detection modes, and has been optimized for time-resolved fluorescence energy transfer (TR-FRET)-based assays, as well as glow luminescence, fast luminescence and dual color luminescence assays. The platform can be upgraded with new detection modes, making it ideal for bridging the drug discovery gap between research, assay development and screening in the biopharmaceutical industry, as well as for research laboratories with multiple users. The system is targeted at a broad spectrum of applications that includes the latest biomolecular assays for primary and secondary screening, receptor-ligand binding studies, cell-based assays and UV fluorometry-based applications. As far as instruments go, a microplate reader is not the most expensive item on most research labs' most-desired lists, with the simplest systems costing about $6,000 and the higher end models costing more than $20,000. But it might be one of the most versatile. One of the first things to consider is the intended application for the reader. Knowing this will allow one to determine what wavelengths are required, as well as whether fluorescence or luminescence capabilities are needed. Related to deciding what capabilities are needed is having an idea of the type of data that will be generated. Knowing this will management decide what kind of software will be required. For example, if a lab runs a large number of assays with different formats, managers may want to consider complex software that will allow one to store methods and calculate results with minimal manipulation. This is especially important if a lab has a high technician turnover rate On the other hand, results for the occasional ELISA or protein assay can be readily calculated using a simple spreadsheet. The multimode microplate reader market has been one of the fastest growing microplate reader markets. Multimode readers provide detection capabilities across a range of detection modes, including absorbance, luminance and fluorescence. Multimode readers have clearly found a home in high-throughput screening labs, yet market drivers and the instruments' increasing versatility continue to expand their presence in this and other end-user markets. Multimode readers were first introduced in the late 1990s.

97 86 The Worldwide Market for Lab Automation The type of plate reader most used currently is filter-based. In the near term, filter-based and monochromator readers will find more use. Filter-based readers are most favored on the basis of capital costs, the specific read modes required and sensitivity. Monochromator readers have the edge in terms of wavelength scanning capability, the ability to run a wide diversity of assays and the ability to differentiate a fluor. It appears that PerkinElmer has the greatest share, about 28%, of the market for plate readers, followed by Molecular Devices at 27% and Tecan at about 10%. Expect the market for plate readers in drug discovery labs to experience about a 4% annual rate of growth, as seen in Table 4-18, due to the softer market for automation in drug research and development. Table 4-18 World Market for Drug Discovery Lab Plate Readers Revenues (in billions) $1.30 $1.35 $1.40 $1.46 $1.51 Source: Kalorama Information AUTOMATED LIQUID HANDLING SYSTEMS Incorporating new liquid handling technologies into the drug discovery process has been important in keeping pace with the demands for increasing throughput and lowering costs. Systems must be designed to handle the assays and chemical compounds under development. Additionally, manual pipetting techniques can, over time, present health and safety risks. As a result there has been an increasing demand for automated liquid handling systems. Automated liquid handling is instrumental in drug discovery initiatives and has helped speed work flow. Although growth in the this segment of the lab automation market is not what it used to be, the market continues to provide innovative advancements, such as low-volume dispensing systems for key applications in drug discovery. Drug discovery researchers in both academia and industry are constantly grappling with bottlenecks in the liquid handling work flow that impair productivity, cost

98 Chapter Four: Markets 87 efficiency and throughput. Productivity will vastly improve as automated systems emerge, and robotics perform otherwise manual, time-consuming, routine procedures faster. Ambitious goals and time-bound projects make researchers constantly evaluate automated liquid handlers for precision, accuracy, efficiency, smaller size, and lower cost. These features optimize processes by improving quality and speed, testing turnaround, and reducing labor and time. As many therapeutics come off patent, competition increases, and there is a strong pressure on pharmaceutical companies to produce new drugs. Along with this is the need to produce drugs at reduced overall costs. The advantages of automated liquid handlers include increased reproducibility and reliability, which leads to a reduced cost. Liquid handling systems are used in a number of applications in the drug discovery laboratory. They have become essential for tasks ranging from assay development to plate replication. Just as these instruments have facilitated HTS operations in industry, liquid handlers also are starting to liberate academic researchers from repetitive manual pipetting. Without such burdens, scientists would be free to undertake more value-added research. The wide variety of automated devices that are available has evolved over the last 25 years. With the sudden and swift spread of the AIDS epidemic in the 1980s, the world received a glimpse of the sluggish drug discovery process. The need to find an AIDS treatment spurred the development of expedited methods of research. Today, those technologies are still crucial. Researchers are desperate to treat a barrage of diseases. Projects that would otherwise require excruciatingly protracted time periods operate on timelines more in line with the fast track uncovering of the molecular and cellular worlds. Many objectives for research facilities include improved efficiencies and reduced overall research and development costs. Automated liquid handling systems are key to accomplishing these common goals. The devices are crucial to downsizing experiments to miniaturized formats, which reduce the use of reagents and consumables. Robotic arms and multi-probe dispensing heads can dispense nanoliter volumes with a precision not possible with the inherent faults of humans. This capability allows assays to be miniaturized and modified for higher density plates. Whereas 96-well microplates were once the norm, 384- and 1536-well plates are quickly becoming the standard. The savings can grow significantly. Decreasing the use of reagents and consumables will reduce how much is spent on disposal. Automated liquid handlers are

99 88 The Worldwide Market for Lab Automation more affordable than ever. Decreasing prices and smaller units have both improved the accessibility of the instruments. The cost has declined for entry-level systems. In addition, many companies have adopted the modular approach, which allows researchers to purchase liquid handling functionality by itself. Instead of the prohibitive cost of large systems that provide start-to-finish features, purchasing individual modules makes the move to automation more realistic and less intimidating. Moreover, software is becoming a driving factor for selling equipment. Some users do not want to worry about programming. Software can be written for specific applications so the user only has to push the run button. The demand for ease-of-operation reflects the overall trend toward liquid handlers that are very flexible. This is becoming most evident in nucleic acid sample preparation and solid phase extraction applications. The need for simpler, compatible, interconnectible plug-and-play instruments is reflected in the approximately 30% of liquid handlers that are targeted to the needs of genomics researchers. Here, the priority is in obtaining quality results, which can be efficiently obtained with instruments developed for specific applications. These include devices for DNA purification, RNA isolation, microarray hybridization, and PCR cleanup and set-up. The instruments can be more affordable and less intimidating. Traditionally, instruments with complex features and advanced capabilities come at higher prices. Researchers' continual demand for superior-featured instruments at lower prices is straining manufacturers' profit margins. Manufactures need to create flexible instruments or accessorize their products to meet varied, complex demands from researchers in different industries and yet maintain their profitability. Although high flexibility is often a competitive advantage, manufacturers also need to be cautious to couple high flexibility with a certain level of ease of use. Even with the movement toward simpler systems, the technology for both multipurpose and application-specific liquid handlers is advancing. Complex tubes can detect and report clots. Pipette tips can verify the volumes dispensed or transferred. The instruments can respond to the input and act accordingly. As closed-loop systems, they are able to optimize the efficiency of assays and screening efforts. Investigators can program equipment to respond to the downstream reader. Upon recording specified types of data, the instrument can direct its attention to pertinent samples, such as retrieving them and performing further analysis. These are intelligent systems.

100 Chapter Four: Markets 89 One of the most rapidly expanding fields of robotics is automated liquid handling systems pipetting, diluting, dispensing and washing. These systems have made large strides in terms of efficiency, accuracy, and technological sophistication, fueled by the need for HTS on the part of drug developers. The risks of handheld pipetting errors as well as accuracy and precision mistakes can be avoided by harnessing automated liquid handling. Interest in stackers and robotic arms has been increasing thanks to their ease of use and installation, and the time and effort they save. As technical acceptability increases and prices become more affordable, the tools will be more widely adopted. Also spurring on adoption of this technology is increased the user-friendliness of the automated liquid handling systems' control software. For example, Thermo Scientific offers its Matrix Hydra DT, which has on-board programming or intuitive graphic-based PC software. More automated liquid handling systems and robotics will be recruited to carry out various routine procedures at a faster speed as time goes on. Bench top automated liquid handling and sample-dispensing systems have become routine in most life science research laboratories. Such systems will become even more ubiquitous with the introduction of a new wave of lower-cost modular devices with much the same functionality as the systems used by drug company labs. So essentially for the automated liquid handling segment of the lab automation market, volumes will get smaller, with microliter plates moving down to nanoliters. Software for scheduling liquid handler plates could be intelligent and optimize the run, order, and timing sequence in the laboratory. Table 4-19 indicates the near term growth for this segment, which will continue at a modest pace. Table 4-19 World Market for Drug Discovery Automated Liquid Handling Systems Revenues (in billions) $0.80 $0.83 $0.87 $0.89 $0.92 Source: Kalorama Information

101 90 The Worldwide Market for Lab Automation ROBOTICS Laboratory robots are continuing to find applications in pharmaceutical development to help increase productivity, decrease drug development time and reduce overall the coasts associated with drug development. A robot can perform a variable but programmed series of physical manipulations including moving objects, weighing, extraction, filtering and diluting specimens. Robots can be classified according to the type of movement the robotic arm can perform. Cylindrical and anthropomorphic robots generally provide more flexible human-like automation that includes transferring objects, weighing, extracting and filtering samples. In a typical analysis, several steps are performed: sampling; sample preparation; sample measurement; and data collection, analysis, and reduction. Most laboratory robotic systems automate the sample preparation stage, usually the most labor-intensive step of the analysis process. Robotic systems are expensive, running from a few hundred thousand dollars to more than $1 million, depending on the system purchased. But their high capital cost is justified by increasing throughput in the lab since automatic systems can operate 24 hours daily unattended, which also reduces the cost per analysis. During the 1990s, drug development times significantly declined, which has required more responsive just-in-time analysis, and this has been an integral part of cost reduction for the release of raw materials and commercial products. Robotic systems also enable scientists to use their time more productively since they enable them to spend more time on evaluating data and on more innovative tasks rather than performing routine repetitive operations. Although the application of laboratory robotics is increasing, limitations including high capital cost, relative complexity of operation and poor connectivity between the robot and laboratory information management systems, can hinder their implementation. The growing number of potential new drugs has generated a need to automate procedures in the laboratory. Laboratory automation equipment vendors have responded to this need with a series of tools. Automated integrated robotic systems help to increase throughput while reducing tedious and expensive human intervention. Higher numbers of wells and smaller liquid dispensing capacity along with robotic systems can help maintain the throughput for HTS. High content screening (HCS) uses similar high productivity techniques to automate information-rich biological assays for the discovery and validation of new drugs. And new platforms, such as microarrays and labs-on-a-chip,

