| Fitch Expects to Rate Novant Health, North Carolina VRDBs ’AA-/F1+’; Affirms Underlying ’AA-’ |
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Fitch Ratings expects to assign an ’AA-/F1+’ rating to the $110 million North Carolina Medical Care Commission hospital variable-rate demand health care facilities revenue bonds, series 2004A, and....
Fitch Ratings expects to assign an ’AA-/F1+’ rating to the $110 million North Carolina Medical Care Commission hospital variable-rate demand health care facilities revenue bonds, series 2004A, and $25 million North Carolina Medical Care Commission hospital variable-rate demand health care facilities revenue bonds, series 2004B. Fitch also affirms the ’AA-’ long-term rating for Novant Health, Inc.’s (Novant) approximately $467 million outstanding revenue bonds. The Rating Outlook is Stable.
The long-term rating on the series 2004 bonds is expected to be based on the credit factors cited below. The short-term rating is expected to be based on the support of a stand-by bond purchase agreement to be provided by JP Morgan Chase Bank.
Proceeds from the series 2004 bonds will be used to fund various expansion and renovation projects, acquire equipment and pay costs of issuance. The bonds are scheduled to be sold the week of Dec. 6 via negotiation by Citigroup Global Markets Inc. for the series 2004A bonds and by Wachovia Securities for the series 2004B bonds. Fitch expects to assign its ratings prior to the sale date.
The affirmation of the ’AA-’ rating is supported by Novant’s strong and improved operating profitability, solid market share position in its two regions (Triad and Southern Piedmont), favorable service area characteristics, and an extensive primary care physician network that supports Novant’s seven acute care hospitals. Novant posted a 3.5% operating margin in fiscal years 2002 and 2003, which follows a 1.4% operating margin in 2001, and continued to improve through the nine months ended Sept. 30, 2004 with a 4% operating margin ($44.2 million gain from operations). Pro forma coverage of maximum annual debt service through the interim period was strong at 3.8 times (x), which is in line with Fitch’s ’AA’ median of 3.9x. The continued improvement in profitability is supported by improved managed care negotiations, including a new contract with Aetna, and lowered losses from employed physicians despite aggressive growth of Novant’s vast employed physician network in both regions.
Novant maintained a solid market position in its two primary service areas (PSAs) in 2003 with a leading 67.1% market share in Forsyth County and 33.1% market share in Mecklenburg County, which is the number two position. However, Novant’s market share in both PSAs declined slightly from 2002-2003. The two PSAs are relatively affluent with per capita personal income exceeding state and national levels and have experienced rapid population growth. In November 2004, Novant opened Presbyterian Hospital-Huntersville, a 50-bed hospital in the fast-growing Lake Norman region 16 miles north of Charlotte. The cost of the facility ($60 million) was largely funded from cash flow and a line of credit and is expected to be profitable from operations in fiscal 2006. Although the legality of the facility’s Certificate of Need is being challenged in the North Carolina Court of Appeals, management does not expect operations to be disrupted.
Concerns include the presence of a strong competitor in Mecklenburg County and profitability concentration of the system at Forsyth Medical Center. In Mecklenburg County, Carolinas Health Care System had a leading 59.9% market share in 2003, a slight increase from 2002. Forsyth Medical Center (778 operated beds) generated a very strong $30.4 million in operating profitability through the interim period, which accounted for 68.8% of Novant’s total operating income. While Novant’s pro forma cash to debt position at fiscal 2003 (including expected reimbursement of $75 million) of 101.5% falls below Fitch’s ’AA’ median of 131.6% this is somewhat offset by Novant’s current profitability levels. Nonetheless, Fitch believes Novant’s increased future capital spending, which includes $900 million for capital improvements throughout the system, could hinder liquidity growth over the medium term.
The Stable Rating Outlook reflects Fitch’s belief that Novant will c
ontinue to post strong operating margins, which should be supported by cost savings initiatives such as the recent consolidation of purchasing and distribution. Fitch expects Novant’s recent capital expansions, including a new women’s center and Presbyterian Hospital- Huntersville, will support favorable utilization trends and stem further erosion of market share.
