Reconstruction Of U.S. Healthcare Has Just Begun

A combination of technological change and the introduction of the Affordable Care Act, along with many efforts to control escalating costs, have already remade how U.S. healthcare professionals deliver care to patients, but these forces are not finished transforming the market.

“It’s really time for us to reimagine how we do healthcare,” Sinai Health System CEO Karen Teitelbaum said at Bisnow’s National Healthcare Series: Midwest Real Estate Summit Sept. 24.

A complex set of factors are increasing overall demand for care, including the aging of the U.S. population, the epidemic of opioid abuse and greater demand for mental health services, among other factors, according to Teitelbaum. But simultaneously, other developments are decreasing the need for care at large, centralized hospitals. For one thing, new technologies such as telemedicine, which allows physicians or other professionals to remotely consult patients on many needs without the inconvenience of in-person visits, have gotten more popular.

And the search for lower costs has led to the proliferation of an array of outpatient clinics, which provide both specialty and basic care to patients closer to home. That has led to a lot of empty hospital beds, even as the total amount of care provided has increased across the board.

“We know there is excess capacity,” Illinois Health and Hospital Association CEO A.J. Wilhelmi said. He estimates that one-third of the beds in some hospitals are typically unoccupied. That means developers, providers and other stakeholders should start thinking about how to repurpose many of these buildings, even as the construction of off-site care facilities continues.

That won’t be an easy task, Skender Director of Healthcare Design Jenny Han said. The watchword for any healthcare effort is affordability, and that puts a lot of pressure on builders. To have any chance of combating rising construction costs, and completing the redevelopment of the U.S. healthcare system, the methods of construction have to change.

“We are an archaic industry,” she said. By using factory-produced modular components, Skender intends to drastically reduce costs. It also plans to do all of the architecture, design and manufacturing in-house, a more efficient process than the traditional methods of construction, which typically involve an assortment of firms working in silos.

“I look forward to the day [modular construction] is no longer the shiny new object,” Han said.

Even if cost-effective methods of construction can be found, the changes up ahead could be gut-wrenching for many.

In 2016, after deciding it could no longer sustain operations, Wilhelmi said, Springfield, Illinois-based Hospital Sisters Health System closed the nearly 130-year-old St. Mary’s Hospital in Streator, Illinois. Last year, however, Peoria, Illinois-based OSF HealthCare showed what the future may look like for many communities that lose such institutions. It launched a $30M renovation of St. Mary’s, an effort that demolished a portion and transformed the remainder into an outpatient center with a 24/7 emergency center. Other long-term needs can be met by St. Elizabeth Medical Center in nearby Ottawa, Wilhelmi said.

Teitelbaum’s Sinai Health System, located on Chicago’s West Side, largely serves a low- to moderate-income population, and like many providers these days, has to carefully watch its funds.

“We don’t have a lot of money to invest in big, beautiful buildings,” she said. Instead, it plans on making strategic investments that divert patients into less-expensive care settings. Earlier this summer, it opened a $6.5M Crisis Stabilization Unit at Holy Cross Hospital for patients experiencing mental health crises.

“Mental health has never been a big moneymaker, these are patients that no one is running after,” she said. But a pilot program launched in 2015 found that 70% of its 5,000 patients were stabilized without emergency room visits or hospitalization. Instead, they received lower-level care in their own communities, and also avoided incarceration.

Still, Teitelbaum knows the future of health systems like Sinai won’t be easy.

