December 2001

Eastman Kodak Co.’s (Rochester, N.Y.) Heath Imaging (HI) division will feel the effects of job cuts in the United States and internationally, as part of the parent company’s Oct. 24 announcement that it will layoff 3,500 to 4,000 employees.

This latest round of job reductions follows 3,500 layoffs announced in April, which means Kodak will eliminate a total of 6,500 to 7,500 jobs across the company in its cost-saving campaign. Kodak’s worldwide employment totaled 78,000 at the end of 2000.

John LaBella, Kodak director of worldwide communications for Health Imaging, said the division “definitely will be impacted,” with Kodak executives weighing the effect of cuts on various HI business segments.

“We certainly have some growth businesses, and — even though we need to be good corporate citizens and help in the overall reduction effort — we want to be very sure that we remove from the right areas,” added LaBella.

LaBella said cuts in HI will go into effect in the first quarter of 2002, with employees notified in December and leaving in January. He confirmed that the reductions are expected to include managerial and nonmanagerial positions, both in the United States and worldwide.

Kodak is prompted to reduce the work force because of the economy. Health Imaging’s sales in the third quarter saw little change, totaling $545 million, compared with $543 million in the year-ago quarter. Earnings from operations in the third quarter declined 64 percent to $51 million, compared with $141 million in last year’s third quarter.

For the nine-month period, HI’s revenues increased 4 percent to $1.69 billion, compared with $1.63 billion in the same period of 2000. Earnings from operations slid 34 percent to $257 million, compared with $388 million in the year-ago period.

“In our analog business, volume is up, and that is always a good indicator of the health of a business,” said LaBella. “Our issue right now is profitability because of the prices in the marketplace.”

Kodak’s success at signing several GPO (group purchasing organization) contracts was essential to the company’s ability to remain competitive in the United States. In a counter move, however, competitors lowered prices in their markets, particularly Europe and Japan, LaBella added. The combined effect of GPO contracts at volume-discounted prices and competitors’ actions in their home countries resulted in lower prices in major medical imaging markets.

HI’s digital segment reported 11 percent growth in third quarter compared with the same quarter last year, due to increases in DryView laser imaging placements and DryView media sales of 39 percent and 32 percent, respectively. Revenues increased “very substantially” in digital-capture and PACS (picture archiving and communications system) products, LaBella said, but the figures are compared with a relatively low base, because those products are fairly new to Kodak.

Royal Philips Electronics (Amsterdam) has completed its acquisition of Marconi plc’s (London) Medical Systems (Highland Heights, Ohio) business for $1.1 billion.

The October addition of Marconi Medical adds to Philips’ current line of computed tomography (CT) and magnetic resonance imaging (MRI) systems, while boosting the nuclear medicine segment Philips acquired last year with its purchase of the former ADAC Laboratories (Milpitas, Calif.).

“The heart of the reason as to why we were interested in Marconi is because of their CT and MR programs, and clearly we are pleased to have the addition of their nuclear medicine programs,” said Jack Price, president and CEO, Philips Medical Systems North America Sales and Service Region (Bothell, Wash.). “We are already very actively involved in integrating their product offerings with ours, and we are looking toward that [integration] providing us with an extremely strong position in both CT and MR.”

Price said there are no plans to discontinue any of Marconi’s systems “at this point in time.” While both companies serve the same modalities, the majority of the two companies’ products do not compete, he said.

“Marconi has an excellent multislice CT in the high-end; this was something we were late at, so they’ve added a high-end capability,” Price said. “They also have a CT scan that is very specific for the oncology market, which adds to the program. We will continue with some single-slice CT [scanners] in the Philips’ line. There wasn’t much overlap in these product areas.”

When Philips announced its intention to buy Marconi Medical Systems this past August, Philips said it planned to divest Marconi’s Health Care Products division (HCP of Mayfield Village, Ohio), which distributes radiology imaging supplies in the United States. While Price declined to divulge any details, he said the company remains committed to the divestiture plan.

Price said that Philips Medical Systems will consolidate the two companies’ existing Ohio operations and will continue utilizing Marconi’s manufacturing capabilities.