Novant operates seven acute care facilities (1,620 operated beds) in the Winston-Salem and Charlotte regions of North Carolina and had total revenue $1.4 billion in fiscal 2003. Novant has covenanted to provide bondholders with quarterly unaudited and annual audited financial statements. Quarterly disclosure to Fitch has been adequate in terms of content and timeliness and includes a balance sheet, income statement, statement of cash flows and utilization indicators. However, Fitch notes the lack of management discussion and analysis.
Outstanding Issues:
-- $193,000,000 North Carolina Medical Care Commission hospital revenue bonds (Novant Health Project), series 2003A
-- $57,925,000 North Carolina Medical Care Commission hospital revenue refunding bonds (Novant Health Project), series 1998B
-- $113,660,000 North Carolina Medical Care Commission hospital revenue bonds (Novant Health Project), series 1998A;
-- $100,538,199 North Carolina Medical Care Commission hospital revenue bonds (Carolina Medicorp Project), series 1996;
-- $2,200,000 North Carolina Medical Care Commission hospital revenue bonds (Carolina Medicorp Project), series 1991.
Not Rated:
-- $86,800,000 Carolina Medi-Plan, Inc. taxable variable rate demand bonds, series 1997. Fitch was not asked to assign a long- or short-term rating to these bonds.
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| New National Poll; Physicians Voice Views on U.S. Drug Safety - Nov 24, 2004 14:49 IST |
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Results of a new national survey revealed that while the vast majority of U.S. physicians have a very high confidence level in the FDA approval process, approximately half of the doctors believe the process is influenced by commercial or political interests.
The national e-survey was conducted by Muhlenberg College Institute of Public Opinion (MCIPO) and HCD Research during November 21-22, among a nationally representative sample of 1,039 primary care physicians.
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| Analogic Corporation Announces Market Clearance Received for Multipurpose Direct Digital Radiography System - Nov 24, 2004 14:8 IST |
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John Wood, President and CEO of Analogic Corporation (NASDAQ: ALOGE), announced today that the U.S. Food & Drug Administration (FDA) has granted 510(k) clearance for Analogic’s new multipurpose, direct Digital Radiography (DR) system. This system features the new GR17 amorphous Selenium flat-panel detector, which was developed by Analogic’s Canadian subsidiary, Anrad Corporation, and received 510(k) clearance in early November.
Designed and developed by Analogic, the new SyneRad(TM) OMNI DR system is being sold by ANEXA Corporation, an Analogic subsidiary, which sells digital imaging products directly to end users in select U.S. markets. John Ross, Vice President of Marketing for ANEXA, said, We’ve designed the SyneRad OMNI to meet the clinical demands of our emergency medicine and orthopedic office customers. We’re excited to offer them a complete DR solution using groundbreaking SELENIUM(2)technology. The OMNI will be formally introduced at The Radiological Society of North America (RSNA) Annual Meeting in Chicago next week.
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| Keith Smith, Former NYC Commissioner of Human Resources for the Department of Health and Mental Hygiene launches Consortia - Nov 24, 2004 13:53 IST |
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The same unwavering focus that has taken Keith Smith from his southern roots in Atlanta to positions in human resources for the City of New York and some of the nation’s largest corporate brands, has now led him to the role of founder and CEO of Consortia.
Smith’s interest in the human side of human resources began during his educational years. While still in school in Atlanta, his enthusiasm for helping companies maximize their resources and helping employees successfully navigate corporate structures and career development landed Smith a spot in Marriott International’s manager-in-training program.
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| Banner Healthcare Chooses Leap Enterprise Policy Manager - Nov 24, 2004 13:53 IST |
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Leap Solutions, Inc., a Las Vegas based developer and manufacturer of regulatory compliance software for the healthcare industry, has announced an agreement by Banner Health System, one of the nation’s largest not-for-profit health system, to purchase and implement the Leap Enterprise Policy Management software system for use throughout facilities in the United States.
Leap’s Director of Implementation Services, Dale Lea, noted “Banner is a healthcare leader.
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| Anthem, Inc. Announces Appearance at Upcoming Investor Conference - Nov 24, 2004 13:17 IST |
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Anthem, Inc. (NYSE:ATH), announced today that senior management is scheduled to appear at the Merrill Lynch Health Services Investor Conference on December 1, 2004.
