Good Friday brought bad tidings to American Medical Imaging (AMIC).Less than a year after declaring Chapter 11, the Horsham, PA,mobile ultrasound service provider went out of business. AMICwas a casualty of over-ambitious management and an
Good Friday brought bad tidings to American Medical Imaging (AMIC).Less than a year after declaring Chapter 11, the Horsham, PA,mobile ultrasound service provider went out of business. AMICwas a casualty of over-ambitious management and an under-performingeconomy.
"It became too hard to revive the patient," saidDr. Mark Schafer, who left AMIC last May to reincorporate hisnearby firm, which specializes in ultrasound acoustic measurement.
AMIC ran out of customers and cash, Schafer said. The companyhad lost six of its biggest customers--three hospitals in southernCalifornia and three in the Philadelphia area. The three in Philadelphiaare now clients of AMIC's former president, Robert Kane, who waslet go a year ago.
A three-year slide led to AMIC's demise. The company's goalin 1988 was to go public and reach $30 million in sales by 1990.1989 sales were $12 million, and the company had a network of16 joint-venture centers and main centers in Pennsylvania, Maryland,Florida and California. AMIC bought Schafer's firm, Sonic Technologies,in January 1989.
But AMIC didn't have the customer base to sustain its spendingspree. Rather than growing, sales dropped to about $8 millionin 1990 and $5 million to $6 million in 1991. The company defaultedon its payroll taxes, fired Kane in April 1991, and brought ina new president, Leo Pound, who had an accounting background.AMIC declared Chapter 11 on July 29 and fired 60% of its homeoffice staff in August.
The company has scrambled to stay afloat ever since. "Itscraped together half a million dollars," Schafer said, butthen one of its creditors refused to throw good money after bad.AMIC sold its furniture, Schafer's firm bought the assets of thedivision he formerly led and on April 17, AMIC locked its doorsand had its phones disconnected.