102 Chapter Four: Markets 91 enable researchers to pursue more targets simultaneously while saving costs on labor and sample preparation as well as the use of smaller volumes of reagents. Robotic systems can undertake many of the tasks that humans would usually perform. Systems from such companies as Caliper, Thermo CRS (formerly CRS Robotics), and Tecan are smart and flexible. They can perform one operation and be easily modified to perform other tasks. The application of robotics to life science is hardly new. In recent years, robots have become much more useful for integrating different types of technology onto a single platform. Liquid handling robotics provide the ideal platform for the automation of a broad range of routine applications, ranging from simple pipetting tasks to sophisticated isolation processes or assay development. A simple combination of liquid handling and robotic systems is opening up the field of liquid handling automation by providing affordable solutions for even the smallest of workloads all the way up to high throughputs. Companies, such as Xiril AG of Switzerland, are marketing space-saving, open pipetting robots in 75 cm, 100 cm or 150 cm footprints. These can be adapted to suit a wide range of life science applications with optional arm and pipette configurations and simple integration of modular hardware components. One advantage of integration is the optimization of limited laboratory space. In 2006, Thermo launched its HCS WorkCell, a high-content screening system with a small footprint. The use of fluorescent microscopy has given rise to screening tools based on high-resolution imaging of multiple targets within a cell. These systems present information on multiple spatial and temporal events in cells and offer significant advantages over fluorescent plate readers used in conventional cell-based assays because they measure multiple signals from individual cells within a well as opposed to a single signal per well. A typical system consists of imaging instrumentation, fluorescent reagents, probes, and software. It can be fully automated using multiwell and robotic sampling systems. This approach is more efficient for validation of cellular targets and predictive toxicology and lead optimization. And, from the view of the bench top, increasing trends are toward the implementation of modular automation -- small work cells that can be rapidly configured, installed, brought into operation, and reconfigured when the need arises. Technical solutions could involve distributed robotics -- that is, many simple, rather than one large robot. Thus, a work cell can be a small, automated solution that addresses tasks such as

103 92 The Worldwide Market for Lab Automation sample extraction, reading plates, or some other portion of an assay as a single device or integrated. With the knowledge of genome sequences, low cost robotic liquid handlers are being aimed at medium- and low- throughput systems especially with the huge information churned from the high throughput screening process. Compound management has lent itself to automation by gradually adapting to robotic and automated dispensing environments for plate reformatting. Sample preparation has been the weak link in chemical analysis. The preparation step has been time-consuming, expensive, and a major source of errors. Laboratory robotics has become a popular alternative to preparing samples manually. Many users are getting better analytical results -- faster, safer and at less cost than before. The industry recognizes the importance of reducing human exposure to a wide range of chemicals and biologically active materials, while isolating sensitive procedures from human contamination. What are needed are practical techniques for generating feedback and controlling laboratory automation systems. Automated sample preparation systems normally run unattended. While increasing productivity, unattended operation creates situations that must be accommodated if the system is to run reliably. Modern robotics use feedback and feedforward techniques to assure reliable operation. Feedforward technology is used to confirm that the operation is possible. The heart of feedforward control is the system image, which consists of a set of data variables for every possible container, or tube, position in the system. The usual variables are container volume and capped status. As the containers move and volumes change, the stored image is kept updated. In the example of removing a tube from a rack, the computer program can compare the intended operation with a stored record, or image, of the system before the action starts. It would confirm that the robot's hand is empty and that there is a tube in the target location. Feedback is used to confirm that an operation was performed as expected. Feedback control relies mostly on robotic tactile sensing and position sensing switches in associated mechanisms. It is important for the laboratory robot to be able to sense the force with which it is pushing in all of its axes, not just the grip. After the robot has removed a test tube from a rack, the force exerted by the gripper mechanism can confirm that there is a tube in the fingers and that the operation was successful. Additionally, laboratory balances are used to gravimetrically confirm transfers. Weight confirmation is important with other

104 Chapter Four: Markets 93 automated preparation steps, such as membrane filtration, solid-phase extraction, and evaporation when the final sample amount may be in question. The robotics segment of the drug development lab automation market is continuing the trend toward integrated, flexible products that can be customized. Flexible robotic platforms will be important to future market growth, which is seen in Table Table 4-20 World Market for Drug Discovery Robotic Systems Revenues (in billions) $0.50 $0.52 $0.54 $0.56 $0.57 Source: Kalorama Information DISSOLUTION TESTING Dissolution is a test used by drug developers to characterize the dissolution properties of an active drug, the active drug's release and the dissolution from a dosage formulation. Dissolution testing is used to formulate the form of drug dosage desired and to develop quality control specifications for the manufacturing process. In-vitro dissolution testing correlates with in-vivo clinical studies. It measures change on stability, and establishes an in-vitro and in-vivo correlation for some products. A significant time and effort have been invested in developing automated dissolution testing systems. Large pharmaceutical companies have invested many resources in automation concepts to the point of creating task forces or departments to achieve this objective. The need for automating these systems comes from an increase in the number of tests performed. This has come about because of the required dissolution testing of older drugs; an increase in the number of stability tests; the need for bioequivalency studies; and increased numbers of tests per production batch. These factors require an increase in capacity. In addition, an increasing number of drugs require dissolution tests that run for several hours. Often these tests have sampling points that require overnight or over-theweekend processing, which may require hiring additional lab personnel. For the most

105 94 The Worldwide Market for Lab Automation part, dissolution testing is important to many different areas drug research, quality control and methods development. With these various markets, it is less vulnerable to a drug company s changing development plans. For these reasons, expect the market for automated dissolution testing systems to continue to grow, as seen in Table Table 4-21 World Market for Drug Discovery Dissolution Testing Systems Revenues (in billions) $0.13 $0.14 $0.14 $0.15 $0.16 Source: Kalorama Information Today, with the documentation required for quality control tests and about eight hours in a working day, an average of about four short time tests of 30 minutes each per employee per day may be needed. However, this is only true for short time tests. As soon as the test length increases, the capacity is reduced considerably. An increase in the number of tests performed will require an additional investment in manual equipment or laboratory staff. Important factors to consider are the cost for hiring additional personnel, and the fact that hiring is not always approved, or in some countries the proper personnel cannot be found easily. For these reasons, more laboratories are investing in automated systems. Automation offers reproducible results. Manual tests with different personnel often create considerable discrepancy in results, resulting in high costs as production batches cannot be released or have to be re-analyzed. Automation of a single test might require a semi-automated system, whereas, automation for a series of tests might require a fully automated system. Some semi-automated systems are based on a modular concept allowing the customer to customize specific testing needs. Available options include UV on-line, HPLC on-line solutions, as well as off-line, or combinations of both. Options like solvent replacement after sampling and solvent addition for ph-change are also available. Fully integrated automation systems manage all operations simultaneously. With some systems, up to 15 USP 2 tests can be fully automated from the tablet input up to the printout of the report.

106 Chapter Four: Markets 95 Dissolution testing entails measuring the stability of the investigational product, achieving uniformity in production lots and determining the product s in vivo availability. The test helps a drug developer formulate dosage forms and develop quality control specifications for its manufacturing process. The dissolution test is a relatively new analytical technique that has undergone modifications and improvements in the last 10 years. The importance of the test has increased considerably in that time. As dissolution testing has evolved, these testing systems have become fully automated. The control of convective diffusion properties through hydrodynamics is emerging as critical. It may be the key factor in obtaining appropriately responsive, relevant and reliable dissolution measurements. Applying to all types of dissolution measurements, this is especially relevant to flow-through techniques, producing a vast improvement in dissolution measurements. The successful development of a discriminating automated dissolution technique is often the critical factor in moving product development forward, releasing manufactured product, avoiding an unnecessary product recall, establishing an in vivo relationship, and even substituting in vitro data in place of in vivo for future product upgrades. In addition to increasing efficiency and decreasing operational costs, automation of dissolution technology can substantially improve precision, reproducibility and sensitivity to formulation differences. Improving the control of hydrodynamics and convective diffusion, fully automated high-performance multi-sample systems have been developed. They are useful for a wide array of dissolution applications, producing a higher rate of data acquisition, precision and ultimately improved correlation in vivo. Such companies as Agilent, Shimadzu and Varian have marketed their instruments and software to users through alliances with leading dissolution equipment manufacturers. Some companies sell their own components separately. However, complete solutions are available. Varian's Cary 50 spectrophotometer is part of VanKel's Total Solution system. Agilent's 8453 spectrophotometer and ChemStation software are compatible with Distek's dissolution equipment and Zymark's (a division of Caliper Technologies) MultiDose work station. Shimadzu and Logan Instruments have marketed completely automated HPLC dissolution systems, featuring Shimadzu's LC-10A series HPLC and CLASS VP software. In the last two decades, dissolution testing has become increasingly automated. However, automation presents some significant challenges as well as opens up new opportunities. FDA and international regulations require the continuous calibration of

107 96 The Worldwide Market for Lab Automation instruments and the validation of parameters, such as temperature and agitation rate. Automation has not only increased the number of samples tested but has also increased the level of unmonitored testing, making validation more necessary. New systems appear to be meeting these challenges. The automation of dissolution testing systems has also made the role of software more crucial. In an effort to further integrate systems, analytical instrument companies have modified their software to enable them to run dissolution testing systems. The pooling method of dissolution testing -- the analysis of samples in batches -- has also simplified the process and increased throughput. Initially, the focus of automation systems for dissolution testing was more on the hardware side. Now, regulatory requirements have been published, such as Good Automated Manufacturing Practices (GAMP) guidelines, and the FDA CFR part 11 for software. Validating the systems has become a top priority, especially concerning software. Comprehensive systems have a very high level of complexity. These systems operate with CFR-compliant software with the potential for transferring data to LIMS. Automated dissolution testing systems are not just targeted to large pharmaceutical companies but to mid-sized pharmaceutical companies as well. LIMS As in the clinical diagnostic laboratory, a laboratory information management system (LIMS) is used in the drug discovery laboratory to manage the placement, handling, testing and retrieval of samples. LIMS also can direct lab personnel, instrumentation and other laboratory functions, such as invoicing. It impacts plate management and work flow automation in general. Today's trend is to create a seamless organization in which instruments are integrated into the lab network. They receive instructions and worklists from the LIMS and return finished results including raw data back to a central repository where the LIMS can update relevant information. By means of electronic lab notebooks connected to LIMS, lab personnel perform calculations and review documentation and results using online information from connected instruments, reference databases and other resources. Management can supervise the lab process, react to bottlenecks in work flow and ensure that regulatory requirements are met. External participants, such as physicians and hospitals, can place test or retest requests and follow up on progress. HTS, drug candidate screening, gene

108 Chapter Four: Markets 97 screening, DNA sample handling and genotyping, protein screening, and the like have made LIMS a necessity, even in fundamental laboratories. Commercially available LIMS have been around since the 1980s. In addition, many laboratories have designed, implemented and maintained their own systems. The heart of any LIMS is the software. Like other laboratory systems, LIMS software is subject to quality control and quality assurance checks. In regulatory environments, this is system validation. The primary purpose of the validation process is to ensure that the software is performing as it was designed to. For example, system acceptance criteria should be established and tested against quantifiable tasks to determine if the desired outcome has been achieved. LIMS features, such as autoreporting, reproducibility, throughput, and accuracy, must be quantifiable and verifiable. System validation ensures that the entire system has been properly tested, incorporates required controls, and maintains and will continue to maintain the integrity of the data. Laboratories must establish protocols and standards for the validation process and associated documentation. Although vendors of commercial LIMS perform initial internal system validations, the system must be revalidated whenever the end user, vendor or third party modifies the LIMS. There is no standard way to plan and implement a validation process. Validation activities need to be conducted throughout the entire LIMS life cycle. The validation process starts with the functional requirement development phase when the LIMS is purchased, and it continues through the specification, testing, implementation, operation and retirement of a system. Despite a slower rate of growth expected in drug discovery lab automation, LIMS will continue to be adopted by drug developers because these systems increasingly meet industry-specific requirements, including the need for companies to comply with various regulatory and manufacturing processes, such as cgmp, NAMAS (National Accreditation of Measuring and Sampling), Environmental Protection Agency (EPA), and of course, FDA regulations. Many early users of LIMS installed heavily customized systems that proved difficult to upgrade and integrate with other business functions. As merger and acquisition activity occurred, application integration became a necessity to ensure that laboratories made their data accessible throughout the enterprise. After several years, homegrown systems had become almost obsolete. These were replaced by more available, upgradeable and compliant vendor-supplied generic LIMS. These early

