Tax Repealed | Financials Up | Shimadzu RADspeed fit

“…always assist the radiologist, never replace them.”

IDgital, announcing its new ML/AI-based radiology Digital Assistant Platform and addressing its target market’s concerns about the effect AI will have on their future job security.

 

 


The Imaging Wire

 

House Votes to Repeal Device Tax
The U.S. House voted Tuesday to permanently repeal the 2.3% medical device tax, with most expecting it to be quickly signed into law by the White House given Trump’s campaign promises to “repeal and replace Obamacare.” The tax was originally included in the ACA to help pay for health insurance subsidies, and was active between 2013 and 2015, before congress placed a 2-year moratorium on it in 2016 and extended the moratorium through 2020 earlier this year. This repeal would be applauded by much of the medical device industry, as previous research suggests the tax dragged down manufacturer revenue (-$188M), gross margins (-$375M), and earnings (-$68M), and resulted in significant R&D funding cuts (-$34M). However, it would cost the government $24.4 billion over 10 years, making you wonder how we’re going to pay for the ACA with cuts like this. Or maybe that’s the point….

 

Shimadzu Rolls Out RADspeed fit
Over 3.5 years after its global launch, Shimadzu’s RADspeed fit entry-level general radiography table system is now available in the US, targeting budget-oriented urgent care and clinic environments. Based on a similar platform as the already-available RADspeed Pro, the new system makes a number of sacrifices to achieve its budget positioning (e.g. omits fluoroscopy, long view radiography, and tomography, among others). Beyond low-cost, the new system relies on its “highest in class” image quality, as well as application flexibility, ease-of-service/use, patient comfort, and ability to scale-up to a digital system as the core to its value proposition. The RADspeed fit is about as entry-level as you’ll see these days, but it still has a place in the US X-ray market and should help bolster Shimadzu’s low-end positioning.

 

Q2 Financial Season Starts on Positive Note
The first round of medical imaging company financials from the April-June period hit the press this week, revealing strong healthcare results from GE, Philips, and EOS Imaging.

GE – Although GE’s second quarter will be remembered for the GE Healthcare spin-off announcement, the quarter also brought continued revenue and profit gains for the healthcare division. GE Healthcare revenue increased 6% to $4.978 billion (with $5.3 billion in orders), while operating profit jumped up an impressive 12% to $926 million (18.6% margin), giving the division the second highest OP among all GE businesses. However, GE continued to struggle overall, as a 3.5% increase in corporate revenue to $30.1 billion was overshadowed by a (already expected) 30% drop in profit to $615 million and a 30% drop in industrial free cash flow to $300 million.

Philips – Driven by 8% comparable revenue growth in its Diagnosis & Treatment (imaging) business to €1.78 billion ($2.08b), Philips achieved 4% overall sales growth to €4.3 billion ($5.03b) during Q2. The company’s adjusted EBITA margin increased 100 basis points to 11.2% and income from operations (EBIT) increased 18.2% to €298 million ($348m). Philips’ Q2 performance was in-line with its 2017-2020 goal of maintaining a 4%-6% comparable sales CAGR and a 100 basis point average annual improvement in adjusted EBITA margin.

EOS Imaging – EOS grew revenue by 7% to €17.54 million ($20.54m) in H1 2018, as strong growth in Asia (+36%) and North America (+33%) helped offset delayed EMEA sales. However, the majority of this growth was apparently achieved in Q1 when EOS Imaging posted a 34% increase in revenue to €9.5 million ($11.4 million), suggesting that the company’s Q2 revenue was down QoQ and YoY.

 

Advanced Imaging Systems Acquires, Targets Europe Expansion
The Florida-based MR and CT parts and service provider, Advanced Imaging Systems (AIS), acquired Tennessee-based parts and refurbished equipment company, Dedicated Imaging Solutions. The acquisition adds parts repair to AIS’ portfolio and will be relied on to help AIS expand to the European market. Highlighted in the deal are Dedicated Imaging Solutions’ multiple CT and MR QA bays, expanding AIS’ full service capabilities enough to allow it to provide parts to international third-party components markets, particularly in Europe. AIS also acquires Dedicated Imaging Solutions’ X-ray tube repair protocols and new in-house coil repair lab, expanding its access to other key imaging components. Under the agreement, Dedicated Imaging will retain its name, Tennessee location, and employees, while AIS will remain in Florida.

