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Sciformatix Targets Labs on Tight Budgets with SaaS LIMS Model

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Next week at the Lab Automation conference in Palm Springs, Calif., LIMS startup Sciformatix will launch its first product — SciLIMS, an "on demand" laboratory information system that it is offering in a software-as-a-service model to small and medium-sized laboratories.

Touting the system as one that "takes virtually zero IT resources to develop, install, or run," the company is hoping to reach a clientele with strapped budgets and little to no on-site IT staff to help deploy and maintain an in-house LIMS.

Costs for a small lab to use SciLIMS might run around $100 per month, the company said. By contrast, an in-house LIMS can cost in the tens to hundreds of thousands of dollars upfront, in addition to maintenance costs that many scientists "don't think about," such as infrastructure hardware and software, database licensing, and personnel training, Sciformatix CEO Thomas Kent told BioInform.

"With SciLIMS, it is simply a monthly cost per user," he said. "It's not your father's LIMS."

Traditional LIMS implementations have been hampered by being "difficult, time-consuming and costly" and are often "intimidating and confining to lab users," he said.

By contrast, he noted, "Because we deliver a professional-grade LIMS through the cloud, we are able to handle all of the traditional costs, the hardware, software infrastructure, the maintenance and customization, and remove those burdens from the users and their IT operations."

Another advantage of the SaaS delivery model, the company stated in a brochure, is that it won't suffer from unplanned outages or downtime for maintenance as in-house systems do. And whereas home-grown systems require developers, SciLIMS is set up so that non-technical administrators can use the system.

Kent said that Sciformatix's early customers are seeing savings of 40 percent to 50 percent in operational costs on an annual basis compared to home-grown or informal LIMS solutions such as Microsoft Access or FileMaker Pro solutions, paper-based logs, or spreadsheets.

The firm does not yet have customers beyond beta testers, Kent said. Sciformatix is trying to work with "companies from multiple industries," including pharma, environmental firms, and food and beverage companies, he said.

"We are primarily focusing on the US market right now and as we gain traction and activities there, then we will be expanding geographically," he said.

"We don't expect that we are going to be the primary LIMS for the big labs," Kent said, but that doesn't mean the firm's market is limited, because "more than 80 percent of labs around the world do not have a professional LIMS solution."

The founders of Sciformatix came from a lab environment and "shared the frustration of trying to implement LIMS," he said, noting that they wanted to develop a system that would allow users to tailor the system to their informatics needs without the help of an IT team or a vendor, and avoid "having to succumb to someone else's idea of how they should run their labs."

SciLIMS is geared toward samples and storage management. Beta customers have reported reducing "sample receiving operations from 20-30 minutes down to a minute or two," as compared to home-grown systems or no LIMS at all, Kent said. He noted that SciLIMS helps customers find stored samples and "capture data associated with those [samples] so they can do data analytics along the way."

Speaking to Dr. X

Sciformatix arranged for BioInform to speak to a beta user who has been using the platform for four weeks. The person did not want to be identified because he is still evaluating the system and the university did not want this scientist to comment on a product.

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The user directs a genomics core facility in a California-based academic cancer research facility that runs around 2,000 samples a week for researchers at the university as well as small biotech companies. Two-thirds of those samples are for quantitative PCR and one-third are for high-throughput genotyping on the Sequenom MassArray platform.

For quantitative PCR services, the facility retains samples, but for the genotyping work, samples are discarded after use. The number of samples has doubled over the last year, with growth mainly coming from genotyping, the user explained.

"With SciLIMS, we are still in evaluation and I don't have feedback from the whole lab, but I have been very impressed with the software; it's very easy [to use]," the user said.
"It also presents solutions for dealing with data I had never thought of."

The challenge, the beta user said, is that samples need to be run quickly, "preferably yesterday." As a mid-to-high-throughput facility with five staff members, out-of-the-box LIMS platforms — in the range of $15,000 to $20,000 "at the smallest" — seemed "pretty expensive" and intended for larger facilities. "SciLIMS seems be more affordable," the user said.