The presentation is expected to begin at 10:00 a.m. Eastern Standard Time. All interested parties are invited to listen to the webcast of the presentation on the Internet by visiting www.anthem.com and selecting the Investor Relations link.
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| LifeWave Introduces Non-Transdermal Energy Patches Based On Nano-Technology - Nov 24, 2004 11:40 IST |
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LifeWave introduces Energy Patches that can increase your energy and stamina by up to 40 percent, thus improving your performance.
A new All Natural Non-Transdermal Energy Patch is on the market. NOTHING enters into the Blood Stream. The patches are based upon a relatively new science called Nano-Technology. The patent pending method allows organic materials to signal the human body to increase energy and stamina but without ingesting anything. Double-Blind studies at Major Universities have shown most people experience an increase of energy within minutes of using the energy patches.
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| Kindred Healthcare to Present at Merrill Lynch Health Services Investor Conference - Nov 24, 2004 11:14 IST |
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Kindred Healthcare, Inc. (the Company) (NYSE: KND) today announced that Paul J. Diaz, President and Chief Executive Officer, and Richard A. Lechleiter, Senior Vice President and Chief Financial Officer, will make a presentation regarding the Company at the Merrill Lynch Health Services Investor Conference in New York City on Wednesday, December 1, 2004, at 10 a.m. Eastern Time.
The presentation is being audio webcast and can be accessed at the Company’s website at www.kindredhealthcare.com and at http://wsw.com/webcast/ml29/kind.
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| Health Sciences Group Acquires Exclusive Worldwide License from Cornell University - Nov 24, 2004 10:51 IST |
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Health Sciences Group, Inc. (OTCBB:HESG), an integrated provider of innovative, science-based products and ingredients to customers in the nutrition, skin care, and food and beverage industries, announced today that it acquired the exclusive worldwide license to a powerful antioxidant derived from the apple peel. Apple peels are high in antioxidants, compounds that counteract the damage caused by chemicals known as free radicals - believed to contribute to the proliferation of cancer and neurodegenerative disorders, such as Alzheimer’s.
Developed at Cornell University, this technology utilizes a proprietary method of extracting and preserving the phytochemical content found in apple peels. Apple peels have very high phenolic and flavonoid content, which appear to protect brain cells against oxidative stress generated by sunlight, chemical reactions and the stresses of day-to-day living.
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| FDA Grants Accelerated Approval of TYSABRI, Formerly ANTEGREN, For the Treatment of Multiple Sclerosis - Nov 24, 2004 10:28 IST |
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Biogen Idec (NASDAQ: BIIB) and Elan Corporation, plc (NYSE: ELN) announced today that the U.S. Food and Drug Administration (FDA) has approved TYSABRI(R) (natalizumab), formerly referred to as ANTEGREN(R), as treatment for relapsing forms of multiple sclerosis (MS) to reduce the frequency of clinical relapses. FDA granted Accelerated Approval for TYSABRI following Priority Review based on one-year data from two Phase III studies, the AFFIRM monotherapy trial and the SENTINEL add-on trial with AVONEX(R)(Interferon beta-1a).
TYSABRI, the first humanized monoclonal antibody approved for the treatment of MS, inhibits adhesion molecules on the surface of immune cells. Research suggests TYSABRI works by preventing immune cells from migrating from the bloodstream into the brain where they can cause inflammation and potentially damage nerve fibers and their insulation.
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| Experts Available to Discuss Rising Number of Women with HIV - Nov 24, 2004 10:19 IST |
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ExpertSource can offer several highly qualified experts to comment on this story:
Richard Zaldivar is the founder and executive director of an AIDS organization in Los Angeles, California that focuses primarily on the Latino community, including gay and bisexual men, mothers, and the general public. In addition, he served as a deputy to former Los Angeles City Council Member Art Snyder and then-City Attorney James Hahn. He founded The Wall-Las Memorias Project with the goal of building not only a monument in memory of people who have died of AIDS, but a place where families can go to grieve and heal, and a starting point for talking about issues of health and sexuality that are often denied because of ignorance or shame. Recently, The Wall-Las Memorias Project launched Project FE, which is an outreach program aimed at clergy, churches, religious institutions and communities of faith.