“Over the next two to three years, we will take the combined engineering resources and look at how we can best leverage those groups, so we can increase our investments in R&D, be more responsive to the marketplace, and have the ability to shorten the cycle time in terms of developments,” Price said. “Additionally, we will be in a position where we can potentially provide even more diversity in terms of product offerings given that we have a larger staff.”

Marconi is Philips’ third major acquisition in less than a year. Philips completed its purchase of Agilent Technologies Inc.’s (Palo Alto, Calif.) Healthcare Solutions Group (HSG of Andover, Mass.) on Aug. 1 for $1.7 billion. In January, Philips closed on its acquisition of ADAC Laboratories for $425 million.

In all, Philips invested approximately $3.2 billion on the three transactions.

In its Nov. 2 statement, the FDA wrote that the notification “is to emphasize the importance of keeping radiation doses during CT procedures as low as reasonably achievable, especially for pediatric and small adult patients, who may sometimes receive more radiation than needed to obtain diagnostic images. To prevent this, we want to stress the importance of adjusting CT scanner parameters appropriately for each individual’s weight and size, and for the anatomic region being scanned.”

Lane F. Donnelly, M.D., is the co-author of two of three articles on pediatric CT settings that were published in the February issue of American Journal of Roentgenology and is the associate director of the radiology department at Cincinnati (Ohio) Children’s Hospital.

In an interview with Medical Imaging in February, Donnelly emphasized that no one is suggesting that children may develop cancer from the radiation of a CT scan. What investigators’ studies of CT scans did show is that radiation dosage and other adjustments were not being made for children, particularly in hospitals catering to an adult population. Consequently, children were exposed to radiation levels five times higher than necessary.

Donnelly, who was at the Duke University Medical Center (Durham, N.C.) before joining the Cincinnati hospital, said most of the data were collected at Duke in 1999. Doctors investigated 58 body (chest and abdomen) helical CT examinations that were referred from outside institutions for radiologic consultation. Information recorded included tube current (mA), kilovoltage, collimation and pitch. Examinations were grouped arbitrarily on the basis of age: 0 to 4 years; 5 to 8 years; 9 to 12 years; and 13 to 16 years.

“Because kids are smaller, it takes less x-ray to penetrate their body and generate the same quality image with less radiation as you need in an adult with more radiation,” Donnelly said. “We did a survey of all the CT scans that were referred to us over a period of time to look at the parameters, and the bottom time was, they weren’t being adjusted at all.”

Those results, the study concludes, “suggest that pediatric patients may be exposed to an unnecessarily high radiation dose during body CT.”

Specific FDA recommendations include optimizing CT settings, reducing tube current, increasing table increment or pitch, and using a technique chart that takes patient size into account. The agency cautions that variations in scanner design and operating software may prevent these changes from being implemented, or keep them from changing the dose, so the FDA encourages CT operators to consult with technical support organizations to determine the best approach. The FDA also recommends practice changes, such as reducing multiple scans when contrast agents are used and eliminating inappropriate CT referrals

Pointshare provides eHealth services for healthcare organizations in Washington, Oregon, Nevada, Minnesota and Idaho. Its main services include Web hosting, eligibility verification, connectivity services, referral management, reports and results delivery, coding and claims management.

Pointshare’s operations will remain in Bellevue and Pointshare’s CHC staff will become Siemens employees. Rick Rubin, CHC’s president, will continue to direct operations.

Pointshare is a private company that serves more than 10,000 physicians and their staffs, more than 150 hospitals, and 50 regional and national health plans.

McDonough Medical Products Corp. (Deerfield, Ill.) is expanding its operations with another key acquisition.

McDonough in October acquired Cassling Diagnostic Imaging Inc.’s (CDI of Omaha, Neb.) x-ray tube loading company, Vision Imaging Components LLC (Arlington, Texas). Terms of the proposed transaction were not disclosed.

McDonough will make the transaction through its x-ray tube and imaging system supplier, North American Imaging Inc. (NAI of Camarillo, Calif.), which McDonough purchased in July.

“We viewed [the acquisition] to be a great opportunity to build in NAI’s base business,” said McDonough CEO Ed McDonough. “That is allowing us to fund at an increasing rate some of the products being developed internally at NAI through its Technology Products division.”

