Recently, Siemens Medical Engineering Group (Erlangen, Germany) acquired the ultrasound systems manufacturer Acuson Corporation of Mountain View, CA. This merger, valued at approximately $700 million, comes on the heels of Siemens' acquisition of the information technology (IT) company, Shared Medical Systems. Through these transactions, Siemens Medical Engineering Group hopes to position itself as an IT-driven, high-tech company and further its transformation to an e-company.

Following this merger, John Pavlidis, President of Siemens Ultrasound Division, was appointed Chief Executive Officer of Acuson, a Siemens Company. He recently spoke with Applied Radiology about the future of this new company and ultrasound technology.

APPLIED RADIOLOGY: What are the short- and long-terms plans for integrating Acuson and Siemens?

PAVLIDIS: There are many aspects to integrating the companies. We have identified areas ranging from sales and marketing through service, logistics, legal issues, procurement, etc., and we have teams working on all those aspects. We started as soon as we got the "go ahead" to merge in early November and we expect the planning phase to last until about the end of March. The implementation phase will begin sometime at the end of March and, in some cases, will clearly take up to 24 months or more, because, as you can imagine, there are some things that will take longer than others.

APPLIED RADIOLOGY: Do you expect the companies to be fully integrated under one name?

PAVLIDIS: The company clearly is one company focused on ultrasound; however, there is unquestionable value to the Acuson brand. So, we will definitely keep the Acuson brand prominent not only in the product name--it will still remain Acuson Sequoia, Acuson Aspen, etc.--but for the foreseeable future we will also keep the company name, so it will be Acuson, a Siemens Company.

APPLIED RADIOLOGY: Will the sales forces be merged as well?

PAVLIDIS: Yes. The sales forces will be one, and the unified sales force will be able to sell both Acuson and SONOLINE products.

APPLIED RADIOLOGY: Will there continue to be new developments under the Acuson brand name?

PAVLIDIS: Absolutely. There will continue to be new development on both the SONOLINE brand, which is the Siemens' ultrasound brand, and the Acuson brand. Clearly, one of the areas we are looking at is "cross pollination" of technology and product features.

APPLIED RADIOLOGY: How do you envision the two product lines dovetailing?

PAVLIDIS: Each brand has its own particular strengths in the marketplace. The Acuson brand, for example, is very well known in cardiology, where the SONOLINE brand has really not had much of a presence at all. When it comes to, for example, general imaging, if you look at the Sequoia as the 'super premium' brand in gastrointestinal imaging with cardiology capabilities as well, that would be the 'super premium' level. Then you have the Elegra at the 'premium' level and the Aspen at 'high end.' So at every point, with the two brands combined, we can cover all the price points and customer needs.

APPLIED RADIOLOGY: How will the merger with Shared Medical Systems influence your ultrasound business?

PAVLIDIS: It's not so much ultrasound related, but that merger is very important because it focuses on the IT component of health care. In many ways, it is the connecting glue to hospital information systems. Shared Medical Systems offers several additional services, including--very importantly because we see it as a growing trend--application service provider (ASP) capabilities. Shared Medical is the world's largest ASP provider in health care. There is no question that, over time, with increasing focus on disease management, a key driver for implementing such programs will be the right IT, having access to patient outcome studies, and understanding the work flow; for example, a patient with X disease has this kind of exam first, this kind of exam second, etc. You can't develop and implement best practice guidelines without the right IT structure. Shared Medical plays more of a strategic IT role within all of medical as opposed to ultrasound directly.

APPLIED RADIOLOGY : Acuson is also involved in Picture Archiving and Communications Systems (PACS) as well, are they not?

PAVLIDIS: Absolutely. Actually, since the merger, Acuson's KinetDx Networking Solution has become the Acuson and Siemens ultrasound networking solution.

APPLIED RADIOLOGY: What role does Acuson's WebPro play in the field of ultrasound?

PAVLIDIS: WebPro is part of the e-ultrasound focus and the connectivity solution of KinetDx. It is an important element of connectivity; not so much at the highest possible speed setting, but from a teleradiology perspective. If a physician at a remote location needs to look at images over a regular phone line, they are accessible on a regular PC. It also adds flexibility because many customers are migrating toward "centers of excellence," where basically the images go to the expert physicians wherever they may happen to be while the acquisition is done at a range of facilities. So the "super expertise" lies in one location and the images come to them rather than the patients.

APPLIED RADIOLOGY: What is the future focus for Acuson and Siemens?

PAVLIDIS: In the past, Siemens' ultrasound has been more successful outside the United States, with almost 70% of our revenue coming from outside the U.S. The reverse was true for Acuson, with about 70% coming from within the U.S. So, it was clear that each company by itself was not able to leverage research and development methods on a global basis because we had pockets of strength and pockets of weakness. So, in terms of the logic of the merger, it is clear that one of the key drivers that we are looking forward to is making sure that our research and development investments have a global appeal. The Acuson part of the equation certainly helps the U.S. presence and Siemens' part of the equation helps Acuson's previous presence.

We definitely see ultrasound being more and more focused on workflow issues: making sure the exam can be faster; producing more results per unit of time; and allowing the exams to be more consistent. One of the points that is sometimes mentioned as a negative of ultrasound is that it is user-dependent and has variability depending on the skill of the user. Technology such as tissue equalization, pioneered by Acuson, is shaping the way toward more consistency, easier training for sonographers, and ease of use. That is the kind of technology clearly that we will explore planning to incorporate into the SONOLINE platform.

Another example that appears to be very exciting from a research and development perspective is strain imaging; that is, measuring the elasticity of tissue with ultrasound. It is being tested for a number of applications: breast cancer, prostate disease, thyroid, and peripheral vascular disease. It has been talked about for a long time, but the ability to really show such exciting results was not there until we showed some examples at the RSNA.

Contrast agents are another area. Although they are not FDA cleared in the United States, we see tremendous potential for their use; for example, detection and characterization of liver disease, and treatment monitoring such as radiofrequency ablation. That whole area of contrast imaging, we see as a potential area of significant growth in ultrasound.

In general, in talking with our customers, they say that because of the continued and rapid improvement in ultrasound they have seen their procedure volumes increase significantly, and that is one of the key drivers for growth in ultrasound. Taking another step back, that is one of the key reasons that Siemens invested in Acuson, because ultrasound is a growth area. It's the same with IT in healthcare; it really makes no sense not to invest in growth areas.

APPLIED RADIOLOGY: What other general trends are you seeing in ultrasound?

PAVLIDIS: Another general trend is the one toward connectivity. Ultrasound is a dynamic modality and, as such, it is best expressed not by still images, but by moving images. Up until recently, it has not been easy or straightforward to handle dynamic clips in ultrasound, so most people accepted dealing with static images. The whole KinetDx platform makes dealing with dynamic clips easy and straightforward--transporting them quickly over long distances over a network. What we are finding are more and more customers who used to rely very heavily on sonographer training and making sure that they had very, very specific protocols to capture a specific view, who now basically can request a sweep of a certain organ and have the whole clip sent over so they don't have to depend on snapshots and pre-selection. The physician can really look at the complete study without being concerned that something was missed. That is a tremendous productivity driver and it increases diagnostic confidence.

Another trend is toward miniaturization. Like other things around us, such as cell phones and computers, everything is becoming smaller and more powerful. That trend will certainly also continue. Mobility and portability are becoming key drivers in ultrasound. The technology is now available to make highly portable, highly mobile systems that also have high quality. That also means that customers expect more and more for the same price and also expect much more compact and powerful packages. AR