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| Connetics Receives FDA Non-Approvable Letter for Extina - Nov 24, 2004 9:36 IST |
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Connetics Corporation (Nasdaq:CNCT), a specialty pharmaceutical company focused on dermatology, today announced that the U.S. Food and Drug Administration (FDA) has issued a non-approvable letter (dated November 23, 2004) for Extina(R), an investigational new drug formulation of 2% ketoconazole for the treatment of seborrheic dermatitis. The FDA concluded that Extina was not effective for the treatment of seborrheic dermatitis because it was not superior to placebo foam.
Connetics announced in April 2003 that results from its Phase III clinical trial with Extina demonstrated non-inferiority to Nizoral(R) (ketoconazole) 2% Cream as measured by the endpoint of the Investigator’s Static Global Assessment. Connetics also announced the results did not achieve statistical superiority versus placebo foam.
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| Dr. James M. Luciano Named Vice President for Medical Affairs at Good Samaritan Hospital, Suffern, NY - Nov 23, 2004 19:1 IST |
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Good Samaritan Hospital in Suffern, N.Y. announced today that Dr. James M. Luciano, M.D., Mh.A., F.A.C.P., has been appointed Vice President for Medical Affairs. The announcement was made by Michael Schnieders, Executive Vice President and Administrator at the 370-bed acute care hospital.
In his role as Vice President for Medical Affairs, Dr. Luciano will oversee all aspects of clinical care at Good Samaritan, and will act as a liaison between the hospital and the hospital’s medical staff. He will also coordinate clinical, regulatory and medical issues between the hospital and its parent, Bon Secours Charity Health System.
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| Five Myths and Realities About Children and HIV/AIDS; World AIDS Day - December 1 - Nov 23, 2004 18:59 IST |
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Five Myths and Realities About Children and HIV/AIDS
Myth #1: HIV/AIDS affects adults, not children.
Reality: Last year, almost 500,000 children under age 15 died from AIDS. In addition, an estimated 15 million children have lost one or both parents to AIDS, and that number is expected to climb to 25 million by the end of the decade. As the number of young girls and women living with HIV/AIDS increases, so too does the risk of mother-to-child transmission of HIV, which can occur during pregnancy, childbirth or breastfeeding. Simple, inexpensive measures conducted as a woman enters labor, and within the first 72 hours of a baby’s life, can reduce transmission of HIV from mother-to-child by more than 50 percent.
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| Psychotherapy Malpractice-New Risks for Psychotherapists - Nov 23, 2004 18:52 IST |
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The psychotherapist/patient privilege requires that what is said in psychotherapy remains confidential. However there are several limited exceptions.
For example, when a patient threatens the life of an identified victim, the therapist is to make an attempt to warn the victim. However, a recent California case( Ewing v. Goldstein, Case#B163112) has expanded the duty of clinicians to inform an identified victim who may be in harm’s way from their patient. The Court ruled that if a therapist learns about the danger from a close relative, there is a duty to break confidentiality .
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| Mississippi Baptist Achieves National Disease-Specific Care Certification for Cancer, Diabetes and Heart - Nov 23, 2004 18:6 IST |
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By demonstrating excellence in health care quality in its heart, diabetes, and cancer programs, Mississippi Baptist Medical Center in Jackson, Miss. has been awarded the Gold Seal of Approval and has achieved Disease-Specific Care Certification from the Joint Commission on Accreditation of Healthcare Organizations (JCAHO).
Additionally, Baptist will be the first organization in the United States to earn this distinction for an entire cancer program. Also, through CRUSADE, a nationwide registry of heart patients with Acute Coronary Syndrome (ACS) coordinated by Duke Clinical Research Institute, Baptist is now one of three hospitals within the United States granted accreditation status by JCAHO for clinical outcomes and treatment program surrounding the ACS patient.
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| Minneapolis Activist Testifies at Congressional Hearing - Nov 23, 2004 15:24 IST |
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Minneapolis resident and Parkinson’s disease activist Jackie Christensen testified Tuesday at a hearing of the Republican Main Street Partnership. The hearing, convened by Partnership President of co-author of HR- 4682 the Castle-DeGette Stem Cell bill, chaired the hearing.