“There aren’t many healthcare CEOs that would push me down the stairs to get my job.”https://www.bisnow.com/chicago/news/healthcare/healthcare-forecast-101075

Aspirin may prevent air pollution harms

A new study is the first to report evidence that nonsteroidal anti-inflammatory drugs (NSAIDs) like aspirin may lessen the adverse effects of air pollution exposure on lung function. The team of researchers from the Columbia Mailman School of Public Health, Harvard Chan School of Public Health, Boston University School of Medicine published their findings in the American Journal of Respiratory and Critical Care Medicine.
The researchers analyzed a subset of data collected from a cohort of 2,280 male veterans from the greater Boston area who were given tests to determine their lung function. The average age of participants was 73 years. The researchers examined the relationship between test results, self-reported NSAID use, and ambient particulate matter (PM) and black carbon in the month preceding the test, while accounting for a variety of factors, including the health status of the subject and whether or not he was a smoker. They found that the use of any NSAID nearly halved of the effect of PM on lung function, with the association consistent across all four weekly air pollution measurements from same-day to 28 days prior to the lung function test.
Because most of the people in the study cohort who took NSAIDs used aspirin, the researchers say the modifying effect they observed was mainly from aspirin, but add that effects of non-aspirin NSAIDs are worthy of further exploration. While the mechanism is unknown, the researchers speculate that NSAIDs mitigate inflammation brought about by air pollution.
“Our findings suggest that aspirin and other NSAIDs may protect the lungs from short-term spikes in air pollution,” says first and corresponding author Xu Gao, PhD, a post-doctoral research scientist in the Department of Environmental Health Sciences at the Columbia Mailman School. “Of course, it is still important to minimize our exposure to air pollution, which is linked to a host of adverse health effects, from cancer to cardiovascular disease.”
“While environmental policies have made considerable progress toward reducing our overall exposure to air pollution, even in places with low levels of air pollution, short-term spikes are still commonplace,” says senior author Andrea Baccarelli, MD, PhD, chair of the Department of Environmental Health Sciences at the Columbia Mailman School. “For this reason, it is important to identify means to minimize those harms.”
An earlier study by Baccarelli found that B vitamins may also play a role in reducing the health impact of air pollution.

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Co-authors include Brent Coull, Xihong Lin, and Joel Schwartz at Harvard; and Pantel Vokonas at the Boston University School of Medicine.The current study was supported by grants from the National Institute of Environmental Health Sciences (ES009089, ES021733, ES025225, ES027747). The VA Normative Aging Study is supported by the Cooperative Studies Program/Epidemiology Research and Information Center of the U.S. Department of Veterans Affairs and is a component of the Massachusetts Veterans Epidemiology Research and Information Center in Boston.
https://www.eurekalert.org/pub_releases/2019-10/cums-amp100219.php

Aprea Therapeutics prices IPO at midpoint

Aprea Therapeutics (APRE) has priced its initial public offering at the midpoint of its range, IPO Boutique says.

The company priced an upsized 5.7M shares (up from 5M) at $15, after marketing the range at $14-$16/share.

That marks a raise of $85.5M vs. the planned $75M; that means an enterprise value over $227M.

https://seekingalpha.com/news/3503626-aprea-therapeutics-prices-ipo-midpoint

FDA: Don’t Use Test on Ranitidine That May Generate Carcinogen in Sample

The U.S. Food and Drug Administration on Wednesday said a method of testing the drug ranitidine for impurities is not suitable to detect the presence of NDMA, a possible carcinogenic, because the testing method may generate NDMA.
According to the agency, a testing method employing high temperatures “generated very high levels of NDMA from ranitidine products because of the test procedure.” That method was used by a third-party laboratory, whose work was observed by the FDA.
The FDA said a liquid chromatography-high resolution mass spectrometry, or LC-HRMS, method should be used to test for the presence of NDMA. “FDA’s LC-HRMS testing method does not use elevated temperatures and has shown the presence of much lower levels of NDMA in ranitidine medicines than reported by the third-party laboratory.”
The agency said it is continuing tests of ranitidine products from a number of manufacturers, and is asking ranitidine manufacturers to send samples of their products to the agency for testing by FDA scientists.
Ranitidine is used to treat heartburn and other gastrointestinal disorders.
The FDA last month said it detected low levels of NDMA, a probable carcinogenic, in the heartburn treatment Zantac. Ranitidine is an active ingredient in Zantac.
Since then, a number of retailers, including Walmart, Walgreens and Kroger have removed treatments containing ranitidine from their shelves.
In a release last month, the FDA notified professionals and patients about the voluntary recall, but said not all ranitidine medicines are being recalled, and added it wasn’t recommending individuals stop taking all ranitidine medicines.

