October 2001

Syncor in August purchased InteCardia Inc. (Chapel Hill, N.C.), a privately held company that provides a range of services to cardiologists.

According to Syncor, InteCardia began as a practice management company in the mid-1990s and evolved into a multi-modality cardiology services provider, shedding its practice management business.

Today, InteCardia operates an outpatient cath lab in Memphis, Tenn., and has a second satellite operation currently under construction. The company also provides fee-per-scan services to cardiology group practices, offering nuclear imaging equipment and technologists to perform cardiac scans in the office setting. This fall, InteCardia plans to open an EBCT (electron beam computed tomography) center to help aid in the diagnosis of asymptomatic coronary artery disease and non-invasive colonoscopies.

InteCardia has approximately 80 employees and posted revenues of $11 million in 2000. Syncor plans to operate InteCardia as an independent unit of Syncor.

“In addition to addressing the high growth demand for myocardial perfusion imaging studies, we also gain access to newer technologies, such as InteCardia’s EBCT initiative, which offers substantial opportunities for new revenue growth,” said Robert Funari, Syncor International’s president and CEO, in a prepared statement.

In Europe, Syncor has acquired Multi-Medica S.A., Medcon S.A. and affiliated companies, a privately held group of distributors of radiology and cardiology products, primarily in Belgium, Luxembourg and France.

Multi-Medica and Medcon distribute radiological film manufactured by several medical imaging supply companies, including Eastman Kodak Co. (Rochester, N.Y.) and Konica Medical Imaging (Wayne, N.J.).

According to Syncor, Multi-Medica and Medcon recently diversified their business to include the distribution of cardiology products, such as stents, dilatation balloons and valves for heart surgery.

Multi-Medica and Medcon also recently signed an exclusive agreement with Sorin Biomedica Cardio (Saluggia, Italy) to distribute cardiology products in Belgium and Luxembourg.

Syncor also announced that its radiopharmacy in Galicia, Spain, has been awarded the first commercial license in Spain for the distribution of unit dose radiopharmaceuticals. The radiopharmacy is a joint venture among Syncor, Instituto Gallego de Medicina Tecnica, an arm of the provincial government of Galicia, and Fundacion Centro Oncologico de Galicia, an oncology center in La Coruna.

Syncor began dispensing unit dose radiopharmaceuticals to nuclear medicine customers in June. The acquisitions are expected to have an immediate effect on earnings.

Through the first half of this year, Syncor’s net sales advanced 22 percent to $369.1 million, compared with $303.3 million in the first half of 2000. Net income climbed to $21.2 million, up 28 percent to $16.6 million in the year-ago period.

The acquisitions of InteCardia, Multi-Medica S.A. and Medcon S.A. continue a string of acquisitions for Syncor this year.

The company has signed a definitive agreement to acquire Coincidence Technologies S.A. (Liege, Belgium), a company that designs, develops and manufactures synthesis and handling units for PET radiopharmaceuticals. Coincidence’s synthesizer unit is used in conjunction with a cyclotron, providing the final chemical process step to produce fluorodeoxyglucose (FDG). This final step ultimately determines the quantity and quality of FDG.

Over the last couple of years, Coincidence has partnered with GEMS to sell its Coincidence synthesizer with the GEMS cyclotron.

“The combination of the GE cyclotron and the Coincidence chemistry unit has the highest yield, shortest production time and easiest operation of any combination in the industry,” asserted Thomas Hook, GEMS’ global PET general manager.

Coincidence was established in 1996 with four employees. Today, the work force numbers 12 people who are involved in engineering, mechanical, chemistry, electronics and computer software.

Coincidence’s products are distributed worldwide to Australia, Japan and, more recently, China. Jean-Luc Morelle, managing director of Coincidence, said “a great part” of Coincidence’s market is in the United States, where the popularity of PET imaging is leading the rest of the world.

“What is happening in the United States [in PET] will happen probably quite soon in Europe and will happen in other parts of the world,” Morelle added.

Beth Klein, GEMS’ vice president and global general manager of functional and molecular imaging, said the acquisition will aid GEMS’ going forward as the company proceeds into the field of molecular imaging.

“Our vision is noninvasive imaging with disease-specific markers,” she added. “In order to see these markers, PET and SPECT [single photon emission computed tomography] will be the eyes that let the physicians know that the markers are hitting the targets and working. The key link to making that happen is chemistry. That is a competency that the team at Coincidence brings to us.”

Hook said the companies plan to complete the acquisition by the end of September. The terms of the agreement were not disclosed.