The Sciformatix system seemed to be "a system we could reasonably afford," and is now used to store sample locations for retrieval. So far, the facility's customers have not been concerned about the platform's remote data storage, the user explained. "It's only information about inventory [of de-identified] samples and about assays that are commonly available."

As a condition for beta testing Sciformatix platform, the user said that the facility was looking for software that would not interfere with the lab's daily workflow. "If we're going to spend time beta-testing, I don't want to spend time using the software." That condition was met, the interviewee explained, and use of the software has been "pretty straightforward."

Prior to deploying Sciformatix's SciLIMS, the lab used spreadsheets to keep track of samples, and kept a workflow on a bulletin board. "When people want us to find samples, that can be pretty difficult, because we don't have a method to store them," the user said. "What has kind of saved us is that people don't tend to re-run samples a lot." Storage retrieval and knowing the number of assays the lab has for PCR is "really difficult."

Staying Safe

One of the obvious concerns of a SaaS delivery model is data security, but Kent said the company relies on "many different levels of security" and can "protect customers' data better than most of the internal IT operations can."

He acknowledged that some companies show some hesitation initially, but "as they get together with their IT operations and talk about it, they come back to us and say 'We are willing.'"

In a white paper available on its website, the company explains that in-house LIMS are vulnerable to threats such as viruses, employee negligence or maliciousness, corporate espionage, or hackers — all of which requires security features be put in place and maintained.

The Sciformatix data center is monitored with close-circuit cameras and relies on security procedures such as biometric readers on doors and visitor screening. Administrators constantly monitor server security, manage firewalls and antivirus filtering, provide secure socket layer connections to encrypt data between the LIMS servers and client workstations, and maintain data backup in case of catastrophic failures. In addition, each customer's LIMS data are separated from that of other customers.

Beyond Stealth

Sciformatix, which began operations in 2006 and was incorporated in 2007, was founded by Kent, who previously headed bioinformatics at Abgenix and was vice president of IT at NA Sciences; and CTO Pascual Starink, who was previously director of lab bioinformatics and engineering at Perlegen and also held bioinformatics positions at DNA Sciences, Incyte Genomics, and Synteni.

Next week is Sciformatix's first step into the commercial spotlight. "We came out of the very harsh stealth mode a few months ago," Kent said. "We've been in stealth mode for more than a couple of years now."

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The firm has also started a partnership with a distributor of lab supplies and equipment, which he declined to name. Sciformatix is privately held and has some "outside investors," he said, but he did not offer details.

Kent said that Sciformatix is targeting small or medium-sized labs. Those labs might process samples for a biospecimen bank or be connected to samples in other ways. One of the firm's customers, for example, receives sample materials, processes them, runs them through a sequencer, produces results for their partner, and delivers data in return.

"When you think about that at first blush, it seems like there is not a sample-management issue there, but in fact there really is," he said.

Sample tracking might be done on paper or in spreadsheets, but a reliable system is required so that after processing, "they can compare that with the samples that go out of the system and back to the customer," Kent said.

Many labs also have a procedure in place to retain some portion of the samples in their inventory in case they need to re-run them. "Having a system that can receive that sample information and the containers very efficiently and then track what's happening to it … is a very valuable tool for them," Kent said.

LIMS Outlook

The more traditional LIMS life science markets such as "R&D, manufacturing, QA/QC, [and] clinical sample management are very mature, established, and saturated spaces," Frost & Sullivan analyst Jonathan Witonsky told BioInform in an e-mail.

Witonsky, industry manager for drug discovery technologies and clinical diagnostics at Frost & Sullivan and author the 2008 study, "Strategic Analysis of US LIMS Markets," noted that "the addressable commercial LIMS market in the United States is very small."

Not many US-based laboratories are without a LIMS, he said. Others are employing a home-grown system and not "likely to adopt a commercial LIMS," which means that in the US "each LIMS vendor has only a handful of new customers in a given year."

