Operating area

Business Innovation

Business Innovation is the Group’s incubator for future product areas. This is where Sectra evaluates and utilizes opportunities to commercialize new technologies and new segments in the Group’s main and related areas. The unit also includes new products and services that are not a natural match with the existing operating areas—for example, if the products in question are intended for users in other customer segments.

Business Innovation includes the Orthopaedics and Medical Education business units as well as Sectra’s research department. Business Innovation also manages and develops Sectra’s patent portfolio.

Quick facts

Figures refers to fiscal year 2018/2019.

  • Number of employees: 37
  • Revenue: SEK 68.8 million
  • Customers: The Orthopaedics business unit is aimed at private and public orthopaedic clinics as well as suppliers of prosthetics and implants. The operations in Medical Education focus on educational institutions and hospitals offering basic and specialist medical or veterinary studies, either privately or publicly.
  • Sales channels: Own sales organization and distribution partners within Orthopaedics. Some 40 distribution partners within Medical Education. The business unit’s solutions are also sold as part of Sectra Imaging IT Solutions’ customer offerings.

The Group incubator

Business Innovation is the Group’s incubator for future product areas. This is where we evaluate and utilizes opportunities to commercialize new technologies and new segments that are not a natural match with the Group’s main and related areas. The unit also includes new products and services that are not a natural match with the existing operating areas—for example, if the products in question are intended for users in other customer segments. The long-term goals for our Business Innovation operations are:

  • To contribute to better care for patients by solving difficult and important problems encountered by Sectra’s customers.
  • For research projects to validate clinical benefits or lead to new and innovative solutions that add value for customers in Sectra’s niche areas, thereby offering significant international business potential.
  • To build and manage a strong patent portfolio in Sectra’s key areas.
  • To develop business models for new products and services.

Sound scientific and medical evidence is essential in healthcare, and implementing new technologies and methods is often a long process and associated with high risk. As a result, some research and other early- phase projects will never grow to any major degree. In the long term, the business units in Business Innovation are to be managed in one of the following ways:

  • Form a new operating area once the unit has become profitable and accounts for approximately 10% of the Group’s sales.
  • Be integrated into an existing operating area. This occurred, for example, when digital pathology was transferred to Imaging IT Solutions in 2014. Due to the major synergies identified.
  • Be sold to an external party if this proves to be the best solution from a financial standpoint. This occurred, for example, with the business unit for low-dose mammography products, which was divested in 2011. Sectra also sold a number of patents in 2015.
  • Be discontinued if the unit does not offer sufficient potential. This occurred, for example, with the osteoporosis operations in 2017/2018.

Business Innovation currently comprises only medical technology projects, but may be expanded to include projects in other areas in the future. In certain cases, the projects are already profitable business units with existing customers that need to grow further before becoming an independent operating area.

Business units
Business units

Safer surgery using digital planning

The number of joint replacement surgeries is expected to increase sharply due to an aging population worldwide and is a major global healthcare challenge. To meet the growing need for better, more efficient care, Sectra offers IT systems for image-based planning and follow-up of orthopaedic surgery— for example, hip, knee, spine and trauma surgery. Using 2D and 3D medical images, measurement tools and a library of more than 90.000 implant templates and click guides, orthopaedic surgeons can diagnose and plan with greater accuracy.

For hospitals, increased precision during planning leads to reduced costs, since the operating time is shortened and the number of implants to be prepared before every surgery is reduced. For the patient, more efficient planning and shorter operating times reduce the risk of post-operative infections and other complications.

Sectra’s product offering in orthopaedics includes two new analysis services. One service helps orthopaedists determine if the pain experienced by some patients after implant surgery is caused by a loose implant. If this is not the case, an unnecessary and risky surgery can be avoided. Furthermore, Sectra also contributes to simplifying and streamlining the validation process of new implants. This service simplifies clinical trials and makes it possible for implant suppliers to meet new, tougher demands from authorities.