The project — known as the Digital Mammographic Imaging Screening Trial (DMIST) — aims to compare digital mammography to standard film mammography to determine how the digital technology compares to the traditional method of screening for breast cancer.

GE Medical Systems (GEMS of Waukesha, Wis.); Fischer Imaging Corp. (Denver); Lorad (Danbury, Conn.), a division of Hologic Inc. (Bedford, Mass.); and Fuji Medical Systems USA Inc. (Stamford, Conn.) will have their digital mammography systems included in the trial. Currently, GEMS’ Senographe 2000D and Fischer’s SenoScan are the only devices cleared by the FDA for clinical use.

The study, scheduled to get under way on Oct. 15, is expected to involve approximately 49,500 women in the United States and Canada who will be screened at 18 institutions. Women who agree to participate in the study will receive both a conventional and a digital mammography exam. Participants can expect to be part of the study for approximately three years, including a one-year follow-up mammogram and two to three years of follow-up phone contact.

University of North Carolina’s Etta D. Pisano, M.D., co-principal of the study, said that researchers suspect that the difference between digital and film mammography may not be vastly significant, but they believe a large study is needed to compare the two techniques.

“Standard mammography has been the most-studied screening technology over the past 40 years,” Pisano said in a prepared statement. “What we have is a well-proven technology — film mammography — and one that is in its infancy, not as well-studied yet — digital mammography. We want to make sure that digital mammography is at least as good as standard mammography at finding early breast cancer before it is widely used.”

GEMS’ Senographe 2000D will be installed at the University of Pennsylvania (Philadelphia), the University of Toronto’s Sunnybrook & Women’s College Health Sciences Center (Toronto, Ontario, Canada), the University of Colorado Health Sciences Center (Denver) and Northwestern University (Chicago).

Fischer Imaging’s SenoScan systems will be located at the University of North Carolina (Chapel Hill), Beth Israel Deaconess Medical Center (Boston), Memorial Sloan Kettering’s Guttman Diagnostic Center (New York), LaGrange Memorial Hospital, (LaGrange, Ill.) and Washington Radiology Associates (Washington, D.C.). Fischer’s SenoScan received an FDA pre-market approval (PMA) in September.

Lorad will have its systems located at Columbia University (New York), Good Samaritan Hospital Medical Center (West Islip, N.Y.), Johns Hopkins University (Baltimore) and Thomas Jefferson University (Philadelphia). Lorad’s digital mammography system currently is unnamed and is pending an FDA PMA decision.

Fuji’s FCR 5000MA CR (computed radiography) reader is installed at five participating locations — the University of North Carolina, University of California Davis (Sacramento, Calif.), University of California Los Angeles (Los Angeles), University of Washington (Seattle), University of Massachusetts (Worcester, Mass.) and Mt. Sinai Medical Center (New York).

The states are: Alabama, Georgia, Iowa, Mississippi, Missouri, North Dakota, South Carolina, Virginia and Washington. Those nine states join Utah, Idaho, South Dakota, Illinois, Indiana and Montana, which were approved in June to participate in the program. Also in the National Breast and Cervical Cancer Early Detection Program are Rhode Island, New Hampshire, West Virginia and Maryland.

Participating states receive a federal match of up to 85 percent of the cost of treating uninsured women diagnosed with breast or cervical cancer.

The Centers for Disease Control and Prevention (CDC of Atlanta) oversees the federal screening program. HHS estimates that the program has provided more than 3 million breast and cervical cancer tests to some 1.8 million women since its inception in 1990.

To be eligible for Medicaid assistance under the program, patients must be less than 65 years old, not otherwise eligible for Medicaid and without creditable healthcare.

Among Nycomed’s initiatives is an agreement to purchase the ultrasound contrast assets of Sonus Pharmaceuticals Inc. (Bothell, Wash.), as well as Sonus’ patents for ultrasound imaging. By purchasing the patents, Nycomed no longer will pay any royalties to Sonus from the sale of its ultrasound products.

In addition, Nycomed receives Sonus’ interest in the ultrasound contrast patent license agreement with Chugai Pharmaceutical Co. Ltd. (Tokyo) and Molecular Biosystems Inc. (MBI of San Diego). Under the newly assigned license, Nycomed will receive a royalty for sales of ultrasound contrast agent Optison in Japan, Taiwan and South Korea upon final regulatory approval. Optison is designed to assist in the diagnosis of cardiac disease through imaging heart wall defects.