109 98 The Worldwide Market for Lab Automation systems, while designed to provide basic data management and meet regulatory compliance, required a high degree of customization to meet the specific needs of each particular user group across the enterprise. LIMS were not customarily designed to operate at full functionality, which required pharma users at the research, development or manufacturing phase of drug development to customize the LIMS for a specific laboratory application with its specific work flow and data management requirements. Advances in technology have transformed LIMS over the years. In-house systems often were simple spreadsheet packages. Vendor systems were modeled on minicomputer platforms and often were multi-user oriented. Most products were then based on a basic Windows platform on top of a DOS operating system. But these systems were slow and not secure. The eventual migration of Windows NT as a corporate standard precipitated the need for NT-based LIMS, which offered a reliable, secure and stable environment for data. Moreover, greater use of the internet affected the way in which scientists managed and accessed data. The eventual growth of supporting technologies enabled LIMS to grow in scope from single-user desktop tools to global, enterprise-wide critical business applications. The reality for pharmaceutical labs is that generic LIMS typically satisfy only about one-third of their needs. Installations can take from 18 months to three years to complete. System requirements may change during this time, leading to a significant difference in what an LIMS can deliver and what a laboratory truly needs. To close this gap, organizations must configure their LIMS. In addition, companies want LIMS to address the standardization of their global laboratory processes. By unifying documents and rules, LIMS are becoming the corporate standard. The ineffectiveness of generic LIMS is even more apparent in the pharmaceutical industry when it comes to government regulations in particular, the International Conference on Harmonization (ICH) guidelines. Once again, organizations are looking to their LIMS to assist with regulatory harmonization by building this functionality into the software. Essentially, advances in technology, market trends and strict regulatory requirements have made the industry to look for more purpose-specific LIMS that are not customized but instead are configured to meet their needs. Systems are on the market which offer industry-specific functionality so that companies do not need to go through costly, time-consuming risky customizations. Products are built on open standards that are designed to be quickly and easily implemented. By providing LIMS for specific

110 Chapter Four: Markets 99 applications that are connectible to other technologies, vendors can provide a holistic view across the entire drug development life cycle, while still allowing fast implementation and adoption times for each solution. For drug discovery, a LIMS must be flexible enough to handle changing environments, including the complexities of increasing sample throughput and managing clinical studies. Drug developers struggle to bring more products to market. To be successful, they must foster collaboration among their researchers to minimize rework and, ensure that they have the information they need to make the right decisions. This is increasingly important as companies expand their operations worldwide. LIMS can help remotely located scientists collaborate and impact research decisions, which results in considerably increased laboratory productivity. Laboratories are generating increasing amounts of data as analytical techniques become more sophisticated, and this means there is greater pressure on them to automate and integrate systems to make use of the additional data. LIMS are key to facilitating automation, data sharing, collaboration and integration across multiple data sources and products, including both hardware and software. Forward thinking LIMS suppliers must form partnerships with software vendors to ensure that information sharing through LIMS will be enabled on a global scale across multiple locations and disciplines. To meet the needs of pharmaceutical companies, LIMS will need to grow in terms of functionality, breadth of interconnectivity and extent of collaboration. LIMS must be able to plug into a more seamless enterprise that allows users to work more efficiently and at a higher level. Despite the challenges, LIMS suppliers can expect decent growth in drug discovery lab automation, as indicated in Table Table 4-22 World Market for Drug Discovery LIMS Revenues (in billions) $0.55 $0.57 $0.59 $0.61 $0.63 Source: Kalorama Information

111 100 The Worldwide Market for Lab Automation STORAGE-RETRIEVAL SYSTEMS As combinatorial chemistry has increased the size of many companies main compound libraries, the complexity of managing these libraries has increased as well. But for the libraries to remain useful to the drug discovery process, they must be accessible. Not only is it essential to manage a repository and to physically locate and handle the compounds, but it is also vital to maintain detailed records of sample use and data from previous assays, while conserving stocks by restricting the use of scarce compounds. The process, results and materials must be managed in an integrated fashion, from combinatorial chemistry, through HTS, to development and lead optimization. Most companies begin with a manual repository system. After a compound is created and analyzed, it is labeled and stored manually in a central location. Information technology systems can help researchers access compound information and analyze chemicals and biological data. Compound retrieval is simply a matter of going to the storage area, reaching for the compound, and returning with it to the bench. No records are kept of compound usage or stock levels. But as the compound collection grows, sample retrieval and preparation become increasingly unwieldy. With a larger library, more compounds will be screened against targets, and the number of targets is likely to increase as researchers take advantage of the capabilities of high throughput screening. Automated liquid handling and storage and retrieval systems are usually introduced at this stage together with automated chemical synthesis equipment for library generation and lead optimization. Careful consideration must be paid to their associated information handling systems. Compounds can be lost in a large system -- created and stored but never retrieved. The fear, of course, is that the next big blockbuster drug can be lost in the library. As combinatorial chemical synthesis and high throughput screening systems advance in speed and complexity, they will necessitate not only more widespread, integrated automation of critical processes, but also, on a broader level, industrialization of the overall drug discovery process. Production-scale compound synthesis and screening operations will involve storage, tracking, and retrieval of perhaps hundreds of millions of compounds. To take the fullest advantage of new technologies, this industrialscale process will require database management systems that are flexible, accessible, expandable and secure. In addition to HTS, the storage of compounds also need to be addressed. With a company s screening capacity exceeding 100,000 compounds a week, resource allocation

112 Chapter Four: Markets 101 to compound storage and speeding the time it takes to retrieve compounds also play a crucial role in aiding the screening of such a large number of compounds. Samples used in biological assays are usually chemically synthesized compounds, plant or animal extracts, and cellular material (RNA and proteins). The storage methods vary by the sample type and the solvent they are solubilized in. Sample retrieval methods need to be automated since the manual location and retrieval of specific samples from millions of samples is time consuming and prone to errors. The utilization of bar-code labeling and robotic equipment to decrease the time required for sample location and retrieval is the main feature of automated storageretrieval systems. High end sample storage and retrieval systems can incorporate liquid handling systems for aliquoting samples inside the cold storage room at -20 o C. Among major vendors specializing in this product line are RTS Lifesciences, Tecan s REMP and The Automation Partnership. The importance of storage-retrieval systems in ensuring sample integrity by helping preserve the chemical properties of samples and preventing decomposition will facilitate growth in the overall market for these systems, as seen in Table Table 4-23 World Market for Drug Discovery Storage-Retrieval Systems Revenues (in billions) $0.30 $0.31 $0.32 $0.33 $0.34 Source: Kalorama Information There are a handful of leading competitors in the laboratory automation systems market, including both the clinical segment and the drug discovery segment, as can be seen in Table 4-24.

113 102 The Worldwide Market for Lab Automation Table 4-24 Laboratory Automation Market Leaders Percentage of Market Share Thermo Fischer Scientific 14 Beckman Coulter 7 Caliper Life Sciences 4 Tecan 4 PerkinElmer 3 Molecular Devices 2 Others 66 Source: Kalorama Information

114 C H A P T E R F I V E Corporate Profiles ABBOTT DIAGNOSTICS 100 Abbott Park Rd. Abbott Park, IL Phone: URL: Abbott Diagnostics is a leader in in-vitro diagnostics and offers a broad range of instrument systems and tests for hospitals, reference labs, blood banks, physician offices and clinics. With more than 69,000 institutional customers in more than 100 countries, Abbott's diagnostic products offer customers automation, cost effectiveness and flexibility. Among its products, the company continues to invest heavily in its Architect and Cell Dyn families of analyzers and has introduced several new successful systems, such as the Arhcitect c8000, i2000sr and ci8200. These product lines will continue to expand over the next several years. The Architect c8000 and Aeroset clinical chemistry analyzers share the same reagents, parts and consumables and meet the throughput needs of mid- to very-high volume labs. In the next few years, the company plans to introduce the c16000 high volume advanced chemistry system. Flexible and scalable, the Architect systems can be implemented as stand-alone analyzers, integrated work cells, as part of a laboratory automation system. All analyzers share the same software which minimizes training and improves operator efficiency.

115 104 The Worldwide Market for Lab Automation Abbott is introducing significant technology to improve lab performance. AbbottLink is an IT-based software that makes possible a secure interface from the Abbott diagnostic instrument to the internet so operational data can be transmitted to a secure server. AbbottLink makes possible the proactive monitoring of instrument operations. EQC is an IT solution that allows Abbott hematology customers to automatically send their quality control information to Abbott, where it is consolidated into reports and returned to the laboratory. This enables the customer to see how his quality control is performing compared to a peer group to ensure their lab is functioning at optimum levels. Abott Prism is an advanced automated blood banking testing instrument. The Accelerator Automated Processing System is designed to automate the labor-intensive, repetitive motion in the laboratory. This suite of automation components reduces manual steps in the testing process to ensure fewer errors and greater process consistency. There are other technologies that Abbott has developed that reduce error and improve patient outcomes. These include but are not limited to the reduction of sampleto-sample carryover to less than 0.1 part per million, thus reducing false positives due to cross-sample contamination. This also includes the use of radio frequency identification (RFID) technology in the new Accelerator to ensure positive identification of samples and to ensure results are associated with the proper patient sample.

116 Chapter Five: Corporate Profiles 105 AGILENT TECHNOLOGIES INC Stevens Creek Blvd. Santa Clara, CA Phone: URL: Agilent is a measurement company and a technology leader in communications, electronics, life sciences and chemical analysis. The company's 19,000 employees serve customers in more than 110 countries. Agilent had net revenues of $5.4 billion in fiscal The company has two business segments: electronic measurement and bioanalytical measurement. The electronic measurement business focuses on the communications and electronics industries, while the bio-analytical measurement business focuses on the life sciences industry, the environmental, chemical, food and petrochemical industries, and the materials sciences. Agilent sells its products primarily through direct sales, but also utilizes distributors, resellers, manufacturer's representatives, telesales and electronic commerce. Of its total net revenue of $5.4 billion in 2007, the company generated 34% in the US and 66% outside the US. Agilent s bio-analytical measurement includes instrument software, consumables and services that enable customers to identify, quantify and analyze the physical and biological properties of substances and products. The company s key product categories include: gas chromatography, liquid chromatography, mass spectrometry, microfluidics, microarrays, atomic force microscopy, PCR instrumentation, software and informatics, and related bioreagents, consumables and services. Agilent s life science markets accounted for approximately 40% of revenue for its bio-analytical measurement business in Within the life sciences, the company focuses on three primary market categories: pharma, biotech, and contract research and manufacturing organizations. Agilent s life science markets also include academic and government customers. Life sciences also includes the clinical diagnostic segment, which is providing an emerging growth opportunity that can be addressed by leveraging existing platforms like microfluidics, microarrays, and liquid chromatography/mass spectrometry. The clinical diagnostic market is viewed by Agilent as a developing area for strategic growth. The Agilent 2100 bioanalyzer is a commercial microfluidics product for the analysis of a wide range of biological molecules, including DNA, RNA, proteins and

117 106 The Worldwide Market for Lab Automation cells. The bioanalyzer chips allow sample quality assessment to be done in a fraction of the usual time using fewer samples and reagents than traditional gel electrophoresis. Agilent also provides related software, which enables the bioanalyzer to be used for the development and manufacture of protein-based therapeutics. The bioanalyzer is commonly used in genomics laboratories and has enabled the standardization of RNA quality measurement. In December 2007, Agilent completed the acquisition of Velocity11, involved in automated liquid handling and laboratory robotics for the life science market. The acquisition of privately held Velocity11 enables Agilent to offer a more comprehensive suite of work flow solutions to its life science customers in the pharmaceutical, biotech and academic research markets. Specifically, Velocity11's technology strengthens Agilent's offering of automated sample-preparation products across a broad range of applications.