Vision Imaging Components has eight employees at its Arlington facility and markets its products in the U.S. and internationally. McDonough said there are no plans to make any changes to the Texas operation or to relocate the business.

When McDonough Medical purchased NAI in July, CEO McDonough detailed his company’s strategy to grow NAI’s business by both internal product development and corporate acquisitions.

Mobile PET Systems, Inc. (San Diego) has created a wholly owned subsidiary, Molecular Imaging Corp., to complement mobile positron emission tomography (PET) services.

Molecular Imaging will create stationary PET centers through partnership agreements with healthcare entities. The expansion is part of Mobile PET’s development plan to take advantage of the growing demand for PET, particularly in oncology.

Crowe said the company is working with eight stationary facilities to get Molecular Imaging off the ground. All eight potential sites were developed from Mobile PET’s existing customer base, and were selected on the basis of increases in PET utilization expected over the next 18 to 24 months.

The facilities will be located in West Coast and Midwest hospitals and outpatient radiology offices. No timetable for completion has been set.

Palatin Technologies Inc. (Princeton, N.J.) is collaborating with Walter Reed Army Medical Center (Washington, D.C.) to evaluate the efficacy of the company’s investigational infection imaging agent LeuTech for the early detection of inhalation anthrax.

LeuTech is a radiolabeled monoclonal antibody that binds to white blood cells to image infected regions of the body. As LeuTech collects at the site of infection, the area is imaged and detected with a gamma camera. To date, Palatin has used LeuTech to image and detect conditions, such as appendicitis, bone infection, post-surgical infections and bowel infections and inflammation.

The study at Walter Reed will enroll as many as 500 patients believed to be at-risk of having inhaled anthrax spores.

If the initial results of this clinical trial confirm LeuTech’s ability to diagnose inhalation anthrax, Palatin plans to speak with the FDA about making LeuTech available to other medical institutions under the regulatory provision of a treatment investigational new drug (IND) application.

Recent developments inside and outside of the company and the loss of a major computed tomography (CT) customer have prompted Analogic Corp. (Peabody, Mass.) to realign its corporate structure, creating two major business groups.

Analogic will divide its product lines between OEM advanced technology subsystems and systems, and niche market end-user products in order to refocus on what the company says are its strengths.

Founder and former CEO Bernard M. Gordon — in conjunction with Donald Barry, group vice president and president of Analogic subsidiary Sky Computers Inc. (Chelmsford, Mass.) — will focus his activities on OEM product development, particularly as it relates to Analogic’s OEM medical imaging subsystems and systems.

Tom Miller, president and CEO, will focus his attention on niche market end-user activities. This unit will include surgical and urological ultrasound company B-K Medical A.S. (Copenhagen) and Camtronics Medical Systems Ltd. (Hartland, Wis.), which specializes in cardiac image and information management.

Miller also will explore potential acquisitions for Analogic, while — in the company’s words — “more mature activities are sold or deactivated.”

Medical imaging subsystems and systems account for approximately 75 percent of Analogic’s total revenues, and, until now, that segment has remained financially healthy.

In announcing its corporate changes, Analogic said that one of its “major customers” in CT advised — in Analogic’s words — “that they are planning to source products from an acquired entity instead of from Analogic. Negotiations are underway with that customer to replace that business with newer types of products.”

Analogic has a company policy of non-disclosure regarding its customers and declined to comment further.

Speculation is that Philips Medical Systems International B.V.’s (Amsterdam) recent addition of Marconi Medical Systems Inc.’s (Highland Heights, Ohio) medical imaging product lines, which include CT, may be the culprit.

In early October, Analogic warned investors that FY 2002, ending July 31, would be a difficult 12 months for the company, as it anticipated poor results from its telecommunications subsidiary, Anatel, and its Test and Measurements business.

Analogic posted record revenues in FY2001, ending July 31, of $360.6 million, a gain of 24 percent over $291.6 million in FY2000. Net income increased 8 percent to $15.2 million, compared with $14.1 million in the last fiscal year.