On Jan. 16, Sonus entered into a patent license agreement to give Chugai non-exclusive rights under certain Sonus patents to manufacture and sell Sonus’ Optison in the three Pacific Rim countries. Sonus received a $1 million up-front license fee in January from Chugai and a second $1 million payment in June. Sonus also was promised royalties on sales of the contrast agent Optison, if and when the product was approved for marketing in territories covered under the agreement.

Nycomed’s second volley is the creation of a specialist field force to provide dedicated promotional support to Optison, as Nycomed acquires the co-marketing rights to Optison as a result of the settlement of litigation with Mallinckrodt Inc. (St. Louis) in May 2000.

As a result of the settlement agreement, Mallinckrodt has decided to terminate the joint development and commercialization agreement for ultrasound products effective Dec. 31, 2001.

Upon termination of this agreement, Nycomed will proceed independently with the global development and commercialization of both Optison and Sonazoid, with the exception of the Pacific Rim for Optison. Nycomed will begin to promote Optison in the United States with a dedicated ultrasound field sales force during the second half of this year.

Nycomed’s product portfolio includes contrast agents for X-ray, CT, MRI and nuclear medicine imaging. Optison is the only second-generation ultrasound contrast agent marketed in the United States.

Financial notes
Nycomed’s parent company, Amersham plc (Buckinghamshire) can thank its medical imaging unit for helping to propel the company to a 24 percent gain in first-half profits.

Amersham’s six-month earnings (before tax and goodwill) increased to $195.4 million, compared with $157.7 million in the same period of 2000. The company’s sales totaled $1.1 billion for the first half of 2001, with Nycomed’s medical imaging products accounting for more than half the total.

Amersham also announced that it is “not in the interest of shareholders” to launch an initial public offering (IPO) of Amersham Pharmacia Biotech (Uppsala, Sweden, and Piscataway N.J.) right now. Amersham had planned to float 10 percent of the jointly owned firm — Pharmacia Corp. (Peapack, N.J.) owns 45 percent — early this year, but market volatility prompted Amersham to delay the IPO.

Amersham Chief Executive William Castell said there is no hurry to carry through with its plans for Pharmacia Biotech.

“We don’t need the funding,” he told Reuters news service. “We have a very significant cash flow in Amersham and our borrowings have been substantially reduced. It’s not a question of cash, it’s a question of shareholder value.”

Analogic acquired all remaining shares in Camtronics — which Analogic helped found in 1986 — in return for shares in Analogic. Analogic had held an 82 percent interest in Camtronics.

“All of the shares that were acquired were held by employees and the two other founders of the company,” said Bernard M. Gordon, Analogic chairman, chief technology officer and founder.

Gordon declined to discuss share values.

The chairman noted that the stock swap offers Camtronics founders and employees flexibility. There is a market for Analogic stock, but not for Camtronics stock, because Camtronics stock is privately held.

In other company news, Analogic trimmed its employee ranks at the end of July, laying off approximately 70 people, or 4 percent, of its total work force. Gordon said the layoffs were across the board in the company’s major medical, industrial and telecommunications sectors. The layoffs also were the first staff reductions in Analogic’s history.

“I think that the company in the past year grew at a pretty good clip and there was an expectation amongst various managers that they would continue to grow at that clip, [but] that clip is not continuing at the same rate,” Gordon added. “We’ve never had a layoff, but we had to regrettably lay off some people that we had hired during the past year primarily.”

Gordon described the move as a sign of the economic times.

Gordon said that over the years, Analogic has grown at a 17 percent compound growth rate.

NMR spectroscopy relies on radio waves to analyze the size and concentration of lipoproteins, the small spheres that circulate cholesterol throughout the body and deposit it in various locations, such as the coronary arteries or the liver.

Robert Rosenson, M.D., director of Northwestern’s Preventive Cardiology Center and a cardiologist at Northwestern Memorial Hospital, was one researcher who worked on the project.

“By evaluating specific medications with the NMR technology, physicians will be better able to select cholesterol medications that will have optimal results for the patient depending on his or her lipoprotein size and concentration,” said Rosenson in a prepared statement. “Ultimately, this will help patients get effective, and even life-saving, help quicker and reduce the cost often involved in switching therapies.”

Rosenson and colleagues analyzed the effect of a particular cholesterol-lowering drug, Pravastatin, over a six-month period in a group of 262 patients with high-risk heart disease.

The NMR technology employed in the study, developed by LipoMed Inc. (Raleigh), is designed to identify people at greatest risk for developing heart disease.

