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Biotech / Medical : IMAT - ultrafast tomography for coronary artery disease -- Ignore unavailable to you. Want to Upgrade?

To: Angel Medina who wrote (2946)	3/8/1999 11:59:00 AM
From: Bruce Rozenblit	Read Replies (2) \| Respond to of 3725

Angel and others like myself holding a big loss. The stock price of 1 3/8 reflects the economic conditions of the company and perceived future returns. A year ago, I was very confidant about the future. Now, I fear that bankruptcy is a real possibility. The effectiveness of the technology was never in doubt. The scanners don't sell because of the economics of the procedure. If the machine cost 1.8 mil and the loan interest is 12%, the monthly payments are $18,000. That figure does not include overhead, and personnel. The only way for the machine to pay back is to keep a steady stream of patients running through it and the hospitals obviously feel that is way too much risk. So they don't buy the scanner. I have made many, somewhat presumptuous, statements about redesigning the machine to lower costs. Seimens has done just that. They are showing a conventional CT for calcium screening at the ACC. It does not have the precision and resolution of Ultrafast but maybe that is what the marketplace wants. My position has been that calcium screening should initially be used to feed into other more traditional diagnostic procedures in order to gain a foothold in the marketplace. That's what the Seimens machine does. If you want to sell something, you have to provide the customer with what he wants. He wants something that will make him money. A machine that sells for 700K is a lot easier to make money on than one that goes for 1.8 million--that does essentially the same thing. It says your are sick and further tests are required. Those "further tests" are where the practitioners make the big bucks. Its time to become very defensive. The annual report will be out soon and we will see the red ink. Imatron is in serious financial trouble. If sales don't increase soon, we are facing the end. The only way to produce the scanner that is cost competitive is to have the major assemblies manufactured in the far east. Final assembly would be done here. Obviously, management does not share that vision. Maybe they should talk to someone at GM or Ford, or TI, or HP, or GE, or Nike, or Dell, or CAT, or USS, etc.