Accuray (ARAY) entered into a research and development agreement with Siemens Healthcare, whereby the latter received a right to sell CyberKnife System globally for the treatment of tumors. Accuray will continue to sell and distribute this System through its own distribution network.
Under this agreement, Accuray and Siemens intend to expand their global footprint in healthcare products. The agreement will not only create new sales opportunities for the system but will also facilitate development and commercialization of new and innovative technologies and products.
Siemens expects to integrate technological skills and capabilities of both the companies in its linear accelerator products and in turn help them to explore future synergies between them. Moreover, the combination of radiation treatment and advanced imaging is expected to contribute substantially to the prospect of cancer care. The agreement will provide a boost to Accuray’s revenue in the future.
The CyberKnife System is the first and only commercially available intelligent robotic radiosurgery system designed to treat solid tumors anywhere in the body. This is an alternative to traditional surgery.
Accuray generates product revenue primarily by selling the CyberKnife System, placing the System with customers, and providing ongoing services and upgrades to customers following installation of the System.
Total products revenue declined 17% year-over-year to $34.0 million in the first quarter of 2010. This resulted from the decline in demand for the CyberKnife System due to lack of effective methods for cancer treatment than radiation therapy and radiosurgery.
However, we hope the company to benefit from latest addition of the VSI system to the CyberKnife systems’ portfolio and the new technologies and expertise incorporated through the Siemens agreement.
Headquartered in Sunnyvale, California, Accuray designs, develops and sells the CyberKnife System, an image-guided robotic radiosurgery system used for the treatment of solid tumors. Recently, Accuray installed the first CyberKnife VSI System at Creekside Cancer Care in Lafayette, Colorado.
The VSI System is the latest addition to Accuray’s CyberKnife family of products. The upgraded system will enable the Creekside Cancer Care center to offer enhanced cancer treatment options from radiosurgery to high-precision radiation therapy.
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