AI Hot in Healthcare Despite IBM’s Watson Health Pullout

AI ibm watson health

Earlier this week, the tech giant IBM sold off chunks of its once-promising artificial intelligence (AI)-guided division Watson Health. Despite this setback, European firms see a bright future for the use of AI in healthcare.

The tech giant IBM hit the headlines this week when it sold off parts of Watson Health — a division of IBM that offers cloud-based access to its supercomputer to analyze healthcare data using artificial intelligence (AI). The decision followed struggles to make Watson Health profitable and indicates a retreat by IBM from the healthcare space. 

IBM launched Watson Health in 2015 with the promise to revolutionize healthcare and personalized medicine by feeding reams of patient data to its AI algorithm. Over time, Watson Health’s AI offering has progressed steadily, but has had limitations. For example, a meta-analysis last year found that IBM’s Watson for Oncology software was good at predicting the cancer treatments professionals would prescribe for patients, but was less accurate for advanced cancers.

We think it was possibly too big a promise at that time,” said Tero Silvola, CEO of the Swiss healthcare AI firm BC Platforms, adding that personalized medicine and data-guided approaches should be developed for each therapy area individually. “[A holistic] solution for addressing all the diseases in one application is simply too complex.

The shockwaves of IBM’s pullout were felt in Europe’s healthcare industry, where the application of AI in handling patient data is in its infancy. At present, routine AI use in European healthcare focuses on optimizing hospital workflows, such as allocating operation rooms and predicting the discharge of patients from hospital.

In Europe, the legal framework for using AI in healthcare is behind the FDA, which has already published clear guidelines for development and validation of ‘Software-as-a-Medical Device,’” said Silvola. “In many EU countries, regulation doesn’t support or allow AI-based data analytics, or applying results to healthcare.”

Even though IBM’s intention was good, the drama “has raised concerns against AI in general,” Silvola told me, especially in terms of the regulation of AI and its use in healthcare. When looking at the big picture, however, investments in digitalizing healthcare data are always a positive thing.

Financial setbacks have also hit the UK AI company Sensyne Health in recent months. In November 2021, Sensyne was fined by the London Stock Exchange for not disclosing bonus payments to executives before listing. And earlier this month, Sensyne’s stock price plunged by more than 70% when the firm revealed it would run out of cash in weeks unless it found emergency funds.

Nevertheless, AI tools are still causing excitement in the quest to produce better and more tailored disease treatments. Big pharma companies are snapping up collaborations with firms using AI to speed up drug discovery, with one of the latest being Sanofi’s pact with Exscientia. Tech giants are placing big bets on digital health analysis firms, such as Oracle’s €25.42B ($28.3B) takeover of Cerner in the US.

There’s also a steady flow of financing going to startups taking new directions with AI and bioinformatics, with the latest example being a €20M Series A round by SeqOne Genomics in France. 

IBM Watson uses a philosophy that is diametrically opposed to SeqOne’s,” said Jean-Marc Holder, CSO of SeqOne. “[IBM Watson seems] to rely on analysis of large amounts of relatively unstructured data and bet on the volume of data delivering the right result. By opposition, SeqOne strongly believes that data must be curated and structured in order to deliver good results in genomics.”  

In the near future, a fleet of small- to mid-sized AI and health companies are likely to drive personalized medicine in specific disease niches. However, Silvola said that European policymakers need to rebalance data privacy regulations to keep up with the technology’s rapid advances, which could benefit patients immensely.

Healthcare is a massive industry and there is a lot to do,” said Silvola. “At the same time, the European population is getting older and managing the increased demand the old way will not work. This is a tremendous opportunity to transform and has attracted investors and established players. 

Over the past years many large enterprises have overlooked the complexities in healthcare process development — change requires patience and commitment.”

Cover image via Elena Resko

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