Norland builds under new owners

March 13, 1991

Norland is enlarging its U.S. organization, following the bonedensitometer company's acquisition last year by Novatech Management(SCAN 5/23/90). Novatech is a New York health-care investmentcompany partially owned by Albert S. Waxman, founder and

Norland is enlarging its U.S. organization, following the bonedensitometer company's acquisition last year by Novatech Management(SCAN 5/23/90). Novatech is a New York health-care investmentcompany partially owned by Albert S. Waxman, founder and formerchairman of Diasonics. Waxman is chairman of Norland, which isbased in Fort Atkinson, WI.

The expansion of Norland's operations falls under the supervisionof John I. Mankowich, president and CEO. Mankowich joined thefirm last September. He was previously vice president of worldwidesales and service for ultrasound vendor Interspec. Mankowich hiredTom Regan, another ex-Interspec employee, as vice president ofsales last month. Regan had been director of sales at the ultrasoundcompany.

Norland's vice president of marketing arrived through a connectionto the chairman. Joel Blank, a former Diasonics vice president,initially served as a consultant to Waxman after the Norland acquisition,Mankowich said.

Regan will be in charge of an expanded U.S. sales effort. Norlandhired three sales representatives along with the vice presidentlast month and is in the process of bringing on a fourth. Thecompany will sell its dual-energy x-ray absorptiometry (DEXA)systems primarily through direct sales representatives, althoughit will maintain a few select dealers, he said.

U.S. sales of DEXA systems are picking up as more Blue Shieldand Blue Cross organizations begin to reimburse densitometry exams,Mankowich said.

"Forty percent to 50% of the Blues are currently reimbursing,"he said. "In California, they are reimbursing for baselineexaminations." Baseline exams are given women during menopausein order to help gauge changes in bone mineral density with postmenopausalscreening.

Medicare does not reimburse DEXA exams.

Most of Norland's U.S. sales are to rheumatologists, endocrinologistsand ob/gyns. While radiologists appear interested in the systems,they seem to be holding off acquisitions until the reimbursementissue is more clearly settled, he said.

Although DEXA competitor Hologic has indicated that internationalsales of densitometers are sagging (SCAN 2/13/91), Norland hasexperienced continued growth of sales in Europe and other markets,Mankowich said.

Picker International sells Norland densitometers in Germany.A group of distributors handles other European national markets.Norland has a European subsidiary, Norland Scientific Instruments,based in the Netherlands. NSI will move from its headquartersin Weesp to a larger facility in Baarne within the next month,he said.

BRIEFLY NOTED:

  • Du Pont Diagnostic Imaging agreed to acquire PICSTalk,a medical software integration business, from Trinity ComputingSystems of Houston last month. The purchase should be completedby April, according to Jerome M. Smith, vice president and generalmanager.

PICSTalk translates transmissions between different types ofcomputer systems in a hospital. Integration of hospital and departmentalinformation systems has been retarded by the utilization of differenttypes of operating systems and data formats. Du Pont will usethe integration system to improve communications between its radiologyinformation system, Linx Micro Radiology Manager, and other hospitalcomputer systems.

"We view the radiology information system as a base forthe future of electronic imaging. This acquisition strengthensour electronic imaging product line by integrating these (RIS)systems with the hospital's information systems," Smith said.

  • Medical Imaging Centers of America nearly doubled consolidatedrevenues in fiscal 1990 (end-December). San Diego-based MICA'srevenues rose 95% from $40 million in 1989 to $78 million. Netincome increased 54%, from $4 million in 1989 to $6 million (seegraph). The bulk of MICA's business is in the provision of fixed-siteand shared medical imaging services.

"With outpatient revenues expected to account for morethan half of hospital revenues by the year 2000, MICA is wellpositioned for the `90s," said Antone J. Lazos, chairmanand CEO.

  • Net revenues increased 41% for Health Images of Atlantain 1990 (end-December), from $32 million in 1989 to $45 million.Net income at the MRI center company rose 28% for the year from$2.27 million to $3 million (see chart). Most of HI's revenuegrowth came from patient services rather than its MRI equipmentmaintenance business. Net patient service revenues were up 52%for the year (to $26 million), compared to a rise of 4% in engineeringrevenues (to $5.2 million).

  • Increased demand for Lunar's DPX-L x-ray bone densitometersin both Europe and the U.S. was credited with the 32% boost incompany revenues in the second quarter (end-December) of fiscal1991. Lunar revenues rose from $3.4 million in the second quarterof 1990 to $4.5 million during the same period in 1991. Net incomejumped 52% from $559,000 in the second quarter of 1990 to $849,000this year.