Fortis Healthcare to disown 100 per cent stake in RadLink-Asia to Fullerton Healthcare for SGD 111 million
Wrapping up sale of its major international assets, Fortis Healthcare's Singapore-based arm will offload 100 per cent stake in RadLink for SGD 111 million (over Rs 530 crore) to Fullerton Healthcare Group.
Fortis Healthcare International, a step-down subsidiary of Fortis Healthcare, announced its decision to divest 100 per cent shareholding in RadLink-Asia and its subsidiaries, the company said in a statement.
The deal will be completed by May 12, it added. RadLink provides diagnostic and molecular imaging services.
In a joint statement, Fortis Healthcare Executive Chairman Malvinder Singh and Executive Vice Chairman Shivinder Singh said: "The significant value that we have created in our international healthcare businesses is now being unlocked and will be ploughed back to strengthen our growth in India."
RadLink was acquired in 2012-13 and "the divestment of this last major international business is in line with our strategic decision to intensify our focus on our core hospital and diagnostics business in India," they added.
JP Morgan and Religare Capital Markets acted as financial advisors to Fortis for this transaction.
Last year, Singapore's competition authority had sought a more detailed review of Fortis' plan to exit from RadLink saying the deal significantly reduced the number of providers of radiology and imaging services.
In 2013, it completed the sale of entire 65 per cent stake in Vietnam-based hospital chain Fortis Hoan My Medical Corporation for USD 80 million. The healthcare firm had also sold its stake in Hong Kong-based Quality Healthcare to Bupa for USD 355 million.
In 2012, Fortis Healthcare International had sold 64 per cent stake in Dental Corporation Holdings, Australia, to Bupa, for AUD 270 million.

Memphis-based Wright Medical Group continues to see sales increase as it gets closer to being able to launch a new bone graft product.
The medical device company reported a 10 percent increase in sales for the first quarter, hitting $77.9 million. That sales increase was led by the continued adoption of Wright Medical’s Infinity total ankle system, which grew by 49 percent in the quarter.
The company continues to report a net loss, totaling $46.2 million, or 91 cents per diluted share, in the first quarter. In the same period of 2014, Wright Medical (NASDAQ: WMGI) reported a net loss of $30.3 million, or 62 cents per share.
However, it continues to receive encouraging news on its Augment bone graft product, which was part of Wright Medical’s 2013 acquisition of Nashville-based BioMimetic Therapeutics Inc. in a $380 million transaction. The company is anticipating final approval from the U.S. Food and Drug Administration for Augment to come in the second half of 2015.
One thing that may not be occurring in the second quarter is the closing of Wright Medical’s merger with Tornier, which was announced last year. The Federal Trade Commission has asked for more information from both companies before it approves the merger. While closing in the second quarter is “still possible,” according to a Wright Medical statement, the third quarter is more likely.
“We are off to a very strong start in 2015 in the most important parts of our business. Specifically, our U.S. foot and ankle business posted another quarter of significant growth acceleration, driven by improved sales force execution and strong contribution from new products,” said Robert Palmisano, CEO of Wright Medical. “We also saw continued gains in U.S. foot and ankle sales force productivity, which now stands at approximately $1.1 million per sales rep, or double the level it was before we transitioned to a direct organization. Given our sustained focus and attention in this area, I am confident that we can reach a meaningfully higher level in the future.”

Hospital group Pulse Health has continued its aggressive east coast expansion trail with the $33.6 million acquisition of a NSW mental health clinic.
The deal means the company now has nine hospitals in its expanded portfolio. The company, whose shares have increased this year, said it would continue to review a range of acquisitions and developments.
The deal would see the company make a cash payment of $27.7m to acquire the Hills Clinic in Sydney, which is Pulse’s third major transaction in 10 months. There is also additional capped earn-out payments of $5.9m in aggregate, subject to achievement of 2015 and 2016 revenue targets for a maximum consideration of $33.6m. Pulse Health also earned long-term lease options for the hospital property of up to 30 years.
Pulse, an integrated health services provider, has in its portfolio private hospitals, day surgeries and community home care, and recruitment agencies.
Following a $30m capital raising last year, the company acquired the North Mackay Private Hospital in Queensland and followed that with the acquisition of another new specialist surgical hospital on Queensland’s Gold Coast in November. The group’s aggressive growth strategy has seen its stock shoot up almost a quarter since December. Shares rose 9.3 per cent yesterday to 53c.
The company said the Hills Clinic deal was a “beachhead” acquisition in what it called the attractive mental health market.
“The Australian mental health market was worth an estimated $6.9 billion in 2010-2011, with demand for and use of mental health services anticipated to grow by as much as 6 to 7 per cent per year over the next 15 years,” the company said. “Initial market analysis conducted by Pulse Health has indicated high levels of unmet demand.”
The Hills Clinic has 59 beds and recently opened a specialised young adult ward for 16- to 25-year-olds. Pulse outlined that key clinicians at the centre remained committed to having ongoing relationships with The Hills Clinic and Pulse Health, post transaction.
Pulse said the transaction would be funded by a new $42m debt facility, with NAB, and cash reserves. “Agreed debt facility terms are a significant improvement on previously agreed terms, and include acquisition, asset finance and general working capital lines.

