Rad AI CMIO Woojin Kim, MD

Artificial Intelligence

Augmedix Takes Hit As Ambient AI Heats Up

Augmedix just reported Q1 results that managed to axe its share price in half, an interesting turn of events given the company’s role as the bellwether for the white hot ambient AI space.

There’s plenty to unpack when the only publicly-traded medical scribe company takes a hit like that despite beating expectations for both EPS and revenue, which jumped 40% to $13.5M.

The simple explanation? Competition. Augmedix saw “a slow-down in purchasing commitments” as providers evaluate competing offerings, prompting it to cut its full-year revenue forecast to between $52M and $55M (down from $60M to $62M).

• During the investor call, Augmedix said that 42 companies currently offer GenAI medical documentation solutions, leading to a ton of noise and just as many pilots.

• Although the increased demand from health systems is promising for the overall sector, it doesn’t exactly translate to success for established players when nimble startups like Nabla, Abridge, and Suki start swarming in on the action.

Augmedix is shaping its strategy around a product portfolio that lets providers choose the right tool for their needs, expanding beyond Augmedix Live (human scribes, high cost) with Augmedix Go (GenAI scribe, low cost) and Augmedix Go Assist (GenAI + human review, medium cost).

• The push into GenAI has apparently been a double-edged sword. Augmedix reported that strong uptake for its new AI products might result in slower revenue growth as customers transition away from its high-margin Live solution.

• New products tailored to specific settings will be another focus, as seen with the recent debut of Augmedix Go ED following a pilot-turned-implementation at HCA Healthcare. As scribing tech becomes commoditized, expect to see more players differentiate on setting / specialty.

The Takeaway

If there’s one lesson to learn from Augmedix’s first quarter, it’s that business is booming in the ambient AI space, but that doesn’t benefit incumbent leaders when it also attracts hungry competitors looking to feast on the same momentum.

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• Incentives = Outcomes: A new study in Health Affairs showed that financial incentives work wonders on patients, especially if you’re asking for a one-time action instead of long term behavior change. After West Virginia began offering a $100 bond to young adults for getting the COVID vaccine, the state saw a nearly 12% increase in vaccinations among 16 to 35-year-olds. The increase was larger among the unemployed and those making under $35, as well as people who had never had a prior COVID infection versus those who had already gotten sick.

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• Top Medical GenAI Models: AI expert Woojin Kim, MD, turned to LinkedIn to share a great overview of Google’s just-revealed Med-Gemini as well as other leading LLMs/foundation models. Dr. Kim is bullish on the disruption potential of GenAI in healthcare and shared some recent research papers highlighting their potential, focusing not only on Med-Gemini, but also on RayDINO from Meta, Rad-DINO from Microsoft, and MedVersa.

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If you’re in Minneapolis for the Clinical Informatics Conference this week, make sure to meet Nabla at Booth #8 to learn more about the keys to successful ambient AI deployment. The Nabla team will be doing live demos, and it’s a great chance to get hands-on with the hottest tech in healthcare.

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