About American Shared Hospital Services
American Shared Hospital Services, Inc. provides stereotactic radiosurgery equipment and advanced radiation therapy and related equipment. The company provides Gamma Knife units to medical centers in eleven states in the United States and two Gamma Knife units at stand-alone facilities in Lima, Peru and Guayaquil, Ecuador. The company provides Gamma Knife services through its 81% indirect interest in GK Financing, LLC, a California limited liability company (GKF). The remaining 19% of GKF is owned by GKV Investments, Inc. (GKV Investments), a wholly-owned U.S. subsidiary of Elekta AG, a Swedish company (Elekta). Elekta is the manufacturer of the Leksell Gamma Knife (the Gamma Knife). GKF is a non-exclusive provider of alternative financing services for Leksell Gamma Knife units. The company wholly-owns the subsidiaries American Shared Radiosurgery Services (ASRS), OR21, Inc. and MedLeader.com, Inc. (MedLeader). ASRS is the majority-owner of GKF. GKF has established the wholly-owned subsidiaries Instituto de Gamma Knife del Pacifico S.A.C. (GKPeru) and HoldCo GKC S.A (HoldCo) for the purpose of providing similar Gamma Knife services in Peru and Ecuador. HoldCo owns approximately 99.3% of the total outstanding shares of Gamma Knife Center Ecuador S.A. (GKCE). GKF also owns a 51% interest in Albuquerque GK Equipment, LLC (AGKE) and Jacksonville GK Equipment, LLC (JGKE). The remaining 49% in each of these two companies is owned by radiation oncologists. The company is also the sole owner of PBRT Orlando, LLC (Orlando) and the majority owner of Long Beach Equipment, LLC (LBE) which were formed to provide proton beam radiation therapy services in Orlando, Florida and Long Beach, California. A 40% minority ownership in LBE is owned by radiation oncologists. The company is targeting large, hospital-based cancer programs. On April 27, 2022, the company signed a Joint Venture Agreement (the Agreement) with the principal owners of Guadalupe Amor Y Bien (Guadalupe) to establish AB Radiocirugia Y Radioterapia de Puebla, S.A.P.I. de C.V. of Puebla (Puebla) to treat public- and private-paying cancer patients. The company and Guadalupe will hold 85% and 15% ownership interests, respectively, in Puebla. The company owns ASHS-Mexico, S.A. de C.V. to establish Puebla in order to provide radiation therapy and radiosurgery services locally in Mexico. The company continues to develop its design and business model for The Operating Room for the 21st Century through its 50% owned OR21, LLC (OR21). The remaining 50% of OR21 is owned by an architectural design company. Operations Gamma Knife Operations Gamma Knife stereotactic radiosurgery, a non-invasive procedure, is an alternative to conventional brain surgery and/or radiation therapy. It can be an adjunct to conventional brain surgery, radiation therapy, or chemotherapy. Typically, Gamma Knife patients resume their pre-surgical activities one or two days after treatment. The Gamma Knife Perfexion unit, which was introduced by Elekta, treats patients with 192 single doses of gamma rays that are focused with great precision on small and medium sized, well circumscribed and critically located structures in the brain. The Cobalt-60 sources converge at the target area and deliver a dose that is high enough to destroy the diseased tissue without damaging the surrounding healthy tissue. In 2015, Elekta introduced an upgrade to the Gamma Knife Perfexion unit called Icon. In 2022, Elekta introduced an upgrade to the Icon, called the Esprit. As of March 1, 2023, all of the company’s twelve Gamma Knife units in the United States are Gamma Knife Perfexion units and two of these Perfexion units have the Icon upgrade. The company’s Gamma Knife units in Peru and Ecuador are Model 4(C)s. The Gamma Knife treats selected malignant and benign brain tumors, arteriovenous malformations, and functional disorders, including trigeminal neuralgia (facial pain). As of December 31, 2022, there were 118 Gamma Knife sites in the United States and 360 units in operation worldwide. Based on 2021 case mix data, an estimated percentage breakdown of Gamma Knife procedures performed in the U.S. by indications treated is as follows: malignant (63%) and benign (22%) brain tumors, vascular disorders (4%), and functional disorders (11%). The company’s Gamma Knife units performed 1,286 procedures in 2022 for a cumulative total of approximately 46,200 procedures from commencement through December 31, 2022. The company conducts its Gamma Knife business through its 81% indirect interest in GKF. The remaining 19% interest is indirectly owned by Elekta through its wholly-owned subsidiary, GKF Investments. GKF is managed by its policy committee. Advanced Radiation Therapy Equipment and Services The company is continuing its efforts to contract new radiation therapy customers both domestically and internationally. The