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424 posts categorized "Health business"

July 01, 2014

Mayo Clinic-linked Cardio3 making push into China

Cardio3 BioSciences, a Belgium company working closely with Mayo Clinic, recently launched a joint venture in China, the third largest pharmaceutical market in the world.

Cardiobioscience_jpegWorking with Hong Kong-based Medisun International Limited, it created Cardio3 BioSciences Asia Holdings Ltd. to make a serious push into China. As part of the deal, Medisun purchased $34 million in stock. It now owns 8 percent of the company's outstanding shares.

Cardio3 is publicly listed on the European stock markets NYSE Euronext Brussels and NYSE Euronext Paris, though it is not traded publicly in the U.S. Get_photo

The company says that $34 million will finance the U.S. clinical trials for C-Cure, Cardio3's regenerative heart treatment. Cardio3 CEO Dr. Christian Homsy flew to Rochester in January for a press conference at Mayo Clinic to announce that U.S. trial. Mayo Clinic in Rochester is one of the trial sites. Homsy gave a tentative time line of commercialization in Europe possibly by 2017 and by 2018 in the U.S.

Medisun has also committed to buy an additional $34 million shares of Cardio3 stock from existing shareholders in the next eight month at a price per share equivalent to the 10 days average preceding the offer.

This new deal means Medisun's ownership of Cardio3 has quickly leapfrogged Mayo Clinic's investment. As of June 16, Mayo Clinic owned 5.05 percent of the available shares of Cardio3. Medisun had just 4.21 percent at that point. As of June 25, Mayo Clinic controlled 3.1 percent of the shares.

Mayo Clinic researchers Dr. Andre Terzic and Dr. Atta Behfar originally developed the proprietary process of regenerating heart tissue with stem cells drawn from a patient's own bone marrow. Since 2007, Cardio3 has licensed patents and related research from Mayo Clinic. Terzic and Behfar each have a financial interest in the company.

Homsy has previously stated that he hopes to eventually base a few employees in Rochester for office and laboratory work. Cardio3 previously attempted to open a U.S. headquarters here, but that fizzled when the one person based here left.

Many consider what Cardio3 is attempting as the "holy grail" of cardiac treatments. Terzic previously described repairing faulty hearts as a "major unmet need worldwide." He estimated about one-third of all deaths stem from heart disease.

To date, the promising company has raised $121 million in equity and capital.

A recent study also estimated that the global market for such treatments could grow to $18.2 billion by 2019. The U.S. market was valued at $6.1 billion in 2012, with potential to increase to $8.49 billion by 2019.

“With this presence in Greater China, we are very proud to become the first global player in the field of cardiac regenerative medicines, aiming to commercialize our leading edge cell therapy to patients all across the globe,” stated Cardio Chairman Michel Lussier in the announcement of the venture.

Medisun Chairman Danny Wong says that his company is organizing medical conventions in August "to promote cell based medicines as well as Cardio3’s technology" in both Beijing and Shanghai.

"We are passionate about this project and I am certain that our involvement with Cardio3 as a leader in this field, combined with our local knowledge of the regulatory, healthcare and market access capabilities and expertise, will bring success to all the parties involved,” said Wong.

All the costs of Cardio3's moves in China will be funded by Medisun, with a minimum of $27 million committed during a three year period. Cardio 3 has 40 percent ownership in the joint venture, which will drop to 30 percent when clinical trials are up and running.

Success of the Phase III clinical trials that allow Cardio3 to market C-Cure in Asia would trigger  royalties ranging between 20 and 30 percent of net sales depending on total revenue of the joint venture.

June 30, 2014

Consultants hired to create DMC blueprint w/ FULL CONTRACTS

Here's some of the lead-in to my package from the weekend about the $4.1 million  contracts for the consultants to create the Destination Medical Center plan to re-make Rochester.

There's a lot more detail in the rest of the package. So if you are interested in this topic, I'd suggest reading the full piece.

And for the document wonks out there like me, here's the 251 page PDF that includes all of the contracts with Nelson / Nygaard Consulting Associates of San Francisco; Kimley-Horn and Associates of Cary, N.C.; AECOM Technical Services of Los Angeles; and EE&K of New York.

Download Combined Consulting Agreements EDA(1)

 

---------------

Planning for a complex initiative like Mayo Clinic's Destination Medical Center doesn't come cheaply.