“In the past, we had thought that a simple lipid test [blood test] could show us how well a particular cholesterol-lowering medication was working,” Rosenson said. “But by using this new technology — which gives us significantly more data than a cursory lipid test — we found the medication is suitable for a broader base of patients than originally thought.”

Rosenson added that approximately half of the people who have so-called normal cholesterol levels will develop heart disease and millions of them will die from it.

“The new technology enables us to more accurately identify individuals at silent,” he added, “but lethal risk, and allows the physicians to select and begin treatments early on.’’

This week, the support for the victims of last week’s tragic events, their families and emergency rescue and relief personnel continues, as financial and technical contributions coincide with humanitarian efforts in Manhattan and at the Pentagon. Charitable contributions are among the heartfelt gestures from medical imaging companies and their employees looking to do their part.

Both Eastman Kodak Co. (Rochester, N.Y.) and Siemens AG (Munich) have unveiled plans to donate $2 million each to help in the relief efforts.

Kodak’s $2 million contribution will go to the American Red Cross to help with its relief work. Like many people across the country, Kodak employees also donated blood at community hospitals and blood centers, while working to produce and deliver medical X-ray film and other radiography products to hospitals and medical centers in New York, Washington and Pennsylvania.

Siemens will make its $2 million donation to emergency support agencies through the Siemens Caring Hands Foundation. The company also plans to match every dollar contributed by employees worldwide.

Siemens has more than 440,000 employees worldwide, approximately 90,000 of whom work in the United States.

Siemens last week offered technical and product support to New York City and Washington, D.C., authorities, including mobile medical units, supplies, service personnel, and information and communications network technical support to federal agencies. The company also encouraged its employees who wanted to offer personal assistance to aid the relief effort to do so.

On the business side, Siemens established a Web site for customers to advise them of disaster relief-related services available through Siemens and made available medical equipment — such as ventilators, ultrasound equipment and mobile CT and MR equipment — to help in relief efforts. Siemens continues to work directly with the N.Y. Hospital Authority to ensure that healthcare providers have access to needed equipment and services on a priority basis.

Toshiba Corp. (Tokyo) is extending its helping hand across the Pacific Ocean to the United States with a donation of $1 million to the American Red Cross for relief efforts in the aftermath of Sept. 11’s events. At the same time, Toshiba America Inc. companies donated an additional $40,000 to the cause.

Varian Medical Systems Inc. (Palo Alto, Calif.) is chipping in as well in a big way with a $100,000 donation to the American Red Cross. The company also will contribute up to another $400,000 to the Red Cross through a voluntary employee matching gift program.

Varian Medical employees can contribute a portion of their Employee Incentive Program bonus for this fiscal year, as well as gifts of up to eight hours’ worth of pay, which will be matched by the company. If goals are reached, Varian Medical could conceivably donate close to $1 million for the relief effort.

GE Medical Systems (GEMS of Waukesha, Wis.) wasted no time in loading four tractor trailer trucks on Sept. 11, the date of the terrorists attacks on the United States.

GEMS spokesman Patrick Jarvis said one truck left from GE OEC Medical (Salt Lake City) carrying surgical C-arms and other accessories that help in the imaging of surgical procedures.

From its home base of Waukesha traveled a truck transporting a variety of medical imaging equipment, including ultrasound systems, patient monitoring equipment, a dozen AMX X-ray systems and CT parts.

GEMS’ truck from Chicago was loaded primarily with IT equipment and PACS from GE Medical Systems Information Technologies (GEMSIT of Milwaukee). The fourth vehicle left from Columbus, Ohio, carrying a wide variety of medical parts and accessories.

Philips Medical Systems North America (Bothell, Wash.) delivered a large shipment of emergency medical equipment – primarily patient monitors and ultrasound systems — and supplies to lower Manhattan and helped to deploy the technology in field triage sites and local trauma centers on the day of the terrorist attacks. Leading the way was the former Healthcare Solutions Group (Andover, Mass.) of Agilent Technologies Inc. (Palo Alto, Calif.) that Philips acquired in August.

In addition, one Philips team helped relocate a complex PACS at Bellevue Hospital into a triage unit to treat victims of the attacks.

Philips also contributed $1 million from all of its business segments to the relief effort.

Hologic Inc. (Bedford, Mass.) contacted officials from the Federal Emergency Management Agency (FEMA) to donate portable X-ray and C-arm systems to help survivors of the terrorist attacks.

Other efforts include Hologic employees with RT backgrounds volunteering to relieve technologists in New York City hospitals. Employees who are trained emergency medical technicians (EMTs) also have been given time off to lend a hand.