Analogic also posted a write-down of $3.2 million in Anatel assets in FY2001, which reduced the company’s net income by $3.5 million.

Miller said the sharp declines in revenues for Anatel and the Test and Measurements business segment began in the third fiscal quarter, ending April 30, followed by “very, very sharp declines in revenues, such that by the fourth quarter, revenues were negligible for both businesses.”

The number of positron emission tomography (PET) procedures continues to rise in a quarter-to-quarter comparison by market research firm IMV Medical Information Division (IMV of Des Plaines, Ill.).

From April 1 through June 30, IMV estimates there were more 40,000 PET procedures over the three-month period. That total is up 7 percent, or 2,600 procedures, from 37,400 in the fourth quarter of 2000.

Most of the procedures in the second quarter of 2001 were for oncology, followed by neurology and cardiology applications.

While total PET imaging procedures rise, IMV Vice President Gail Prochaska noted that PET procedures performed by coincidence detection cameras are on the slide. She cited the June 29 decision by the Centers for Medicare and Medicaid Services (CMS) to decline reimbursement for most PET studies performed by gamma cameras. CMS ruled that coincidence detection PET images from gamma cameras do not match the quality of full-ring PET scanner.

In its decision, CMS wrote that “camera-based systems miss a non-trivial number of small but potentially clinically significant malignant lesions, compared with full-ring PET scanners. In addition, available studies do not clearly show that gamma camera imaging can replace or add to the diagnostic information provided by conventional imaging.”

IMV estimates there were 510 facilities in the United States performed PET procedures in the second quarter. While the majority of sites performing PET procedures used coincidence cameras for the studies, the majority of procedures were conducted using dedicated PET scanners.

The Sagemark Companies Ltd. (New York City) is officially in the positron emission tomography (PET) market.

Sagemark’s subsidiary, Premier P.E.T. Imaging of Wichita (Kansas) Inc., has opened a PET imaging center in Wichita. The center utilizes an ECAT Exact HR+ PET scanner from Siemens Medical Solutions Inc. (Iselin, N.J.).

Stephen A. Schulman, M.D., president and CEO of Premier P.E.T. Imaging International Inc. (New York City), said the company has identified 10 sites for future PET imaging centers.

Sagemark set the stage for its entry into the PET market in May, when it acquired Premier PET Imaging International Inc. and Premier Cyclotron International Corp. (PCI).

Premier and PCI were formed to own and operate PET centers and cyclotrons, the devices that manufacture radioisotopes used in PET imaging. Schulman was chairman and CEO of Premier and PCI.

Sagemark purchased all outstanding shares of Premier and PCI capital stock in exchange for shares of Sagemark common stock. Sagemark also agreed to provide $1 million of working capital to Premier to establish and operate its PET centers.

Hologic Inc. (Bedford, Mass.) received positive news from the FDA on two mammography products in the month of October.

The FDA sent Hologic an approvable letter regarding the company’s pre-market approval (PMA) application for its Lorad full-field digital mammography system.

Hologic also received FDA marketing clearance for its Lorad Affinity screen-film mammography system.

The Lorad full-field digital mammography system utilizes CCD-based (charged-couple device) technology to generate digital mammographic images for the screening and diagnosis of breast cancer. The system has been in clinical trials around the world for three years. Hologic submitted its PMA application in May.

Hologic President and CEO Jack W. Cumming said the company is looking “forward to working with [the FDA] in the final phase of the review process.”

Final marketing clearance for the Lorad system is subject to labeling discussions, an agreement on criteria on the use of the product and successful completion of the FDA’s Good Manufacturing Practices audit of Hologic’s Bedford manufacturing facility.

Cumming added that Hologic is in what the company described as the “advanced stages of development” of a second-generation digital mammography system that employs Hologic’s proprietary amorphous selenium DirectRay direct-to-digital technology. The system will require additional regulatory review by the FDA.

Hologic plans to market the Lorad Affinity screen-film mammography system globally, promoting the unit as a cost-effective product with performance similar to high-end systems. The Affinity features the company’s High Transmission Cellular (HTC) Grid technology and exclusive Fully Automatic Self-adjusting Tilt (F.A.S.T.) compression paddle.