The surge of DMC hype already has national and international businesses fluttering around Rochester's sudden glow. The sale of commercial real estate is booming, particularly in the downtown core. New housing developments are being mapped out for the tens of thousands of people expected to move to Rochester for the forecasted 35,000 to 45,000 new jobs.

51687d3f5e0c6-image However, there's no blueprint yet for the $6 billion upgrade of the city's infrastructure, transportation systems, private development and more that's at the heart of DMC's vision of a Rochester better suited to accommodate more patients for Mayo Clinic.

Hiring a team to create a detailed plan for the massive undertaking to change the face of the city was a top priority for the public Destination Medical Center Corp. board of directors.

Public-private projects on this scale are rare in U.S., so there are not many examples to follow. National experts say sports developments, like the $975 million Vikings stadium and the new $622 million Atlanta Braves stadium, are about the only comparable projects to what is being proposed in Rochester.

The DMCC contracted with the DMC private Economic Development Agency, led by Mayo Clinic's Lisa Clarke, to handle hiring consultants to create the overall DMC "development plan." In December, the EDA board posted requests for proposal for six roles in the planning process.

800px-Gonda_building,_closer_upWith so much money on the table, proposals came in from 19 leading firms across the country and even overseas. Five of the teams vying for the contracts are based in Minnesota with three of them having offices in Rochester.

In April, the EDA wrapped up that six-month hiring process by contracting with four national consulting firms. Two were chosen to fill dual roles.

All of the consultants have had experience in major public-private projects, from stadiums to transit systems to airports.

Those four, plus another company hired in February, will be paid a total of $4.1 million this year to create the DMC's grand plan by February. That $4.1 million accounts for almost half of the DMC's total city-funded budget of $8.2 million for 2014.

In the end, all of the Minnesota hopefuls were passed over for the DMC planning jobs.

"The main factors that influenced our decisions was experience, knowledge of the market and the team they put forward. Those were the basic components we needed to consider as we moved forward," said Clarke. "I'm very confident that we have hired the best."

June 27, 2014

Mayo Clinic still mum on SE Rochester building

There's no question that an unmarked 22,000-square-foot commercial center is being built in south Rochester's Shoppes on Maine area.

The question is what will it be used for when completed?

The half-completed gray and blue building at 4544 Canal Place S.E. stands at the corner of Canal Place and Maine Avenue Southeast.

06262014mayoclinicsoutheastIt's described as "Future Mayo Clinic Southeast" in city building permits dating back to April. However, Mayo Clinic isn't acknowledging any involvement.

"We don’t have anything to share at this time. When we do — I’ll certainly let you know" is how Rebecca F. Eisenman of Mayo Clinic Communications responded to questions on June 18.

In April, Eisenman did acknowledge that Mayo Clinic is interested in the area.

"We are exploring options to improve our ability to improve access to community care for our employees and those who depend on us for these services," she wrote. "Future options may include expansion of facilities and services in southeast Minnesota, but no specific details are available at this time."

The owner of the project is Canal Place Pointe Inc., which is based nearby at Suite 200 of 4325 Maine Avenue. That's also the address of the office of Maine Street Development Co. Tom Hexum, who manages the Maine Street Development projects with partner Ron Schultz from that office, filed the original land development application for the building. He says it's owned by a group of local investors, though he is not part of that group.

Hexum describes the building as a Mayo Clinic project.

Building permits show that just the structural shell of the Canal Place Pointe complex is valued at $1.4 million. There is a half-circle drive under an 880-square-foot canopy in front that would be handy for a medical facility. The parking lot features 109 parking spaces.

The whole facility, being built by Benike Construction, is on two acres of land. The local design firm SEH-Yaggy, formerly known as Yaggy Colby Associates, planned the project.

June 25, 2014

Mayo Clinic-linked NeoChord gets new leader

An Eden Prairie company that makes a medical device based on Mayo Clinic research named a new leader this week for the first time since it launched in 2007.

NeoheartNeoChord announced that David H. Chung was appointed as president and CEO, "effective immediately." He replaced John Seaberg, who resigned.

“David Chung’s extensive experience in building and managing international sales forces will be invaluable, as we introduce NeoChord’s innovative technology to patients throughout Europe,” said Dr. Michael Fulton, Neochord's chairman of the board.

