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AI Medical Service's Challenge to Spread Medical Care without Disparity

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This website has been translated into English using automatic translation. Please note that the translation may not be entirely accurate.

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Tomohiro Tada, who has been developing world-class AI endoscopes through his 10 years of experience in endoscopic medicine, says, "I want to realize a world without disparities in medical care." While there are many startups that utilize AI technology, the endoscope x image analysis is an unusual one.

We interviewed Mr. Tada, CEO of​ ​ AI Medical Service Inc., which has successfully raised more than 10 billion yen in total and is planning to expand into overseas markets.

Incorporating AI technology into the ever-developing world of endoscopes

Please tell us the business outline of AI Medical Service Inc. again.

We aim to be a global AI medical company specializing in AI endoscopes.

Mr. Tada, you were the director of a clinic before founding AI Medical Service Inc. Please tell us about the process leading up to the start-up.

After graduating from university, I spent my residency period at the University of Tokyo Hospital. In 2006, about 10 years after graduating from university, I opened an endoscopy clinic in a medical mall in Musashiurawa. Although a typical clinic can be opened with about 50 million yen, I invested 250 million yen of my own funds to open a clinic that can provide the world's highest level of endoscopic care. In collaboration with the University of Tokyo Hospital and Cancer Institute Hospital, we have been at the forefront of the endoscopic field, performing 9,000 endoscopic procedures per year, the highest level in Japan.

It's amazing to invest 250 million yen with your own funds. It is because the clinic has made such an initial investment that it is possible to provide the highest level of endoscopic medical care in Japan.

Correct. Endoscopes have undergone various developments up to now. When I opened my clinic, transnasal endoscopes, which are approximately 5 mm thick and can be passed through the nose, were introduced. Subsequently, countermeasure-type gastrointestinal endoscopic screening began for people over 40 years of age, which dramatically reduced the number of patients who lost their lives to gastric cancer. However, endoscopic care still had challenges: the heavy workload placed on the physicians in charge and the need to improve the quality of examinations.

The quality of endoscopy is ensured by double-checking the images taken during endoscopy. However, such a process is currently supported by the overtime work of medical doctors. In addition, although gastric cancer is a disease with a 98% five-year survival rate with early detection, data show that 20% of all patients are not detected early and are overlooked. In 2016, when I personally wanted to somehow solve these issues, I had the opportunity to listen to a lecture by Dr. Yutaka Matsuo, an authority on AI research. There, I heard that AI's image recognition capability was surpassing that of humans through deep learning technology. I thought that endoscopy x AI technology could help reduce the burden on doctors in the medical community.

Frankly, I think the idea of endoscopy x AI is simple and many people can think of it. However, at the time of 2016, no one was actually working on it, and I decided to initiate the research. Later, I was able to publish the world's first case study on "using image recognition technology to determine if a patient is infected with Helicobacter pylori".  As an endoscopist myself, I felt the mission to implement AI endoscopy technology in society and founded AI Medical Service Inc.

Our strength is that we have many irons in the fire. 

Mr. Tada operating a prototype of an AI endoscope

Many medical startups have been born in Japan and overseas. What are the strengths of AI Medical Service Inc.?

Since I am an active medical professional who provides endoscopic medical care, I feel that being able to develop products with a deep understanding of the industry has led to great differentiation.

Mr. Tada opened "Tomohiro Gastrointestinal and Analytical Department" in 2006, and at the same time, is also the CEO of AI Medical Service Inc. What kind of work style are you taking now?

When I first started the business, I was working completely alongside the clinic, as it was not possible to close it down right away. Now that we have moved into the phase of research and development and are producing products, I devote about 95% of my time to managing AI Medical Services Inc. The clinic is headed by a junior colleague, and I only provide endoscopic care for about half a day a week.

So you are concentrating on management now. Please tell us about your daily life. How do you wind down on weekends?

I refresh myself by staying at home and doing a digital detox. I organize my thoughts by cutting off contact with the outside world and watching movies or reading books.

Did you envision your career as a business owner from the time you were studying as a medical student?

I never envisioned my current career. Also, when I was a medical student 25 years ago, it was the norm to stay at the university hospital where you graduated.

Currently, a diverse career can be envisioned after obtaining a national medical license. Those who aspire to become doctors are all talented people. And the medical field is full of problems. I would very much like to see more and more people who can draw up careers in which they can solve such problems with their own expertise and wisdom.  

Five years of doing tough work with solid team members

Are the members of AI Medical Service Inc. mostly from the medical industry?

