The University of Pittsburgh Medical Center is looking to capitalize on its expertise in radiation oncology through hospital partnerships from California to Ireland.

While UPMC is engaged in two distinct efforts -- one invests in a new U.S. company and another that targets Europe -- the business opportunity in both cases involves working with hospitals that could not otherwise afford expensive new radiation technology for treating cancer patients.

Linear accelerators -- the machines that direct radiation at tumors to shrink or dissolve them -- can cost more than $3 million when outfitted with equipment to generate tumor images just prior to treatment, said Paul Viviano, the chief executive of California-based Alliance Imaging Inc. These costly machines also are capable of delivering intensity modulated radiation therapy (IMRT), a relatively new form of treatment.

Currently, about 40 percent of all linear accelerators in the country are capable of delivering IMRT treatments, Mr. Viviano said, while only 2 percent of machines include the imaging equipment.

UPMC is taking a 20 percent stake in a joint venture with Alliance Imaging to create a firm called Alliance Oncology. The new company, which already has opened two cancer centers in California and is developing five more in Massachusetts, will work with midsize community hospitals that lack access to capital as well as the expertise needed for IMRT treatments.

IMRT treatments must be planned by physicists who are in short supply, so Alliance Oncology customers could have access to treatment planning from a UPMC backed firm.

"Alliance Oncology can be a partner to the hospital to maintain its cancer program, rather than let it be stripped away," Mr. Viviano said. "In the last five to seven years, a number of competitors have developed free-standing cancer centers to compete against hospitals."

The new company will compete for business with Houston-based US Oncology, a privately held firm that is affiliated with 985 physicians operating in 494 locations, including 97 radiation oncology facilities.

John Hennessy, executive director of a US Oncology affiliate in Kansas City, Mo., said hospitals wanted to develop IMRT capabilities in-house to remain competitive, especially when it comes to the relatively lucrative business of radiation treatments for prostate cancer patients. But he questioned whether hospitals can stem the tide of doctors capturing this business in physician-owned centers.

That might be the case in some regions, said Kerry Carmody, an administrator with Providence Heath System in suburban Los Angeles, one of Alliance Oncology's first customers. But Mr. Carmody said that in his market, the partnership has allowed Providence Health System to pre-empt physician-owned competition.

Alliance Oncology will form joint ventures with hospitals to create new centers, said Mr. Viviano, or the company will outfit centers with software, hardware and personnel, and will bill hospitals on a per-procedure basis. Mr. Viviano's diagnostic imaging business, which is publicly traded, works with more than 1,000 clients in 44 states, including UPMC.

In Ireland, UPMC will open cancer centers this year in Waterford and Dublin, also in conjunction with local hospitals. The Oakland-based medical center will provide $2.5 million in capital for the Irish projects, said Chuck Bogosta, managing director of UPMC's Office of Strategic Business Initiatives.

The Irish program builds on UPMC's international experience in Palermo, Italy, where the medical center manages a specialty hospital.

UPMC will create 50-50 joint ventures with Irish hospitals, said Mr. Bogosta. He noted that access to radiation therapy had become a political issue in Ireland, where there are fewer linear accelerators in the entire country than there are in Western Pennsylvania alone.

The hospitals in Waterford and Dublin were attracted by UPMC's "hub and spokes" model of centralized treatment planning, he said.

"We'll do the treatment planning back here until we have the critical mass, so it does generate directly a business opportunity right here in Pittsburgh for D3," he said, referring to D3 Advanced Radiation Treatment Planning Services, a Shadyside company backed by UPMC. "But once we have critical mass, which will go beyond Ireland, we intend to do centralized treatment planning in Europe."