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| Obesity Epidemic Stymies Primary Care Physicians: Pri-Med Institute Survey - Nov 23, 2004 15:3 IST |
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While two of every three Americans today are clinically overweight or obese, the condition remains largely untreated by primary care physicians, a national survey by Pri-Med Institute reports.
Although obesity is clearly implicated in the mounting toll of chronic disease in the US today, primary care physicians feel prepared to offer little more than conventional diet and exercise encouragement, Pri-Med Institute vice president and compliance officer Marissa Seligman, PharmD said. Greater involvement by doctors in managing patient weight loss could make a vital contribution to reversing this epidemic, as well as enhance treatment of a wide range of conditions that are caused or exacerbated by excess weight.
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| OSI Pharmaceuticals Announces Launch of Tarceva-TM- - Nov 23, 2004 12:49 IST |
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OSI Pharmaceuticals, Inc. (Nasdaq: OSIP) announced today the initiation of the launch of Tarceva(TM) less than two business days after last Thursday’s approval of the drug for the treatment of patients with advanced non-small cell lung cancer (NSCLC) after failure of at least one prior chemotherapy. Tarceva(TM) is priced to wholesalers at $2,026 per 30-day supply of the 150mg tablets, and is also available at 100mg and 25mg tablet strengths. Tarceva(TM) is approved for use as a monotherapy in second- and third-line settings and is both the first EGFR inhibitor and the first non-cytotoxic agent to improve survival in advanced NSCLC patients and to be approved in the second-line setting.
We are pleased to be able to make Tarceva available to lung cancer patients so soon after approval, stated Colin Goddard, Ph.D., Chief Executive Officer of OSI Pharmaceuticals. We believe that the broad-based nature of the survival benefit demonstrated by Tarceva coupled with its side effect profile will make this a valuable and viable treatment option for lung cancer patients and their doctors. We also have a strong post-approval development plan seeking to expand the label and use of Tarceva to earlier stages of lung cancer patients; to other forms of cancer where EGFR is implicated and where we have seen indications of activity; and to combinations of all targeted therapies which we believe represents a true paradigm shift in the treatment of human cancer. With this plan we are confident that Tarceva can be grown into a major product in the treatment of a variety of cancers.
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| Sharp Health Plan Agrees to Transfer Medi-Cal and Healthy Families Contracts to Molina Healthcare of California - Nov 23, 2004 12:23 IST |
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Molina Healthcare of California (NYSE:MOH) and Sharp Health Plan today announced that the two companies have reached a definitive agreement to transfer Sharp’s Medi-Cal (Medicaid) and Healthy Families Program (California’s State Children’s Health Insurance Program) contracts to Molina, a leading California managed care organization. To take effect, the transfer must be approved by multiple governmental agencies, including: the Department of Managed Health Care, which regulates health plans; the Department of Health Services, which administers the Medi-Cal program; and the Managed Risk Medical Insurance Board, which administers the Healthy Families Program.
Approximately 70,000 of Sharp Health Plan’s Medi-Cal and Healthy Families members could be affected by the transfer. If approved, Molina expects to begin providing coverage to these members in the second quarter of 2005. The consideration for the transfer of the contracts to Molina is $25 million, subject to possible adjustment and an earn-out.
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| Health Benchmarks Study Suggests Chiropractic Coverage Reduces Health Care Costs - Nov 23, 2004 12:10 IST |
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A study published in the October 11, 2004 issue of Archives of Internal Medicine reports that considerable cost savings and reduced utilization are observed for patients with chiropractic coverage. Savings to the health plan have been estimated at $208 per member per year, with an average $110 saved per back pain episode. The study was conducted and co-authored by Health Benchmarks(R) (HBI) as an investigation of supplemental chiropractic coverage provided by American Specialty Health (ASH).
Back pain accounts for more than $100 billion in annual U.S. health care costs and is the second leading cause of physician visits and hospitalizations. HBI evaluated the effect of systematic access to chiropractic care on the consumption of health care resources within a large managed-care system. HBI conducted a retrospective analysis of four years of administrative claims data comparing health plan members with an additional chiropractic benefit to members of the same health plan without the chiropractic benefit. The findings, detailed in Archives of Internal Medicine, include a significant decrease in healthcare spending over the four-year study period.
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