Med Tech Firms Join Forces

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Medical and scientific laser maker Cell Robotics International Inc., Albuquerque, NM, and Hamilton Thorne Research, Beverly, MA, have joined forces to jointly market their respective infertility treatment systems in an agreement that involves a combination of direct sales and distributors.


Hamilton Thorne and Cell Robotics officially kicked off their alliance at the American Society of Reproductive Medicine's 54th annual meeting in San Francisco earlier this month. Both firms are touting the pact as a win-win deal.


"Many times when you look at alliances of some kind or another, they're not quite perfect fits. This one seems to fit quite nicely," said Cell Robotics president/CEO Ronald Lohrding.


Cell Robotics is looking to raise the profile of its IVF Workstation, a laser-based in-vitro fertilization device that has not yet received Food and Drug Administration approval but is cleared for sale in Europe. Ongoing FDA clinical trials for the IVF Workstation have resulted in pregnancies among previously infertile women who, the company says, are representative of the growing number of patients turning to assisted reproduction technology.


Privately-held Hamilton Thorne makes devices for analysis of eggs and sperm and also provides general software services to the fertility marketplace, composed mostly of fertility clinics and embryological researchers.


Under the agreement, Hamilton Thorne will promote the IVF Workstation along with its sperm analysis system and identify potential customers to Cell Robotics, which then will close the sales using inhouse direct sales staff and distributors. Cell Robotics has internal telesales capability and usually markets its products through trade shows and direct response ads in technical publications for the in-vitro fertilization community. The company uses an Albuquerque-based ad agency, The Outsource, for design work on its ads and brochures.


"[The deal] gives us a marketing presence with the Hamilton Thorne research people who sell to fertility clinics with their sperm analyzer," Lohrding said. "Our product is a complementary technology to that, so it gives us a kind of market presence. We also believe, and I think Hamilton Thorne believes, that our technology also enhances sales of their technology."


Though Cell Robotics has not tried any direct mailings for the IVF Workstation, Lohrding said the company plans to carry out mailings in the future, and he foresees mail efforts that jointly promote the companies' products. The smaller of the two companies, Cell Robotics pulled in revenue of $784,000 in the first six months of 1998. The company went public in February 1995.


The IVF Workstation is designed to measure the size of eggs and embryos, and the device can inject sperm into the egg when combined with microinjectors. The workstation also performs laser-assisted hatching, which involves placing a crease on the surface of an egg so the embryo can break out more easily after it's implanted back into the patient.


For its own part, Hamilton Thorne hopes the alliance will give a boost to sales of its new line of DNA diagnostics products for the in-vitro fertilization market. The company's competition already offers sperm analysis equipment bundled with a laser hatching package, and Hamilton Thorne hopes Cell Robotics' IVF Workstation will help fill the laser technology gap in its own product offering.


"It's a response to competitive issues," said Meg Hamilton, president/CEO of Hamilton Thorne.


As a finder's fee, the company will take a portion of any sales Cell Robotics generates from Hamilton Thorne's leads, but Hamilton suggested that she sees the fees as less valuable than the sales advantage gained by the company, whose annual revenue she put at "under $10 million." She declined to specify the percentage of Cell Robotics' sales Hamilton Thorne will get.


Hamilton Thorne uses trade shows and direct mail efforts in some parts of the United States but has a national U.S. distributor, Fertility Technologies Inc., the marketing and distribution subsidiary of reproductive disorder treatment company Zonagen Inc. Hamilton Thorne has distributors in 55 countries, including the United States. The company generates promotional materials inhouse.
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