He said that the US LIMS market is projected to grow at a compound annual growth rate of "just under 1 percent" between 2007 and 2014 with most of this growth "driven by replacements." For example, the IT infrastructure for most pharmaceutical firms "is spread out over multiple business units and varied geographic locations where there will be increased demand for enterprise-wide LIMS solutions."

While the Western European LIMS market will grow at a higher rate than the US market, it, too, is "relatively mature," he said.

However, Sciformatix's Kent believes these numbers reflect the market that vendors "have already been going after." In his view, 80 percent of the market is "still untapped." "That's where we see the real opportunity," he said.

Frost & Sullivan's Witonsky said that lower growth in established markets is leading LIMS vendors to focus their attention on emerging regions including China, India, and Eastern Europe, which could be an advantage for the SaaS delivery model. "In these regions, vendors are struggling to maintain the pricing structure that they established in the United States or Western Europe," he said. The SaaS model for LIMS means that users can lower their administrative overhead in these regions.

"As vendors look to exploit high growth opportunities in emerging regional markets, a SaaS LIMS could enable faster penetration of a customer base that demands a more affordable solution," he said.

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"Moreover, SaaS LIMS are generally platform- and language-independent, which supports researchers in pharmaceutical and biotechnology companies across the globe. Therefore, a SaaS model fits well with a business strategy focused on multiple developing regions of the world," he said.

"The Sciformatix [offering] seems innovative," and with "an attractive price point," analyst Glenn Cudiamat told BioInform. "It might find a small niche in the LIMS world," he said.

Cudiamat, who follows life science lab instrumentation as vice president of research services for consulting company Strategic Directions International, said he sees some resistance to the SaaS model in the LIMS market. "It may fly but I don't see it happening in the near term," he said. "If it does take off, the big guys are going to react to it."

He agrees with the Frost & Sullivan market analysis of slow market growth to be expected "certainly for the next two years." Like Witonsky, he noted that growth will come from the Asian-Pacific region where there is interest in using the same instruments and software as in the US or Europe.

The SaaS LIMS model "opens up to the lower end of the market," Cudiamat said. While small labs might not need LIMS of this kind, he said, "When you are in that mid-range, maybe [you do]."

Big LIMS vendors, "where the bulk of the market comes from," such as ThermoFisher, LabWare, StarLIMS, Applied Biosystems, or LabVantage, "are not going to be cannibalized by [a] software-as-a-service-type company," he said.

Larger vendors have "a lot of legwork for a sale and so they are not interested in that business model." Smaller labs who are "really penny-pinching and have a different mind-set" are not their focus, he said.

"It will be interesting to monitor how the SaaS LIMS approach works out and if this low-cost solution will effectively expand the addressable LIMS market," Clive Baron, chief business development officer at StarLIMS, told BioInform in an e-mail.

Baron said that the SaaS model for smaller labs is "an interesting concept," but noted that other firms have previously tried to offer LIMS "as an online service" but that approach "did not get much traction."

Cloud computing "could better facilitate this offering, but it is unlikely that the platform was the only reason for the previous offerings not succeeding," he said.

In his view, "without a reasonable level of configuration effort, [a SaaS-based LIMS] will have limited functional use and as such will be limited in the value that it can add."

At the same time, it may work for the targeted market. "A SaaS LIMS will not meet the needs of an enterprise LIMS but may be sufficiently attractive for non-enterprise or point solution applications," he said.

He also pointed out that LIMS contain data "that is typically highly confidential," and questioned whether companies would be "comfortable" having this data out of their control. "I am sure that the jury will be out on this issue," he said.

Baron added that linking LIMS to third-party software and instruments may not be achieved efficiently in the cloud computing model. "Selling a complex solution like LIMS is very intensive and expensive," he said. "[Can] a SaaS offering reduce this effort sufficiently to make it a viable business model?"

Baron added that it will be "interesting to monitor how the SaaS LIMS approach works out and if this low-cost solution will effectively expand the addressable LIMS market."

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