118 Chapter Five: Corporate Profiles 107 AI SCIENTIFIC PO Box 215 Clontarf, Qld 4019, Australia Phone: Fax: URL: Ai Scientific s 30 years of experience is the foundation of its two divisions -- Analytical Instruments and Ai Automation. Ai Scientific supplies analytical instruments to industrial, environmental and research labs in Australia and New Zealand. The product range includes Varian, CEM and Tecan. Ai Scientific's automation systems manage sample preparation, tracking, delivery and storage in laboratories. In the area of pathology sample management, Ai Scientific's systems aid pathology laboratories in processing an increasing number of specimens and improving turnaround times. The company s range of automated systems for pathology labs automatically identify, split and sort specimen tubes into analyzer racks or storage racks. As well as automating the reception and preparation of specimen tubes, Ai Scientific's Pathology Systems also: eliminate the risk of RSI/carpal tunnel syndrome for laboratory workers; improve turn around times for patient results; and provide tracking of a specimen's location within the laboratory. The PathFinder 900 is a fully automated tube management system. It is designed to manage pre- and post-analytical sorting, decapping, aliquoting, recapping and tracking in a laboratory as well as all handle other storage and tracking requirements. The PathFinder 350S Sorter is a simple, fully automated, stand-alone bench top tube sorting system. To automate routine and repetitive tasks, such as dilution or reagent addition, the company expanded on its autosampler technology to provide standalone preparation stations -- fully programmable, computer controlled liquid handling stations.

119 108 The Worldwide Market for Lab Automation AURORA BIOTECHNOLOGIES 7668 El Camino Real Suite Carlsbad, CA Phone: URL: Aurora Biotechnologies optimizes high throughput and high content assay productivity by applying its assay platform technology and know how. Aurora Biotechnologies microplate products are constructed of cyclo-olefin polymer (COP) which has physical and chemical properties that are superior to polystyrene and polypropylene. COP offers improved clarity, thermal stability, biocompatibility, low auto-fluorescence, flatness and chemical resistance. In January 2008, Aurora Biotechnologies launched a series of 384-well microplates for the life science research market. The 384-IQ microplates are targeted at imaging and high-content screening applications. The new 384-well microplates are made from the same high-performance COP that is exclusive to Aurora Biotechnologies current and 3456-well microplate products. For compound storage applications, micoplates must be amenable to automation, be solvent resistant, and circumvent evaporation over extended periods to maintain the integrity of the compound libraries. Aurora Biotechnologies microplates offer specific features for compound storage, including: broad chemical resistance, especially to dimethyl sulfoxide (DMSO) and alcohol. This allows for storage of compound concentrates. The plates have mechanical stability a hardness of 2.2 GPa that resists curvature or deformation that could be caused by robotic handling. Aurora Biotechnologies intellectual property portfolio includes US patent 7,270,784 Automated Laboratory for High Throughput Biological Assays and RNA Interference -- an automated multiple-purpose, integrated laboratory system comprising interchangeable modular elements for the construction and measurement of biological assays. The company s comprehensive microplate intellectual property portfolio includes COP compositions of matter and thin film insert injection molding manufacturing methods for producing low auto-fluorescence, thin transparent bottom microplates for use in high throughput fluorescence screening and high content and cell imaging screening.

120 Chapter Five: Corporate Profiles 109 BECKMAN COULTER INC N. Harbor Boulevard PO Box 3100 Fullerton, CA Phone: Fax: URL: Beckman Coulter develops, manufactures and markets products that automate complex biomedical tests. Beckman Coulter has more than 200,000 clinical and research instrument systems operating in laboratories worldwide. Recurring revenue, consisting of supplies, test kits, service and operating-type lease payments, represented more than 78% of the company s 2007 revenue of $2.76 billion. About 83% of the company s total revenues come from sales to clinical laboratories. The company reports results as a single business segment. Within this single segment, Beckman Coulter has identified four product areas, each focused on a core product strategy Chemistry Systems, Immunoassay Systems, Cellular Systems, and Discovery and Automation Systems. Revenue in the Discovery and Automation Systems unit increased by 2.6% in 2007 to $575.1 million. The increase was driven by robust sales of clinical lab automation partially offset by a decrease in revenue from life science products as compared to the prior year. Automation is central to the company s strategy of simplifying and automating laboratory processes. Additionally, clinical lab automation continues to be a key emphasis as the company s customers increasingly focus on the efficiency and cost savings that can be provided by increased automation. The decrease in revenue from life science products is mainly due to a softness in the academic research market for some of the company s more mature life science products. Beckman Coulter addresses the clinical lab automation market with its Power Processor System, which allows a laboratory to automate a number of pre-analytical steps, including sample log-in and sorting through bar code technology, centrifugation, and cap removal. The system also sorts the prepared samples into discrete racks for further processing on the company s clinical chemistry, immunoassay and hematology systems. The AutoMate 800 system is a fully automated sample preparation system that brings many of the same benefits enjoyed by Beckman Coulter s larger laboratory automation customers to mid-sized hospitals. Features such as automated sample loading,

121 110 The Worldwide Market for Lab Automation decapping, sorting, integrated on-demand centrifugation, and intelligent aliquotting and tube labeling reduce manual sample handling and help to eliminate sample preparation errors. Beckman Coulter s products are used in many parts of the drug discovery and development process. An important application for these automation products is in primary screening HTS. Other important drug discovery applications, which can also require samples to be processed in an automated or high-throughput mode, include target identification, secondary screening, and pre-clinical testing. In 2007, the company introduced its Industrial Robotics Solutions for high-throughput pharmaceutical and biotechnology applications. These systems are individually tailored to the customer s applications to provide full process automation that integrates many devices. The company s Biomek family of liquid handling systems uses advanced scheduling and data handling software to perform dispensing, measuring, dilution, and mixing of samples and analysis of reactions as well as robotic manipulation of samples. In 2007, Beckman Coulter introduced the BioRaptr microfluidic work station, which provides high precision low volume fluid dispensing. The system can be used alone or integrated with liquid handling systems. Microplate readers make possible highly parallel analysis of biomolecules and are standard tools used in systems biology and drug discovery operations The company s DTX 800 and 880 readers use an optical design and can be integrated with existing automation systems or used in stand alone operations. Beckman Coulter offers different levels of automation. Level 1 is System-Based Automation automated instruments, consolidated work stations and information management systems. Also available is Level 2: Discrete Automation stand-alone preanalytical sample processing. With discrete automation, labs can reduce manual processing by more than 70% in the areas of sample receiving; sorting and prioritizing; integrated centrifugation; sample decapping; and creating aliquot tubes from primary sample tubes. Level 3: Integrated Automation is available pre-analytical and post-analytical sample handling technology connected to lab analyzers. Up to 80% of manual sample processing steps can be eliminated with integrated automation, which helps achieve seamless sample processing and analysis while managing growth and ensuring overall quality. Sample receiving tasks includes sorting and prioritizing samples; integrated centrifugation; decapping samples; creating aliquot tubes from primary sample tubes;

122 Chapter Five: Corporate Profiles 111 loading and unloading instruments from multiple vendors; recapping samples after analysis; transferring samples to refrigerated stockyards for easy retrieval; and performing reflex testing, rerun and repeat testing automatically. Beckman Coulter also offers Level 4: Comprehensive Automation complete automation network, including customizable options. Designed to fit a lab's specific requirements, comprehensive automation consists of modules for sample centrifugation, cap removal, aliquot capability, sorting, various instrument connections, sample capping and refrigerated storage. Configurations are typically custom-engineered to accommodate a lab's work flow.

123 112 The Worldwide Market for Lab Automation BIOTROVE INC. 12 Gill St. Suite 4000 Woburn, MA Phone: Fax: URL: BioTrove leverages micro- and nano-scale technology. Currently, the company offers two high throughput technology platforms: RapidFire, which enables the acceleration of drug discovery and pipeline decisions, and OpenArray, which advances genomic research in a range of life science fields, including agriculture, disease research, bio-defense, and public health. The company has more than half of the world's 10 largest pharmaceutical companies as clients. The company s OpenArray SNP Genotyping system provides PCR-based single nucleotide polymorphism (SNP) analysis of hundreds to thousands of samples and candidate SNPs. On a single OpenArray, researchers can test up to 48 samples against 64 SNP unique assays. OpenArray technology is a broadly applicable nanoliter fluidics technology platform for massively parallel and low-volume solution-phase reactions, including analysis of genetic, genomic, proteomic, biochemical, and cellular samples. The OpenArray NT Imager Genotyping System enables life science researchers to run more than 3,000 genotyping assays on the same OpenArray plate. Plates are imaged and called using the company s OpenArray NT Imager or NT Cycler. RapidFire microfluidics technology provides a way to analyze small molecules by mass spectrometry at throughputs that are suitable for screening. BioTrove's high throughput mass spectrometry system consists of a proprietary computer-controlled fluidic robot, which is interfaced with a triple-quadrupole mass spectrometer. Sample throughput is decreased from minutes to seconds using RapidFire robotics, which replace conventional high performance liquid chromatography as the sample injection and purification system.

124 Chapter Five: Corporate Profiles 113 CALIPER LIFE SCIENCES 68 Elm St. Hopkinton, MA Phone: Fax: URL: Caliper Life Sciences provides advanced technologies for the life sciences market. Caliper s portfolio of offerings includes microfluidics, lab automation and liquid handling systems, optical imaging technologies, and discovery and development outsourcing solutions. Caliper Life sciences achieved $140.7 million in total revenue in 2007, an increase of 30% from $107.9 million in Sales of microfluidic products, comprised of LabChip instruments and chips, increased by approximately $1.8 million, or 11%, from $15.8 million in 2006 to $17.6 million in The key reasons for this improvement were the introduction of the EZ Reader kinase screening platform and associated ProfilerPro reagent kits in the first quarter of 2007, and continued strong demand for the LabChip 90 automated electrophoresis system. During 2007, Caliper Life Sciences placed 69 new LabChip systems with customers, which represented a 17% increase in units sold compared to Caliper s microfluidic LabChip systems include instruments, experiment-specific reagents and software. The company s chips contain networks of miniaturized, microfabricated channels, some scarcely wider than 1 micrometer, through which fluids and chemicals are moved to perform experiments. Fluid movement is controlled via pressure or voltage, and an integrated optical system detects the results of particular experiments. The company has multiple channels of distribution for its products and services: direct to customers, indirect through an international network of distributors, through partnership channels under the Caliper Driven program, and through joint marketing agreements. Among its products, Caliper Life Sciences offers a full range of in vitro technologies that includes high- and ultra-high-throughput screening systems, liquid handlers, advanced robotics, storage devices, and dissolution, extraction and evaporation workstations.