For the past seven years, the company has been developing a device designed by Mayo Clinic cardiac surgeons Dr. Richard Daly and Dr. Giovanni Speziali. Beside licensing its technology, Mayo Clinic also is invested in an equity position in the firm. Speziali was named as the company's chief medical officer in 2013.

The NeoChord DS1000 device is used to treat a heart condition called mitral regurgitation. Mitral regurgitation means the valve or leaflet that controls the flow of blood from the left atrium to the left ventricle is not working properly.

Portfolio-neochord-260x138Treatment typically consists of “cracking the chest,” stopping the heart and doing surgery. NeoChord's approach is much less invasive and can be done on a beating heart. A tool is inserted between the ribs and into the heart. Then it is used to attach a chord to the faulty valve leaflet, which is tethered to the heart.

The former CEO Seaburg described the process as “a very elegant treatment."

A Transapical Artificial Chordae Tendinae (TACT) trial is underway to evaluate the NeoChord DS1000. The system now is being used to treat patients in 18 hospitals across eight countries in Europe. More than 120 patients have been treated. It is not yet cleared for commercial use in the U.S.

The market for less invasive techniques for mitral valve repair has been estimated at more than $2 billion. There are 50,000 surgeries done in the U.S. each year. An estimated 2 million patients are treated due to the risks of surgery.

Since it formed in 2007, NeoChord's lifeblood has been venture capital funding. By 2008, it had raised $3 million. It raised another $5.1 million in 2011 to finance the European clinical trial. In March 2013, it raised $3 million through the sale of its series B-2 preferred stock.

June 24, 2014

Prosthetic Laboratories of Rochester sold to Texas company

After 30 years under local ownership, a Rochester prosthetic firm has been bought out by an Austin, Texas-based company.

Prosthetic Laboratories of Rochester, Inc., founded here by former Mayo Clinic technicians Steve Amundson and Mike Gozola in 1984, has been acquired by Hanger Inc.

Exterior_rochester3Darren Overton of Prosthetic Labs confirmed the sale, but didn't say when it occurred or what it might mean for the about 85 employees that work at Prosthetic Lab's offices in Minnesota, Wisconsin and South Dakota.

Hangarlogo"We aren't at liberty to disclose details of the acquisition, but what we can share is that we are pleased our company has joined the Hanger family," he stated in an email response to questions. "Hanger provides more opportunities and resources to our staff and patients than we could as an independent facility."

A media representative for Hanger said they could not discuss the purchase yet. The publicly traded company describes itself as the largest owner and operator of orthotic and prosthetic patient care clinics in the United States.

In 2009, the majority owner of Prosthetic Labs was Rochester developer Gus Chafoulias. He owned the private company along with Gozola and Amundson. It's unclear if those three were still the owners, when Hangar bought the firm.

Its main Rochester facility is located at 121 23rd Ave. S.W., in front of the Shorewood Senior Campus along Second Street Southwest. Prosthetic Labs' corporate family also includes Lair’s Shoes, the Silhouette Shoppe and Ortho Innovations. Its staff saw an average of 10,000 patients a year at its Rochester office in 2009.

While Prosthetic Labs has been very successful locally, it's much smaller than its new new owner. Hanger reports that it has an annual net income of about $60 million and makes about $1 billion of sales a year. It has more than 5,000 employees working at 740 clinic locations.

Acquiring mid-sized firms like Prosthetic Labs is not a new thing for Hanger. In 2012, it bought six companies.

In May, Hanger reported earnings for the first quarter that did not rise to the levels analysts had expected. The company reported an earning per share of 19 cents, missing the estimate of 24 cents. Its quarterly revenue of $235.60 million was below the anticipated $243.60 million

June 17, 2014

Brandix i3 'graduates' from Accelerator, leases BioBusiness Center space

Another start-up is "graduating" from the Mayo Clinic Business Accelerator to lease office space in Rochester's Minnesota BioBusiness Center.

02272013mayoaccelerator1As a parting gift, it is providing the Accelerator with a short-term solution to its need to expand by  providing space for it to use.

Brandix i3, the healthcare technology arm of a Sri Lanka-based company, has signed a three-year lease with the City of Rochester for 2,000-square-feet of space on the skyway level of the center at  221 First Ave. S.W. The space is half of a 4,000-square-foot area that never hasHeader been built out for a tenant since the BioBusiness Center opened five years ago.

