A Medical Device Daily
Allscripts (Chicago), a provider of clinical software, connectivity and information solutions used by physicians, reported that it has acquired all of the outstanding stock of Extended Care Information Network (ECIN; Chicago), a provider of hospital care management and discharge planning software, for about $90 million in cash.
Allscripts said it financed the acquisition using cash on hand and through $50 million of borrowings from a new $60 million credit facility.
The companies said the acquisition combines the two industry leaders in care management and enables Allscripts to connect another key component of the healthcare delivery system — the exchange of patient information between hospital case managers, physicians outside the hospital and the growing number of post-acute care facilities nationwide.
ECIN says that its web-based “software as a service” solutions are designed to automate and streamline the entire care management process in hospitals, from admission through discharge, resulting in increased productivity, improved patient throughput and better outcomes.
The private company reports a client base of more than 400 hospitals and nearly 5,000 post-acute care facilities — nursing homes, assisted living and other facilities to whom hospitals refer patients in need of long-term care or short-term residential-based rehabilitation.
Along with Allscripts existing Canopy care management solution, the company says that the acquisition gives it one of the largest installed bases of care management clients in the nation, with nearly 700 combined hospitals, as well as one of the largest networks of post-acute care facilities. Both care management solutions are deployed using an application service provider model designed for rapid implementation with minimal use of hospital IT support staff.
“Our acquisition of ECIN represents the convergence of two market leaders and will help connect hundreds of hospitals and thousands of post-acute care facilities to our network of ambulatory physicians, bringing us one step closer to our vision of a truly interconnected healthcare system,” said Glen Tullman, CEO of Allscripts. “This combination provides significant leverage for each of our product offerings and broadens Allscripts relationships in the hospital market at a time when hospitals are becoming more important influencers in the Electronic Health Record sales process.”
Allscripts also reported the creation of a new Hospital Solutions Group within the company to be directed by Jeff Surges, CEO of ECIN.
The new business unit will provide a suite of products and services under one umbrella, combining ECIN with the company’s emergency department information systems and its existing care management solution, Canopy. Allscripts will continue to support both of its care management products for the foreseeable future.
With the addition of ECIN, Allscripts said it is positioned to benefit from recent trends that are driving the automation of healthcare information and the manner in which it is exchanged between hospitals, physicians outside the hospital, and post-acute care facilities.
Staar Surgical (Monrovia, California), a developer of minimally invasive ophthalmic products, reported that it has completed the purchase of the interests of all other shareholders in Canon Staar (Tokyo), a joint venture that was formed by Staar, Canon and Canon Marketing Japan (both Tokyo) in 1988 to develop, manufacture and sell in Japan products using Staars technology. Canon Staar, which generated $10.4 million in revenue during FY06, has been renamed Staar Japan, and is now a wholly owned subsidiary of Staar, operating directly in the Japanese market.
Staar said the transaction significantly increases its direct presence in the high-growth Asian surgical marketplace.
In the buy-out Staar paid the Canon companies $4 million in cash and 1.7 million newly issued shares of Series A convertible preferred stock. The Series A stock will be convertible into common stock at a 1-to-1 ratio and under certain circumstances will be redeemable for cash at $4 a share.
“This transaction represents a major milestone for Staar Surgical,” said Barry Caldwell, president/CEO of Staar. “While Canon was a positive strategic partner of ours for nearly 20 years, our agreements with them created some significant limitations regarding potential strategic options, and those are now removed. We now have a direct marketing and selling presence in Japan, one of the largest ophthalmic surgical markets in the world.”
He added: “At its current sales levels, we continue to expect that Staar Japan will add in excess of $12 million of revenue to Staar Surgical in 2008. In addition, the acquisition gives Staar exclusive control over the rights to use our patents and other proprietary technology in Japan, China and worldwide while strengthening our intellectual property position in areas such as Preloaded Injectors.”
Isamu Kamijo, who served as general manager of Canon Staar, has become president of Staar Japan.
Canon Staar’s Preloaded Injector, approved for sale in Japan and China employs a silicone aspheric IOL and has been expanded to incorporate a hydrophobic acrylic lens supplied by Nidek (Gamagori, Japan) under an arrangement that will continue after the transaction.
Nidek has also acted as a Japanese sub-distributor for Canon Staar’s silicone Preloaded Injectors, and Staar said it anticipates that Nidek will continue to handle this sales channel for Staar Japan.
In other dealmaking news: Home health nursing company Amedisys (Baton Rouge, Louisiana) reported the acquisition of six home health agencies located in Georgia and South Carolina, from Memorial Health University Medical Center (Savannah, Georgia).
The transaction was effective as of Dec. 31, 2007, and is expected to contribute about $10 million in net revenue in 2008, though terms of the acquisition purchase agreement were not disclosed.