Swissray cuts deal with HCP for sale and service of digital radiography

July 8, 2001

As June drew to a close, Swissray International announced that Marconi Health Care Products (HCP) would market and service Swissray’s line of direct digital radiography (ddR) systems in the U.S., supplementing an existing distribution agreement

As June drew to a close, Swissray International announced that Marconi Health Care Products (HCP) would market and service Swissray’s line of direct digital radiography (ddR) systems in the U.S., supplementing an existing distribution agreement with Hitachi Medical. The Marconi sales force had been trained, marketing had begun, and Swissray was enthusiastic about the prospect of broadened acceptance of digital radiography through a concerted effort by HCP.

In the wake of Marconi Medical’s agreement to be acquired by Philips, however, the question of what will become of the deal with Swissray rears its head. Rex Harmon, vice president of global marketing, sees nothing but upside in regard to digital radiography.

“Philips is clearly in transition,” Harmon said. “It has distanced itself from the Trixell (digital detector) plate, because Trixell cannot produce these plates in volume.”

Alternatively, HCP might be spun off, Harmon speculates. Either way, Swissray wins.

“This is a terrific opportunity to divert a revenue stream toward our product and away from CR and film,” he said.

Traditionally, HCP has sold consumables, particularly medical film. Over the past several years, however, the division has been steadily adding capital equipment. This transition began with laser imagers a decade ago, according to Larry Miller, vice president and general manager of HCP, and includes Fuji, Agfa, and Kodak computed radiography systems and, now, Swissray ddR systems.

“It has been a natural progression,” Miller said. “We have been growing into the digital world as the film manufacturers have migrated there. But we still have a foot in the analog world. Two-thirds of our gross margin and revenue come from film.”

HCP holds the greatest potential of any vendor for increasing ddR sales, Harmon said, because of its extensive customer base, its commanding position in the radiography film market, and a corporate strategy to move toward digital imaging. Marconi’s negotiations to sell the medical business added a sense of urgency to the talks between HCP and Swissray, he said.

“We thought once a change of control was announced, there would be a long period of waiting for things to shake out,” Harmon said. “We wanted to jump right in and be in the middle of it.”