TeamHealth Holdings acquires Professional Anesthesia Service, Inc. Expands Relationship with Summa Health System
TeamHealth Holdings Inc., a leading provider of outsourced physician staffing solutions for hospitals, announced the acquisition of the operations of Professional Anesthesia Service, Inc. Based in Akron, Ohio, Professional Anesthesia Service currently provides anesthesia services for Summa Akron City Hospital, Summa St. Thomas Hospital and one ambulatory surgery center (ASC). In conjunction with this transaction, TeamHealth will also begin providing anesthesia services for Summa Barberton Hospital. These new relationships will add more than 50,000 annual anesthesia cases to TeamHealth’s existing anesthesia operations. 
“We are excited to join TeamHealth—an organization that supports our commitment to providing high-quality, compassionate care,” said Robert Donahue, MD, president of Professional Anesthesia Service. “Through our partnership with TeamHealth, we will have access to resources to better serve our patients, our clinicians and our hospital and ASC clients.”
“Our partnership with Professional Anesthesia Service highlights our commitment to the continued growth of our anesthesia service line,” said Michael D. Snow, president and CEO of TeamHealth. “We are pleased to welcome this well-respected group of clinicians to TeamHealth, and we look forward a successful partnership.”

Healthcare firm Bupa has 200-300 million pounds for acquisitions
Financing constraints mean British private healthcare group Bupa [BUPAI.UL] only has around 200-300 million pounds available for acquisition in 2015, its chief executive said on Monday.
The unlisted company made profits of 638 million pounds last year and would come in at around 50-60th position in the FTSE-100 if it were a listed company, Stuart Fletcher told Reuters in an interview.
Bupa, set up in 1947 just ahead of the formation of Britain's national health service to provide an alternative health provision, ploughs all its profits back into the business.
It has no plans for a listing. But with two billion pounds in outstanding debt, it would not want to risk its single-A credit rating by issuing more debt to fund expansion, Fletcher said.
"We have some headroom, and that headroom we are using, but it's relatively small — we are talking about 200-300 million pounds for this year."
Bupa has completed seven deals totalling 1.6 billion pounds in the past three years, including moving into new markets in Poland and Chile. Expansion in Peru was likely the next focus, Fletcher said.
The firm was making small "fill-in" acquisitions, rather than planning any major purchase, he added.
Bupa's most recent debt issue was a 350 million sterling bond due 2021 with a coupon of 3.375 percent, launched last year and currently trading at a yield of 2.5 percent [GB107530975=].
Fletcher said he was also cautious about going on a spending spree due to uncertainty about capital requirements ahead of new European Solvency II regulations for insurers, due to come into force in Jan 2016.
Bupa gets 70 percent of its revenue from health insurance but also operates hospitals, care homes and medical clinics in many of its international markets.
Its largest markets are Australia, Britain and Spain. But it has seen more opportunities in emerging markets, where it has been expanding in recent years.
"Given the growth prospects for the UK, Australia and Spain … we needed to find new avenues for growth," Fletcher said.
He said the firm finds cost savings in providing services such as care homes alongside insurance, and aims to develop both sides of the business in countries where it is currently only in one sector.

