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No. 361, October 1999

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American Companies in Japan


A year ago, APPLIED MATERIALS, INC. was seriously thinking about pulling out of APPLIED KOMATSU TECHNOLOGY INC., a company equally owned with KOMATSU LTD. that makes production equipment for flat-panel displays, because of a slumping FPD market. With AKT's business prospects brightening because of booming demand for active-matrix TFT screens, the Santa Clara, California manufacturer has changed its mind. It will buy out Komatsu's stake in AKT for an undisclosed amount and make the Kobe company, formed in September 1993, a wholly owned unit. As a result of restructuring last fall (see Japan-U.S. Business Report No. 350, November 1998, p. 20), AKT's product line is limited to chemical vapor deposition equipment. .....Even though its future was in doubt, APPLIED KOMATSU TECHNOLOGY INC. developed a CVD system for working on FPD glass substrates that measure as much as 27.3 x 35.1 inches. Marketing of the AKT-5500 PECVD will start in early 2000.

HARMON INDUSTRIES, INC. sublicensed its Advanced Automatic Train Control system to NIPPON SIGNAL CO., LTD. for marketing in Japan and elsewhere in Asia. AATC is a communications-based train control system that uses a radio network of transmitters and receivers to determine a train's location much more precisely than the Automatic Train Control system now in use. Blue Springs, Missouri-based Harmon exclusively licensed the AATC technology from RAYTHEON CO. It is installing the system on the San Francisco Bay Area Rapid Transit system, with operations scheduled to start in 2001. Nippon Signal, Japan's largest supplier of signaling equipment, reportedly is making AATC devices for the tops of trains for the BART project.

OVS Physical Stress Systems produced by Denver's QUALMARK CORP. will be represented in Japan by SUMITOMO CORP. These accelerated life testing systems and associated services give manufacturers, particularly electronics makers, the information needed to improve product reliability by quickly exposing design and manufacturing-related problems. The typical accelerated life test using OVS equipment takes only four to five days to finish. Sumitomo has been demonstrating one of QualMark's systems at a facility in Zama, Kanagawa prefecture. More than 280 OVS Physical Stress Systems already are in use in 14 countries.

With the bankruptcy last year of OKURA & CO., LTD., its primary distributor, HIPOTRONICS, INC. gave NIPPON KOEI CO., LTD. rights to market its high-voltage test systems to users and manufacturers of power-delivery apparatus. The Brewster, New York supplier reportedly has little in the way of Japanese competition and vies basically with a small number of other foreign producers for sales of test equipment to electric utilities, manufacturers of electric power equipment and cable makers. Hipotronics' automatic test sets, dielectric breakdown testers, first-response cable fault locators, resonant systems and other high-voltage test equipment are priced between $370,400 and $463,000. Nippon Koei, one of the world's leading engineering consulting companies, projects sales of $1.9 million in the initial year.

Start-up ANTARA, LLC signed Tokyo's SANKEI SHOJI CO., LTD. to distribute its Port Authority suite of network test products. The Campbell, California company's open-architecture line includes Port Authority/Manufacturing for quality assurance applications, Port Authority/GT for general network device and simulation testing and Port Authority/IT for applications performance analysis. This array of products allows network testing all the way from device testing on the manufacturing floor to monitoring real-world enterprise networks.

The Ministry of Agriculture, Forestry and Fisheries' decision to require labeling of 30 food products that contain detectable amounts of genetically modified organisms already is creating business opportunities for U.S. suppliers of GMO testing services or test kits, even though the regulation will not go into effect until April 2001. An early beneficiary is STRATEGIC DIAGNOSTICS INC., the maker of the GMO Check test kit. For starters, the Newark, Delaware company signed an agreement with TAKARA SHUZO CO., LTD. that gives that firm's Biomedical Division the right to use the GMO Check test kit as part of its commercial testing operations to quantitatively determine the extent of GMOs in soybeans and other bulk agricultural commodities and in so-called food fractions like flour and protein concentrates. Takara Shuzo also has the nonexclusive right to market GMO Check in Japan, where the kit will cost $1,700, and in South Korea. .....STRA-TEGIC DIAGNOSTICS INC. also licensed JAPAN OILSTUFF INSPECTORS CORP. to use the soybean version of the GMO Check test kit in the laboratories that it runs at Japanese ports. Certified by MAFF, JOSIC is the leading inspector of imported oilseeds. To date, it has performed quality tests on soybeans and other oilseeds for importers, usually trading companies, and crushers. Now, it will add GMO testing to its services.

NORTHERN INSTRUMENTS CORP., a Cleveland maker of electronic sensing instruments, has tapped NEW BEX CO., LTD. of Saitama prefecture to market its Foodoil Sensor. Billed as taking the guesswork out of changing shortening in deep-fryer operations, the portable system is said to provide a quick, easy test for indicating when a batch of frying shortening should be discarded to prevent an accumulation of harmful components. It does this by monitoring the change in the dielectric constant of the fat. NIC notes as well that the Foodoil Sensor is designed to be used by food-processing and food-service personnel that have no scientific training.

A revolutionary line of ultrasound devices soon will be available in Japan. SONOSITE, INC.'s miniaturized, high-performance, all-digital equipment will be distributed by OLYMPUS OPTICAL CO., LTD. The first product, the SonoSite 180, can be hand-carried since it weighs just 5.4 pounds. Nonetheless, the Bothell, Washington developer says, it produces images comparable to those generated by larger, more expensive ultrasound machines. The SonoSite 180 will be marketed initially for use in gynecology, obstetrics, urology and general-purpose abdominal imaging.

With MHW approval in hand, CENTURY MEDICAL INC. has begun marketing three neurovascular access and delivery products made by MICRO THERAPEUTICS INC. of Irvine, California (see Japan-U.S. Business Report No. 355, June 1999, p. 21). The EASY RIDER Micro Catheter, FLOW RIDER Flow Directed Catheter and the SilverSpeed Hydrophilic guidewire are all used to access small, remote vessels in the brain to enable the delivery of blood clot-dissolving agents. These products will be parts of MTI's ONYX Liquid Embolic System, which is awaiting regulatory clearance.

ENCORE MEDICAL CORP., an Austin, Texas supplier of orthopedic total joint, trauma and spinal implants, has added another distributor. SENKO MEDICAL TRADING CO., LTD. of Tokyo will market the Ultimax line of trauma products. CENTURY MEDICAL INC. is Encore's primary sales agent.

The primary subsidiary of big drug manufacturer JOHNSON & JOHNSON is in the process of absorbing the company's formerly freestanding JOHNSON & JOHNSON MEDICAL K.K., which supplies medical devices, medical equipment and various surgical and medical consumables. Like other parts of JOHNSON & JOHNSON K.K., the medical business will operate as an independent unit. Efficiency considerations dictated the merger.

An exchange rate of ¥108=$1.00 was used in this report.

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