orr.jpg (8823 bytes)X-rays are becoming an exciting business again, similar to their discovery 100-plus years ago. The recent emergence of new digital X-ray systems and spread of PAC systems has pumped life into the supposedly mature modality. One of the pioneers in the resurgent X-ray field is Fuji Medical Systems, a company focused exclusively on X-ray imaging products. I visited the company’s U.S. headquarters in Stamford, Conn., to find out what Fuji’s plan is today and for the next few years.

X-ray: Here to stay
X-ray still accounts for more than 70 percent of the medical imaging volume in the U.S., derived from an installed base that reaches well beyond the radiologist’s suite. Digital X-ray solutions offer real improvements over traditional X-rays, measured in both substantive imaging and workflow terms. Given that the transition from film to digital will take time, and technology developments are expected to accelerate, this market takes on an interesting challenge from a business and strategic perspective.

Imaging technologies with a focus
The key to Fuji’s strategy is straight-forward – X-ray market focus and internal development. Fuji managers can quickly recite the top imaging technologies and Fuji’s on-going development efforts in each area. PACS, digital X-ray, digital mammo, computer-assisted diagnostics, dry imaging, teleradiology, image compression and image processing comprise the Fuji R&D list. This approach reflects a fundamental commitment to in-house technology research and integration, not a GE-type acquisition strategy. These technologies are then leveraged into three product categories: PACS (Synapse), computed radiography (Fuji CR) and imagers/film.

There are strong competitors in each Fuji product area. Most buyers require integrated systems for workflow and imaging solutions, and Fuji leverages it’s technology ownership by offering a more robust path of product upgrades and system (not just product) performance. Fuji’s participation in IHE (Integrating the Healthcare Enterprise), sponsored by RSNA and HIMSS, reflects a system level integration and compatibility design, not just a free-standing product approach.

Start with film
Fuji has an estimated 10 percent market share in X-ray film in the U.S. – not in the same league with Kodak and Agfa (40 percent+ share players), but this represents a substantial market presence. Fuji just announced a $300 million manufacturing facility expansion (including X-ray film) in South Carolina. It’s fair to assume that Fuji expects the film market to continue growing in this “filmless transition” period.

Add some technology
Fuji pioneered digital X-ray imaging, via its computed radiography (CR) technology. Some 16 years later, Fuji has installed more than 10,000 systems that perform 1 million-plus CR procedures per day. This digital X-ray experience base dwarfs the newer market entries. Fuji recently introduced a broader range of CR products for every budget and application. CR mammography is the next major application target, representing a substantial challenge and market opportunity.

Mix in some computers
Fuji’s entry into the PACS market with Synapse also reflects focus and planning. The Synapse product line incorporates underlying technologies that should prove valuable over a projected product life-cycle of more than 5 years. Fuji’s terms for these technologies include On Demand Access, Cascadeable Architecture, Integrated Web Technology and Desktop User Interface. If you dissect these building blocks, you’ll find a sophisticated but easy-to-use product designed to leverage future developments in computing power, bandwidth, archiving, compression, distributed computing and the Internet.

Don’t forget the software
Image processing is projected to become the new currency of? X-ray imaging. CAD, image compression, image enhancement, 3D and image segmentation are necessary tools in X-ray’s future world, where 2D images on a lightbox are a quaint legacy. R2 Technology’s ImageChecker validates the need and benefit of these image analysis tools that merge the visual skills of radiologists with the tireless efficiency of computers. Fuji’s development staff continues to innovate and deploy imaging software tools into their full range of products.

If you want a single OEM contract for film, CR and PACS, it’s a real short list that includes Fuji. With a strategy to match its technology, Fuji has positioned itself to address the continuum of radiographic X-ray system design, sale and ongoing use for both the traditional film and evolving digital X-ray world. end.gif (810 bytes)

Doug Orr, president of J&M Group (Ridgefield, Conn.), consults with medical device companies in strategy and business development for emerging growth markets, notably radiology and cardiology. Comments and suggestions can be sent to [email protected].