Hologic expects full commercial production of the Affinity to begin in the first quarter of 2002.

Bio-Imaging Technologies Inc. (Newtown, Pa.) is expanding its medical imaging laboratories services and holdings with the acquisition of Intelligent Imaging (Plymouth Meeting, Pa.) from Quintiles Transnational Corp. (Research Triangle Park, N.C.).

Terms of the transaction were not disclosed.

Bio-Imaging is a pharmaceutical contract service that provides support services for the product development process of pharmaceutical, biotechnology and medical device industries. The company specializes in the imaging component of clinical trials.

Intelligent Imaging provides digital medical imaging services, such as image data management, data translation and digitization for submission of medical image data to the FDA and clinical sponsors using proprietary interactive software. The unit’s technology helps support x-rays, MRI, CT, nuclear medicine, positron emission tomography and ultrasound.

The acquisition of Intelligent Imaging will help support Bio-Imaging’s growth over the last several years, said Bio-Imaging President and CEO Mark Weinstein. He added that the company has doubled its size in the last three years.

“The market is growing dramatically,” he added. “If you go back to the clinical trial market 10 years ago, nobody used a central lab for blood processing. Now probably 95 percent of the trials use it. If you look at EKG or ECG heart rate monitoring, it was never done by a central lab, and now that is probably 20 percent of the trials and growing dramatically.”

With that growth comes a need for human resources as well.

Intelligent Imaging brings 50 employees to Bio-Imaging, increasing the company’s workforce to a total of 140 people. Bio-Imaging plans no changes at Intelligent Imaging and will keep the company operating in Plymouth Meeting.

Magna-Lab Inc. (Lynnfield, Mass.) and Alliance Pharmaceutical Corp. (San Diego) are set to embark on clinical studies of their respective products.

Brigham and Women’s Hospital (BWH of Boston) has agreed to partake in a clinical study of Magna-Lab’s Cardiac View Probe and Cardiac View Surface Coil.

The company seeks to investigate the clinical utility of its proprietary MRI coils in the diagnosis of coronary artery disease. BWH physicians want to evaluate the capabilities of the two coils in several hard-to-image areas of the heart.

BWH will use the devices in patients undergoing cardiac MRI studies to obtain anatomic information prior to catheter-based treatment of atrial fibrillation. In addition, the clinical study will include patients who are undergoing transesophageal electrocardiography to compare ease-of-use, as well as comfort, tolerance and diagnostic quality. Imaging of the coronary tree also will be an objective in imaging these patients.

Magna-Lab said the studies will take place over six months. E. Kent Yucel, M.D., director of cardiovascular imaging in BWH’s department of radiology, will serve as the principal investigator.

The Cardiac View Probe transesophageal receiving coil is designed to operate in conjunction with an MRI system to non-invasively aid in the production of high resolution MR images of the aortic arch, the descending aorta and the coronary vessels of the heart to diagnose coronary artery disease.

The Cardiac View Surface Coil is an MRI receiver coil that is placed on a patient’s chest and is used in conjunction with the Cardiac View Probe to help complete MR imaging of the heart and associated structures in the thoracic regions of the body.

Alliance is set to begin a clinical study at Thomas Jefferson University Hospital (Philadelphia) for the company’s Imavist ultrasound contrast agent for the detection of prostate cancer. Alliance is developing Imavist with Schering AG (Berlin). The agent currently is pending FDA clearance.

The study will include some 300 adult men with suspected prostate cancer and, if successful, could result in a non-invasive method to detect prostate cancer.

Ethan Halpern, M.D., associate professor in the department of radiology at Jefferson Medical College of Thomas Jefferson University, is the principal investigator.

He believes that an ultrasound contrast agent could provide what describes as “a unique opportunity” to visualize microvasculature, detect the presence of cancer and metastases, and assess the stage of disease and disease-specific survival and help many patients avoid biopsy.

Agfa Corp. (Ridgefield Park, N.J.) has finished its largest picture archiving and communications system (PACS) project.

