Varian finds growth in basic x-ray,advanced networking technology

February 15, 1995

Eureka acquisition adds to record quarterFuture prospects for Varian Associates are warming due to new-foundindustry leadership in x-ray tube manufacturing and Food and DrugAdministration clearance of a new radiation oncology

Eureka acquisition adds to record quarter

Future prospects for Varian Associates are warming due to new-foundindustry leadership in x-ray tube manufacturing and Food and DrugAdministration clearance of a new radiation oncology informationmanagement system.

The Palo Alto, CA, company enjoyed its strongest first quarterever. Varian reported sales of $401 million for the quarter endingDec. 30, 1994. Sales in the period climbed 24% above the $324million generated in the first quarter the year before. Earningssoared 78% to $20.8 million.

Acquisition of Eureka X-Ray Tube helped Varian's Health CareSystems group boost sales 20%. Varian announced that it wouldacquire Eureka last October from Dentsply International (SCAN10/26/94). As part of the deal, Varian now operates the formerEureka plant in Arlington Heights, IL. The facility produces lowand moderately priced tubes for OEMs and independent service organizations.Varian continues to make its own line of high-end tubes.

By acquiring Eureka, Varian earned title to world leadershipin x-ray tube manufacturing, according to Richard M. Levy, executivevice president. He estimated that Varian will sell more than 20,000tubes valued at about $150 million in 1995. Varian sales willgrow about 20% in 1995 because of the Eureka purchase.

Sales growth is expected from Varis, a computer-based oncologymanagement system that gained FDA clearance shortly before lastyear's Radiological Society of North America conference. By referringto patient positioning and tumor information acquired during simulation,Varis controls the position and operation of the accelerator andthe configuration of its multi-leaf collimators during therapy,Levy said. After treatment, the new product verifies successfulcompletion of therapy and prints results.

Varis also expedites therapy by automating administrative tasks,such as scheduling, billing, reporting and documentation, accordingto Levy. It captures patient demographics and interfaces withCT systems using the DICOM 3.0 standard to import images usedin procedural planning. The system also reports billing and utilizationdata.

Additional flexibility will be gained with the addition ofVaris Images, a work-in-progress shown for the first time at theChicago show. It gives radiation oncologists access to 3-D CTimages acquired during initial diagnosis, simulation and verification.Images drawn from all three sources can be simultaneously displayedon a workstation screen, according to Levy.

He used the RSNA meeting to scout potential partners to expandthe system's reach outside the oncology department. While Variswill make a radiation oncology department totally self-sufficient,according to Levy, it can't communicate with the laboratory, pharmacyor hospital administration departments.

"These are links we are interested in pursuing,"Levy said.

Four different types of partners may help Varian fulfill theseobjectives, Levy said. Varian seeks additional partners in imagemanagement to complement its relationship with Picker International.The Picker Acqsim CT therapy simulator provides Varian acceleratorswith patient positioning and 3-D tumor localization data. Thecompany is also investigating deals with firms that develop radiologyinformation systems, pharmaceutical firms that produce chemotherapyagents and hospital information system concerns.

"Our goal is a seamless system," Levy said. "Weare developing an integrated and automated system that requiresa minimum of human interaction on the prosaic part of operationsand a maximum amount of human interaction when judgment is required.We are looking toward building a system that starts with diagnosticimages and ends with a well-treated patient."