Kromek spun out of Durham University’s Department of Physics in 2003. It was initially known as Durham Scientific Crystals, but changed its name in 2008. Kromek is active in the nuclear detection, medical imaging and security screening markets. Its group headquarters is at NETPark, but it also has offices in Germany and the USA. It started with two employees in 2003 and now has over 100 in its workforce. It floated on AIM in 2014.
The company specialises in creating semi-conductor materials from Cadmium Zinc Telluride, which have applications in gamma rays and X-rays. Its technology includes bottle scanners for airports that can classify liquids accurately in under 30 seconds, and a lightweight detector that can identify hazardous radiation sources in the environment.
Cadmium Zinc Telluride is a semi-conductor material that is widely used in digital and spectral radiation detectors. It is better at picking up X-rays than silicon and can operate at room temperature, unlike materials such as germanium that require cooling with liquid nitrogen. However, the material is typically hard to produce on a commercial scale as it is difficult to produce sufficient volume at a reasonable price. Companies that produce crystals use a process in which raw Cadmium Telluride is melted into liquid form, producing a yield of around 5% to 15%.
Following 30 years of research, Durham University’s Department of Physics developed a process that vaporised the material in a vacuum chamber and passed it through a series of heaters, increasing the yield to more than 50%.
In 2003, a bid was made to commercialise this research. The new spin-out company was known as Durham Scientific Crystals (DSC), and it was set up with the aim of producing crystals and selling them to companies that required it for their work.
The company brought in Dr Arnab Basu as CEO to help build the company. It received an early order for the material from the European Space Agency, and significant investment from Amphion Innovations, a US-based investor. It also outgrew its university incubator space, and became the first tenant in the incubator in the newly built NETPark Incubator. The new space gave the company a purpose-built home for its crystal growth operations.
The first product:
The company’s patented Multi-Tube Physical Vapour Transport technology was ground-breaking, producing more crystals with fewer defects at lower cost. DSC was expecting widespread interest in the material, assuming it was of a certain cost or quality, but it did not initially get the market response for this raw material that it was expecting.
Dr Basu said: ‘Nobody was prepared to pay the value. Once you’ve developed an application, you can extract that value, but staying right at the bottom of the value chain can be quite painful. We decided to make the material work in an application that doesn’t require a person in a white coat to operate it and show what it can do.’
Then came 2006, and news of a foiled terrorist plot to detonate liquid explosives on several passenger planes travelling from the United Kingdom to the United States and Canada. The incident prompted a surge of interest in technology that could quickly identify explosive liquids in airports.
A major benefit of Cadmium Zinc Telluride crystals for this market is that they can provide a high resolution even at low radiation, and are capable of imaging at speed. They are very efficient at converting Gamma rays and X-rays into electrical signal.
The company decided to create a product that would fulfill this demand. In 2007, it was awarded a contract to develop a liquid and plastic explosive identification system for aviation security. The finished product can scan, analyse and classify liquids with a high degree of accuracy in less than 30 seconds.
DSC hired a Chief Technology Officer to help integrate its material into a finished product. As there were no established designs for this kind of product, the company had to build its own software and electronics, as well as making its crystals. The integration of the crystal into a finished product required the creation of specialist electronics, which are sensitive enough to handle the examination of every photon in an object. The crystal is combined with this electronics to produce signals representing detailed information on the composition of the object itself.
The company also produced detector software that could handle this large quantity of information, and provide a spectral image of the object for analysis. The software also makes use of the company’s proprietary ‘ADMiT’ algorithm, which converts this multispectral data into the reading the user needs, so there is no need to be able to interpret a spectral image.
In the case of the bottle scanner, the product can handle different types and sizes of bottle, from glass to metal or plastic. It checks the information against liquids on its database, and identifies any anomalies or dangerous ingredients.
DSC was re-named Kromek in 2008, and is now a multinational firm with more than 100 staff and offices in the USA, UK and Germany. It sells products in the medical imaging, nuclear detection and security screening markets, and floated on the London Stock Exchange’s AIM market in 2014.
Kromek has two routes to market. It sells detectors, sub-assemblies and components to established players in high-value markets, and also produces End User Products in emerging or less saturated markets.
‘We like to say that we provide the equivalent of the Intel chip in an X-ray machine, or the silicon charge-coupled device in a digital camera’, said Dr Basu. ‘It’s something that goes into someone’s system and becomes the key value driver.’
The company began with a portfolio of over 70 patents and applications, drawn from the work of researchers at Durham University. It has expanded this portfolio with innovations created during internal and client projects, as well as through company acquisitions.
It also boasts a range of capabilities, from expertise in specification, systems engineering, electronics, material production, semi-conductor processing, detector assembly, and algorithm and applications development.
Dr Basu said: ‘Software and user interface makes up 10% of our workforce. 10% are materials scientists, and application development and electronics are another 10%. Physicists make up about 10%. We’re now expanding in commercial and sales and marketing. It’s about keeping the core competency in-house and out-sourcing to bring other things in. We don’t need to re-invent the wheel. For example, at the moment we’re designing a small handheld computer and there are hundreds of people who do that better, so we outsource that. We’re very conscious not to replicate what other people are doing.’
Cadmium Zinc Telluride can be integrated into products in a range of industries. However, the company is keen not to stretch itself too thin.
‘We bring in world class consultants to characterise a particular market sector. Often we will spend a significant amount of energy and money to fully develop a plan…it’s intense market research, although if a customer comes in with a proposal and a real plan that process can be cut down quite a bit.’
Acquisitions have played an important role in the speed at which Kromek can integrate its material into new products. The acquisition of California firm NOVA R&D in 2010 increased its expertise in electronics and circuit designs, and added 22 patents in imaging and radiation detection to its portfolio. The 2013 acquisition of Pennsylvania’s EIDIS increased Kromek’s presence in the US market, as well as adding the expertise of a fellow creator of Cadmium Zinc Telluride sub-assemblies and components.
Dr Basu commented, ‘We've got the luxury of picking up technology blocks and assembling them very fast. We're in a fantastic position to integrate new products very quickly. Technologically we can produce any system we want to produce with a defined period of time.’
The range of expertise at Kromek enables it to be able to handle the rapid prototyping, design, development and engineering of a product, in as little as a few months.
‘As the company matures, those processes mature. In the early days it was instinct and conversation. Now we look at where we have Intellectual Property to extract real value. We look at market size, and competitive environment, and decide whether it is better to partner, go alone, or stay at a component level market.’
An example of Kromek’s speed to market is the RadAngel, a lightweight and accurate personal radiation detector that can provide users with the source and level of radioactive contaminants in items such as food, soil and water. The product was launched into the Japanese market in 2012 in response to the catastrophic meltdown at the Fukushima Daiichi nuclear facility that forced thousands of people from the surrounding area. The RadAngel responded to a need among Japanese citizens who were concerned about the very real threat of radiation in their surroundings.
‘We could establish a brand via quality, quality of service and responding to customer need. The brand value is what you provide in the market rather than the name.’
Kromek has spent nearly 10 years at NETPark, and over half of its workforce is based at the Park.
‘The proximity to the universities and the infrastructure are very important factors. Ultimately having a presence in Europe is very valuable to us and we intend to stay at NETPark for many years to come. We’ll continue to look at acquisitions, but that’s just part of a plan which will also include a lot of organic growth.’