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Tyco Conglomerate Splits Tyco International Ltd made headlines last month when the company announced it would split into four companies to calm investors made nervous by rumors of accounting problems at Tyco. The plan is designed to close the gap between Tycos market value in recent years and the value of our business, Tycos chairman, L. Dennis Kozlowski, told The New York Times. The stock of the Bermuda-based conglomerate had fallen 20% since December. Tyco Healthcare customers will notice few, if any, changes, however, since the entire health care division, including respiratory care manufacturers Nellcor, Mallinckrodt, and Puritan Bennett, is being spun off as a single unit. If industry trends continue, Tyco Healthcare should do well. The unit had $1.7 billion in profits in 2001, Tyco said, and the day the split was announced, Nellcor signed a 3-year, sole-source contract with MedAssets Inc Healthcare Solutions, a group purchasing provider based in Alpharetta, Ga. Respironics and Novametrix Sign $90-Million Merger Deal Respiratory care product manufacturers Respironics Inc, Pittsburgh, and Novametrix Medical Systems Inc, Wallingford, Conn, entered into a merger agreement on December 18, 2001, in which Respironics will acquire Novametrix. The boards of directors of both companies unanimously approved the deal. Novametrix is an excellent fit strategically and operationally. This is a highly synergistic transaction in terms of technology, products, and markets served, says James W. Liken, president and CEO of Respironics. In addition, our sales and marketing efforts are complementary. Combined revenues of the two companies are approximately $490 million for the latest 12 months. This tax-free, stock-for-stock transaction is valued at $8.65 per share to the Novametrix stockholders, or $90 million, based on the assumption of approximately $6 million in debt and Respironics December 17, 2001, closing price of $34.59. Novametrix board of directors and management team strongly endorse this tax-free transaction and believe it is an excellent opportunity for Novametrix stockholders, says William J. Lacourciere, chairman and CEO of Novametrix. As part of this acquisition, Novametrix becomes an important contributor to Respironics growth in revenues and earnings. This was an important consideration in deciding on a stock-for-stock transaction. For more information on the acquisition, visit www.respironics.com and www.novametrix.com. | HME Insider The HELiOS Personal Oxygen System has been on the market for 14 months and has had phenomenal success rejuvenating and revigorating the liquid oxygen market, says Daniel Van Hise, director of marketing at Puritan Bennett/Tyco Healthcare, Pleasanton, Calif. Dealer/Provider spoke with Van Hise about product development and the success of the HELiOS system. Q What is the process of developing a new product at Tyco? A We take into consideration the focus groups and customer analysis. We do a lot of elaborate upfront market research. We survey the end users of the technology, the distribution channel, and the clinicians that prescribe the technology. After the research phase, we put together a prototype of the product and take it to the marketplace to see that what we heard and what we created match. At that point, we get very good feedback on the design and the feasibility of the product. We then go through the engineering process to develop the product. Q How long does this process take? A It is not a quick process and it varies from product to product. Some products can take a number of years from start to finish. Something like a ventilator can take anywhere from 2 to 3 years, and sometimes longer than that. If it is a completely new concept, you are required to do a premarket approval. These technologies can take 5-plus years to bring to the marketplace. Most commonly, the development cycle is 14 to 18 months for products in the home care arena. Q To what do you attribute the success of the HELiOS Personal Oxygen System? A We did a good job listening to what end patients needed. We did extensive surveying of the customers, their likes and dislikes, and the inconvenience of living with oxygen in the home, both from the standpoint of the difficulties in having a normal lifestyle with oxygen as well as the embarrassment factor. One of the major concerns that patients have is how they appear with their oxygen system. The HELiOS system was designed around the patients need for a long-lasting portable device that was aesthetic and also very economic, both for the patients because they dont have to worry about a high electric bill...and for the DME company. Q How does Tyco Healthcare survive the competition within the industry? A Our name is synonymous with high-quality products, products that have long staying power. We spend a lot of time making sure that the product is safe for the patient and that the product lasts a long time...We have liquid oxygen systems out there that are 10-plus years old and continue to operate as effectively as when they were new. The same thing with our ventilators. We have a lot of ventilators in the home care arena that are over 10 years old. These ventilators are workhorses; they