125 114 The Worldwide Market for Lab Automation Caliper Life Sciences acquired Zymark Corp., a liquid handling instruments company, in July This combination bridged the interface between micro- and macro-fluidics for the company. Caliper brought a detection platform and experimental control. Zymark s expertise in nanoliter liquid handling technology provided sample preparation solutions to feed the microfluidics platform and to interface with the company s existing microtiter plate architecture. Sales of liquid handling and automation products declined by $3.8 million on a net basis overall, or 10%, from $39.5 million in 2006 to $35.8 million in This decline was driven mainly by a substantial decrease of $6.6 million in sales of liquid handling and automation products, primarily as a result of weakness experienced in OEM sales and integrated Staccato platform sales. This was partially offset by a $2.8 million increase in sales of analytical instruments for drug development and other specialty applications, such as forensics analysis. The company believes that the decline in liquid handling and automation product sales was due, in part, to temporary market conditions as evidenced by an increase in customer orders in the company s fiscal fourth quarter which led to a stronger ending backlog for such products at the end of 2007 in comparison to the end of The Caliper Sciclone ALH series features interchangeable 96- and 384-channel pipetting heads that can pipette and dispense volumes from 100 nanoliters to 200 microliters. The Caliper Sciclone i-series, based on MEMS (microelectromechanical systems) technology, addresses volumes ranging from 10 nanoliters to 1 milliliter and embeds real-time adaptive algorithms ensuring consistent liquid delivery in changing environmental conditions, such as temperature and sample viscosity. In addition, in 2006, Caliper introduced Zephyr, a lower-priced, desktop version of its Sciclone liquid handler. It was developed in response to a market demand for a compact, cost-effective, multi-channel liquid handler. Zephyr is designed to handle key applications for compound management, HTS, genomics, proteomics and bio-analytical assays, as well as numerous commercially available kits. These applications include: DNA/RNA purification clean-ups, PCR setup, protein precipitation, solid phase extraction, protein purification solubility assays, kinase assays and cell-based assays. Zephyr s small footprint targets it for workbench operation. Staccato automated work stations provide fast and scalable automation for drug discovery, genomics, proteomics and drug development laboratories. Staccato systems are available in three base configurations: the Mini Work station Series, the Application

126 Chapter Five: Corporate Profiles 115 Series and the Custom Systems Series. Staccato Mini Work stations offer the minimal amount of equipment required to automate basic liquid handling and material management tasks. Staccato Application Series are pre-configured and pre-integrated solutions for common applications, such as plate reformatting and replication, hitpicking, enzyme-linked immunosorbent assays (ELISAs), and a variety of cell-based assays. Staccato Custom Systems use automation-friendly building blocks, iblox, that are designed into custom configurations as dictated by the needs of the end user. The company s Twister Universal Microplate Handler automates the movement of microplates to and from a microplate reader, washer, or other microplate-processing instrument. Twister I has a capacity of 80 microplates, and is used as a dedicated autoloader with a wide variety of scientific instruments. The Twister II has increased integration capabilities and increased handling up to 400 standard microplates. The MultiDose G3 is a fully automated dissolution testing system that works within an open architecture, allowing the use of industry-standard accessories. It performs eight unattended dissolution runs without intervention. The TPW III (Tablet Processing Workstation III), which was introduced during 2006, performs quantitative sample preparation on pharmaceutical dosage forms, such as tablets or capsules, automating processes, such as content uniformity testing and stability analysis. The APW (Active Pharmaceutical Ingredient Workstation), also introduced during 2006, automates pharmaceutical sample preparation for samples, such as bulk drug substances, performing tasks, such as solvent addition, extraction, sample transfer, mixing and dilutions.

127 116 The Worldwide Market for Lab Automation DYNACON INC Nashua Dr. Mississauga, Ontario Canada L4V 1R1 Phone: Fax: URL: Dynacon applies automation and robotics technology for the laboratory and aerospace markets. The company s capabilities include systems integration, analysis and simulation, software and hardware design, and fabrication. In the laboratory automation market, the company s InocuLab product line reduces labor cost, increases quality and eliminates exposure to repetitive strain injury. Dynacon s focus is the automation of all large volume specimen types in microbiology to increase quality and labor efficiency in the clinical laboratory. A key area in microbiology that has not been addressed extensively, is the inoculation and plating on agar media from patient specimens. In most clinical laboratories, liquids or swab specimens are the largest volume of specimens and are traditionally processed completely manually. Dynacon has introduced the InocuLAB LQ that automates this work flow. Under development is a system similar to InocuLAB LQ that will automate the processing of swab specimens. For sensitive and life threatening diseases, early detection of the etiologic agent is of foremost importance. For this purpose, large scale laboratories are slowly adopting automation to process an increased number of samples, in turn reducing total processing time and increasing quality control. InocuLAB LQ automates the complete front-end processing of urine specimens. The system automatically opens the urine specimen container, reads the barcode label, inoculates the media, streaks in a user defined pattern, bar-codes the plates and recaps the specimen. InocuLAB can also be used in streak only mode to automatically streak the media plates of other types of specimens, processing up to 80 plates per hour and using the standard four quadrant streak pattern familiar to laboratory technologists. When plating samples onto agar, InocuLAB gives a more consistent deposition onto the surface of the agar than human hands can. Accurate colony counting depends largely on the ability to see colonies distinctly, and the quality of the plate has a tremendous effect on the development of colonies that are clearly discernible.

128 Chapter Five: Corporate Profiles 117 InocuLAB has proven to be very cost effective; offering a payback period that can be as short as three years. These savings are achieved because InocuLAB automates the entire specimen setup process including recapping and bar coding media plates.

129 118 The Worldwide Market for Lab Automation EPPENDORF AG Barkhausenweg Hamburg Germany Phone: Fax: URL: Eppendorf is a marketer of laboratory equipment and associated consumables. The company s products include liquid handling and centrifugation equipment, including related consumables as well as instruments and systems for PCR, cell technology and microarrays that are used by researchers in life science, drug discovery, clinical, environmental and industrial laboratories. Founded in 1945, Eppendorf is privately-held, has revenues of more than $400 million and employs approximately 2,000 people in more than 20 countries. Among the company s products are pipettes, centrifuges, tips and microcentrifuge tubes. Products for automated pipetting and PCR applications include: epmotion automated pipetting systems and the Mastercycler ep realplex thermal cycler. In October 2007, Eppendorf acquired New Brunswick Scientific, Edison, NJ, which is involved in the manufacture of equipment for cell growth, detection and storage. Among its products are a comprehensive line of fermentors, bioreactors, CO 2 incubators and freezers, The merger agreement was valued at approximately $110 million. Sales of its products exceeded $ 75 million in 2006.

130 Chapter Five: Corporate Profiles 119 HAMILTON STORAGE TECHNOLOGIES INC. 103 South St. Hopkinton, MA Phone: Fax: URL Hamilton Storage Technologies has targeted life science process management by automating manual processes and integrating isolated upstream and downstream applications that can slow sample management in drug discovery. The company has developed modular, scalable systems that automate sample storage, management and processing. The systems share a common technology platform and seamlessly operate as standalone automation islands that address specific process steps, or as integrated systems that provide total process management solutions. In February 2007, Hamilton acquired TekCel. The acquisition broadens Hamilton s product portfolio and strengthens its position as market leader in laboratory automation. The Boston, MA-based TekCel designs and manufactures specialized cooling and storage systems for research labs in the biotechnology and pharmaceutical industry. With the acquisition of TekCel, Hamilton broadened its product portfolio with systems for sample logistics. The company s new Active Sample Manager complements and integrates with Hamilton s Star line of liquid handling workstations. Hamilton, founded on the technology of analytical syringes, has evolved with advances in scientific techniques to provide a broad offering of precision fluid measuring devices and robotic fluid measurement products.

131 120 The Worldwide Market for Lab Automation INNOVASYSTEMS INC. 840 N. Lenola Rd. Unit 8 Moorestown, NJ Phone: Fax: URL: InnovaSystems was founded in 1989 and provides mechanical design, electrical engineering, hardware and software development, machining, assembly, testing and support for academic, biotechnology, chemical, environmental, food, government, petrochemical and pharmaceutical labs. InnovaSystems has an installed base of more than 400 automated systems targeted at sample handling, preparation and analysis. The company s products are designed to support FDA 21 CFR Part 11 compliance. InnovaSystems has laboratory automation products for: metered dose inhalation product testing actuations, dose weights, dose content uniformity; nasal spray pump product testing actuations, dose weights, dose content uniformity; solid dosage tablet dissolution; physical properties testing ph, viscosity, color; sample tracking and data management software packages; and general laboratory sample handling and preparation gripping, weighing, liquid handling, mixing, capping, uncapping and bar code reading. The company also offers a customized Automated Extraction Station that can automate the extractions of gels, pastes and ointments. It is automated for the dispensing of semi-solid product to target weight; for decapping and capping; for solvent dispensing; and for horizontal or vortex mixing. The station can improve the accuracy and reproducibility of results and relieve scientists of routine sample preparation.

132 Chapter Five: Corporate Profiles 121 LABOTIX AUTOMATION INC Fisher Dr. Peterborough, Ontario Canada K9J 6X6 Phone: Fax: URL: Labotix Automation, (formerly LAB-Interlink Canada Inc.) provides automation technology designed to improve the process and operations of the clinical laboratory. Labotix manufactures automation technology for the clinical laboratory market, providing solutions to automate labor intensive, tedious and hazardous laboratory sample and specimen preparation procedures. Labotix has developed automated systems for leading clinical reference laboratories. Following research and development in the large clinical reference laboratory market, the company has configured pre- and post-analytical specimen tube automation technology into flexible modules that meet the needs of clinical laboratories. The company s open LAB-Frame system design allows it to develop interfaces to many of the automated instruments currently operating in the clinical laboratory. Users are not locked into a single brand of instrumentation with the LAB-Frame system. The company s LAB-Manager software is at the heart of the LAB-Frame system, and provides scalable process control, laboratory intelligence, and the adaptive capacity to run complex laboratory operations or applications on different platforms. Centering the automation hardware components, such as a transportation system, on the software makes it inherently more flexible than hardware driven systems. The LAB-Manager process management software provides the tools needed to monitor the status of the hardware, software and work cell modules at all times from a single PC workstation. A real-time interface to the laboratory information management system provides the data that drive the specimen through the random access process of clinical analysis. Patient demographics, episode of care information, orders and verified results are sent from the lab s information system to the automation system. The automation system transmits unverified results from the clinical instrumentation to the information management system. The company provides online system management tools to monitor these interfaces. The company s RRUSH system is a configuration of automated modules interconnected through a transport system which can rapidly process specimens

133 122 The Worldwide Market for Lab Automation throughout the clinical laboratory. The system s purpose is to transport and automatically sort specimen tubes while delivering them to appropriate analysis or storage areas ready for processing. The Labotix product line includes loading stations, robotic analyzers, specimen sorters, uncappers and recappers, automated aliquotters, on-line analyzers, work stations, automated centrifuges, refrigerated storage managers and transport systems.

