Medical Imaging Equipment
Date June 2018
By the numbers
- The global Magnetic Resonance Imaging (MRI) systems market is expected to grow at a CAGR of 3.9% to reach to $7.1 billion by 2023, driven primarily by technological advancements and an aging population
- The number of healthcare bankruptcies and consolidation is on the rise, particularly for rural medical centers increasing the amount of equipment available on the secondary market
- As technology is updated, older machinery may become obsolete, losing value in the secondary domestic market
Age of machine important to value: The year of manufacture is a good indicator of how much imaging equipment is worth on the secondary market. After five years, machines are typically worth no more than 25 to 40 cents on the dollar. Anything older than eight or nine years most likely will end up in emerging markets like Mexico or South America. While these second or third generation machines may be fully functional, they are no longer the state-of-the-art technology desired by most medical facilities in the U.S.
Magnet strength, gradient, and slew rate determine best use: Magnets are the most important and fundamental components of MRI machines and correlate with the level of detail in images produced. Magnetic strength is commonly measured in Tesla (T). Today’s machines use magnets ranging from 0.35T to 3.0T in power; however, most machines sold in the world today are powered by 1.5T magnets. Within that category, machines are further refined by their gradient specifications, which define the machine’s spatial resolution and imaging speed. Gradients are created when electrical currents pulse on and off during imaging. They reach different heights over different durations. A machine’s slew rate is calculated by taking the gradient strength and dividing it by the rise time (the time to reach that strength) and is measured in Tesla per meter per second (T/m/s). High field superconducting machines achieve slew rates around 150 to 200 T/m/s; superconducting open scanners typically range from 100 to 120 T/m/s; and lower field permanent scanners feature 50 T/m/s. The combination of strong gradients and high slew rates means thinner slices, which are important for cardiac and brain imaging. However, other specialties, such as orthopedics, do not necessitate such strict performance requirements. Appraisers must consider these technical specifications when determining the marketability of machines.
Coils add value: Coils act as an antenna for MRI systems that broadcast the RF signal to the patient and/or receive the return signal. There are two classes of RF coils: volume coils and surface coils. Volume coils transmit and receive signals over large volumes while surface coils are designed to scan smaller regions of interest. Examples include specialized extremity coils, which produce high resolution images for wrists, shoulders, feet, fingers; and head coils, which enable faster brain scans with parallel imaging. A broad array of coils can add to the value of MRI systems. Lenders should be aware of which coils are included in their collateral. Coils are more valuable when sold with a system.
Latest software desired: While the physical characteristics of the machine are crucial, they mean little without the sophisticated software that operates the equipment. Some companies won’t service machines unless the software is up-to-date. Upgrades can be very expensive, so MRIs operating current technology will fetch the highest prices. Even an older machine running the latest software can be quite valuable. Lenders should inquire with borrowers about their maintenance practices for upgrades.
Logistics can add up: Prospective buyers on the secondary market will factor in significant rigging and transportation costs into the purchase of used machines. De-installation is complicated and must be done by a trained professional who may charge around $10,000, and that doesn’t include the cost to get it out of the building. Rigging of machines that can weigh up to 45 tons will add thousands more in fees and will increase further if the machine is not located on the first floor or near an exterior wall. Installation involves a variety of highly technical tasks that require specialized expertise along with sensitive and costly tools. Together, removal, rigging, transportation, and installation costs can reach $75,000 to $100,000 or more.
Industry outlook: According to a 2018 market research report “Magnetic Resonance Imaging (MRI) Systems Market by Architecture published by MarketsandMarkets™, the global MRI systems market is expected to reach over $7 billion by 2023 up from $5.6 billion in 2017, representing a 3.9 percent average growth rate.
The key factors driving the growth include technological advancements leading to the increased adoption of high-field MRI systems, a growing geriatric population, and the discovery of new helium deposits. The major players in the global MRI systems market are Siemens Healthineers (Germany), GE Healthcare (U.S.), Phillips (Netherlands), Hitachi (Japan), and Canon Medical Systems (Japan).