Christine Nikiel: Health software developer dares

Precept Health's Vivian Ho and Tony Blomfield. Photo / Glenn Jeffrey

In the intensive care unit at Temerloh, Malaysia's largest hospital, a stream of data is silently transferring from a patient to drug pumps, vital sign monitors, ventilators and other life support machines.

Controlled by software, data on everything from the patient's heart rate to the volume of blood being pumped by their heart is monitored and recorded. The technology saves hospital staff from having to manually record and analyse copious amounts of complex information, and its inventor, Precept Health, is a tiny start-up based on Auckland's North Shore.

The company recently won a $20 million contract with the Malaysian Ministry of Health - beating United States healthcare IT giants Philips Healthcare and GM - to roll out its flagship critical care information software system, called ICU Care, in the Hospital Sultan Haji Ahmad Shah Temerloh (Temerloh Hospital). And this week Precept scored deals to supply 13 more hospitals in Malaysia with ICU Care.

Founder Tony Blomfield hopes to "get it right" in Malaysia and secure a larger contract with the ministry to supply more of the country's 134 hospitals, and sees the Temerloh contract as a foot in the door to the rest of developing Asia.

"In the 1980s you wouldn't have gone to a hospital in Asia, some of them were third world in their facilities," Blomfield says. "Now they have some of the top-rated hospitals in the world, such as Bumrungrad Hospital in Bangkok."

In New Zealand the company has placed software-based cardiology products in the country's 14 cardiac intervention centres, but its bread and butter comes from distributing ICU Care through resellers in Europe and Southeast Asia.

Blomfield says the company recognised very early that to sell ICU Care it needed a much bigger marketplace than New Zealand to justify the "huge" R&D expenses involved. Being a finalist in the prestigious Red Herring 100 Asia Awards last year helped propel Precept onto the international radar; the awards acknowledge cutting-edge private technology companies in the Asia Pacific region.

However, Blomfield admits, the company struggles financially. Based at the Massey e-centre, an Auckland business incubator, Precept Health is still small, with just 12 staff, and any profits are poured back into the company. "But that's the way it has to be; you have to burn everything, even the retirement fund, to get there. However, what makes us successful is that we are very fortunate to have a team of highly committed individuals who can see the

huge opportunity we are facing."

At 63, with his bushy beard and sandals, Blomfield doesn't fit the image of a typical entrepreneur. After completing a science degree at the University of Auckland he started his own television repair business before a friend referred him to US biomedical giant Technicon. The company snapped him up to fix its blood analysers, initially in the Southeast Asian region. He then moved to Paris as an R&D engineer doing specialist research into new micro techniques

in biochemistry and haematology, and left Technicon in 1989 for Abbot Diagnostics in Chicago as a field engineer.

After redundancy in 1990, Blomfield contracted himself out creating software for manufacturing, financial services and retail customers.

"Basically I was a one-man software development shop taking down business requirements and creating software to fit the need for anyone that would pay me. I wrote 28 systems over about eight years. All are still in place except for one."

By 1994 he found himself with a handful of core cardiology products and set up his own company specialising in field medical software, a niche he felt was underserviced in the global market.

Blomfield admits at first he was no businessman. He bought a health IT company called Precept Systems from the liquidators thinking it was a cheap way to get his products into the market. Unfortunately, he believes he also bought some bad relationships and spent three years and thousands of dollars trying to rebuild the brand and company. He eventually closed down the company and set up another, Precept Health.

"Those were the tough times. I made plenty of classic mistakes and paid the penalty. We ended up dumping the code, ideas, and just kept the name. This was a dark period for us."

Driven by the fear that he was running out of time - he was in his mid-50s and had had a triple heart bypass in 2002 - Blomfield set about forming a network of contacts in Europe and Canada, and got a $100,000 market development grant from New Zealand Trade & Enterprise. He decided the US was too big to get any traction, and after reading a report on the developing Asian economies and realising things were improving on the healthcare front, targeted

Malaysia. With help from NZTE he found a local businessman with hospital and political connections and after three years signed the Temerloh Hospital contract.

Another deal with an Asian private hospital chain that specialises in medical tourism has also been signed, and the company last month secured its first US deal, but Blomfield can't yet give any details about either deal.

The company, says Blomfield, is under pressure to expand its product range to include software tools such as real-time cardiac performance measurement, alert systems based on real-time instrumentation, and clinical decision-making software. It's also working on the next generation of clinical analysis tools.

There are also plans for an office in Malaysia. High costs and lack of local knowledge have prevented the company establishing an office in Belgium, where its European distributor is based.

Blomfield's enthusiasm for his job is clearly apparent. He's interested in "the concept of a computer as a human", and has sat in on numerous operations in hospitals around the world.

Hiring good staff has been an important part of the company's success, he says. Last year he took on start-up business expert Vivian Ho as general manager to help propel the business into more offshore markets.

Ho believes Blomfield and his team have the right attitude for success.

"It comes down to the ability to dream, to think that a small New Zealand company can go against the big guys, like David and Goliath. That's something New Zealand companies are good at doing."