134 Chapter Five: Corporate Profiles 123 LABVANTAGE SOLUTIONS INC Route 22 East Bridgewater, NJ Phone: Fax: URL: LabVantage is a leading provider of laboratory information management systems (LIMS) serving several industries in a variety of testing and research environments. The company offers software and services. LabVantage's functional solutions can be easily configured to automate specific customer business processes. Its global customer base includes quality control, analytical services, research and development, and discovery-oriented laboratories. The company serves discovery, development, formulation, process research, raw materials testing, and quality management laboratories across multiple industries, including: pharmaceuticals and biosciences, health and personal care and process chemicals, among other industries. For pharmaceutical and genetic engineering companies, LabVantage's Sapphire R4 LIMS has solutions for the entire process discovery, research and development, pre-clinical, clinical and quality management. Research and development laboratories need systems and procedures that can automate analytical processes and effectively share information. With the ability to make more real-time decisions, researchers can identify, and elevate promising candidate compounds to NDA, while eliminating non-viable candidates as early in the process as possible. LabVantage's Sapphire maintains a complete audit trail to comply with 21 CFR Part 11 and other FDA regulations. Sapphire LIMS offers a variety of mechanisms for grouping, tracking and viewing samples. Designed for use in multi-site and multi-language settings, Sapphire makes possible collaborative research efforts across physical and cultural boundaries. Sapphire also provides extensive sample management tracking by batch, lot and individual sample.

135 124 The Worldwide Market for Lab Automation MOLECULAR DEVICES 1311 Orleans Dr. Sunnyvale, CA Phone: URL: Molecular Devices supplies bioanalytical measurement systems that accelerate and improve drug discovery and other life sciences research. Its systems and consumables enable pharmaceutical and biotechnology companies to facilitate the high-throughput screening, identification and evaluation of drug candidates. Molecular Devices' products are based on its technologies that integrate engineering, molecular and cell biology, electrophysiology and chemistry. Founded in 1983, Molecular Devices introduced its first microplate reader in 1987 and since then has broadened its product portfolio through a combination of internal research and acquisitions. Molecular Devices acquired Universal Imaging Corp. in 2002 and Axon Instruments in 2004, broadening its portfolio to include electrophysiology products, scanners and analysis software for microarrays, and workstations for cell-based screening using high-resolution imaging. In March 2007, Molecular Devices was acquired by MDS Inc., Toronto, Canada. Molecular Devices and an MDS division, MDS Sciex, merged with it to become MDS Analytical Technologies. MDS had $1.1 billion in net revenues in 2007, 47% of which came from sales in the US and 27% of which came from Canada. Two-thirds of the company s revenues came from the pharmaceutical and biotechnology companies. It markets analytical instruments, medical isotopes for molecular imaging, radiotherapeutics and sterilization technologies, and offers pharmaceutical contract research. With more than 13,000 units shipped, Molecular Devices is a leading supplier of tunable microplate reader systems to academic, pharmaceutical and biotechnology research groups. Its patented technologies, such as PathCheck well-volume detection, dual-monochromators, and SmartOptics design, enable researchers more flexibility, sensitivity, and ease-of-use for the broadest range of assays. Its products include automation systems, GxP compliance features, and SoftMax Pro data analysis software. Other microplate reader products include: multi-detection microplate readers; absorbance microplate readers; fluorescence microplate readers; and luminescence microplate readers.

136 Chapter Five: Corporate Profiles 125 Among the company s automation-related products are Fluorometric Imaging Plate Readers. The FliprTetra broadens the Flipr system's capabilities to include 96, 384 and 1536 simultaneous liquid transfer, multi-wavelength kinetic reading, and agile internal plate handling. The FlexStation bench top scanning microplate reader is flexible enough to be an assay development or screening tool for functional cellular assays, such as calcium mobilization or membrane potential. Utilizing multi-wavelength detection in conjunction with microplate-to-microplate transfer, real time kinetic traces can be analyzed to provide data. Also on the market are the Integrated 4-fluid dispenser and washer, in 96-, 384- and 1536-well formats, as well as automatic 96- and 384-well washers. They offer lowvolume dispensing to 0.5 µl. An automatic 96- and 384-well washer that is robotcompatible (angled pin model optimized for 384-well cell washing) is also available. Automatic 12- or 96-channel cell harvesters separate and collect from culture media onto filter mats. Molecular Devices has launched an Automation Vendor Partnership Program. By working with partners throughout different product development stages, Molecular Devices has developed the capacity to integrate its plate reader systems and liquid handlers with all leading partner robots in an "out-of-box" automation solution.

137 126 The Worldwide Market for Lab Automation MOTOMAN INC. 805 Liberty Lane West Carrollton, OH Phone: Fax: URL: Motoman is a subsidiary company of Yaskawa Electric Corp. of Japan, a leader in robotics. Motoman markets products to companies in North and South America and, combined with its sister companies, can support robotic applications worldwide. Motoman delivers robotic automation for virtually every application, including arc welding, assembly, clean room, coating, dispensing, material cutting (laser, plasma, water jet), material handling (die cast, machine loading, packaging, palletizing, part transfer, press tending), material removal (deburring, polishing, sanding), and spot welding. Since its founding in August 1989, Motoman has grown to be the second largest robotics company in the Americas, with more than 27,000 robots installed. Motoman has experienced a compounded annual sales growth of more than 30%. Working with a number of high-volume reference laboratories, Motoman brought industrial automation technology to the clinical laboratory field in Laboratory requirements for extremely high throughput while maintaining flexibility were similar to many industrial automation challenges elsewhere. AutoSorter was Motoman s first solution to high volume sorting and processing for the clinical lab market. Additional AutoSorter products have followed AutoSorter I, improving on the original design and offering alternative capabilities and configurations to meet a broad range of laboratory requirements. Applications include: high-speed specimen sorting; improved sorting accuracy; and concurrent archiving. AutoSorter I utilizes Motoman s planar-drive technology and has been operating in some of the highest-volume clinical labs since High throughput (greater than 2,000 specimens per hour), flexibility to handle a wide variety of specimen configurations, and configurability to fit into each lab s unique work flow are some of the benefits of AutoSorter I, which is effective as a pre-clinical specimen sorter as well as a post-clinical specimen sorter/archiver. AutoSorter II leverages many of AutoSorter I s advantages into a lower cost, easy to maintain work cell, adding additional process capabilities for inspection, capping, and the like.

138 Chapter Five: Corporate Profiles 127 New is AutoSorter III, which brings specimen processing automation into many hospital and medical center environments. AutoSorter III includes a new, linear-drive motion platform with multiple specimen handlers packaged in a compact footprint. Specimens may be centrifuged, decapped, and loaded into instrument-specific racks ready for testing. Planned enhancements include direct loading to track systems and aliquoting. Motoman's AutoElisa is a high throughput platform for automated enzyme linked immunosorbent assay processing of microtiter plates. Motoman will consult with laboratory managers on process improvement objectives to develop and build optimized solutions for specimen processing work flow. These solutions make best use of AutoSorter and other Yaskawa/Motoman platforms in addition to automation process systems and multiple process cells and informatics -- middleware.

139 128 The Worldwide Market for Lab Automation OLYMPUS CORP. Shinjuku Monolith Nishi-Shinjuku Shinjuku-ku, Tokyo Phone: URL: With consolidated net sales of $9.4 billion, Olympus has a number of business lines. Its Life Science Group markets biological microscopes, educational microscopes, inverted biological microscopes, fluorescence analysis systems, stereo microscopes, biomolecule imaging systems, and microscope system equipment and peripherals. The company also markets automated chemistry analyzers, automated electrophoresis systems, automated chemiluminescence enzyme immunoassay analyzers, and a variety of other laboratory automation systems, including specimen processing systems and automated analyzers for examining water quality.

140 Chapter Five: Corporate Profiles 129 PERKINELMER LIFE AND ANALYTICAL SCIENCES INC. 940 Winter St. Waltham, MA Phone: URL: PerkinElmer is focused in the following businesses life and analytical sciences, optoelectronics and fluid sciences. PerkinElmer provides products and services for a range of applications. The company s 2006 revenue was $1.55 billion. The company operates in 125 countries and has 8,500 employees. From compound management and sample preparation to downstream applications for drug discovery, genomics and proteomics, PerkinElmer offers solutions for automated liquid handling. The company s Packard portfolio of products offers modular and scalable liquid handling solutions. This philosophy is at the heart of the new Janus Automated Workstation that provides real-time and future adaptability in throughput, capacity and dynamic volume range. It has proprietary Modular Dispense Technology that delivers all of these. The station features hands-off, on the fly adaptability in dynamic volume range and microplate densities up to 1,536 wells. Dispense heads can be automatically switched, within a single protocol, to go from nanoliters to microliters in seconds, with no user intervention. The station has adjustable throughput and capacity, or is integratable with other accessories or instrumentation for true walk-away automation, and also has precision pipetting over a wide dynamic volume range. The Janus Cellular Workstation is a fully automated system for cellular assays and screening applications that uses pre-tested application templates and application guides for common cellular assays. The company also offers its MultiProbe II, a highly flexible liquid handling platform enabling the automation of a wide variety of liquid handling tasks, including forensic applications, drug discovery assays, and molecular biology and proteomics applications. PerkinElmer offers a complete range of quality application-focused microplates, as well as the PlateStak Automated Microplate Handler that addresses increased capacity and unattended processing needs by automating the handling and storage of microplates and tip boxes. The system incorporates a bi-directional shuttle that transports plates or tip boxes from cassette to cassette or to programmable locations on the diving board. The

141 130 The Worldwide Market for Lab Automation diving board extends out from the PlateStak, making plates available on the working deck of popular instruments. Also on the market are a variety of plate readers and imagers.

142 Chapter Five: Corporate Profiles 131 F. HOFFMANN-LA ROCHE LTD. Grenzacherstrasse 124 CH-4070 Basel, Switzerland Phone: Fax: URL: Roche's Diagnostics Division offers a range of products and services in all fields of medical testing. Roche is a leader in in-vitro diagnostics and drugs for cancer and transplantation, and is a market leader in virology. It is also active in other major therapeutic areas, such as autoimmune diseases, inflammatory and metabolic disorders, and diseases of the central nervous system. In 2007 sales by the Pharmaceuticals Division totaled $35.2 billion, and the Diagnostics Division posted sales of $8.9 billion. The Diagnostics Division s operating profit increased to $1.5 billion and its operating profit margin was up 1.3% to 17.6%. Among its lab automation products, the company offers the Cobas 6000 analyzer series, a new generation of modular serum work area automation that brings added versatility from a single analytical module to complete capability for clinical chemistry and immunochemistry, covering more than 95% of daily routine testing requirements. The 6000 analyzer series is the first member of the new Cobas modular platform. It offers medium workload laboratories tailor-made solutions, integrating clinical chemistry and immunochemistry testing. Roche also is marketing fully automated, real-time PCR solutions for improved reliability and accuracy of HIV-1, HCV and HBV testing. The Cobas AmpliPrep/Cobas TaqMan Systems and Assays are designed for automated sample preparation, amplification and quantitation of RNA or DNA. For larger throughput labs, the system is available in a fully docked configuration. The Cobas TaqMan analyzer and smaller Cobas TaqMan 48 analyzer are designed for clinical laboratories that require a single, simple system for their real-time PCR needs. Real-time PCR delivers increased sensitivity and a wider dynamic range more rapidly than earlier PCR technologies. The Process Systems Manager (PSM) is process management software combining fully computer aided sample handling functions with data management. The modular software architecture allows the adaptation of PSM to the specific needs of the laboratory. Also available are total lab automation, including centrifugation, decapping, aliquoting, bar code labeling, restopping, sorting and sample transportation, as well as

143 132 The Worldwide Market for Lab Automation task targeted automation systems, in which individual labor-intensive pre- and postanalytical steps like decapping, aliquoting and sorting are automated.