Thankfully, we have participants from a wide range of industries, not just the medical industry. However, negotiations regarding actual regulations and product development are left to members with backgrounds in the medical industry. On the other hand, we have people from a wide range of backgrounds working in business-related positions.

You have a diverse workforce. What are some of the things you are doing to make your organization strong as a start-up?

  In order to manage an organization like AI Medical Service Inc., which is supported by people from various backgrounds, it is important to be aware of the premise that "everyone's perception of common sense is different." Remote work in the medical industry is really a special case. Since common sense differs from industry to industry, we communicate with our employees after confirming the background from which they come.

AI Medical Service Inc. has raised about 6 billion yen in its first two years of operation. What did investors value about your company?

There are two points I think.
First, we have a solid founding team. I have deep knowledge of endoscopic treatment, Kato is a top-notch engineer who serves as CTO, and Yoshioka serves as CFO and has experience in taking startups public. I believe that such a team has been highly valued.  I don't think that a startup established solely by medical professionals such as myself would have received much recognition.

  The second point is that we have been accumulating steady work. We may have a flashy image as an AI x medical startup, but what we do in the field is very simple. We mark tens of thousands of teacher images and improve the accuracy of the algorithm. We also develop all the software in-house to make it easy for doctors in the field to use. even though it is called AI, there are many aspects that have to be built up manually. Even if other companies were to purchase AI endoscope data, it would be extremely difficult for them to beat us, who have accumulated proprietary data and know-how through steady efforts while possessing core technologies.  We have already gained market superiority in this respect, which has been highly evaluated by our customers.

What was the most challenging part about raising funds?

I wouldn't say difficult, but I had a hard time​ ​ at first in understanding what investors were looking for.  

What I remember very well is how the need is perceived. There is not a single medical professional who hears of an AI endoscope and does not need one. That's how much trouble doctors in the field are in. However, I was told by an investor that wanting it and wanting to become a customer and buy it are two different things. We learned that we need to dig deeper into the needs of the medical professionals who will become our customers to find out why they want AI endoscopes. 
After that experience, I realized that  we need to think deeper than what we usually think and explain our business to others.

Spreading products all over the world and creating a world of medical care without disparity

What start-up assistance programs have you benefited from in the past?

BRAVE, an accelerator program by Beyond Next Ventures, and Incubate Camp, run by Incubate Fund, were two very good opportunities. BRAVE specializes in the growth of R & D ventures. They provide training for researchers and university professors on the basics of startup finance and how to involve CXOs. It was a good fit for a startup like ours, whose main focus is on R&D.
The Incubate Camp was a great opportunity to learn how to grow an R&D startup in Japan. Incubate Camp is an event that brings together Japan's top capitalists, so the actual amount of money involved is off the charts.  Incubate Camp was also the catalyst for our investment.

Please tell us what you feel is necessary for the Japanese startup ecosystem to grow further.

In my opinion, I feel it is important for startup managers to have the perspective that a startup is a temporary form of business. They receive funds from investors and test hypotheses. This strategy is fine in the beginning, but as time goes by, the startup must transform itself into a unicorn and then into a solid company. The startup ecosystem is very cozy, but I think it is easy to get comfortable.

Please give a message to medical professionals nationwide who are interested in starting a business.

Many people may feel that starting a business is a big hurdle and think that it is a world beyond their reach. However, this may be because they simply don't know what it is like to start a business, and therefore think it is risky and scary, or because they don't know of any successful cases of entrepreneurship in their own neighborhood, and therefore can't picture it working.  If you are interested, I would like you to see what it is like in the real world, even if it is just to observe a pitch contest.

Please tell us what kind of world you would like to create in 10 to 20 years.

We want our products to be utilized by endoscopists around the world to raise the level of medical care. The development of medical standards directly leads to saving lives in the field of endoscopic medicine, and gastric cancer, in particular, is a curable cancer if detected early. In the future, we are considering a system in which endoscopy laboratories around the world can be connected via the cloud to provide a high level of medical care no matter where they are located. We are determined to create a world in which we can provide medical care without disparity, and we will continue to work on the business in front of us. 

Thank you!

Editor's comments

Mr. Tada has had a lot of experience before starting his own company. I believe many of his employees decided to join after being impressed by his strong will.

AI Medical Service Inc. is one of the few startups in Japan that possesses world-class core technology. Having established itself as a leading company in Japan, AI Medical Service Inc. is already looking to succeed in the global market.

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