Canon Announces New Strategy to Market Digital Radiography; Canon's Digital Radiography Systems Will be Offered as a Fee-Per-Use Service.

Business/Technology Editors

IRVINE, Calif.--(BUSINESS WIRE)--Nov. 27, 2000

Canon U.S.A., Inc., a subsidiary of Canon, Inc. (NYSE: CAJ), today announced that its Canon Medical Systems division will begin marketing the company's CXDI-22 Digital Radiography (DR) systems on a fee-per-study basis through an Application Service Provider (ASP) model. Establishing this new ASP business model will enable Canon to alleviate the initial upfront capital investment usually required when leasing or purchasing this equipment, making the DR technology more readily affordable and available to small and medium-sized medical institutions.

Each analog image on x-ray film is estimated to cost between $12 - 20; in some cases, the costs are higher to process the image for diagnostic review. Medical institutions, which consider upgrading to DR technology to eliminate film from their radiology departments, usually justify up-front capital equipment investments by analyzing film cost-savings over time. Large medical centers and hospitals with sizeable film volumes more easily can cost-justify the investment in DR technology since they amortize the expense over a larger number of patients and recover costs more quickly. Other medical institutions, such as outpatient clinics, imaging centers and small to mid-sized hospitals, often see fewer patients and can't absorb the initial equipment investment as easily.

With Canon now providing its state-of-the-art digital radiography technology on a fee-per-study basis, users pay for what they use each month, with a minimum basic charge over a contracted time. Canon's ASP model, in most cases, will enable users to pay less than what they spend currently on each analog image.

Featuring a 17" x 17" imaging area, the largest available in the industry, Canon's CXDI-22 system can display images in portrait or landscape orientation at over 7.2 million pixels resolution and 4,096 levels of grayscale. Its large dynamic104 range compensates for over-and underexposure to the images. Preview images are displayed on a touch-sensitive LCD in the operation unit/preview panel within a few seconds after x-ray exposure. The control station can store up to 750 images and transmit the images to a diagnostic viewer for soft copy, archive and hard copy printer, or to any other location via Ethernet interface with DICOM 3.0 format.

Canon's DR system can be retrofitted to existing radiographic systems and generators so customers do not need to invest in a completely new x-ray room with a DR system and generator, which costs over $400,000. The Canon's CXDI-22 system sells in the $200,000 price range. Customers now have the option of obtaining DR technology via a traditional capital equipment sale or lease, or via the fee-per-use application.

"Canon now can deliver a superior clinical solution at an affordable price to a wide array of customers," said Eric Kuramato, director and general manager, Canon Medical Systems. "By offering our customers a choice in the way they obtain their systems, we expect to penetrate the digital image market and allow more customers to experience the benefits of digital technology."

Canon will demonstrate its digital radiography system in a joint application with Stentor's medical image and information system, iSite(TM), at the Radiology Society of North America (RSNA) trade show taking place on November 26 - 30 in Chicago.

Canon's DR systems have been used with Stentor's iSite (TM) system by Kaiser Permanente of Northern California, where over 100 San Francisco bay-area clinicians have realized the benefits of the immediate image acquisition, data display and distribution that this joint application offers.

Stentor's technology utilizes standard desktop PCs, the Internet and organizations' existing Intranets, so no new infrastructure is required for enterprise-wide integration. This reduces end-user costs without sacrificing image quality or acquisition times.

Stentor is a world leader in enterprise-wide medical image and information management. The company has developed iSite(TM), the first image and information management system to deliver on-demand diagnostic quality images over existing hospital networks. iSite(TM) is based on Stentor's patent-pending iSyntax(TM) which matches the delivery of image data to the speed of human perception. iSite's workflow engine is driven by Imaging Suite, the medical industry's leading RIS worklist & workflow solution.

Canon Medical Systems, a division of Canon U.S.A., Inc., is based in Irvine, California. The group was formed in April 1999 to provide medical facilities with a single source from which to purchase both Canon's innovative Digital Radiography and its PACS products.

Canon U.S.A., Inc. is an industry leader in professional and consumer imaging solutions and, through its parent company, Canon Inc., is a top patent-holder of imaging technologies. The company's comprehensive product line includes networked multifunction devices; digital and analog copiers (color and black and white); printers, scanners, image filing systems, and facsimile machines; camcorders, cameras and lenses; and semiconductor, broadcast and medical equipment. Canon employs 12,000 people at more than 30 facilities throughout North, Central and South America and the Caribbean.

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