https://www.marketscreener.com/news/FDA-Recommends-Against-Using-Certain-Test-on-Ranitidine-Says-it-May-Generate-NDMA-in-Sample–29327990/

Puma Biotechnology +13% after FDA OKs Nerlynx label addition

Puma Biotechnology (NASDAQ:PBYI) surges 13% in after-hours trading after the U.S. Food and Drug Administration approves a labeling supplement for Nerlynx (neratinib) for the extended adjuvant treatment of HER2-positive early stage breast cancer.

With the approval of the labeling supplement, the label now includes safety information based on interim results from Puma’s Phase II CONTROL Trial, a study evaluating antidiarrheal prophylaxis or dose escalation in the reduction of neratinib-associated diarrhea that has a primary endpoint of the incidence of grade 3 or higher diarrhea.

Interim data from the trial showed that the addition of prophylactic treatment with loperamide and budesonide reduced the discontinuation rate due to neratinib-associated diarrhea to 11% versus a discontinuation rate of 18% with loperamide alone.’

Neratinib was approved by the FDA in July 2017 for extended adjuvant treatment for adult patients with early stage HER2-positive breast cancer.

https://seekingalpha.com/news/3503593-puma-biotechnology-plus-13-percent-fda-oks-nerlynx-label-addition

ADC Therapeutics pulls IPO

ADC Therapeutics (ADCT) has withdrawn its IPO registration statement.

The company is a clinical-stage oncology-focused biotech.

“In light of adverse market conditions, we have determined it is in the best interests of our shareholders to withdraw the registration statement,” says CEO Chris Martin.

“We are fortunate to have a strong balance sheet, highly supportive investors, alternative financing options and a steady flow of forthcoming milestones, all of which factored into our decision to not proceed with an initial public offering in the current market conditions,” he adds.

It had planned to offer 8.19M common shares at $23-$26/share.

https://seekingalpha.com/news/3503611-adc-therapeutics-pulls-ipo

Immunovant set to land on Nasdaq via HSAC merger

Immunovant is set to land on Nasdaq through a deal with Health Sciences Acquisitions Corporation (HSAC), a business founded by RTW Investments to buy a biotech. HSAC will buy the Roivant business but the resulting company will take Immunovant’s name, management team and strategic focus.
HSAC went public earlier this year, raising $100 million with the sole intention of acquiring a North American or European biotech or medtech. Now, HSAC has named Immunovant as its target.
Immunovant will exit the deal with an investor syndicate featuring RTW Investments, BVF Partners, Adage Capital Management, Roivant and others, plus $100 million in cash. The cash projection includes the proceeds of a $35 million bridge financing involving RTW, BVF and Roivant.

The money is forecast to see Immunovant through to the second half of 2021, by when it may have a better idea of whether its anti-FcRn monoclonal antibody IMVT-1401 can compete. Argenx has a FcRn drug in phase 3 in myasthenia gravis, one of the indications targeted by Immunovant; other companies including Alexion and UCB are also in the running.
Immunovant expects to share phase 2a data on IMVT-1401 in Graves’ ophthalmopathy in the first quarter of next year, with results from a phase 2a trial in myasthenia gravis expected to follow shortly thereafter. The company looks set to advance toward those milestones as part of HSAC.
HSAC is one of three organizations with similar goals that went public over an eight-month period starting in the back half of 2018. Chardan Healthcare Acquisition Corporation, a business set up by the investment group of the same name, listed late last year with the goal of buying a biotech, medtech or digital health startup. In July, the group struck a deal to merge with BiomX.
With HSAC hooking up with Immunovant, Perceptive Advisors’ Arya Sciences Acquisition Corporation is the only one of the three not to execute a transaction so far. Arya raised $125 million in an IPO a little more than one year ago and has around one year more to seal a deal.
https://www.fiercebiotech.com/biotech/immunovant-set-land-nasdaq-via-hsac-merger