Premier Inc. (Charlotte, N.C.) was among the group purchasing organizations (GPO) that mobilized quickly to ferry medical supplies and pharmaceuticals to the Greater New York Hospital Association (GNYHA) to treat victims of the attacks.

Aiding Premier was FFF Enterprises Inc. (Temecula, Calif.), the exclusive provider of Premier and the GNYHA for human serum albumin, which is crucial to trauma care, as well as tetanus-diptheria vaccine and tetanus immune globulin to the East Coast despite disruption of airline transport. FFF Enterprises chartered a plane from Federal Express (Memphis, Tenn.) and obtained special clearance from governmental authorities to fly the shipment across the country. The cargo included 100,000 units of albumin.

Nycomed Amersham Imaging (Princeton, N.J.) and Amersham Pharmacia Biotech (Piscataway, N.J.) have created the Amersham Manhattan Disaster Fund to provide support to their employees and the local communities in which they work.

Parent company Amersham plc (Buckinghamshire, United Kingdom) will contribute $500,000 to the fund for financial assistance to benefit individuals and local communities adjacent to the companies’ sites in New Jersey, who have been affected by the terrorist attacks.

Medrad Inc. (Indianola, Pa.) is making a corporate donation of $10,000 to relief efforts in New York and Washington and will match employee contributions dollar-for-dollar. The company also will collect donations from its employees around the world. Medrad will match the money raised through these efforts.

Requests for Medrad medical equipment and supplies — which include vascular injector systems, MR surface coils and MR accessory products — were met quickly in New York and Washington.

For its part, GEMS will pursue the development of noninvasive molecular imaging to detect and monitor disease with specific molecular markers. GlaxoSmithKline is expected to bring its expertise in respiratory science, molecular medicine and drug development to the collaboration. By working together, the two companies hope to enable physicians to stage diseases better so that patients can be treated more effectively.

The first project under the agreement aims to advance the diagnosis and treatment of chronic obstructive pulmonary disease (COPD). Early stages of the collaboration are slated to take place at the GE Corporate Research and Development site in Schenectady N.Y., in conjunction with GlaxoSmithKline’s COPD clinical network.

“Future molecular imaging techniques will be built on the principles of detecting and quantifying highly specific biological changes,” Eric Stahre, GEMS’ general manager for genomics and molecular imaging, said in a company statement. “As GE develops imaging capabilities that see the molecular markers of disease, we can deliver greater medical value when medicines are available to alter their progression. This collaboration with GSK will help establish that link.”

The news of the collaboration also included predictions from the American Lung Association and a recent article in The Lancet medical journal that COPD, which includes chronic bronchitis and emphysema, will become the leading cause of death worldwide by 2020. The National Center for Health Statistics currently ranks COPD as the fourth leading cause of death in the United States.

GEMSIT will contribute its application service provider (ASP) model to healthcare facilities and delivery systems to electronically store medical images securely at off-site at Qwest’s worldwide CyberCenters, where Qwest also will manage the medical data. The companies say users will be able to retrieve images at “near instantaneous speeds.”

GEMSIT and Qwest estimate that their ASP service will generate more than $250 million in revenues.

Since introducing its ASP product a year ago, GEMSIT says it has been contracted to provide radiology and cardiology ASP services to more than 50 healthcare sites in the U.S.

Boston Scientific Corp. (Natick, Mass.) has launched its next-generation intravascular ultrasound (IVUS) imaging system called Galaxy System. Galaxy System is designed for the integration of high-resolution cross-sectional and longitudinal ultrasound images with X-ray images, simultaneously displaying the three images on a single monitor — a first in the industry. Galaxy System also provides digital ultrasound recording capacity, which increases ease-of-use, efficiency and image analysis capability.

IVUS technology is used to diagnose and manage coronary artery and peripheral vascular disease. It also helps physicians visualize intracardiac structures during electrophysiology procedures.

Galaxy System currently is available in the United States and Canada. It is slated for release in Europe and Japan in 2002.

Visualization Technology Inc. (VTI of Lawrence, Mass.) recently announced the first image-guided surgical procedure using its FluoroCAT 3D fluoroscopy software. FluoroCAT, which is integrated into VTI’s proprietary electromagnetic tracking technology, uses standard 2D images from a mobile C-arm fluoroscope and computes 3D images, much like a CT scanner.

