IDS to rent blood testing machines to hospitals

Dec 11 2008 by Karen Dent, The Journal

MEDICAL testing company IDS has raised £3.12m through a shares placing to roll out new equipment and a new business model which it says will boost profits.

The Boldon business revealed its plans as it announced an 84% jump in turnover to £12.48m for the half year to the end of September and a 16% rise in pre-tax profits to £1.56m. The AIM-listed company had sales of £4.61m during October and November.

It aims to increase profits further with the introduction of its IDS iSYS fully automated blood testing machine, which hospitals and laboratories will be offered to rent from the next quarter of next year. The company currently sells its manual machinery but says it can take time for clients to raise the average £35,000 it costs for the analysing equipment.

Chief executive Dr Roger Duggan said: “An alternative is to say we will put one of these machines in your lab, you buy the critical equipment and pay an extra 10%, so they pay a premium on the consumables.

“The IDS iSYS is a hands-free walkway machine. You load your samples on to the machine, press some buttons then an hour, 90 minutes later you have your results. It’s fully automated.”

The new equipment and rental arrangements will be rolled out in the UK and Europe during the first quarter of 2009 and launched in the US –which counts for 35% of the global market – at the end of 2009.

Dr Duggan said: “Our sales have been on the up for years now. All that is just with manual equipment. The automated equipment enables us to go after a much bigger market. The market we’re going into is multi-million. With an ageing population, the requirement for testing just keeps climbing.” The majority of the large companies in the sector already use automated testing equipment but Mr Duggan said IDS would not be fighting them for business.

“We are in a more specialist niche market. We are the only one in Britain,” he said.

Dr Duggan said the company was anticipating massive growth but would not be drawn on a figure.

However, the company which last year acquired Nordic Bioscience Diagnostics of Norway and French firm Biocode Hycel, is predicted to boost its annual revenue to £46.9m by 2011.

IDS is a world leader in testing for vitamin D in blood and Dr Duggan said the future for the company looked “rosy”.