Clinical studies are a part of the business unit’s growth strategy. To disseminate knowledge and collect evidence for products and services, more than 20 new clinical studies were initiated in 2018 in collaboration with, for instance, several major hospitals in Sweden. Discussions concerning similar collaborations are also being conducted with customers in the UK, the Netherlands and the US.

Sectra is currently the market leader in Scandinavia in this niche and commands a strong market position in several other countries, including the Netherlands and the UK. The business unit is also advancing its position in the US, where the organization has recently expanded.

The way forward

  • Contribute to improved orthopaedic pre-operative planning and reduce the amount of time spent in the operating room through the development and sale of software and cloud-based services for planning and follow-up. Focus on expanding the joint replacement surgery (hip, knee and shoulder) and trauma segments through direct sales and in cooperation with implant suppliers.
  • Grow primarily in the regions and countries where the business unit has its own sales organization: Benelux, North America, the Nordic region and the UK.
  • Establish service for follow-up of orthopaedic surgeries outside the Swedish market.
  • Establish analysis service for follow-up of new implants during clinical testing.

 

Cloud-based teaching platform for international collaboration

By interacting with medical images from actual patient cases, students and resident physicians are provided with a better understanding of anatomy, bodily functions and variations, and better knowledge about various cases. Sectra offers a cloud-based training platform, Sectra Education Portal, which consists of software for interacting with medical cases, access to images of actual patient cases and training terminals for teaching large groups, such as Sectra’s visualization table. Through the platform, customers can also share cases with other connected customers, such as universities, training centers and hospitals. During the last few years, the business unit has transitioned from supplying visualization devices for a one-time fee to offering a subscription model with a greater focus on content.

Use of the solution continues to grow, and it is currently available for healthcare personnel, medical training programs and veterinarians at roughly 400 educational institutions and hospitals in some 50 countries. Sales mainly take place through distribution partners in Europe, the Middle East, North America, South America, South-East Asia and China. The network of distribution partners continues to expand and improve. For example, collaborations have been initiated with an additional partner in China and a new distributor in Mexico. Cyprus and Japan are the latest countries to be added to the distribution network.

The way forward

  • Continue to expand the customer offering with complementary training material for several specialist areas.
  • Create an offering tailored to different aspects of medical education to meet different customer groups’ specific needs and enable price differentiation.
  • Continued focus on usability in the development of training platforms.
  • Grow in key markets such as the US, China and Europe.

 

Innovation for sustainable growth

Sectra’s research department conducts and participates in projects to produce clinical evidence for existing technology as well as to create new products—all in an effort to contribute to the company’s long-term business value. The department is home to seven researchers, three of whom divide their time between Sectra and various universities.

Ongoing research projects

Sectra is currently involved in approximately ten research projects, including projects in the fields of AI and orthopaedic surgery. Projects are also being carried out in the field of digital pathology, which remains an important area for the research team. In recent years, these digital pathology projects have enabled Imaging IT Solutions’ product offerings to be expanded and improved.

AI is an underlying theme in much of the research department’s work. Our researchers are working on solutions that combine AI and visualization, focusing on how physicians control and adjust computer results. Among other projects, Sectra is one of the main participants in the Vinnova- funded project AIDA. The project serves as a national arena for research into AI for medical image analysis, with the aim of leveraging the full benefits of AI-based tools in the Swedish healthcare sector. Two of our researchers are also participating in the large-scale Swedish AI initiative WASP (Wallenberg AI, Autonomous Systems and Software Program). Sectra is contributing research in diagnostic imaging so that AI can move from the laboratory to providing real value in the healthcare sector. Sectra is also cooperating with Visual Sweden, which is on the way to becoming a world-leading hub for innovation in image analysis and visualization, with close cooperation between industry, academia and the healthcare sector.

In addition to AI research, Sectra is also participating in a major project in the field of orthopaedic surgery. The aim of the project, run by a large Swedish consortium, is to develop high-precision methods for planning orthopaedic surgeries and post-operative follow-up.

Management

Gustaf Schwang

General Manager Business unit Orthopaedics

Sofia Bertling

General Manager Business unit Medical Education

Claes Lundström

Research Director Medical systems