The surgery was performed by Hansen Yuan, M.D., professor of orthopedic and neurological surgery, SUNY Upstate University Medical Center (Syracuse, N.Y.). In addition to being the first 3D fluoroscopic image-guided procedure, the operation also was the first use of image guidance for kyphoplasty, a young and minimally invasive procedure for repairing vertebral compression fractures, which occur in patients suffering from osteoporosis.

FluoroCAT received 510(k) notification from the FDA and currently is undergoing user testing. VTI plans to market the FluoroCAT software application as an option to the company’s existing FluoroTrak image-guided surgery product.

4-D Neuroimaging’s (San Diego) Magnes 3600 radial detection Magnetoencephalography (MEG) system commenced operation at the Veterans Administration Medical Center’s (VAMC of Minneapolis, Minn.) Brain Science Center (BSC).

The VAMC BSC is part of a national collaborative effort sponsored by the MIND Institute, National Foundation for Functional Brain Imaging (NFFBI of Albuquerque, N.M.) to clarify brain function in patients with mental illness using the most advanced functional brain imaging technologies.

MEG systems utilize superconducting sensors to measure magnetic fields in the human brain and body and assist in the diagnosis of a potentially broad range of medical disorders.

Approximately 200 insurance companies have approved reimbursement on a case-by-case basis for certain MEG procedures performed with 4-D’s Magnes and Vectorview systems.

Instrumentarium Imaging Inc. (Milwaukee) will market Alara Inc.’s (Hayward, Calif.) MetriScan phalangeal bone densitometry system to breast imaging centers in the United States. MetriScan is a desktop device that uses radiographic absorptiometry to scan fingers in less than one second with a radiation dose of 5 percent of dental X-rays.

Surgi-Vision Inc. (Columbia, Md.) has joined with the Heart, Lung and Blood Institute (NHLBI) of the National Institutes of Health (NIH of Bethesda, Md.) in a cooperative research and development agreement. Robert Lederman, M.D., director of the NHLBI’s cardiovascular intervention lab, will test Surgi-Vision’s Intercept vascular internal MR coil for imaging and treatment of artery blockages in the legs, kidneys, heart and other regions of the body. The project also will measure the efficacy of Intercept in detecting wall anatomy, as a guide for drug delivery using MR, and as a guide for transluminal intervention using MRI.

U.S. Medical Inc. (Denver) has signed an exclusive agreement to become TomTec Imaging Systems Corp.’s (Munich) distributor of TomTec’s four new ultrasound products in the United States. The products are the 3D Smart-Scan workstation, Echo-Com workstation, Echo-Com Review software and TomTec ultrasound tutorial products. U.S. Medical will distribute the line to physicians in private practice.

Swissray International Inc. (Elmsford, N.Y.) is reporting that it has taken orders for a dozen ddR systems over 10 weeks in the second and third quarters. Orders for the digital radiography systems have come from University of Southern California Medical Center (Los Angeles), Swedish American Hospital (Rockford, Ill.) and Southern Union Community College (Opelika, Ala.) for its Radiologic Technology education facility, to name a few. Swissray says virtually all of the orders have come from its U.S. distribution partner, Hitachi Medical Systems America Inc. (Twinsburg, Ohio).

Broadlane Inc. (San Francisco) has signed agreements to handle products for two companies. Broadlane will distribute radiopharmaceuticals, FDG (fluorodeoxyglucose) and PharmaSeed I-125 brachytherapy seeds for Syncor International Corp. (Woodland Hills, Calif.). The sole-source pact is for three years and has a two-year renewal option at the end of 2004. Broadline also inked a three-year contract extension with Marconi Medical Systems Inc.’s (Highland Heights, Ohio) Health Care Products (HCP of Mayfield Village, Ohio) division. Marconi said the pact could be worth as much as $30 million to HCP, which also supplies products to the healthcare industry.

MDS Nordion (Kanata, Ontario, Canada) has cut the ribbon on its new yttrium-90 facility in Fleurus, Belgium. The isotope is used in radioimmunotherapy treatments for cancer, which combine a biological compound with radioactive material to target and destroy tumor cells, while sparing nearby healthy cells from radiation. MDS Nordion says the weekly production capacity at the Fleurus facility exceeds any other yttrium-90 supplier currently in the market.

The FDA has awarded Elekta AB (Stockholm, Sweden) 510(k) marketing clearance for its iView Guided Therapy (iViewGT) portal imaging system. Elekta says iViewGT’s high-resolution and high-contrast images are designed for faster verification of dose conformance in image-guided therapy and intensity modulated radiation therapy (IMRT). iViewGT also provides a large field-of-view to accommodate all major clinical techniques in a single image. Clinical studies were conducted at the University Medical Center (Utrecht, The Netherlands).