The software development firm plans to have six employees based in the Rochester office to start with, though it expects to grow to 12 by the end of the year, said Aaron Epps, Brandix's associate vice president of healthcare.

"We want to be part of the Destination Medical Center project," said Epps. "We're looking to expand quickly. We're a start-up, but we're a start-up with the backing of a large company."

051509biobusinesscenteratnightBrandix currently is operating out of the Accelerator space. The lease that was approved by the city council Monday sets Brandix's rent at $20 per rentable foot for the 2,000-square-foot space. It also will pay its share toward the maintenance of the building and its taxes.

The city is giving "a one-time fit-up allowance" of $10 per square foot, or $20,000, to the software firm to prepare its offices.

By comparison, the city signed a five-year lease in 2013 with Patient First Home Infusion Services for $16 per square foot and gave it $10,000 to use for construction costs.

In 2013, Imanis Life Sciences signed a five-year lease set at $15.50 per square foot for the first two years.  It then increases every year to $18.50 by the fifth year. The city also agreed to provide Imanis a $20 per foot allowance to build out the space plus an interest-free loan of up to $10,000.

In addition to the leasing the 2,000-square-feet, Brandix's lease promises "first right of refusal" for the other 2,000 square feet of adjacent vacant space to the west.

"In the interim, the Business Accelerator may lease the adjacent space until such time as it is needed by Brandix," according to the lease. There has been talk of expanding the Accelerator, which opened in 2009.

Epps, who has lived his whole life in Rochester, says the company plans to create a "unique" office to enhance the local business community.

Brandix's focus is to work with its local partner, Rochester-based Ambient Clinical Analytics. Ambient makes "real-time decision support tools" for doctors and nurses working in the ICU, operating room or emergency departments.

Mayo Clinic launched Ambient in 2013, and it named Al Berning as CEO. Berning is known in Rochester as a former IBMer, a co-founder of Pemstar and former CEO of Hardcore Computers/LiquidCool Solutions.

June 09, 2014

Mayo Clinic eliminates 14 nurse positions in Rochester

Mayo Clinic eliminated 14 discharge planning nurse positions in Rochester on June 2 in an effort to improve efficiency.

800px-Gonda_building,_closer_up"To improve service to patients and eliminate duplication of effort, Mayo Clinic is shifting some of the discharge planning work to other resources," explained Spokesman Bryan L. Anderson of why the Rochester positions were cut.

Anderson said that all 14 nurses impacted by the change were "offered the opportunity to select other nursing roles at Mayo Clinic."

He added that, "Some opted to retire/leave Mayo."

Unlike last week's announcement about Mayo Clinic Health Systems eliminating 188 medical transcriptionist positions in Wisconsin by outsourcing with a Madison company, the planning nurse nurse duties will not move outside the clinic.

Anderson said the discharge planning work has been shifted to other "internal resources."

June 03, 2014

Mayo Clinic to cut 188 Wisconsin jobs

Mayo Clinic's cuts of medical transcriptionist jobs has spread into Wisconsin with 188 positions going away as part of an outsourcing contract to reduce costs.

Medical transcriptionists convert dictation from health care providers into written reports. They also review and edit medical documents created by speech recognition technology.

Mayo-1024x731Mayo Clinic Health System notified Wisconsin staff last week that it's contracting with Amphion Medical Solutions to handle all transcription services. The positions will be transitioned over the next few months and Mayo expects to completely shift the work to Madison, Wis.-based Amphion by Nov. 1.

The change will affect 51 transcriptionists from southwest Wisconsin where La Crosse serves as the hub and 137 from northwest and southwest Wisconsin where Eau Claire is the hub

Amphion has told Mayo Clinic that is would be willing to hire all of its outgoing transcriptionist, though it's unclear if that would require relocating to Madison-Wis. or how comparable the wages would be to what Mayo Clinic pays. The 13-year-old company is declining to discuss the issue citing Mayo Clinic Health System's request to field all questions.

Mayo Clinic also says the displaced workers can apply for other positions within the health system that might might fit their skills.

This shift will add up to 40 percent savings in transcription costs, according to Mayo Clinic.

