Radiology provider Akumin highlights ‘robust’ growth in PET/CT volumes with no signs of slowing
Publicly traded radiology provider Akumin witnessed “robust” growth in PET/CT use during the first quarter of 2023 with no signs of slowing.
The Plantation, Florida, company saw volumes from the modality leap 16.1% on a same-store basis (only including imaging centers that were part of the company during both periods) when compared to Q1 of 2022. Such “impressive growth” in PET/CT demand was particularly high among hospital partners, leaders noted.
During a conference call with investors Thursday, an analyst asked CEO Riadh Zine whether the development is sustainable.
“Obviously this is a new trend as you’ve outlined, but what we know is that there’s no reason to believe it will slow down,” Zine said in response to the question on May 11. “We’re still experiencing that type of organic growth, but it’s a recent shift. We’re not going to sit here and say this is going to continue for the next five years. To be honest with you, we don’t know yet. But what we know is it’s not slowing down and the demand is not pent-up. It’s not COVID related. It’s actually fundamental demand from growing applications and the development of new tracers.”
During the three-month period ending March 31, Akumin delivered about 36,000 PET/CT scans, up from 32,000 at the same time in 2022. The company charted nearly 8% same-store volume growth for the modality in Q4 of 2022 and same for Q3. The trend comes after fellow publicly traded radiology provider RadNet similarly reported a 20.5% uptick in same-store PET/CT volumes earlier this week.
“PSMA tests are driving substantial growth in RadNet’s PET/CT business and I suspect it may be doing the same for Akumin,” Executive VP and Chief Financial Officer Mark Stolper told Radiology Business by email on Thursday. “From my discussions with the head of our PET/CT program, the efficacy of this test and the new radioactive tracer is causing referring physicians to order this test with more frequency.”
The U.S. FDA approved the first commercially available PSMA (prostate-specific membrane antigen) PET agent two years ago. Experts marked the decision as a “significant milestone” in medicine, with the Cleveland Clinic labeling PSMA PET as one of the top 10 medical innovations to watch in 2022. A report from IMV released in March also charted 46% year-over-year growth in PET prostate scan volumes, climbing 3 percentage points to account for 9% of the overall procedure mix by study type.
Hiring challenges have impacted Akumin’s business in recent years. However, that has not been the case for this modality, Zine told investors.
“Labor constraints are less of a factor in PET/CT, given the highly specialized skill sets of clinical personnel for this modality and we are better able to capitalize on strong demand for these services,” he said Thursday.
Analysts questioned whether the growing demand will strain capacity, but Akumin said it is prepared if the trend persists. The company already has plans in surging markets to transition toward digital PET/CT equipment, which offers throughput that is two to three times faster than traditional equipment.
“We don’t foresee utilization or capacity constraints,” he said. “We are excited about this fundamental shift and as it continues and we grab a higher share, it’s a high-margin, very profitable business for us.”
Akumin additionally absorbed 4% same-store growth in MRI volumes. All told, it tallied revenue of $187.6 million in Q1, up about 1% compared to the same period in 2022. It generated $33.1 million in adjusted earnings, a 4% increase. But overall, Akumin tallied a $29.2 million net loss for the first quarter, versus $26.4 million in losses in Q1 of 2022.
Zine and colleagues attributed the numbers, in part, to revenue losses from certain Florida facilities that were closed for renovations. All told, Akumin boasts 180 owned and/or operated imaging locations, providing outpatient radiology and oncology solutions to 1,100 hospitals across 48 states.
For more on its financials, read this press release or the accompanying slide deck.
Marty Stempniak has covered healthcare since 2012, with his byline appearing in the American Hospital Association's member magazine, Modern Healthcare and McKnight's. Prior to that, he wrote about village government and local business for his hometown newspaper in Oak Park, Illinois. He won a Peter Lisagor and Gold EXCEL awards in 2017 for his coverage of the opioid epidemic.