CADx Medical Systems Inc. (Laval, Quebec, Canada) has opened new offices in Shannon, Ireland, and Northborough, Mass. CADx says the new locations will help the company streamline sales and customer service to clients in Europe and support the launch of its SecondLook CAD (computer-aided detection) mammography system in the United States. The screening tool is designed to help identify suspicious microcalcifications and masses in mammograms. SecondLook has not yet received marketing clearance from the FDA.

ADAC Labs, a Philips Medical Systems Co. (Milpitas, Calif.), is hosting a free Web cast on maximizing positron emission tomography (PET) reimbursement. The Web cast is available 24 hours a day at the Philips Medical Systems Web site, www.pmsna.com. Jennifer Keppler, former executive director of the Academy of Molecular Imaging, leads the presentation.

The International Symposium on Endovascular Therapy (ISET) will be held Jan. 20 through Jan. 24, 2002, in Miami Beach, Fla. The annual meeting on minimally invasive therapies will feature live case demonstrations shown via satellite, first-time trial results and expert panel discussions for vascular and cardiac medicine specialists worldwide. More than 70 companies are expected to exhibit their latest technologies.

Artesian Medical (Omaha, Neb.) will expand its technical support business as a result of increasing the size of its current integration lab located in parent company Cassling Diagnostic Imaging’s 50,000-square-foot facility, also in Omaha. Currently, the lab designs, tests and services customers’ PACS (picture archiving and communications system) equipment. It also houses a 24×7 call center, which will add two technicians as part of the expansion. In related news, Artesian is centralizing operations by moving its corporate management offices from Frisco, Texas, to its Omaha headquarters. Also, Mike Cassling, CDI president, has assumed the additional role of president of Artesian, replacing Gary Sunsten, who had been president.

Wuestec Inc. (Mobile, Ala.) is partnering with national radiology group purchasing organization (GPO) Radiology Partners Inc. (RPI of Tampa, Fla.). Wuestec will offer its line of digital radiography products to RPI’s more than 1,500 member practices. Products and services include digital X-ray equipment, networked video communications hardware and software, PACS, film digitizing and data conversion, off-site storage and image streaming.

Orion Medical Management Inc. (Tampa, Fla.) has awarded Toshiba Medical Systems Inc. (Tustin, Calif.) a three-year contract for a group purchase rate for Toshiba’s CT, MRI and ultrasound products. The group purchasing organization and physicians service group has 120 members.

P.E.T.Net Pharmaceuticals Inc. (Knoxville, Tenn.) has opened radiopharmacies in Cincinnati and St. Louis. Located at Christ Hospital (Cincinnati) and Tenet Health System (St. Louis), the centers will produce the radiopharmaceutical MetaTrace FDG (fluorodeoxyglucose) for PET (positron emission tomography) imaging.

Biomec Inc. (Cleveland) has received a two-year, $871,000 Phase II SBIR (Small Business Innovation Research) grant from the National Cancer Institute (NCI of Bethesda, Md.) to develop porous nuclear medicine phantoms. The test devices will be designed to evaluate the performance of single photon emission computed tomography and positron emission tomography imaging systems and their ability to detect cancerous lesions and correct images for nonuniform attenuation.

The Society of Nuclear Medicine (SNM of Reston, Va.) has created its own virtual library. Sessions from the annual meeting in June are available in a Webcast format that combines synchronized audio, video, slides and transcripts with continuing education credit. The SNM Virtual Library will be available for a yearly subscription of $25 for members and $40 for non-SNM members. The fees will allow unlimited access to the site.

Powered by brachytherapy and non-therapeutic product lines, North American Scientific Inc. (NAS of Chatsworth, Calif.) grew sales in its third fiscal quarter, ending July 31. Net sales increased 9 percent to $4.9 million, compared with $4.5 million in the third quarter of FY2000. NAS posted a net loss of $1.8 million, compared with net income of $1.5 million in the year-ago quarter. The third-quarter loss was due primarily to a one-time charge of $3.7 million related to the aborted construction of two linear accelerators. Earnings also were affected adversely by costs associated with the development of the company’s radiopharmaceutical imaging agent, Apomate. For the nine-month period, net sales rose 10 percent to $14.2 million, compared with $12.9 million in the same period of FY2000. The net loss was $2.1 million, compared with net income of $4.1 million in the year-ago period.

