A Medical Device Daily

Cardinal Health (Dublin) reported plans to acquire privately held MedMined, a developer of technology and services that identify and prevent hospital-acquired infections. Terms of the agreement were not disclosed.

The acquisition will extend Cardinal's portfolio of patient safety solutions in the areas of hospital-acquired infections and antimicrobial management.

Hospital-acquired infections directly affect patient outcomes and are estimated to cost the healthcare industry billions of dollars each year, Cardinal said. Current estimates are that one of every 20 patients gets an infection as a result of hospitalization, leading to higher costs, longer hospital stays and a greater risk of death.

Using data-mining methods to analyze hospital records, MedMined helps identify opportunities to manage infections and change processes to prevent future infections. The data may also be used to efficiently report infection rates, enabling hospitals to provide the information from which to make comparisons. It says that hospitals using its Data Mining Surveillance service “have achieved a significant financial return in the first year of use by improving practices, reducing infection rates and lowering non-variable reimbursement costs.“

MedMined said that its services are used in about 185 hospitals in more than 25 states and are available to local hospitals for quality initiatives through Blue Cross Blue Shield in Alabama, California, Pennsylvania, New Jersey, New York and Texas.

“Hospitals have a long history of striving to prevent infections and MedMined's techniques now provide them with information that complement their safety initiatives and support measurable improvements,“ said David Schlotterbeck, CEO of Cardinal's Pharmaceutical and Medical Products business. He cited “significant opportunities to extend MedMined's data-mining and technology-based services to the medication management solutions we offer today with our Alaris and Pyxis products.“

Stephen Brossette, president of MedMined, said, “Given Cardinal Health's breadth and depth of knowledge and experience in managing medications in hospitals, we expect to find additional opportunities to apply our patented data-mining methods to deliver value to customers.“

Cardinal develops healthcare solutions designed to reduce costs, improve efficiency and deliver better patient care.

In other dealmaking activity:

• Behrman Capital (New York/San Francisco), a private equity investment firm, reported that it has sold portfolio company Tandem Health Care (Maitland, Florida), a provider of long-term healthcare services, to a consortium of JER Partners and Formation Capital in a transaction valued at $620 million.

Tandem Health Care is a provider of long-term care in targeted regional markets. Behrman Capital initially invested in Tandem in 1998, and since that time it has made additional equity investments to facilitate multiple acquisitions. Today, operating in 12 states, Tandem's services include short-term transitional care, long-term nursing care, Alzheimer's care, assisted living, rehabilitation, mobile diagnostic imaging, as well as pharmacy and hospice services.

JER and Formation said they will restructure Tandem into an owner of skilled nursing and other senior housing facilities and enter into a master lease for all of its facilities with Consulate Healthcare, a joint venture between Joe Conte, Tandem's president/COO, and Gene Curcio, the company's CFO.

Behrman said the Tandem transaction marks its second exit this quarter in the healthcare sector. In April, Behrman completed the sale of Athena Diagnostics, a developer of proprietary molecular diagnostic and immunodiagnostic tests and services, to Fisher Scientific International for about $283 million.

JER is the equity investment arm of J.E. Robert Companies (McLean, Virginia), while Formation Capital (Alpharetta, Georgia/Jenkintown, Pennsylvania) is an operator and investor in the senior housing and care industry.

• Affiliated Computer Services (ACS; Dallas), a provider of business process outsourcing and information technology solutions, has signed an agreement to acquire Primax Recoveries, a healthcare recovery firm providing services for more than 48 million customers in the healthcare payor industry.

The terms of the acquisition include a purchase price of $40 million, plus milestones based on future financial performance. ACS said it funded the acquisition through cash on hand and existing credit facilities.

With the acquisition of Primax, ACS said it now can provide recovery solutions including subrogation, coordination of benefits, duplicate payment, Medicare risk premium, contractual re-pricing and referral overpayment.

John Blaney, president and CEO of Primax, said, “We believe the cultural fit and complementary solutions with ACS provide excellent opportunities for both our customers and our employees.“

• AmerisourceBergen (Valley Forge, Pennsylvania) reported that its wholly owned subsidiary, AmerisourceBergen Canada, would acquire Rep-Pharm (Oakville, Ontario). The purchase price was not disclosed.

AmerisourceBergen said it expects to complete the acquisition by Sept. 30, the end of its fiscal year, and anticipates Rep-Pharm will not be material to earnings.

“When we complete the acquisition of Rep-Pharm, we will have built our Canadian pharmaceutical distribution business to over $1.4 billion in annualized sales and achieved the No. 2 position in the Canadian market,“ said R. David Yost, CEO of AmerisourceBergen.

Monty Kobrin and Herbert Kobrin, president and vice president of Rep-Pharm, will continue to be part of AmerisourceBergen Canada.

Rep-Pharm distributes pharmaceuticals primarily to retail community pharmacies in the provinces of Ontario, Quebec and Alberta.

AmerisourceBergen is a pharmaceutical services company serving the U.S., Canada and other global markets.