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Imatron hopes to stanch red ink by restructuring HeartScan stake

June 25, 1997

"Why isn't HeartScan developing? In a nutshell, it boils down to insurance reimbursement," Meyer said. "We frankly don't agree (that this exam is investigational), nor do the 17 chairmen of cardiology departments who have written to the Blue Cross Technology Assessment Committee saying that this is an extremely valuable piece of information. It is the only way we know how to assess in asymptomatic people whether they have significant arteriosclerosis."

Imatron has been successful selling the expensive ultrafast CT scanners in international markets, and large multi-unit scanner orders have come from Japan and Malaysia. The vendor also signed a service support agreement in April with Siemens, which sells the ultrafast CT under its Evolution XP label. This strengthened relationship should bring in more service revenue for Imatron.

In the U.S., the reimbursement issue has kept down ultrafast CT sales. Imatron has installed over half of its scanners, about 45, in sites outside the U.S. Approximately 30 systems are in this country, Meyer said.

HeartScan has been left with the option of marketing to individuals who will pay to find out their cardiac condition. This restricts HeartScan to only large metropolitan areas, where there is a sufficiently large pool of potential patients. Ultimately, Imatron believes that direct participation in coronary artery disease (CAD) risk-assessment diagnostic services will benefit the company by stimulating clinical advocacy of this cardiac CT procedure and by providing a model for other service providers to follow, which should build the business for Imatron's scanner, Meyer said.

"We absolutely plan to maintain our position in HeartScan," he said. "What the level will be, I can't tell you. But we intend to continue participating in the service side of the business. It keeps our fingers on the pulse of the market. We get to talk to opinion leaders in a more direct way."

This situation is ironic in that pressures in the U.S. to keep down healthcare costs should provide an incentive for CAD screening in order to reduce the large sums spent on cardiac treatment, he said.

"We have a view that healthcare in the U.S. is better (than overseas)," Meyer said. "But to be frank, investing in screening tests or an annual physical is a much more accepted paradigm in Asia than it is in the U.S."

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