company has increased its product offerings from standard linear accelerators to more advanced linear accelerators that incorporate Magnetic Resonance Imaging (MRI) and potentially Positron Emission Tomography (PET) imaging technologies. Proton Beam Radiation Therapy Operations (PBRT) PBRT is an alternative to traditional external beam, photon-based radiation delivered by linear accelerators. PBRT has physics advantages compared to photon-based systems which allow PBRT to deliver higher radiation doses to the tumor with less radiation to healthy tissue. PBRT treats prostate, brain, spine, head and neck, lung, breast, gastrointestinal tract and pediatric tumors. Approximately 280,000 patients have been treated with protons worldwide. Customers The company’s business is the outsourcing of stereotactic radiosurgery services and radiation therapy services. The company typically provides the equipment, as well as planning, installation, reimbursement and marketing support services. The majority of the company’s customers pay it on a revenue sharing basis. Southwest Texas Methodist Hospital San Antonio, Texas; Kettering Medical Center Kettering, Ohio; Central Mississippi Medical Center Jackson, Mississippi; OSF Saint Francis Medical Center Peoria, Illinois; Albuquerque Regional Medical Center Albuquerque, New Mexico; Northern Westchester Hospital Mt. Kisco, New York; USC University Hospital Los Angeles, California; St. Vincent’s Medical Center Jacksonville, Florida; Sacred Heart Medical Center Pensacola, Florida; PeaceHealth Sacred Heart Medical Center at RiverBend Eugene, Oregon; Orlando Health Cancer Institute Orlando, Florida (PBRT); Bryan Medical Center Lincoln, Nebraska; and Methodist Hospital Merrillville, Indiana. In most cases, GKF is responsible for providing the Gamma Knife and related ongoing Gamma Knife equipment expenses (i.e., personal property taxes, insurance, and equipment maintenance) and helps fund the customer’s Gamma Knife marketing. The customer can either renew the agreement or terminate the agreement at the end of the contractual term. One customer accounted for approximately 45% of the company’s total revenue in 2022. As of December 31, 2022, four customers each individually accounted for 12%, 14%, 16% and 22% of total accounts receivable, respectively. Marketing The company markets financial and turnkey solutions to cancer treatment centers, hospitals, and large cancer networks worldwide. The company works closely with major global Original Equipment Manufacturers (OEM’s) that provide leading edge clinical treatment systems and software that treat cancer using radiation therapy and radiosurgery. The major products the company is able to provide creative financial and turnkey services for are; MR Guided Radiation Therapy Linacs, Advanced Linear Accelerators, Proton Beam Therapy systems, Brachytherapy systems, and through its GK Financing partnership with Elekta, the Leksell Gamma Knife product and services. The company is product agnostic and works with all major OEMs to provide financial solutions to the end users for the products and services they desire. The company has enhanced and expanded its sales and marketing team and efforts to better provide sales and customer service to the healthcare community. The company’s CEO manages directly the day to day operations as well as all sales, marketing, and customer service teams to ensure close contact with the company’s customer installed base and management of the sales pipeline. The company provides planning, installation, operating and marketing assistance and support to its customers, as well as providing turnkey solutions if room modifications, new vault, or even a new cancer care facility is needed by working with creditable and reputable construction companies. Financing The company’s Gamma Knife business is operated through GKF. The company’s Gamma Knife unit in Ecuador is financed with United States Development Finance Corporation (DFC). Government Programs The company’s Gamma Knife and PBRT customers receive payments for patient care from federal government and private insurer reimbursement programs. In the United States, Gamma Knife and proton therapy services are performed primarily on an out-patient basis. Gamma Knife patients with Medicare as their primary insurer, treated on either an in-patient or out-patient basis, comprise an estimated 35%-45% of the total Gamma Knife patients treated nationwide. Government Regulation The company’s Gamma Knife units contain Cobalt 60 radioactive sources. The medical centers that house the company's Gamma Knife units are responsible for obtaining possession and user's licenses for the Cobalt 60 source from the Nuclear Regulatory Commission. The company is in compliance with the Federal False Claims Act. History American Shared Hospital Services was founded in 1980. The company was incorporated in the state of California in 1983.
