Irvine-based Quality Systems Inc.’s shareholders just got a new board to direct their company.
The maker of healthcare software announced its shareholder vote results in a recent Securities and Exchange Commission filing.
All nine candidates were elected, including three chosen by New York-based activist investor Clinton Group Inc.
The new directors backed by Clinton are: Peter Neupert, a former Microsoft Corp. executive and partner at San Francisco-based Health Evolution Partners LP; James Malone, chief financial officer of Boston-based healthcare software company American Well Corp.; and Morris Panner, chief executive of Phoenix-based cloud software company DICOM Grid.
Clinton, in making its case for the new directors, contended that Quality needed directors with more experience in the healthcare information technology field. It also said Quality had missed out on gains competitors experienced because of 2010’s healthcare reform law, which emphasized information technology as a way to help improve care.
Also elected were Craig Barbarosh, George Bristol, D. Russell Pflueger, Lance Rosenzweig, Quality’s founder and Chairman, Sheldon Razin, and Chief Executive Steven Plochocki.
Other changes may be afoot now that the new board is working.
Quality disclosed in an earlier SEC filing that its board transaction committee, which is expected to have two members of the Malone-Neupert-Panner group, would “take prompt action to recommend to the board the hiring of a suitable investment banking firm or management consulting firm.”
The chosen firm would participate in a strategic review of Quality’s options, including a possible sale. Analysts who follow Quality have suggested those steps could include a going-private transaction.
Quality’s interactions with Clinton contrasted with some of its other proxy battles this century, in that it was basically done in a low-key fashion.
Things were different with the proxy fights driven by shareholder and former director Ahmed Hussein.
Hussein, who owns some 10% of Quality, resigned from the software company’s board in May after 14 years of service. Many of those years were marked by fights between him and Quality management over corporate governance—he led four proxy battles against management during the past nine years.
Hussein said in an email at the time of his departure that he concluded Quality, which has seen its stock lose value during the past two years, “would continue to be severely damaged” under its management and board.
In other Quality news, Chicago-based Zacks Investment Service examined the company’s deal with Carmel, Ind.-based Clinical Architecture LLC, which was announced in early August. Quality is using Clinical Architecture’s Symedical server in connection with its NextGen Hospital Solutions software.
Zacks said in a report that it continued to have a “hold” rating on Quality’s stock, even after the Clinical Architecture collaboration.
Quality’s “core systems business continues to face significant headwinds but the rate of decline seems to have eased somewhat,” Zacks said. “Despite the [positives] such as improving pipeline growth, lead generation and lower operating expenses, management needs to address several operational issues to bring the Quality Systems back on track.”
The company also faces “intense” competition from the likes of Watertown, Mass.-based Athenahealth Inc. and Cerner Corp. in Kansas City, Mo., according to Zacks.
Masimo Device in Turkish Hospital
Irvine-based Masimo Corp. said Firat University Hospital in Turkey is using its Patient SafetyNet devices.
Firat University Hospital is using the devices to improve the oversight of neonatal intensive care unit patients.
Using Patient SafetyNet, along with Masimo’s SET pulse oximeters, “reduced the number of clinical alarms in our neonatal intensive care unit by about 70% within the first five days of installation,” said Dr. Erdal Taskin, associate professor of neonatology at Firat University Hospital, in a news release. “Our workload in the NICU has been reduced because of far fewer false alarms, which we believe will help patient outcomes.”
Prof. Gets Stem Cell Funding
Magdalene Seiler, a professor at the University of California, Irvine, received a $4.3 million grant from the California Institute for Regenerative Medicine.
Seiler is the lead researcher of the retina project of the Keirstead Research group at UC Irvine. She’ll use her grant to look at turning basic stem cell research into potential treatments for retinitis pigmentosa—a degenerative eye disease—and dry, age-related macular degeneration.
Retinitis pigmentosa can lead to blindness, and age-related macular degeneration is another major cause of blindness.
Bits and Pieces
Costa Mesa-based Vitamin Blue Inc. established its Vitamin Green subsidiary to deal with cannabis and hemp products. … Amada Senior Care in Laguna Woods is now working with Mission Viejo-based health information company Lifescript to develop a doctors’ network to deal with the issue of hospital readmissions. … Mission Surgery Center in Mission Viejo was named one of the top 100 workplaces for nurses by Scrubs, a lifestyle magazine for nurses.