The $11 million installation of Agfa’s IMPAX digital imaging network-PACS (DIN-PACS) took place across each hospital within the U.S. Department of Veterans Affairs’ Veterans Integrated Service Network 22 (VISN 22). The hospitals and their outpatient satellites are located in Loma Linda, Long Beach, San Diego and West Los Angeles, Calif.; Las Vegas, Nev.; and at Nellis Air Force Base (Las Vegas).

The installation began last year at the VA hospital in San Diego, where Agfa installed 14 workstations, a Web server and other core components. The PACS connected with the hospital’s outpatient clinic — Mission Valley Clinic — eight miles away.

The PACS in the Greater Los Angeles VA System was upgraded to Agfa’s IMPAX version 4.1, while the Las Vegas VA site received core PACS equipment, along with five workstations and a Web 1000 server. The connection linked the Las Vegas VA facility with Nellis Air Force Base. Nellis installed Agfa’s core PACS equipment along with the Agfa ADC Compact and ADC Solo computed radiology (CR) systems and seven workstations.

The Loma Linda VA facility and the Long Beach site each received core components of the PACS, as well as 12 workstations and a Web server.

Siemens Medical Solutions Inc. (Iselin, N.J.) on Oct. 23 unveiled Soarian, a healthcare information system (HIS) touted as a holistic approach to transmitting patient, clinician and hospital information through the healthcare process.

Siemens’ strategic partners Microsoft Corp. (Redmond, Wash.) and IBM Corp. (Armonk, N.Y.) both provided input and support for Soarian. Siemens says more than 100 customers participated in validation and usability sessions.

Built for the Web and based on common healthcare standards, Soarian contains three characteristics. It is workflow-engineered to synchronize processes across the health enterprise; its user interface (UI) anticipates the needs and processes of individual users; and its embedded analytic programs provide aggregate clinical, financial and operational data, thus allowing executives to monitor the health of their institutions.

Soarian’s workflow engine is designed to capture complete clinical and financial information for access through the enterprise. From the first encounter with a patient, each department is aware of all healthcare personnel who interact with the patient. From a single screen, authorized clinicians can check a patient’s medical history, including medical images; place orders; track the status of care; and determine the appropriate next steps. Key information, all on one screen, simplifies administrative tasks. Payer-specific reimbursement rules are built into the system, as well.

Soarian’s browser-enabled UI is modeled on syngo, Siemens’ medical imaging user interface that works across all Siemens modalities. The common architecture and design of syngo and Soarian organizes clinical, financial, diagnostic and therapeutic data into a logical, patient-centered focus, presenting information in the context of what users need in their particular jobs. It creates worklists for placing and tracking orders so that physicians can sequence and rate steps in patient care, while also communicating that information to nursing staff and other medical staff. Graphic field descriptions, drop-down boxes and icons simplify learning and reduce the chance of errors.

Soarian’s embedded analytic features help the healthcare organization understand the financial impact of clinical decisions and the clinical impact of financial decisions. Built on Microsoft technologies and tested in the joint Microsoft/

Siemens research and development laboratories on Microsoft’s Redmond campus, Soarian can run in-house or with Siemens’ Information Services Center (ISC) as its host.

Beta sites for Soarian include Susquehanna Health System (Williamsport, Pa.), The Chester County Hospital (West Chester, Pa.), Carilion Health System (Roanoke, Va.) and Universal Health Services Inc. (King of Prussia, Pa.).

Software delivery will begin early in 2002. Siemens said that features inherent in Soarian, with its complete service portfolio including change management, process management and implementation, lead to a targeted reduced installation time of 12 months or less.

Despite some attendees’ concerns about travel and rumors that the event may not be held, the 43rd annual meeting of the American Society of Therapeutic Radiology and Oncology (ASTRO of Fairfax, Va.) kicked off in San Francisco as scheduled in November.

Some 10,000 attendees made the trek to the West Coast to discover recent advancements in cancer treatments and medical imaging’s role in aiding that progress.

On the exhibit floor, Varian Medical Systems Inc. (Palo Alto, Calif.) and GE Medical Systems (Waukesha, Wis.) unveiled a new cancer treatment installation designed to improve tumor targeting. The configuration links GEMS’ HiSpeed CT scanner and Varian’s Clinac linear accelerator in the same radiation oncology treatment room. The first installation of Exact Targeting has been installed at M.D. Anderson Cancer Center (Houston).

