By
STEVE LOHRPublished: February 27, 2007
Microsoft’s drive into the health care market is just getting under way, but the company signaled yesterday that one important ingredient in its plan will be a specialized search engine tailored to deliver useful medical information to consumers.
Microsoft is buying Medstory Inc., a small start-up in Foster City, Calif. Its search software applies artificial intelligence techniques to medical and health information in medical journals, government documents and on the Internet.
The terms of the Medstory acquisition were not disclosed.
The Medstory purchase, said Peter Neupert, vice president for health strategy at Microsoft, was a first step in a broader company strategy to assemble technologies that would “improve the consumer experience in health care.”
“Clearly,” Mr. Neupert said, “search is a critical part of that better end-to-end experience for consumers.”
The acquisition follows Microsoft’s purchase last year of Azyxxi, a clinical health care software system that retrieves and quickly displays patient information from many sources, including scanned documents, X-rays, M.R.I. scans and ultrasound images.
The Microsoft move comes at a time of increased investment in online health ventures, rising traffic at consumer health sites on the Web and profits at the most popular sites. Last month, a venture firm headed by
Stephen M. Case, the former chief executive of America Online, introduced an ambitious new consumer health site,
RevolutionHealth.com.
WebMD, the leading health-related site, last week reported strong quarterly profit of $8.9 million on revenue of $80.6 million, surpassing Wall Street’s expectations. The stock price of WebMD — an Internet pioneer in health information that struggled for years — has surged in the last year.
In health-related search, Healthline Networks, a start-up in San Francisco, reports rising traffic on its Web site and a growing string of deals to provide the search engine for sites of other companies, including
Merck and PacifiCare. At
Google, Adam Bosworth, a vice president for engineering, is leading the effort to develop a health-information offering.
These companies and others are seeking ways to build businesses on the Internet that profit from what is called consumer-driven health care. The notion is that shifts in demographics, economics, technology and policy will inevitably mean that individuals will want to, and be forced to, make more health care decisions themselves.
Aging baby boomers, accustomed to personal choice and to technology, tend to want a say in their treatment decisions. And the Internet is already an important source of health information. Eight million people in the United States go online for health information every day, according to a study last year by the
Pew Internet and American Life Project, a nonprofit group.
Financially, the pressure by Medicare and private health insurers to hold down costs and shift more of the burden to individuals, analysts say, will force people to make more health care spending choices.
In Medstory, Microsoft is acquiring “some of the best deep technology” in the emerging field of medical search, said Esther Dyson, an industry analyst who is also an investor in Medstory. That technology, Ms. Dyson said, is “not so much a search engine, but an ontology engine,” with a capability to find and identify concepts in health and not just sort through words and Web links.
The longer-range goal, Mr. Neupert said, is to link personal information like age, sex, drug regimens, family history and even genetic markers to search. The ideal is that search results are tailored individually, identifying treatments, drug interactions and medical journal articles of interest.
“Health search could be way more relevant,” he said. “You don’t need to see thousands of results. What you want to know is, what does this mean to me personally?”
Dr. Alain T. Rappaport, the founder and chief executive of Medstory, said he was impressed by the importance Microsoft placed on “intelligent search” in health care and by the promise that Microsoft’s global reach and resources could accelerate the spread of the technology his team developed.
Microsoft had talked to Healthline recently about using its health search service, said West Shell III, the chief executive of Healthline. “This means Microsoft has decided to go it alone,” Mr. Shell said.
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