Recovery in Asia helped drive Fullerton-based Beckman Coulter Inc.’s improved third-quarter results.
Beckman, which makes equipment and supplies for labs running tests for doctors and for medical and drug researchers, said revenue from Asia rose about 4% in the quarter.
Chief Executive Scott Garrett said he expects improved results to continue in the fourth quarter and beyond.
“We were disappointed in the first half of the year with our progress in China,” Garrett said.
Beckman made changes in China, opening a subsidiary in Shanghai and taking on sales there itself,instead of using distributors.
Some things were beyond Beckman’s control.
“There was a slowdown in purchasing by hospitals in China because of a corruption investigation that was very much across the board,” Garrett said. “But as I’ve learned now since I visited China, it varied from province to province and city to city.”
The probe “contributed to the slowdown in the first half,” he said.
“We’re going to be improving as we go through the rest of this year and next year. We should be returning to double-digit growth in China,” Garrett said.
The story wasn’t the same in Japan.
Japan is “a totally different market,far more mature,” Garrett said. “The potential for growth is not nearly as high.”
The country has been affected by what Garrett called “pretty severe” healthcare reform in the past several years.
Growth in clinical diagnostics, or medical testing, has been modest, according to Garrett.
“We’ve seen, however, a little bit of an uptick in the life science (medical and drug research) markets in Japan, and that’s where we’ve reconnected with many of our long-term distributors,” he said.
“With that encouragement, we’ll do better in life science. But we’re still watching carefully to see if we can drive a little bit of growth in diagnostics,” Garrett said.
In the second quarter, Beckman said revenue in its Far Eastern region including Japan was down 7.3% because of shortfalls in Japan and China.
During the quarter, Japanese sales were down more than 20% on lower sales of its cellular-related products and in sales to life sciences markets.
Sales in Beckman’s Southeast Asia region grew nearly 16% in the quarter.
Beckman’s past Asia issues, Garrett said, included switching to direct sales in Japan and the need to cope with more governmental regulations.
As for China, Garrett said, “hospitals are delaying purchases due to an expanding Chinese government review of overall hospital buying practices.”
Garrett also touched upon the “one Beckman” idea that he’s promoted since he became chief executive in 2005.
His moves include the combination of the company’s dominant clinical diagnostics unit with its smaller biomedical research unit.
“It’s very much complete. The company is one company,” Garrett said.
Beckman has seen more collaboration, including in product development, as a result, he said.
“The exchange of technology has been very efficient,” Garrett said. “And we have an excellent commercial organization around the world with a single management structure that manages the whole business.”
Ex-Refractec Chief Heads Transcend
Mitchell Campbell, former chief executive of Irvine-based device maker Refractec Inc., now is chief executive of Menlo Park-based Transcend Medical Inc.
Transcend focuses on treating glaucoma, an eye disease that frequently leads to blindness.
The company raised a $7 million round of venture capital funding, which was led by Morgenthaler Ventures and Split Rock Partners.
Campbell, who spent nine years at Refractec, left earlier this summer.
Refractec in June promoted Thomas Frinzi, the company’s chief operating officer, to fill the position.
Refractec makes laser devices used to treat near-vision loss associated with presbyopia.
Bits and Pieces:
Medical Properties Trust Inc., a Birmingham, Ala.-based real estate investment trust, completed its $60 million purchase of West Anaheim Medical Center, La Palma Intercommunity Hospital and Huntington Beach Hospital from Prime Healthcare Services Inc. James Mazzo, chief executive of Santa Ana-based Advanced Medical Optics Inc., spoke about his company at a Credit Suisse healthcare conference last week in Phoenix. Mazzo is set to talk about Advanced Medical next week at a Piper Jaffray healthcare conference Tustin-based Toshiba America Medical Systems Inc. spent $6 million to add 4,840 square feet of education center space to an existing training academy for its customers. The center is equipped with Toshiba’s computed tomography, magnetic resonance imaging and vascular imaging devices Irvine-based IntraLase Corp. said more than 1 million laser eye surgery procedures using its IntraLase FS device have been done worldwide to date Paragon Biomedical Inc. moved to its headquarters to 9685 Research Drive in the Irvine Spectrum from elsewhere in Irvine Anaheim Memorial Medical Center said it received $51,100 from Gov. Arnold Schwarzenegger’s state Office of Homeland Security. In a release, the hospital said it would use the money to put blast mitigation film on its outer windows and buy three portable Geiger counter radiation detectors.