 

 


The Wire

 

  • Included among CMS’ 2019 fee scheduling rate changes is a proposal to allow radiologist assistants to perform imaging tests that have traditionally been done by radiologists, as long as the the assistants do so under a physician’s direct supervision (they have to be on-site). The American Society of Radiologic Technologists logically came out in strong support of this proposal, suggesting that it would improve patient care and efficiency, and calling it “a significant recognition and elevation of [their] entire profession.”
  • Elsevier will offer its STATdx online radiology diagnostic decision support tool through M*Modal’s Fluency for Imaging speech recognition and workflow management system. The integration is intended to speed-up the diagnostic process by “improving accuracy, completeness, conformity, usability, and consistency.”
  • IDgital announced the release of its new diagnostic radiology Digital Assistant Platform (DAP), developed through a partnership with Google ML/AI solutions provider, Zazmic. DAP integrates with an array of Google Cloud, AI/ML, and speech/voice platforms, which it uses to access patient/clinical information and perform radiologist tasks to streamline patient evaluation workflow.
  • Researchers from Toronto Western Hospital found that recent advances in cone beam imaging software could allow neurointerventionalists to diagnose a patient with large vessel occlusion (strokes) without a CT scan or an ER visit. This breakthrough could allow stroke patients to go directly to an angiosuite for endovascular thrombectomy treatment an hour faster than they would with current processes.
  • A number of major healthcare groups urged the Senate and House subcommittees on Energy and Water Development to provide $20 million in additional funding for molybdenum-99 (Mo-99) production, which is used to produce technecium-99m. The letter stated that 2012’s American Medical Isotope Production Act has not created a sufficient supply of Mo-99, putting patient access to “important nuclear medicine procedures” at risk.
  • Nuance launched the cloud-based version of its mPower Clinical Analytics radiology platform, claiming that it can help radiologists create performance improvement strategies, give radiologists faster and easier access to information, and decrease patient length of stay for interventional procedures by up to three days. mPower Clinical Analytics uses data mining algorithms to transform unstructured radiology reports from clinical data sources.
  • Canon Medical Systems’ Vantage Titan / Zen Edition 1.5T MR system scored its first US installation at the Pulaski Memorial Hospital in Indiana, where it upgraded the hospital’s previous mobile MRI. Pulaski Memorial Hospital highlighted the new system’s patient comfort features and imaging performance in the announcement, claiming that patient volume increased 20% since they installed the MRI.
  • According to a recent report from PwC and CB Insights, Medtech companies raised more than $738 million through 61 fundraising deals during Q2 2018 (vs. $739m and 48 deals in Q1 2018; $740m and 57 deals in Q2 2017). Although none of the top-10 deals were signed by medical imaging companies, several of the largest investments went to companies focused on proton therapy and radiotherapy.
  • Belgian online PACS company, Dobco Medical Systems, raised €2.2 million to further develop its PACSonWEB platform and drive expansion across Europe. PACSonWEB is used at an impressive 90% of all Flemish hospitals and the funding should make a big difference in Dobco’s ability to invest in expansion, considering that its annual revenue is €3 million.
  • UK ultrasound software and simulation company, MedaPhor Group, expanded a pilot of its ScanNav AI image analysis software to the Royal United Hospitals in Bath, following an initial pilot at St George’s University Hospitals NHS Trust in London. ScanNav is the first CE marked AI system to perform an automated, real-time “peer review” of obstetric ultrasound images as the patient is scanned.
  • Carestream announced the sale of its DRX-Excel Plus radiography/fluoroscopy (R/F) system to the Willis-Knighton Health System in Shreveport, Louisiana, citing the system’s ease of use and patient comfort as key purchase drivers. The healthcare system already uses two Carestream mobile X-ray systems.

 

 


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