BJC HealthCare and Memorial Hospital in Belleville have agreed to form a “strategic alliance,” although details of the agreement are sparse.
The agreement gives Memorial access to BJC resources while allowing BJC to widen its presence in the Metro East, top executives of the two health care organizations told the Post-Dispatch Wednesday.
The deal is not a merger or acquisition, Memorial CEO Mark Turner and BJC CEO Steve Lipstein said.
The move comes a week after Memorial’s chief competitor, St. Elizabeth’s Hospital, won approval from state health regulators to relocate its current 303-bed hospital from downtown Belleville to O’Fallon, Ill.
Memorial had strongly objected to St. Elizabeth’s relocation, saying it would put additional stress on Memorial’s existing facility in Belleville, but Turner said Wednesday the timing of the BJC announcement is just a “coincidence.” He said Memorial and BJC have been talking for months.
Under the alliance outlined by the two executives, Memorial Hospital’s 2,300 employees will continue to be employed by and receive a paycheck from Memorial, not BJC. Leadership at Memorial will stay the same along with the hospital’s name and branding, they said.
But the governing board of Memorial Hospital will have equal representation from BJC and Memorial. The total number of board seats has yet to be determined.
Both Lipstein and Turner declined to elaborate on financial terms of the deal.
When asked if the two would split the revenue generated at Memorial, Turner said, “What’s generated here, stays here.”
Turner said partnering with BJC allows the 316-bed hospital access to BJC’s resources and will allow Memorial to expand certain service lines, although he would not say which ones.
Asked how BJC would financially benefit from the deal, Lipstein said the two organizations share a “financial responsibility” to ensure the hospital generates enough revenue to cover its expenses.
Lipstein said Memorial is the “perfect fit” for BJC because it helps the system “fill out” its geography.
The only other hospital BJC operates in the Metro East is Alton Memorial, a 206-bed facility, which is 33 miles to the north of Memorial Hospital.
BJC does own a 111-acre tract of land in Shiloh between St. Elizabeth’s new location in O’Fallon and Memorial’s new 94-bed satellite hospital currently under construction in Shiloh. BJC bought the tract in 2008 for more than $21 million.
Earlier this year, BJC expanded its footprint farther south after its acquisition of Mineral Area Regional Medical Center in Farmington, Mo.
Including Mineral Area, BJC operates 14 hospitals throughout Missouri and Illinois. In 2013, BJC reported an operating income of $146 million on total revenue of $3.9 billion. BJC employs 26,583 people.
Memorial Group is the parent organization of Memorial Hospital, Memorial Hospital East, Memorial Foundation and Southwest Illinois Health Ventures.
For 2013, Memorial Group reported a loss of $29 million on total revenue of about $297.7 million. The loss was attributed to being out-of-network with UnitedHealthcare, one of the nation’s largest insurers, for a few months, Anne Thomure, Memorial spokeswoman, said.
St. Elizabeth’s, which is owned by Springfield, Ill.-based Hospital Sisters Health System, posted a $15 million loss in the year ended June 30, 2013, the most recent available.
With the announcement of the strategic alliance, BJC and Memorial will now take the next three to four months to analyze whether to finalize the partnerships, also known as a due diligence period.
Once the due diligence is complete, the two will enter into a definitive agreement and seek opinions on the relationship from the Federal Trade Commission and the Illinois Health Facilities and Services Review Board to see if any certificate of need permits are required. The deal will then be subject to any state or federal regulatory approval.

U.S. health insurer Humana Inc said on Wednesday there was an unexpected pick-up in the rate of hospital admissions late in March and in April, sparking a sell-off in its own and other insurers' shares.
The comments came during a conference call to discuss the company's first-quarter profit, which missed Wall Street expectations.
Shares in Humana, which specializes in Medicare health insurance and drug plans for the elderly and disabled, fell more than 6 percent to $168.66 and brought down larger competitors, including UnitedHealth Group Inc, Aetna Inc and Anthem Inc.
Investors are keeping a close watch on insurers and hospitals for signs that medical use and costs are rising more rapidly than expected, which can hurt insurer profits and help hospitals.
Humana Chief Financial Officer Brian Kane said hospital inpatient admissions were on the rise, the first such cautionary comments from an insurer this quarter.
"During the last weeks of the quarter and into April, we are seeing an elevated level of authorizations for hospital admissions, which, although still declining, are slightly higher than we had anticipated," Kane said.
He said a lower per-admission cost was encouraging, but that the company would be watching admissions closely.
UnitedHealth shares fell 3.7 percent to $113.19, Aetna was down 2.5 percent to $107.65 and Anthem – which also reported earnings on Wednesday – fell 2.5 percent to $150.38.
Sheryl Skolnick, healthcare analyst at Mizuho Securities, said insurer shares were already under pressure and that the comments seemed to be speeding the decline.
Humana also gave a more dour forecast than its competitors for its individual insurance business, which has grown with the creation of the public exchanges under the national healthcare reform law. In particular, Humana said more Georgia residents needed care than it had anticipated.
Georgia accounts for about half of Humana's individual business, based on state insurance data, Goldman Sachs analyst Matthew Borsch said in a research note.
Excluding tax benefits from the sale of Concerta Inc, Humana earned $2.47 per share, below the average analyst estimate of $2.56 per share, according to Thomson Reuters I/B/E/S.
CLAIMS COSTS RISE
The company said the medical benefit ratio (MBR) for the first quarter ended March 31 increased by 80 basis points to 83.1 percent. The measure represents the percentage of premiums paid out in medical claims.
Revenue increased 18.1 percent to $13.8 billion, beating the average analyst estimate of $13.51 billion.