The goal is to “fine tune” radiotherapy and adjust for changes in the size, shape or location of tumors and surrounding tissues by using medical images taken moments before treatments are delivered, said Tim Guertin, president of Varian Medical Systems’ oncology business.

Exact Targeting also features Varian’s Exact Couch with Indexed Immobilization, so clinicians can position patients rapidly and consistently for scanning or for treatment. The Exact Couch pivots between the GE HiSpeed CT scanner and the Varian Clinac linear accelerator, while the patient remains in one position.

GEMS also is exhibiting its Discovery LS hybrid PET-CT imaging system. The system combines GEMS’ LightSpeed Plus multislice CT scanner with its top-of-the-line Advance NXi PET system to produce anatomic and metabolic images simultaneously.

Philips Medical Systems (Bothell, Wash.) unveiled a work-in-progress MR radiation therapy simulation for its Proview Open MRI scanner and AcqSim workstation.

Both products were developed by the former Marconi Medical Systems Inc. (Highland Heights, Ohio), which Philips acquired in October.

Philips said the MR-based application for radiation oncology is the first of its kind and is designed as a method for planning radiation treatment using MR where soft tissue visualization is vital. MRI simulation is intended to provide better visualization of tumors imbedded in and surrounded by soft tissue. A clinician could define a tumor’s actual boundary more clearly and prescribe a more effective treatment plan.

The Oncology Group (Concord, Calif.) of Siemens Medical Solutions Inc. (Iselin, N.J.) this week debuted its Primus Wizard oncology management workstation. Primus Wizard can be upgraded to a full oncology management system and can integrate all treatment techniques into the daily departmental workflow.

Siemens also showcased its Primus linear accelerator, which features the company’s Primeview graphical user interface, Simtec IMRT system and IM-Maxx delivery system.

InSight Health Services Corp. (Newport Beach, Calif.) on Oct. 17 consumated the sale of its assets to investment firms J.W. Childs Associates L.P. (Boston) and The Halifax Group L.L.C. (Washington, D.C.), the same day shareholders approved the transaction. The week before the closing, Banc of America (San Francisco) provide $200 million in debt financing to complete the merger.

Under the agreement, Childs and Halifax Group acquired InSight for $18 per share. As of June 30, InSight had approximately 3 million outstanding shares of common stock. The Carlyle Group (Washington, D.C.) and its affiliates, General Electric Co. (Fairfield, Conn.) and the GE Fund, owned approximately 67 percent of InSight’s outstanding shares. InSight currently provides medical imaging management services to managed-care entities, hospitals and other contractual customers in 28 states, including California, Texas, the Midwest, the Northeast and the Southeast. Steven T. Plochocki remains as InSight’s president and CEO, while Thomas V. Croal continues to hold the post of executive vice president and CFO.

Strong growth in all product segments powered Varian Medical Systems Inc. (Palo Alto, Calif.) to greater heights in its fiscal year 2001, ending Sept. 30. Total sales reached $783.8 million, compared with $689.7 million in FY2000. Net income increased to $71.7 million, up from $53 million in the last fiscal year. Varian’s Oncology Systems’ sales increased to $783.8 million, compared with $689.7 million in FY2000. X-ray Products advanced to $623.4 million in sales, up from $533.9 million in the year-ago period. The Ginzton Technology Center posted sales of $138.7 million, compared with $135.9 million in the last fiscal year. Varian says it expects a fine FY2002, with a record backlog in its Oncology Systems business, particularly in North America. Barring unforeseen events, Varian estimates FY2002 revenues “could grow in the low double digits over the FY2001 total and earnings could increase in the mid-teens over FY2001 levels.”

Alliance Imaging Inc. (Anaheim, Calif.) continues to show strong growth as the company reached record revenue levels in the third quarter. Revenues increased 8 percent to $95.4 million, compared with $88.2 million in the third quarter of 2000. Alliance posted a net loss in the quarter of $887,000, compared with net income of $4 million in the year-ago quarter. For the nine-month period, revenues rose 8 percent to $280.1 million, up from $259.4 million in the same period of 2000. Net income slipped to $2 million, compared with $6 million in the year-ago period. The net loss was due in part to a $2.2 million charge for unamortized deferred financing costs related to refinancing a $260 million senior subordinated credit facility.