Norland Medical Systems Inc. (White Plains, N.Y.) reported lower revenues in its second-quarter financial report. Revenues declined to $2.2 million, down from $3.8 million in the second quarter of 2000. Norland posted a net loss of $603,786, compared with a net loss of $11.9 million in the year-ago quarter. Last year’s net loss included nonrecurring charges related to a write-off of goodwill and a reserve against deferred tax assets. Excluding the charges, Norland’s second-quarter 2000 loss was $516,654. For the six-month period, revenues fell to $5.1 million, compared with $7.8 million in the first half of 2000. The company’s midyear net loss totaled $697,000, compared with a loss of $1.1 million (excluding charges) in the year-ago quarter.

System upgrades, service and components accounted for Positron Corp.’s (Houston) second-quarter revenues of $449,000. The amount compares with $1.5 million on one system sale and service and components in the second quarter of 2000. Positron also posted a loss of $603,000, compared with a loss of $312,000 in the year-ago quarter.

Alliance Imaging Inc. (Anaheim, Calif.) reached record revenues in the second quarter. Revenues increased to $93.4 million, compared with $86.9 million in the second quarter of 2000. Net income slipped to $785,000, compared with $1.4 million in the year-ago quarter. For the six-month period, revenues increased 8 percent to $184.7 million, up from $171.2 million in the first half of 2000. Net income declined to $2 million, compared with $2.8 million in the year-ago period.

Fewer medical imaging centers translated into less revenues for US Diagnostic Inc. (USD of West Palm Beach, Fla.) in the second quarter. Net revenues decreased to $15.4 million, compared with $39.2 million in the second quarter of 2000. In the centers USD still owns and operates, net revenues increased 6 percent in the quarter. The net loss was $12.3 million, compared with net income of $300,000 in the year-ago quarter. Second-quarter earnings include asset impairment losses of $15.5 million, a $4.6 million net gain on the sale of subsidiaries and an extraordinary gain, net of taxes of $500,000 for the early retirement of debt. The results also include a $10.2 million net gain on the sale of subsidiaries and a minority interest gain on sale of subsidiaries of $5.2 million. For the six-month period, net revenues totaled $32.4 million, compared with $77.7 million in the first half of 2000. The net loss reached $13.4 million, compared with a net loss of $4.5 million in the year-ago period.

Fischer Imaging Corp. (Denver) credited its field sales reorganization for greater revenues in its second quarter, ending July 1. Revenues advanced to $12.8 million, compared with $11.9 million in the second quarter of 2000. Net income grew to $751,000, compared with $465,000 in the year-ago quarter. For the six-month period, revenues decreased to $24 million, compared with $25.7 million in the same period of 2000. Net income increased 18 percent to $958,000, up from $815,000 in the year-ago period.

Financial Pulse
Health Care Markets Inc./Medical Imaging Stock Index Analysis

Digirad intends to use the majority of the IPO’s net proceeds primarily for general corporate purposes, including product development, marketing, capital expenditures and working capital, and to repay outstanding debt. Digirad also may use a portion of the proceeds for acquisitions or investments in complementary businesses, although the company claims to have no current plans, arrangements or understandings to do so.

Hologic Inc. (Bedford, Mass.) and Fleet Business Credit Corp. (Boston) have reached an agreement on their litigation suits, but it will cost Hologic some money. The dispute began two years ago when Fleet (formerly Sanwa Business Credit Corp.) acquired Hologic bone densitometry systems to lease to physicians in the United States on a fee-per-scan basis. Under the Hologic program, which ended in February 1999, Hologic sold approximately $61 million of bone densitometers to Fleet. In mid-1999, Fleet advised Hologic that it had incurred substantial losses under the program and sought to shift the losses to Hologic. Hologic filed suit in September 1999, alleging that Fleet failed to fulfill its contractual obligations, while Fleet counter-sued in October 1999. The settlement provides for all claims to be dismissed with prejudice, and for Hologic to pay $1.5 million in cash and a note of $1.55 million payable in three years. Hologic also will be entitled to certain amounts collected over time from customers, such as scan overages and excess pool deposits. Based upon current usage, Hologic estimates that the credit will reduce the total due to Fleet in three years to approximately $1 million.

Compiled and analyzed by Health Care Markets Inc. (Hilton Head, S.C.), the stock indices above plot the performance of two market segments: Imaging Devices and Imaging Services. The indices are part of WDI’s healthcare database of more than 1,000 companies. For comparison we also plot the progress of the S&P 500. The indices began in January 1991 with a base of 100.