A 3D printer was used to create a medical device being called a 4D airway, pne which saved the lives of three babies who were on the verge of death. This amazing new device is capable of changing shape as the child grows to provide lasting protection.
The University of Michigan developed the hollow splint, which is sewn into airways and provides a porous scaffolding supporting the natural airway. The tubes were constructed from polycaprolactone, which slowly dissolves in the body over a period of time.
The three babies fitted with the devices all suffered from tracheobronchomalacia, a condition in which the windpipe occasionally collapses, preventing normal breathing. In the disease, which is typically fatal, the walls of the trachea and bronchi are weak and prone to collapse, which leads to respiratory failure and cardiac arrest.
Each of the three devices was custom-designed to fit the child for whom it was intended. At the time of the implants, the recipients were 3-, 5- and 16-months old.
"These cases broke new ground for us because we were able to use 3D printing to design a device that successfully restored patients' breathing through a procedure that had never been done before," said Glenn Green from C.S. Mott Children's Hospital at the University of Michigan.
Those procedures were carried out on the babies three years ago, and investigators are now reporting the results of their followup studies of the lives of the patients. Before the surgeries, the infants were on artificial ventilators, with breathing tubes inserted in their throats. They were treated with narcotics to provide heavy sedation.
Today, one of the trio, Kaiba Gionfriddo, is believed to be cured of the condition, and his specially designed airway splint has completely dissolved. He was the youngest of the babies to receive the device, as well as the first. Previous attempts to build splints for windpipes faced the difficulty that they could not grow along with the child, meaning the device had to be replaced periodically.
"The device worked better than we could have ever imagined …. Now these children are home with their families. Instead of lying on their backs for weeks, these children are now learning to stand and run," Green said.
In addition to the production of airway splints, 3D printers are also being used to provide a wealth of other medical products, including custom jaws, hearing aids, hips and other parts to repair and enhance the human body.
Future research will study the safety and efficacy of the devices in a larger clinical trial. This investigation could lead to the development of new treatment methods for infants faced with the often-fatal condition.
Development of the 4D airway splint and the three-year study of three patients receiving the devices as babies was published in the journal Science Translational Medicine.

A longside its industrial cousin, the digital revolution has created fundamental and irreversible changes to our way of life. Those changes are particularly apparent in the healthcare sector and from a UK perspective, digitally enabled services are a vital element in the strategy that the NHS is using to head off the £30bn black hole that will otherwise exist in its budget by 2020.
While the majority of us expect that goods and services be available within a couple of taps of a smartphone or tablet, in a healthcare context, a sizeable group of the population are either late adopters or remain seriously concerned about data security. Add to that the moral concerns that exist in relation to the commercialisation of patient data and you see the extent of the challenge that the NHS needs to overcome before it is able to realise substantial savings through use of digital health technology.
The lifeblood of any digital initiative is data. Exponential expansion in the volume of patient data should lead to higher quality analysis and a database that is of ever-increasing value. It is therefore no surprise that the NHS views its data as a three tiered asset, essential to the treatment of patients, vital as a resource for research and increasingly important as a potential source of commercial licensing revenue.
Most people see their health data as being extremely sensitive. That must be right, not just because it is so personal, but also because the wide disclosure of your health data can have serious consequences. We want a comprehensive health record to be instantly available when we require treatment, but we are also concerned about the same data being made available without consent for scrutiny by a prospective employer, or by a financial institution calculating our health and life insurance premiums.
The tension between data use and misuse was recently laid bare when the Health and Social Care Information Centre (HSCIC) attempted to introduce its care.data initiative. Designed to make NHS patient data available to certain approved enterprises, it was subject to a poorly publicised patient opt-out regime and the removal of certain identifiers, which in theory, should have made the data anonymous. However, the technological changes which allowed the initiative to take shape, also created the enhanced data analysis tools which threaten the effectiveness of many data anonymisation protocols, so eroding public confidence in this type of initiative.
Whatever the shape of the new data protection regime that the EU is due to implement in the next 12 to 18 months, there are three factors which will be central to the creation of a workable digital health strategy. Firstly, the need to gain the fully informed consent of patients for wider use of their data. Secondly, the need for a global standard governing the anonymisation of that personal data and thirdly, recognition of the fact that healthcare data must ultimately be owned by the patient to whom it relates.
The first two factors are reasonably easy to grasp. The third is harder, as it runs counter to the current position where a data controller has a large degree of autonomy in relation to the use of data where it holds valid processing consents. In order to rebalance the data subject and data controller relationship, the regulators should adopt a more robust premise that a patient’s rights should be protected not just as the subject of any given data, but also as the ultimate controller of that data. While the law of copyright and database rights mean that data can be owned and traded like any other asset, a new right recognising the patient’s primary interest in his or her personal data is required.
The care.data initiative is laudable in its attempt to create a primary source of healthcare data. However, it falls down because of the flawed belief that an opt-out regime would provide sufficient safeguards against misuse. The high degree of trust that the NHS enjoys as both an organisation and a brand means that it is uniquely well placed to implement a single opt-in arrangement, through which it is empowered to hold and process patient data in a way that demonstrates that the interest of the patient is given absolute primacy.
While the number of patients who sign up to such an opt-in regime will certainly be lower than envisaged under the HSCIC’s original strategy, the clarity in relation to processing rights and hence the increased value of the resulting database should more than compensate for the loss of volumes. Perhaps more importantly, a strategy which is fully patient focused is surely the best way of both discouraging data misuse while also allowing those who have decided that open data is a fundamental part of modern life, to gain the benefits associated with the unconstrained analysis of big data and product personalisation.

