Cedara Will Add Cardiology, Orthopedic Applications To eMed PACS Platform

Cedara plans to increase sales of its medical software products by leveraging eMed Technologies' U.S. installed based of 450 PACS networks.

Under a definitive merger agreement announced Sept. 14, Cedara will acquire eMed's picture archiving and communications systems (PACS) and web-based medical imaging radiology products for $48 mil. in cash.

Cedara estimates the purchase will help grow market share in imaging centers and small hospitals, which comprise eMed's base.

Cedara develops radiology software for device manufacturers and healthcare information technology providers such as GE Healthcare, Siemens, Philips, Toshiba, Hitachi and Cerner. Cedara estimates its software has been deployed in approximately 20,000 medical imaging systems and 4,600 PACS workstations worldwide.

Beyond radiology, Cedara is developing additional applications to complement eMed PACS systems, including those for orthopedics, cardiology, mammography using computer aided detection and virtual colonoscopy, according to eMed.

The firm also looks to benefit from Cedara's marketing and distribution networks in North America, Europe and Asia. eMed currently does not have an international presence.

The acquisition builds on a relationship between the firms dating to 1996, when Cedara first began using eMed's workstation. eMed recorded about $24 mil. in revenue during fiscal 2003 and has been consistently profitable over the last 24 months. Cedara had similar sales of $23.3 mil. last year and reported a loss of $10.3 mil.

eMed CEO Mark Smith will continue to lead the unit as a wholly-owned subsidiary of Cedara upon completion of the deal, expected by November. No material change to the structure of eMed will occur, according to Cedara.

The companies will have a combined 350 employees in the U.S. and Canada.