Inside the Lab Industry

AI Imaging Drives Modest Uptick in Digital Pathology Investment Flows

Since 2014, companies dedicated to developing digital pathology solutions have raised over $860 million in investment capital. However, $207 million, or almost a quarter of that total, was raised in the first few months of 2021. Those are the findings of a new report from market data firm Signify Research.

Digital Pathology Investment Trends

The increased interest of investors in digital pathology was in evidence before the COVID-19 pandemic. Thus, of the $860 million raised since 2014, 73.4 percent has come since 2019. Signify suggests that these recent increases reflect the growing recognition of global health care providers of the need to digitize their pathology departments. While US-based companies account for 68.8 percent of the funding raised, Signify reports that investment is also beginning to scale in other international markets as companies mature and seek later stage funding.

Funding Activity 2014-2021
Source: Signify Research

The Growing Attraction of Pathology AI Image Analysis Solutions

Digital pathology investment is not just increasing but migrating in a new direction. In recent years, there has been what Signify calls a “notable shift” in investment from hardware/software solutions toward start-up companies focused on digital pathology AI-image analysis. In fact, AI vendors accounted for all three of the largest deals in the period, including:

  • Paige.AI: $125 million Series C;
  • PathAI (which just acquired Poplar Healthcare): $60 million Series B; and
  • Volastra: $44 million Seed.

Companies like Volastra and Owkin that specialize in preclinical markets generally attract larger funding amounts at an earlier stage than do those focusing on clinical markets. Signify attributes this to the higher potential for return on investment and lower regulatory barriers to adoption.


Even though capital flows have been increasing, getting providers to shell out investment funds to modernize clinical labs remains a challenge. Thus, digital pathology still attracts far less investment than markets like medical imaging AI and AI in drug development. According to Signify, this is probably due to a combination of factors including regulation and the fragmented supply chain.


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