Royal Philips NV, the Dutch company which is splitting off its lighting unit to focus on consumer health-care, reported a profitability drop at its future main business amid sluggish demand from hospitals and higher investments.
First-quarter adjusted earnings before interest, taxes and amortisation was 5.4 percent of sales at the health-care unit, compared with 8.8 percent a year earlier. The division’s revenue gained 1 percent in the quarter, while Philips’ consumer-lifestyle sales rose 10 percent. The stock fell the most in three months.
The profitability drop doesn’t make it easier for Chief Executive Officer Frans van Houten to convince investors that betting the future of the 124-year-old company on the $125 billion consumer health-care market is the right thing to do. Van Houten predicts booming demand for data offerings that help hospitals monitor and analyze patients’ health, reduce unnecessary visits and increase the efficiency of operations and medical procedures.
“The market for medical equipment in the United States is flat,” Van Houten said on a conference call with reporters. Many U.S. hospitals are currently focused on merging their operations to cut costs, rather than on increasing spending on equipment or services, the CEO said.
‘Fragile Recovery’
In China, the company faces an economic slow down, while the markets in Latin America and the Middle East are still very volatile, he said, adding that Europe is only at the beginning of a “fragile recovery.” Investments in new technologies and products also crimped health-care earnings, he said.
Philips shares dropped as much as 3.4 percent, the most since Jan. 27, and were down 3.3 percent as of 10:40 a.m. in Amsterdam trading. Before today, the stock had risen 14 percent since the start of the year, valuing the company at 25.9 billion euros.
While Philips’ health-care business faces a difficult market environment, it will eventually benefit from the digital investments by many hospitals, according to ING Bank NV analyst Robin van den Broek.
“Hospitals are currently investing in the IT-infrastructure needed to make the transition, and less in imaging systems,” he said. “That hurts now, but longer term Philips can reap the benefits of that.”
Apart from the lower health-care profitability, shares also declined because of a bigger-than-expected 16 percent sales drop in the conventional lighting business, said Rabobank Group analyst Hans Slob.
Separation Vote
Shareholders will vote on the separation of the lighting unit on May 7, and the company plans to carry out an initial public offering of that business in the first half of next year.
The deal marks a turning point for Philips, which has sold lighting products since its founding in 1891. The separation of the unit, the world’s biggest maker of lamps and bulbs, mirrors Munich-based Siemens AG’s move in mid-2013 to spin off Osram Licht AG as an industrywide shift toward more-efficient light-emitting diodes intensified competition.
The company’s earnings have no impact on the separation plans, Van Houten said today.
Total revenue reached 5.34 billion euros ($5.8 billion) in the first quarter. Analysts surveyed by Bloomberg had forecast 5.08 billion euros. Earnings before interest, taxes and amortization dropped 9 percent to 230 million euros. The company predicts “modest” comparable sales growth for 2015.
“Philips is a self-help story and the plan to IPO or sell the Lighting Solutions business in the first half of 2016 suggest the possibility of value crystallisation in due course,” RBC Capital Markets analysts Andrew Carter and Wasi Rizvi said in a note. “Overall, the health-care turnaround still appears a work in progress and we don’t see first-quarter results marking a turn in investor sentiment towards Philips.”