Cognoscenti Health Institute is helping to determine what the new generation of laboratory medicine looks like, from methods of communicating with physicians to diagnostic technology.

The company uses information technology and emerging biotechnology to deliver medical laboratory services to patients, physicians, clinics and hospitals in central Florida. “We are actually a hybrid of a health-care service company and a biotech company,” says Dr. Philip Chen, CEO.

According to Chen, Cognoscenti provides medical laboratory testing services and also develops new applications for existing and new information and medical technologies. These new applications help automate the laboratory medicine services Cognoscenti offers, and help develop new tests to diagnose or monitor diseases.

Cognoscenti’s information technology innovations include proprietary tools that provide physicians with information and guidance over the Internet. For instance, Cognoscenti developed touch-screen systems for physicians’ offices that describe how to collect specimens for and interpret the results of more than 2,000 medical tests. The touch-screen technology is a key competitive advantage, Chen says, because it eliminates 95 percent of lab-related paperwork in a physician’s office.

Cognoscenti broke into the laboratory medicine market and became competitive with large national laboratories because of the information technology it uses to communicate with clients and because of the testing technologies it employs, Chen says. The company develops new applications for existing technologies, such as nanochips, to diagnose diseases and improve patient care.

The company also capitalized on market conditions. Since national laboratories are consolidating services, the laboratory aspect of medicine is often practiced remotely, away from where patients are, Chen explains. The result can be reduced customer service.
Cognoscenti conducts tests that formerly only national labs processed, thus speeding the return of test results to doctors and patients locally. In addition, “If a physician has a problem with a patient’s results, we’re local, and we know exactly what happened,” Chen says.

Cognoscenti joined the University of Central Florida (UCF) Technology Incubator in 2001, grew to seven employees by the time it opened in February 2002, and now has gross revenues of $4 million annually and about 50 employees. Most of those employees are located in the 6,500-square-foot office and laboratory space the company occupies in the incubator, but some are spread among seven regional satellite offices, including a small lab.

“The incubator has helped us with strategizing, especially on the business side,” Chen says. For example, people management has become the fast-growing company’s biggest challenge. From January through March 2003, the company’s sales grew 130 percent, Chen says. “We ended up having 70 percent of our employees work overtime,” he says. Incubator staff have helped Chen identify activities that he can outsource, such as human resources administrative functions including benefits, payroll, and workers compensation. A professional employer organization that is a member of the incubator’s advisory board now handles these functions and gets better rates for health care insurance and other benefits than the company could by itself. Being able to provide good benefits and providing a challenging environment enables Cognoscenti to attract the people it needs, despite a national shortage of technical specialists, Chen says.

UCF Technology Incubator CEO Tom O’Neal says he nominated Cognoscenti for the Outstanding Incubator Client award because “it’s just an outstanding story, an outstanding success. … The problem is figuring out how to grow [the company] bigger quicker.” Chen impressed O’Neal because he had done his market research and knew where the company could locate to best serve an industry sector, and he had already secured angel financing. “We just had to worry about how to make him successful,” O’Neal says.

Cognoscenti plans to stay in the incubator at least another year or two, Chen says. And the link between the university and his company is growing stronger. Chen serves as an adjunct faculty member and has access to faculty members with biomolecular expertise. “They can lend us resources in some molecular testing techniques, and it also helps us create collaborative projects with other faculty,” Chen says.

Cognoscenti now is poised for the future, developing cutting-edge pharmacogenomic tests that help determine which medications will work best for a given patient’s condition. Currently trial and error determines that, which means people often have to try several drugs before they find one that is effective. Because an individual’s genetic makeup determines a drug’s effectiveness, Cognoscenti is developing tests for genetic signatures of how people process drugs, Chen says. “That’s an area I and others believe will drive a lot of biotechnology, especially in the diagnostic area, for the next five to 10 years.”