144 Chapter Five: Corporate Profiles 133 RTS GROUP Northbank, Irlam Manchester, UK M44 5AY Phone: URL: The RTS Group operates RTS Flexible Systems, which markets vision guided automated packaging and product handling systems for the food and consumer goods industries, and RTS Life Science, which markets automation systems and products for drug discovery, sample management, sample storage, testing and drug delivery. RTS Life Science is a major supplier of automated systems and products for large scale sample storage and testing within the laboratory environment. Its market encompasses drug discovery applications within pharmaceutical and biotechnology companies; and sample preparation and storage for medical research, clinical trials and pharmaceutical manufacturing applications. Its main focus lies in providing automation for: automated sample storage, retrieval and management; high throughput and ultra high throughput screening; inhaler testing; and integrated automation systems. RTS offers a complete line of automated storage and retrieval products. These include SmaRTStore, a self-contained storage system with the ability to store plates, tubes and vials within the same store, making it ideally suited for use as a distributed compound storage facility, or as a satellite store directly linked to reformatting or high throughput screening systems. SmaRTStore utilizes internal storage buffers to facilitate cherry picking during unattended periods. In this way, targeted subsets of samples can be compiled overnight, or while the operator is attending to other duties. The selected samples can then be retrieved quickly. SmaRTStore has been designed to link easily to external automation systems. The clear design of the airlock allows external devices to collect or deliver lab ware to and from the tray cradle. Primary screening of compounds seeks to identify which compounds bind to targets of interest and to what degree of affinity. By using RTS Assay-Platform screening, it is possible to automate compound identification. Key features include: Sprint software for flexible scheduling, throughput optimization and process timing control; screening for cell based and binding assays; flexible instrument integration, cell plate washing, incubation, reagent dispensing and compound transfer; and high capacity storage options for samples, compounds, reagents and disposable tips.

145 134 The Worldwide Market for Lab Automation RTS Life Science has experience in large-scale, fully-automated inhaler testing systems. RTS specializes in developing customized storage, retrieval and tracking systems as well as high or ultra high throughput screening or a combination of the two. In May 2008, RTS Life Science unveiled its Automated Blood Fractionation (ABF) system to the US market. This patent-pending high throughput blood fractionation system is used to extract buffy coat (white blood cells) from whole blood samples. The upgradeable system fully automates blood fractionation and processing. The ABF system is a self-contained unit capable of processing up to 500 samples per day, providing substantial time and labor cost savings compared with manual fractionation.

146 Chapter Five: Corporate Profiles 135 SIEMENS MEDICAL SOLUTIONS USA INC. 51 Valley Stream Parkway Malvern, PA Phone: Fax: Siemens Medical Solutions is one of the world s largest suppliers to the healthcare industry. The company markets medical technologies, healthcare information systems, management consulting, and support services. Recent acquisitions in the area of in-vitro diagnostics, such as Diagnostic Products Corp. and Bayer Diagnostics, help make Siemens a full service diagnostics company. Siemens Medical Solutions employs more than 48,000 people worldwide and operates in 130 countries. In the fiscal year 2007 (ended Sept. 30), Siemens Medical Solutions reported sales of $15.18 billion. Siemens Healthcare Diagnostics offers a broad portfolio of diagnostic solutions that assist in the diagnosis, monitoring and management of disease. Diagnostic Products Corp., Los Angeles, CA, and Bayer Diagnostics, Tarrytown, NY, have been merged into a vast new, $8.8 billion corporate vision called Siemens Medical Solutions Diagnostics that employs about 8,000 people. Siemens has created a value chain that stretches from molecular diagnostics and immunoassays, to blood, urine and tissue tests, to imaging modalities ranging from pre-clinical research systems to clinical ultrasound, CT, MR and positron emission tomography (PET) scanning. In addition, Siemens has acquired Dade Behring, which had 2006 revenues of more than $1.7 billion. The laboratory diagnostics company joined the existing business of Siemens Healthcare Diagnostics. A radically different healthcare future is transforming Siemens Medical Solutions. That is based on linking the data that comes from lab tests with in vivo data from medical imaging. Siemens Medical Solutions Diagnostics offers a wide range of lab automation systems, including its Advia families of clinical chemistry and immunoassay systems, as well as hematology, urinalysis, blood gas, diabetes, and molecular testing systems for hospital and dedicated laboratories and physicians offices. Siemens will continue to expand menus across both the Immulite and Advia immunoassay systems. The Advia Decapper has been developed as a seamlessly integrated on-line feature for existing Advia WorkCell and LabCell automation configurations that easily fits onto the existing track with no additional spacing requirements. The unit can process a variety of sample tube types, including screw caps, rubber stoppers, and Hemoguard stoppers at a speed of 600 tubes per hour.

147 136 The Worldwide Market for Lab Automation The company also is marketing a system that merges the strengths of the Advia 1800 Clinical Chemistry Analyzer and Immulite 2500 Immunoassay System onto a single testing platform by connecting to a Sample Management System (SMS). The technology physically links the immunoassay and clinical chemistry components to offer a single entry point for samples, significantly reducing the need to pre-sort specimens. It also makes possible continuous loading for 200 samples and can move tubes at a speed of 200 tubes per hour, while providing staff access to over 80 chemistry assays and more than 160 immunoassays. SMS software optimizes sample processing to maximize throughput and simultaneous sample analysis, which ensures that peak workloads can be handled quickly. The SMS serves as a single point of entry for samples. It features a pick and place robotic arm that transports sample tubes from the SMS to the analyzers for processing and back to the SMS. The SMS holds four drawers containing removable sample rack carriers. Each carrier holds five racks of up to 10 samples each, for a 200- sample tube capacity. A network connection allows operation of the individual analyzers at the central SMS computer, which is connected by a single LIMS interface for improved efficiency and ease of use. Meanwhile, the Versant 440 Molecular System has been approved for marketing by Health Canada for viral load testing of the human immunodeficiency virus (HIV) and the hepatitis C virus (HCV). It is CE-marked for HIV and HCV; the hepatitis B virus (HBV); and is filed in the US for FDA review. The product is a viral load platform designed for flexible automation. It integrates bar code data entry, automated reagent processing and detection, as well as a downloadable patient work list and results through an FDA cleared information system interface. Nearly 100 systems are placed worldwide. Novius Lab is a rules-based LIMS that optimizes work flow across multi-entity settings. It makes possible the macro-management of all laboratory work flows and laboratory results. The StreamLab Analytical Workcell links multiple Dimension Systems by means of a single operator interface and features automated pre-and postanalytical functions. The company s Dimension Lynx System provides entry level automation, featuring smart sample management in a compact footprint.

148 Chapter Five: Corporate Profiles 137 SOTAX Binningerstrasse Allschwil, Switzerland Phone: URL: Sotax, founded in 1973, began as an engineering company to serve the pharmaceutical and other industries. Today it develops and manufactures test instruments and software for tablet testing. In the area of dissolution testing, the company s products include semi-automated dissolution testing systems. Samples can be taken simultaneously, filtered and collected in a fraction collector, withdrawn using a robotic arm or simultaneously sampled and analyzed directly by UV light or HPLC. It is also possible to collect a sample as well as analyze it simultaneously. Dissolution testing can also be performed in situ by using a fiber optic probe. The operator would fill the vessels with media. The tablets would be automatically dropped, and the test would start and finish. Once the test has been completed, the operator can clean the system for the next test. The company offers a fully automated dissolution testing system that can run multiple unattended tests, including media preparation and delivery, automated dosage introduction, automated sampling, filtering and sample analysis, and vessel cleaning. The operator would only load the samples and collect the dissolution reports. The test can be done using paddles on tablets, capsules in sinkers, pellets in cartridges or with capsules in baskets. Sotax also offers WinSotax advanced dissolution software for a complete 21 CFR Part 11 compliant testing environment. The software has been installed and validated worldwide within the pharmaceutical Industry. It has ISO 9001 accreditation. Sotax, in partnership with Leap Technologies, involved in fiber optic UV for insitu dissolution analysis, has released its Sotax OPT-DISS UV fiber optic dissolution system. The testing system is integrated with seamless control by WinSotax advanced dissolution software. The software controls the entire range of all company semi- and fully-automated on-line dissolution systems. The system includes the Sotax 7smart dissolution bath, manufactured to include the company s Auto-Compliance features, such as auto-vessel centering and auto-height adjustment. In the system, the AT 7smart now provides an open architecture that allows for safe fiber optic probe handling and removing capacity. The Arch Probe, with its low disturbance open design, prevents

149 138 The Worldwide Market for Lab Automation excipient buildup, bubble entrapment, and provides consistent minimal path-length measurements.

150 Chapter Five: Corporate Profiles 139 SSI ROBOTICS PAR SYSTEMS INC Dow Avenue Unit #112, Tustin CA Phone: Fax: URL: SSI Robotics provides automation products, and OEM equipment engineering and manufacturing services for the life science and industrial markets. SSI's core product line is focused on laboratory automation. SSI also provides services for large OEMs, such as development, validation and contract manufacturing of medical devices, laboratory instruments and equipment. The company provides general industrial automation services as well. The company has strengths in electrical and mechanical engineering, creative design, software development, manufacturing, biology, medical and pharmaceutical processes, quality systems and regulatory affairs. These strengths enable the company to manufacture medical devices, hospital automation systems, clinical diagnostic equipment, clinical trial automation systems, among other products. The firm has a 600- machine installed base. In life sciences, SSI's Flash, Minilab and Quickstack lab automation products address a range of processes in drug discovery and diagnostic labs. The systems are also used in medical, pharmaceutical and clinical trial applications. These products are designed as flexible platforms able to address niche applications. SSI, established in 1996, markets automated tube capper-uncapper systems, as well as microtiter plate and labware stackers, auto handlers, auto loaders, among other automated products to the life sciences industry.