FDA clearance of its SenoScan digital mammography system in the third quarter helped Fischer Imaging Corp. (Denver) post revenue and earnings gains in the third quarter. Revenues increased 9 percent to $12.9 million, compared with $11.9 million in the third quarter of 2000. Net income more than doubled to $1 million, compared with $414,000 in the year-ago quarter. For the nine-month period, revenues dipped slightly to $36.9 million, down from $37.4 million in the same period of 2000. Net income climbed to $2 million, compared with $1.2 million in the year-ago period. With FDA marketing clearance, Fischer realized $1.7 million in revenues from the sale and shipment of SenoScan systems in the third quarter.

Two new products — the MergeView and MergePort — released in the third quarter helped Merge Technologies Inc. (Milwaukee) post a healthy third-quarter financial report. Revenues increased 75 percent to $4 million, compared with $2.3 million in the third quarter of 2000. Merge also posted net income $438,000, compared with a net loss of $2.6 million in the year-ago quarter. For the nine-month period, revenues climbed 23 percent to $11.1 million, up from $9.1 million in the same period of 2000. Net income totaled $589,000, compared with a net loss of $4.2 million in the year-ago period.

Schick Technologies Inc. (Long Island City, N.Y.) credited cost-saving measures for a brighter financial picture in its second fiscal quarter, ending Sept. 30. Net revenues reached $4.8 million, a gain in 41 percent from $3.4 million in the same quarter of 2000. Schick’s net loss improved to $300,000, compared with a net loss of $2.3 million in the year-ago quarter. For the six-month period, net revenues rose to $10.7 million, compared with $9.7 million in the first half of FY2001. Net income was $400,000, compared with a net loss of $2.8 million in the year-ago period.

Double-digit gains in its U.S. medical imaging business helped Syncor International Corp. (Woodland Hills, Calif.) to healthy third-quarter financial results. Net sales gained 25 percent to $193.8 million, compared with $155.5 million in the third quarter of 2000. Net income increased to $7.8 million, up from $6.3 million in the year-ago quarter. For the nine-month period, Synor’s revenues reached $562.9 million, up 23 percent from $458.8 million in the same period of last year. Net income rose to $29 million, compared with $22.8 million in the year-ago period. Syncor’s U.S. medical imaging business — Comprehensive Medical Imaging Inc. (CMI) — showed strong growth with sales of $39.4 million in the third quarter, an advance of 49 percent over $26.5 million in the third quarter of 2000. For the nine-month period, sales increased to $116.2 million, compared with $66.9 million in the year-ago period.

Royalty and license agreements accounted for Epix Medical Inc.’s (Cambridge, Mass.) revenues in the recently completed third quarter. The MRI pharmaceutical developer posted revenues of $3.6 million, compared with $1.9 million in the third quarter of 2000. Half of the third-quarter revenues came from a product development contract with Schering AG (Berlin), while the other $1.8 million came from a patent licensing and royalty agreement entered into with Bracco Imaging S.p.A. (Milan). Epix’s net loss improved to $4 million, compared with a net loss of $4.3 million in the year-ago quarter. For the nine-month period, revenues reached $7.5 million, compared with $5.6 million in the same period of 2000. The net loss declined to $14.1 million, compared with a net loss of $17.8 million in the year-ago period.

A decline in diagnostic sales of non-CT contrast media products and a drop-off in international markets due to the strength of the U.S. dollars kept net sales at E-Z-Em Inc. (Westbury, N.Y.) relatively flat in the company’s first fiscal quarter, ending Sept. 1. Net sales declined slightly to $27.6 million, compared with $27.7 million in the first quarter of FY2001. The company also posted a net loss of $112,000, compared with net income of $1.8 million in the year-ago quarter. On the positive side, E-Z-Em continued to achieve record sales in its CT contrast products and what it described as “significant” growth in its AngioDynamics segment.