Wuestec buys out Samsung’s interest in digital x-ray joint-venture company

July 7, 1999

DX-1480 is on the verge of market introductionAs Wuestec Medical gears up for commercialization of its new low-cost digital x-ray system, the U.S. x-ray company has restructured its relationship with Korean partner Samsung. Wuestec last month took

DX-1480 is on the verge of market introduction

As Wuestec Medical gears up for commercialization of its new low-cost digital x-ray system, the U.S. x-ray company has restructured its relationship with Korean partner Samsung. Wuestec last month took over full control of its Canadian digital development joint venture with Samsung, DigiX of Edmonton, Alberta. Wuestec will run the venture as an internal R&D arm.

DigiX was founded as a joint venture between Wuestec and Samsung to develop a CCD-based digital x-ray system (SCAN 2/17/99). The joint venture’s work paired Samsung’s expertise in CCD technology with Wuestec’s capabilities in developing conventional x-ray units. Wuestec displayed the product of DigiX’s work, DX-1480, at last year’s RSNA conference.

With DX-1480 on the verge of market introduction, Wuestec has decided to assume more control over its supply of digital x-ray components. The company purchased Samsung’s interest in DigiX using cash, notes payable, and an equity stake in privately held Wuestec. Wuestec is not commenting on the price or what percentage of the Mobile, AL, firm Samsung now owns.

“This was the next step in the evolution of the (digital x-ray) product,” said COO Martin Porter. “Samsung wanted to participate as a part owner of Wuestec.”

The restructuring of its relationship with Samsung will have no impact on plans for the launch of the DX-1480 systems, Porter told SCAN. Wuestec has begun installing the first production unit of the digital x-ray system at its clinical site at the University of South Alabama Medical Center, also in Mobile.

Wuestec has lined up 70 x-ray dealerships in the U.S. to handle DX-1480 and hopes to begin installations of the new system in August. The x-ray firm has its own sales staff to handle national accounts, which will likely be increased by the end of this year, Porter said.

Wuestec will market the unit worldwide as well, he said. Distributor relationships have been established in Europe, Asia/Pacific, and the Middle East. Priced at $197,500, DX-1480 is positioned to compete head-on with standard analog x-ray. It is also less expensive than digital x-ray systems being brought to market by larger companies, which are pricing the new systems in the range of $350,000 to $400,000. Cost savings and increased throughput should help DX-1480 pay for itself in two years or less, Porter said.

“A conventional x-ray room runs about $120,000. For a little bit more, you can have a digital system with PACS,” he said. “And you can at least triple your throughput.”

Radiologists have expressed interest in the system because of its image quality, digital manipulation capabilities, and centralized reading through PACS, he said.

“They see the potential to increase their efficiency because now they can stay in one location instead of having to run around to their different offices and read scans,” Porter said.

Wuestec hopes to get the product on the market sufficiently in advance of competitor GE Medical Systems, so customers eager to take the digital plunge will try Wuestec first and will realize the payoff in economic terms and practice enhancements, he said.

The digital x-ray technology developed at DigiX will be used exclusively in Wuestec products for the time being, Porter said. Eventually, the company could design detectors for other equipment as well.

“What we are really pushing is to launch our product and show it works,” he said.