Analogic innovates in technology and business

January 23, 2006

If the corporate world were a circus, Analogic would be the high wire act. The Peabody, MA, company has struck a fine balance between being an electronics supplier and being a manufacturer of end user equipment.

If the corporate world were a circus, Analogic would be the high wire act. The Peabody, MA, company has struck a fine balance between being an electronics supplier and being a manufacturer of end user equipment.

Core developments in x-ray-based imaging have made the company a powerful OEM provider of some of the most sophisticated electronics in the medical imaging industry, notably the digital acquisition systems and detectors built into multislice CTs. Simultaneously, Analogic has founded subsidiaries designed to allow the company to cash in on opportunitie in both OEM supply and direct sales.

These corporate machinations, particularly the activities of the last several years, have brought Analogic into the limelight. Attention first focused on the company in response to its creation in 1999 of a Canadian subsidiary, called Anrad, concentrated on the development of flat detectors, and most recently with the addition two years ago of a subsidiary, called Anexa, dedicated to the development and sale of digital radiography systems to end users.

With four products in its DR portfolio and three of them exhibited during the 2005 RSNA meeting, Anexa management has set out to make a name for itself. It appears to be well on their way to doing just that.

The company's first product, the Synerad Omni unveiled at the 2004 RSNA meeting, offers a single 17 x 17-inch amorphous selenium flat detector. This year's Omni XT (not shown at the RSNA meeting due to space considerations) incorporates an arm extension that pushes the detector out 18 inches. This unit, designed for trauma patients, allows images to be taken while a medical team tends to the patient. Prominently featured at the Anexa booth in November was the Omni RT, a dual-detector version designed to boost productivity under routine conditions. The company also introduced a dedicated chest unit, the CXR2, built around a single upright detector.

Being a newcomer to the radiography marketplace has advantages. For one, the company is not tied to legacy film systems. Its designs can be fresh and suited specifically to clinical needs. Anexa's new dual-detector Omni RT is designed to take whatever images are needed with minimal repositioning of the patient.

"We give our customers all the use and flexibility they need," said Anexa president Mike Cordes. "With a single button push, the bucky is repositioned to shoot a cross lateral, as well as an AP hip image, without moving the patient."

Cordes and his colleagues wanted to be realistic about what they could - and should - do. The relatively new firm, founded on the eve of the 2003 RSNA meeting, is still growing its sales staff. The focus has been entirely on DR. But in the weeks leading up to the latest RSNA meeting, management was thinking about broadening its portfolio in a way that would have dramatically changed its profile. Executives at Anexa and its parent company were considering the launch of a line of CT scanners.

Two configurations of such a product, SyneRad Impact 60 and SyneRad Impact 72, passed FDA review in September. The two 16-slice scanners differ from one another only in the high-voltage power supply mounted on the gantry. The Impact 60 was designed to use 60 kW, while the Impact 72 was designed to use 72 kW.

The two were built on the AMS 1600, a platform cleared by the FDA along with the two Impact systems. (Many of the components in this platform had gone into CTs developed jointly with Hitachi Medical and shown by that company at the RSNA meeting under the CXR brand, as learned independently from Hitachi.) In the end, however, Anexa and Analogic executives decided against introducing an Anexa CT product.

"Senior management (at Analogic) sat down with us and when we looked at where we were with the program and the new products that Anexa was bringing out, we just decided for a number of reasons not to show the CT," Cordes said. "A big part of our strategy in going to the RSNA meeting was to make sure we had a portfolio of core products and the bandwidth, in terms of sales representatives, to focus on the product."

Analogic is characterized by OEM relationships, all based on the firm's ability to develop and manufacture key electronic components. The company is a major provider of CT data acquisition systems and detectors to be installed in medical diagnostic and therapeutic devices, as well as in luggage scanners at airports. The Selenium 2 detector, manufactured by Analogic subsidiary Anrad, offers unprecedented performance in DR, according to company executives. A version of this detector is being supplied to digital mammography OEMs. Transducer technologies built by subsidiary STI support OEMs in the ultrasound industry. Its two direct sales subsidiaries, Anexa and B-K Medical, build on these capabilities.

These subsidiaries sell products into niche markets. B-K Medical addresses surgical and urological ultrasound. Anexa focuses on segments of the DR marketplace not addressed by the major OEMs.

"We are looking at smaller hospitals and private orthopedists," said John Ross, Anexa vice president of marketing. "They have a different set of needs than large hospitals, and we think we have tied into that."

Aside from the obvious contributions to the bottom line, this strategy of balancing OEM partnerships and direct sales provides feedback from end user customers, allowing Analogic to better understand issues involved in the engineering of core technologies. This proved particularly helpful in the evolution of the company's selenium-based x-ray detector.

Some five years ago, Kodak contracted with Analogic to develop a line of DR products, providing the system engineering and integration. Those products featured the first-generation selenium plate made by Hologic. (Kodak concentrated on the development of software for image processing.) Analogic's involvement in this process provided the firm with invaluable feedback from Kodak customers about an emerging technology that dramatically changed workflow in the radiography department.

"Digital changed the way you did quality control. It changed how you released and called back patients," Cordes said. "In working with Kodak, we learned a lot about what to put into a second-generation product."

Kodak has since brought all the design and integration work for its DR products in-house. Analogic moved on as well, founding Anexa to sell DR products directly and developing a third-generation DR portfolio for the Anexa label. Analogic has also provided a second-generation selenium detector to an OEM that does not compete in the same space as Anexa.

The latest detector technology, dubbed Selenium 2, represents an advance in detector design achieved through a process that deposits an extra-thick layer of amorphous material. This extra layer stops and converts more photons to signals, making the detector more efficient, according to Ross. The claim is supported by hard numbers indicating extraordinary results when measuring the detector's performance.

"Anrad's multilayered deposition technique doubles the thickness of the selenium on first-generation detectors and gives us a detector that has the industry's best MTF (modulation transfer function) and a DQE (detective quantum efficiency) equal to or better than any detector in the industry," he said.

This kind of evolution is critical to Analogic's approach, whereby components provide a steady flow of revenue from OEMs while providing the expertise and building blocks for its own configurations. In this way, the company's strategy reflects its technological developments, which in turn lead it in directions that are both old and new.