An average medical transcriptionist salary in 2012 was $16.36 per hour or $34,020 per year, according to the U.S. Bureau of Labor Statistics.

This shift in Wisconsin follows last year's cuts of 82 medical transcriptionist jobs throughout seven southeastern Minnesota communities where Mayo Clinic Health Systems operate. Those cuts included 26 in Albert Lea, 18 in Austin, 17 in Owatonna, 4 in Faribault, 4 in Cannon Falls, 8 in Lake City and 5 in Red Wing.

May 21, 2014

Mayo launching bioservices firm

Mayo Clinic has long processed and stored patient specimens for its own researchers.

Now it's packaging those services and others together to offer to outside clients via a new start-up company to be called Mayo Clinic Bioservices.

537cd487db2b9.image"Basically, we're taking advantage of some internal business that we've been doing for some time and now we're offering all of that externally to customers," explained Stephen Thibodeau, co-director of the Biorepositories Program in the Mayo Clinic Center for Individualized Medicine.

This new firm will allow Mayo Clinic to compete in a growing bio industry valued internationally in the billions.

He compared the business model to that used at Mayo Medical Labs, which tests patient sample for hospitals and researchers around the world. Mayo Clinic Biosciences won't run tests, though it will process, store and ship samples for its clients.

In addition to those services, it will also offer access to Mayo Clinic's Biobank. The Biobank features thousands of biological samples, such as blood, from healthy volunteers. Mayo Clinic has been collecting samples for seven years toward reaching a goal of 50,000 samples. Thibodeau estimates that the Biobank will finally reach that goal by June 2015.

The primary base for the new operation is being set up in the warehouse at 2915 Valleyhigh Dr. N.W., which Mayo Clinic bought in 2012. Some freezer units have already been installed and more construction to adapt the facility is underway. Thibodeau estimates that the facility will be ready this summer. Mayo Bioservices is expected to move in by August and have the operation running by September. It will also have satellite locations on Mayo Clinic's Florida and Arizona campuses.

Mayo Clinic currently supports the internal clinic sample processing and storage with a staff of about 70 employees, 50 of which work in Rochester.

"Initially, we expect to have a sufficient amount of staff. Though we do expect the business to grow over time and that we'll need to add more later," he said.

While it's not in operation yet, Mayo Clinic Bioservices has already signed up its first customer.Los Angles-based Sanguine recently signed up to have Mayo Clinic Bioservices process, store and ship biospecimens that Sanguine has collected for clients.

"We are excited about the pilot project with Mayo, not only because it increases the scalability of our business, but also because it allows individuals that have been on our waiting list to participate in the research and development of new treatments," stated Sanguine CEO Brian Neman in the annoucement. "Mayo Clinic Bioservices has tremendous infrastructure and processing capacity that will meet our existing needs while also offering the potential for future expansion."

The agreement between Mayo Clinic and Sanguine is a fee-per-service deal at this point, though they expect the business connection to deepen as time goes on.

"We hope to have a long-term relationship with Sanguine," according to Thibodeau. "Essentially, we're the laboratory arm of Sanguine."

May 09, 2014

New trustees bring political, financial clout to Mayo Clinic board

Mayo Clinic is bringing a significant amount of political and financial clout onto its Board of Trustees with the addition of two new members.

Armando Codina and Diana Taylor were officially named as board members at the organization's quarterly meeting on Friday in Rochester.

SFBJ Armando Codina 315*304Codina, a 66-year-old Cuban immigrant, is the executive chairman of Coral Gables, Fla.-based Codina Partners. Codina Partners is a powerful real estate investment and development company.

He has deep personal, political and business ties to the Bush family. By joining the Mayo board, he follows in the footsteps of Barbara Bush, who was a trustee from 1993 to 2001. Codina serves on the boards of many public companies, including General Motors, Home Depot and Merrill Lynch.Diana-Taylor

Taylor, 59, is a managing director of Wolfensohn Fund Management in New York City. She served as the superintendent of banks for the state of New York from 2003 to 2007. For many years, she has been a very public companion of billionaire and former NYC mayor Michael Bloomberg.

Taylor serves on many boards, including Citigroup and Sotheby’s.

The Mayo Clinic Board of Trustees, a 31-member group of public representatives and Mayo Clinic physicians and administrators, is responsible for patient care, medical education and research at Mayo Clinic’s sites.