Innovatus Imaging

www.innovatusimaging.com

Englewood, Colorado / Pittsburgh, Pennsylvania / Tulsa, Oklahoma

Founded: 2017

Privately owned

Employees: 160 (20 in Colorado)

Industry: Medical & Bioscience

Products: MRI and ultrasound components and repair

President and COO Bill Kollitz and CTO Michael Labree are leading the manufacturer and servicer of ultrasound and MRI technology into new markets.

Born of the 2017 merger of three companies -- the Multi Service Vendor Service (MVS) unit of Bayer's radiology business in Pittsburgh, Wetsco in Oklahoma, and MD MedTech in Colorado -- Innovatus Imaging is an established leader in MRI and ultrasound repair and manufacturing. The deal was financed by Cleveland-based Resilience Capital Partners; Dennis Wulf serves as the combined company's CEO.

"The three companies had worked together pretty closely for the last 10 years," says Kollitz. "We were all in this ultrasound repair space." The merger "only made sense."

The business has three main areas of focus: ultrasound transducer repair; MRI coil repair; a field service business; and a manufacturing division. The Colorado facility is the manufacturing facility. The Tulsa and Pittsburgh facilities are focused on repair and service, and Innovatus also has a repair depot in the Netherlands.

In July 2018, the company branded its Tulsa operation as the Ultrasound Transducer Repair Center of Excellence and the Pittsburgh facility as the MRI and CR/DR Centers of Excellence.

Now organized as Innovatus' Engineering, Testing, Regulatory Compliance and Manufacturing Center of Excellence, the manufacturing facility is in Englewood, also the site of most of the engineering and QA/regulatory work.

MD MedTech launched operations in Colorado in 2008 as an offshoot of Wetsco. It changed hands a couple of times in the subsequent decade, and Wulf previously served as the company's CEO.

The 6,000-square-foot facility manufactures components for ultrasound and MRI technology. "We manufacture that to support the rest of the repair business," says Labree, "and we do also do that on an an OEM basis."

It also makes specialty products and probes for specialized uses. "For example, we have several probes that are geared towards surgery," says Labree. "We have an ultrasound probe used in robotic surgery."

The Centennial facility is focused on a "high-mix, low-volume type of production," says Labree. "They are primarily manual processes. Everything is small. Everything is tiny. We are cutting ultrasound components that are thousandths of an inch wide." For that kind of work, he notes, employees use saws made for the semiconductor industry. The equipment is a mix of customized and off-the-shelf tools and machinery.

The service side of the business entails three repair depots (in Pittsburgh, Tulsa, and the Netherlands) and field service for numerous large hospitals and healthcare providers. Innovatus can repair just about every ultrasound probe on the market through R&D-honed techniques, says Kollitz.

"The object of bringing the companies together was to unleash the full potential of the business," he adds. The merger was finalized in September 2017; while it remains a bit early to measure benchmarks, Kollitz says, "So far, so good.

Challenges: Managing the possibilities. "The challenge for us is to effectively prioritize," says Kollitz.

Hiring is another challenge. "The market in Denver has been very tight for manufacturing-type workers and I think that will continue to be challenging," says Labree. "The flip side is Denver is very rich in engineering and quality talent."

Opportunities: "We have opportunities to expand the depth of our offerings and our geography and new areas in healthcare," says Kollitz. "We are also looking at opportunities to use our core technology in other space."

The depot-based repair model is scalable, and Asia and Latin America are targets for new facilities, he adds. Because of logistics of international shipping, that could cut turnaround time for customers in those markets by about 50 percent. "We could trim a week to a week and a half of that turnaround time with a located facility," says Kollitz.

Traditionally expensive ultrasound equipment is getting smaller and cheaper, says Labree, and with that comes potential new partners looking for integration. "In the last year, we've seen ultrasound systems on a chip essentially," he says. "That's where a lot of our activity is. . . . Now you can bolt ultrasound onto something easily and cost-effectively."

In that vein, Labree says, "We are in various stages of work with several companies and universities through NIH grants to do some cutting-edge things with surgical probes."

Needs: Talent is at the top of the list. "We're certainly expecting some growth [in Colorado]," says Labree. "We'll have to continue to work hard to find people who fit our needs and the economics of our business."

Adds Kollitz: "Ultimately, what we are is a people business. What we're selling is the skills, capabilities, and talents of our people."

With that, an expansion or larger facility might be required; the target is about 10,000 square feet. "We're already feeling we are bursting at the seams," says Labree. "We're just now getting started on the space question."