just dont break down. We also do a very good job of listening to our patients, as well as the DME companies and the physicians, and we create products that really suit [the patients] needs. Q What opportunities and products do you predict for the upcoming year? A Products like continuous positive airway pressure (CPAP) and bilevel devices are going to be smaller, more ergonomic, lighter, and with very full feature sets at competitive and cost-effective pricing. The drive is certainly on. Were leading that drive in a lot of ways and we see that happening across the board in terms of all the products that we manufacture. What we are doing now is listening very closely to our customers about their needs, designing products around [those needs], and working with our customers to have a good understanding of the reimbursement issues of Medicare and other insurers. Were not just a manufacturer. Our sales organization is strategically minded and works very well with the dealers to help them make their businesses more successful. | DeVilbiss and Fisher & Paykel Support ASAA The American Sleep Apnea Association (ASAA) announced in November that DeVilbiss Inc, now Sunrise Medical, Carlsbad, Calif, rejoined the ASAA Industry Roundtable as a Patron and that Fisher & Paykel Healthcare Inc, Laguna Hills, Calif, renewed its membership in the Roundtable at the Contributor level. Members of the Industry Roundtable make unrestricted tax-deductible contributions to help the association aid those affected by sleep apnea. For more information on ASAA programs and material, call (202) 293-2650 or visit www.sleepapnea.org. Permobil Is on the Grow: Profits Up 25% Permobil, Lebanon, Tenn, reports an increase in sales and profit of over 25% for the third quarter and an increase of over 30% for the fourth quarter. With a demand for Permobil products escalating, the company will add sales representatives nationwide. www.permobil.com . AARC Zenith Award Presented to VIASYS Healthcare At the American Association of Respiratory Care (AARC) 47th Annual International Respiratory Congress in San Antonio, Tex, the association presented the 2001 Zenith Award to VIASYS Healthcare Inc, Conshohocken, Pa. Tony van den Berg, president of the VIASYS Healthcare Critical Care Division, accepted the award on behalf of Randy Thurman, chairman and CEO of VIASYS Healthcare. The AARC established the Zenith Award program in 1989 to honor respiratory care product and service providers that give the respiratory care community outstanding service. www.viasyshealthcare.com. Rehabilicare and directDME Enter Cyberspace directDME, Farmington, Conn, a direct marketer of DME, is the first Web-based retailer for Rehabilicare Inc, New Brighton, Minn. The Rehabilicare product line, including TENS units and a full range of electrotherapy devices and accessories, is available through directDMEs Web site and toll-free number: www.directDME.com; (877) 496-7461. Trac Medical Inks e-CMN Deal, Hires Lisa Thomas-Payne An agreement between software provider Trac Medical Solutions Inc, Schenectady, NY, a subsidiary of AuthentiDate Holding Corporation, and American HomePatient Inc, a $363-million home health provider in Brentwood, Tenn, will allow American HomePatient to begin evaluation of CareCert, an Internet-based solution for processing Certificates of Medical Necessity (CMNs) and other medical forms, in early 2002. This agreement represents a giant step forward in building the critical mass of users in the health care provider community that we need to ignite growth and acceptance of the medical forms processing, says Jeffrey Frankel, Trac Medicals president. To support the development of Trac Medicals CareCert medical forms solution, the company has also hired Lisa Thomas-Paynes consulting company, Medical Reimbursement Systems. Our collaboration will be instrumental in improving accuracy and speeding cycle time over traditional paper-based methods, Frankel says. www.tracmed.com. Medline Receives VA Contract The Office of Acquisition and Material Managements National Acquisition Center (NAC) with the Department of Veteran Affairs, awarded Medline Industries Inc, Mundelein, Ill, a national contract for its Consolidated Mail Outpatient Pharmacy (CMOP) program. In addition, Medline acquired blanket purchasing agreements (BPAs) and a federal supply schedule. www.medline.com. | HME Insider Michael Hammes joined Sunrise Medical, Carlsbad, Calif, after more than 30 years of senior management experience in the durable goods and the automotive industries. Dealer/ Provider spoke with Hammes, now CEO of Sunrise, about his interest in blending different fields to build a stronger management team. Q How is Sunrises new management team raising standards? A In terms of the manufacturers, our industry has been closed. There are just a few major competitors. Theyre good companies, but they find themselves competing only with themselves, whereas people outside the industry compete with the best Japanese, German, and American companies on quality standards, delivery performance, durability standards, and the ability to handle recalls. What we want to do is raise the bar for Sunrise, and hopefully for the industry too, in terms of quality, durability, reliability, delivery