A nice little niche

  • By Eric Fetters / Herald Writer
  • Sunday, August 8, 2004 9:00pm
  • Business

BOTHELL – Diagnostic Ultrasound’s devices are aimed at just one part of the body – the bladder.

Their use has helped improve patients’ comfort and saved hospitals money. The company’s narrow focus also has helped it grow from a basement operation into a profitable company with a worldwide sales force.

“We’ve stayed right on the bladder because there’s a huge need for that right now,” said Gerald McMorrow, founder and chief executive officer of the Bothell-based company. “We pretty much dominate this little niche in the market.”

For patients recovering from surgery or incapacitated in other ways, nurses use catheters to drain urine from the bladder.

Catheterization is often uncomfortable, and repeated use can lead to urinary tract infections.

Diagnostic Ultrasound’s flagship device, the BladderScan, allows nurses to measure how full a patient’s bladder is, and then use catheters only when the bladder is full.

“It can eliminate more than half the catherizations, which helps pay for the equipment,” McMorrow said.

BladderScan devices use a patented, 3-D imaging technology that makes the measurements as accurate as possible, he said.

As a result, it can save hospitals many times the device’s average cost of $10,000 by avoiding unnecessary catherizations and infections, according to studies cited by the company.

At Swedish Medical Center in Seattle, nurses have had similar results with the BladderScan.

“It’s actually a great tool,” said Joel Lilly, chief of urology at Swedish. “We use it many times in our office, and the hospital uses it all the time.”

The noninvasive technique for looking at the bladder is easy enough that it doesn’t take trained sonographers to use the devices, in contrast with larger ultrasound equipment.

Though BladderScan devices don’t provide detailed ultrasound images themselves, Diagnostic Ultrasound last year launched an online service that allows for that. A medical technician can use BladderScan on a patient, plug the handheld device into a special high-speed modem that connects to the company’s large computer servers.

With the online subscription service, called ScanPoint, technicians can view and store ultrasound images without having to buy additional equipment, a large savings for smaller medical practices.

Since the first BladderScan model came out in the mid-1980s, Diagnostic Ultrasound has expanded, employing about 100 people in its headquarters today.

The company also has a sales force spread across the country and overseas. In fact, the highest per-capita sales of the BladderScan have come from medical centers in Sweden, not the United States.

“There’s not a continent that doesn’t have one of these. Except Antarctica; we haven’t able to sell them to the penguins,” McMorrow said as he showed off the company’s manufacturing plant at its headquarters.

McMorrow, 54, grew up near Port Townsend and got his electrical engineering degrees at the University of Washington before working for several electronics companies, including Everett’s Fluke Corp.

After working with a colleague on a vascular ultrasound device, he started his own company in the basement of his Kirkland house.

That was 1984. By the following year, the company released its first product, an ultrasound device that measured blood flow to screen patients at risk of stroke and arterial disease. The first BladderScan model was released soon after.

Since then, the BladderScan has undergone several updates, with the product’s development accelerating during the past two years. Diagnostic Ultrasound has released four different versions of the BladderScan, all designed for different uses, since 2002.

They include a home version for patients who have lost sensation in their bladders because of multiple sclerosis, spinal injuries and other conditions. A portable version that can store data from several patients also is available for doctors.

In the coming weeks, the firm is unveiling another updated model that can assess the relative mass of the bladder wall. That could help doctors diagnose symptoms of benign prostatic hyperplasia, a common enlargement of the prostate in men over 50.

Diagnostic Ultrasound is still privately held, with McMorrow owning about half. Employees and investors make up the other half of the ownership.

McMorrow doesn’t talk about his company’s financials, saying only “we’ve been profitable for years.” It helps that the company’s main product line has no direct competition in the United States, he said.

However, Diagnostic Ultrasound isn’t relying just on continued domination of the bladder ultrasound field, McMorrow said. Its research and development group, located in Woodinville, has a long list of proposed uses for the company’s technology other than the bladder.

Reporter Eric Fetters: 425-339-3453 or fetters@heraldnet.com.

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