Hta Case Study

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In 1997, Dr. Charles Casper and John Frost founded ATH MicroTechnologies Inc. to develop, manufacture, and sell a new medical imaging product. Dr. Casper (47), a radiologist, had trained at Johns Hopkins medical school and, after a research fellowship at Harvard Medical School, joined a private practice in Florida. Casper specialized in the use of imaging systems for the medical practice. Over time, he had experimented with different procedures, such as ultrasounds and x-ray, until he became interested in a new technology based on sending electronic impulses through electrodes attached to the skin and observing how these impulses changed as they went through the body. Together with John Frost-an engineer who specialized in digital imaging for medical applications- Casper perfected the technology, reducing its cost and improving its resolution. Both founders anticipated a significant market potential for their product. Relatively low cost combined with improved image quality made it a very attractive alternative for applications where other imaging systems were prohibitively expensive to use. With these expectations, they convinced a group of doctors to invest in the venture. The company started with $3.6 million in paid-in capital. In 1998, ATH MicroTechnologies received regulatory approval to market its first product-an imaging system to work in conjunction with minimally invasive surgical procedures. Building on this initial success and after a detailed sales and profit projection over a five year period, a deal was struck with Alumni Capital Partners, a venture capital firm, which agreed to invest $8.7 million to support the launch of the new product. The business plan anticipated the intr
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