151 140 The Worldwide Market for Lab Automation THE AUTOMATION PARTNERSHIP York Way Royston, Herts, SG8 5WY, UK Phone: Fax: URL: The Automation Partnership (TAP) is involved in the design, development and implementation of advanced large-scale automation systems for the life science research industry. TAP was founded in 1987, originally as the automation division within The Technology Partnership (TTP). TAP developed the world's first fully automated cell culture system Cellmate -- in 1988, followed by the automated compound store Haystack in TAP formally came into being in 1995 when it became an independent trading subsidiary of TTP. TAP demerged from TTP in 1998 to become a privately owned, independent company. In 1998, TAP opened its first US, which now is based in Wilmington, DE. TAP offers several automated cell culture systems: SelecT, Cellmate, CompacT, SelecT, CompacT CellBase, Cello, Piccolo and Sonata. Typical cell culture applications include: discovery and screening, protein expression, regenerative medicine, cell therapy and biologics development. TAP offers several automated sample management and screening systems: HomeBase, Solar, Polar, Asset, BasePlate, BasePlateXR plus the Concerto inventory management software package. Typical sample management and screening applications include: biobanking and ultra low temperature (ULT) storage, compound management, plate production and high throughput screening. TAP also offers custom engineering and consultancy services to customers. More than 250 TAP automated systems have been installed worldwide, ranging in value from $590,000 standalone systems to multi-million dollar large-scale drug discovery facilities. In 2001, TAP launched SelecT, the first of a new generation of automated cell culture systems, followed by Cello (2003), Piccolo (2004), CompacT SelecT (2005), and Sonata (2007). In 2006, the UK Biobank, the world's largest genetic resource, chose TAP to supply its automated -80 C biological sample archive. In 2007, TAP launched CapitAll, the first of a new generation of bench-top systems. TAP is a member of the Remedi Consortium, a UK-based collaboration of academic and industrial partners that includes Loughborough University and Cambridge University. The consortium is investigating automated techniques for producing cost-

152 Chapter Five: Corporate Profiles 141 effective tissue engineered products for use in the emerging field of regenerative medicine. EMD Biosciences, part of Merck s Life Science Products division, has formed a strategic partnership with TAP to optimize cell lysis and affinity purification products specifically for use with Piccolo, TAP's fully automated system for optimization and production of recombinant proteins. NovaThera, Cambridge, UK, is leading a project to enable the production of stem cells in such quantities that they can be used in regenerative medical treatments. TAP joined the consortium in May 2006 and is advising on the automation aspects of the project. TAP is the industrial partner in a project being undertaken by University College London to investigate the application of its Piccolo culture technology to highly parallel, small-scale process development projects and the translation of these to large-scale bioreactors. In January 2008, TAP introduced Fill-It, a new product for automatically creating freezer ready cell stocks. The Fill-It system consists of an uncapping-recapping module fully integrated to a dispensing unit controlled by a simple user interface. The system can automatically unscrew lids from 96 or 24 cryovials; accurately and reproducibly fill each vial with cell stock; and then recap the tube in two minutes. Also because Fill-It s pump uses sterile disposable tubing and its recapping module has a built-in method of preventing the wrong lid going back on to a vial, the system eliminates many potential sources of contamination of frozen cell stocks. Fill-It can process common cryovials and tubes from suppliers including Nunc, Micronic, Matrix, Corning and Greiner. The system uses SBS standard 24 and 96-way rack formats compatible with most commercial liquid handlers. It is compact enough to fit into any laboratory or microbiological safety cabinet to maintain aseptic conditions for dispensing both mammalian and microbial cell suspensions. In October 2007, TAP introduced Capit-All, its new system for automatically removing and replacing screw caps from microtubes. The Capit-All system, designed in consultation with major microtube suppliers and tested at a pharma company, can simultaneously unscrew and recap 96 tubes held in standard 96-way tube racks. Each cap is replaced concurrently and individually tightened to a tight seal, avoiding the risk of putting the wrong lid back onto a tube and eliminating a source of cross-contamination. Capit-All can process common tube types.

153 142 The Worldwide Market for Lab Automation TECAN GROUP LTD. Seestrasse Maennedorf, Switzerland Phone: URL: Tecan is a leading global supplier of automated products and systems for the biopharma, forensic and diagnostic industries. The company is involved in the development, production and distribution of advanced automation and detection solutions for life science laboratories. Through its REMP subsidiary, Tecan is a major supplier of largescale automated laboratory storage and logistics systems. Its customers include pharmaceutical and biotechnology companies, university research departments and diagnostic laboratories. The company has more than 1,100 employees, owns production, research and development sites in both North America and Europe, and maintains a sales and service network in 52 countries. In 2007, Tecan achieved sales of more than $390 million. Regarding long-term growth, the company is expanding its market coverage not only in the high growth Asian and Near- and Middle East markets, but also in the new EU countries. Its customer application teams will continue to be strengthened, especially in the areas of cellular biology and genomics. Tecan plans to further strengthen its OEM development and supply capabilities and work on the development of new consumables. Tecan offers flexible pipetting platforms, as well as numerous standardized and validated packaged solutions for specific applications. Platforms for biopharma, research and clinical diagnostics include the Freedom EVO series, liquid handling platforms that can be integrated with a wide choice of robotic arms and application modules for pipetting applications. The Freedom EVO 75, for laboratories with limited space, can be used for DNA extraction, PCR set-up and ELISA. The Freedom EVO MultiChannel Pipetting system can be used for multichannel pipetting. The REMP Small-Size Store (SSS), Mid-Size Store and Large-Size Store provide scalable, fully automated storage and retrieval systems for samples. The Freedom EVO and the REMP SSS together enable the storage, retrieval and reformatting of compounds and DNA samples. The new ELISA analyzer offers fully automated microplate processing and includes advanced art reader, washer and incubation units. The Freedom EVO Clinical is Tecan s IVD-D compliant pipetting platform for clinical diagnostic applications. The Genesis FE500 is Tecan s front-end, pre-analytical

154 Chapter Five: Corporate Profiles 143 laboratory automation solution. The Genesis FE500 combines pre-analytical functions, including pre-sorting, centrifugation, volume check and clot detection, decapping, secondary tube labeling, aliquoting and destination sorting into analyzer racks, on a small footprint instrument. Many pharmaceutical and agrochemical companies use the REMP Tube Technology. This technology is based on the premise of individual tubes for individual compounds. These tubes can be manipulated and accessed more efficiently and quickly than other tube rack systems by simply pushing the tube through the source rack to the destination rack. The REMP Sample Administration System provides a comprehensive software package to administer sample libraries and execute the processes associated with the usage and maintenance of such a facility. The basic package can be configured to reflect specific situations ranging from single manual stores, fridges and balances up to a complete cluster of dosage and replication and automated storage systems.

155 144 The Worldwide Market for Lab Automation THERMOFISCHER SCIENTIFIC INC. 81 Wyman St. PO Box 9046 Waltham, MA Phone: URL: In November 2006, Thermo Electron Corp. merged with Fisher Scientific International Inc. Thermo Fisher now has 30,500 employees and serves more than 350,000 customers in pharmaceutical and biotech companies, hospitals and clinical diagnostic labs, universities, research institutions and government agencies, as well as environmental, industrial quality and process control settings. The company markets a broad selection of analytical instruments, equi0pment, consumables and laboratory supplies. Its portfolio includes technologies for mass spectrometry, elemental analysis, molecular spectroscopy, sample preparation, informatics, fine and high-purity chemistry production, cell culture, RNA interference analysis and immunodiagnostic testing, as well as air and water quality monitoring and process control. ThermoFisher Scientific is a provider of automation solutions to the laboratory and life sciences markets. A manufacturer of light payload robotics and robotic systems, Thermo has an installed base of more than 3,000 robots worldwide, with worldwide sales to end users, OEMs and system integrators. The company markets its products through a direct sales force, customer-service professionals, electronic commerce, third-party distributors and various catalogs. It has approximately 7,500 sales and service professionals. In addition to its own sales channels, Thermo s clinical chemistry and automation systems are distributed by leading diagnostic manufacturers, such as Siemens Medical Solutions Diagnostics and Ortho-Clinical Diagnostics. Thermo offers automated systems and technologies ranging from standalone robots to complete liquid handling systems. Its key technologies include automated storage, integration platforms, robotics and software. Advanced automated storage systems offer both low- and high-volume capacities with full environmental control. Integration platforms include stand-alone plate stackers and movers, multifunctional three-dimensional platforms with robotic arms, advanced analytical equipment and software for experimental design, control and analysis. Microplate instrumentation products encompass a complete range of highperformance plate readers, washers and bulk dispensers. The company s software platforms schedule and control all robotics and third party instrumentation. These

156 Chapter Five: Corporate Profiles 145 software platforms integrate with LIMS and other informatics systems. Thermo s automated platforms can incorporate imagers, liquid handlers, bulk dispensers, incubators, microplate stackers, automated storage products and vertical loading robotics. Thermo offers a wide variety of different microplate instruments for drug discovery, assay development, ELISA and applied testing. The company s portfolio includes different microplate detection, bulk reagent dispensing, magnetic particle, microplate washer and incubation instruments. The company s clinical chemistry and automation systems include analyzers and reagents that analyze and measure routine blood and urine chemistry, such as glucose and cholesterol; and advanced testing systems for specific proteins, therapeutic drug monitoring and for monitoring for drugs of abuse. Its diagnostic test range covers approximately 80 different validated methods. The company also provides pre- and postanalytical automation for preparing blood specimens before and after analysis. Thermo also supplies highly flexible, modular drug discovery platforms that automate virtually any assay, method or protocol. The addition of the Matrix Technologies and Cellomics brands brings together more than 20 years of robotics and software development with automated liquid handling equipment and consumables. For drug discovery automated incubators and storage, the company offers the Cytomat line of automated incubators and storage systems, as well as Momentum lab automation process and data integration software. Other clinical chemistry automation products include aliquoters-labelers, centrifuges, decappers and multitube carriers. Regarding laboratory consumables, the company manufactures and sells glass and plastics consumables and certain related equipment used to conduct drug discovery and drug development, quality and process control, clinical and basic research and development. The company supplies sample tubes, containers and vessels, in a variety of plastics and glass and in a wide range of volumes. Included are microwell plates ranging from a single well to 1,536 wells for applications ranging from tissue culture to primary and secondary screening in drug discovery.

157 146 The Worldwide Market for Lab Automation XIRIL AG Garstligweg 2 CH-8634 Hombrechtikon, Switzerland Phone: Fax: URL: Xiril was founded in 2001 by a team of experts with more than 25 years liquid handling experience. The company develops automated systems for life science and diagnostic applications. Xiril robotic work stations address the mid- to low-end pipetting markets where bench space is often costly and budgets are limited. Xiril incorporates electronic hand pipettes into a flexible robotic work station to create an accurate liquid handling robot. The company uses air displacement to aspirate and dispense liquids to eliminate dilution and reduce contamination risk. Each pipette is equipped with an individual pressure-based sensor system that detects liquid levels, clots and clogged tips. Intelligent engineering encloses the electronics, motors and pipettes into the centrally mounted arm. Xiril liquid handling robotics provide a basic platform for the automation of a broad range of routine applications, ranging from simple pipetting tasks through to sophisticated isolation processes or assay development. The company s open pipetting robots are available in 75 cm, 100 cm or 150 cm footprints and can be adapted to suit a wide range of life science and diagnostic applications with optional arm and pipette configurations and simple integration of modular hardware components. Xiril has a 1-, 2-, 4- or 8-channel pipette arm that covers the volume range from 2 ul to 1,000 ul. Each pipette can be controlled individually, enabling independent Y and Z axis movements. Disposable tips with and without filters can be used within the same pipetting process to balance contamination risk and control costs. It also is possible to add a second arm with up to eight pipette channels or even a 96-tip head. The company simply mounts the second arm onto the same axis. Xiril also offers PCR setup work stations and ELISA preparation work stations. The company has launched its MRSA (methicillin resistant Staphylococcus aureus) robotic work station for the extraction of DNA at high throughput. MRSA is a resistant variation of Staphylococcus aureus. It has evolved an ability to survive treatment with beta-lactam antibiotics and is especially troublesome in hospitalassociated infections. Consequently, most hospitals screen samples from both patients

158 Chapter Five: Corporate Profiles 147 and other possible contamination sources. These samples are first cultivated, then boiled and finally analyzed using qpcr (quantitative polymerase chain reaction). Xiril s robotic work station can extract the DNA rapidly and allows a high throughput of samples with little time and manpower. This fully automated method makes possible the extraction of 96 samples within 50 minutes.