A proposed $35.7 million deal for South Coast Medical Center in Laguna Beach is getting a thumbs-up from a state regulatory consultant.
Medical Development Specialists Inc., an El Segundo-based consulting firm with a Costa Mesa office, has recommended that Attorney General Jerry Brown approve the sale of South Coast to Orange-based St. Joseph Health System.
In November, St. Joseph agreed to buy the 208-bed hospital from Roseville-based Adventist Health for $35.7 million. St. Joseph is awaiting the attorney general’s decision on the sale.
Medical Development suggested applying some conditions to the sale, including requiring St. Joseph to operate South Coast as a general acute-care hospital through the end of 2012, regardless of California’s earthquake retrofitting requirements.
Retrofitting is a major issue for South Coast and a big reason why it wants to sell the facility,its officials estimate it will take $25 million to $30 million to bring it into compliance with the state’s earthquake safety law, which requires hospitals to be able to be operational after a major quake.
South Coast has asked regulators for permission to operate until 2030 without retrofitting, even though Laguna Beach is near the Newport-Inglewood-Rose Canyon offshore fault line, which begins just south of Newport Bay and runs into San Diego County.
St. Joseph, a nonprofit Catholic health system with annual revenue of $3.7 billion, operates three of OC’s largest hospitals,St. Joseph Hospital-Orange, Fullerton’s St. Jude Medical Center and Mission Hospital in Mission Viejo.
Mission is listed as South Coast’s buyer in the report.
St. Joseph already has agreed to some stipulations as part of its deal, including retaining most of South Coast’s 460 employees, except for those whose jobs won’t be needed due to the closure of South Coast’s sub-acute unit and due to “integration initiatives,” the report said.
Adventist has cited several reasons for needing to sell South Coast, including a $26.8 million operating loss during the past five years and “a belief that the hospital is unable to ever break even financially,” the report said.
Adventist has operated South Coast since 1997. It also wanted to sell the hospital because it was geographically remote from its other facilities in Los Angeles, Glendale and Simi Valley. That kept Adventist from getting better contracts from health insurance companies, according to the hospital operator.
As part of the deal, Adventist agreed that none of its affiliates will provide healthcare services in the 29 ZIP codes surrounding South Coast for three years.
The report also addressed what could happen if Brown’s office doesn’t sign off on the deal, noting that South Coast could be sold to other interested buyers on similar terms.
Visiogen Lens
Irvine-based Visiogen Inc., which raised $40 million in venture funding last week, said its Synchrony intraocular replacement lens,an implant for cataract patients,was featured in presentations at the recent annual meeting of the American Society of Cataract and Refractive Surgeons in San Francisco.
The presentations covered the lens’ clinical research results.
The device maker anticipates getting Food and Drug Administration approval for Synchrony in 2010.
Visiogen, a venture-backed, privately held company, sells Synchrony in Europe.
The company’s latest funding brings its total raised to about $80 million.
Bits and Pieces:
The University of California, Irvine, is among several institutions that are lobbying Congress to increase federal support for National Institutes of Health-funded research. The campaign, called “Research Means Hope,” is going to use print, radio and online advertising, as well as electronic and social media Lake Forest-based InSight Health Services Holdings Corp. said it completed an acquisition of two imaging centers in the Boston area. A purchase price wasn’t disclosed Peregrine Pharmaceuticals Inc., a Tustin drug maker, said that a majority of patients in a second-phase trial for its bavituximab drug candidate for lung cancer achieved an objective tumor response, or a decrease in tumor size California State University, Fullerton, hosted a conference on autism research late last month. The event was designed to disseminate practices for children who have the disorder, organizers said Loving Back.com recently launched as a Rancho Santa Margarita-based Web site that provides information and resources for caregivers to and children of the elderly.