performance, and technology. Were bringing in people from the electronic industry, the automotive industry, and the consumer-durable industry and mixing them with people experienced both with Sunrise and with the industry. Hopefully, we will end up with an overall team that will change the standards. The overriding goal of Sunrise is to improve peoples lives through high-quality innovative products. That comes before financial results, because, in our opinion, if we really change peoples lives through high-quality innovative products, the financial results will just happen. We have two goals, one to raise the standard of the industry in ourselves and second to make sure our vision happens. Q Did your various background occupations help you develop this management idea? A Yes. I was the vice chairman and chief operating executive at Black & Decker
that whole background of [competing with foreign and US companies], and bringing together all of the disciplines within a company that really focus on the customer, was enormously helpful. But Im missing that 15 or 20 years of experience in the rehab business, the standard HME business, and the respiratory business. Thats where Marilyn Hamilton, vice president planning and strategic services, and Michel Papillon, vice president North American sales, come in. By mixing experience like that with my experience, you get a better answer in the end. In that enthusiasm to bring in new talent, you shouldnt pass by that very necessary ingredient called tradition, history, culture, and experience that you already have inside your company. Q What is Sunrises vision for 2002 and what products can our readers look for? A Our first fiscal year as a private company, which ended last June, was by far our most successful. In the second year, we can look forward to more of the same. Results are what happens when you do the basic things right. When I look at that first year and a half and whats been accomplished, I think we can be very proud as a Sunrise team. Q In October, Sunrise had the first Quickie Wheelchair Sports and Education Clinic hosted at the University of Memphis. Why are events such as this important? A These types of events are extremely significant in terms of bringing together the community and educating consumers, clinicians, dealers, families, and friends. We strive to touch more consumers lives with value-added experiences, whether it is sports, kids, or everyday consumer programs. These events are critical to our culture, critical to what we stand for, and theyre going to become bigger and more important as we move forward. | CAS Recalls Infant Apnea Monitor CAS Medical Systems Inc, Branford, Conn, is recalling all AmiŽ and AmiŽ Plus Apnea monitors manufactured since 1997 by Nellcor Puritan Bennett, Mallinckrodt, and CAS Medical Systems. CAS received complaints involving seven Ami and Ami Plus monitors where users reported the monitor shutting down without alarming when exposed to high levels of static electricity. Although no deaths or injuries have been associated with these complaints, the failure of the monitor to alarm in this situation could put the patient at risk. The recall plan requires all monitors to be returned to CAS for modification, including incorporating a power-failure alarm and making the monitors less susceptible to static electricity. In order to accomplish the recall with minimal disruption to the customer, CAS has designated a full-time recall coordinator to work with their customers. Contact Tracy Blanusa, CAS recall coordinator, at (800) 862-6186. eClickMD Releases e-CMN and HIPAA-Compliant Software According to eClickMD Inc, Austin, Tex, its beta third-generation software platform accommodates care plan oversight billing, e-CMN documents for HME providers, and the Health Insurance Portability and Accountability Act (HIPAA) privacy requirements. Encryption technology protects patient data while the open architecture software platform can integrate into legacy software for managing and tracking documents that fall under HIPAAs privacy protection rules, said company COO Deborah A. Kaufman. www.eclickmd.com. | In Brief | | Essentially Women, Oxford, Mich, added a sales and marketing division to be headed by director of business development JoAnn Wandrey. Medigas, a division of Praxair Canada Inc, Danbury, Conn, received accreditation status from the Canadian Council on Health Services Accreditation (CCHSA). Kimberly-Clarks Health Care business, Roswell, Ga, named Joanne B. Bauer president. The company also announced the launch of its redesigned Web site, www.kchealthcare.com. The new site features an e-catalog to support the growing need for e-business assistance to health care professionals. The VGM Group, Waterloo, Iowa, awarded a full line product contract to Mason Medical, Glendale, NY. The contract covers products ranging from foam/innerspring mattresses, powered mattresses, and mattress overlays to wheelchair cushions and other bed-related products. Golden Technologies Inc, Old Forge, Pa, expanded its sales and marketing departments and introduced a support services department to manage and operate the companys reporting, Web continuation, and co-op programs. Golden Technologies named Charles Copley sales and marketing manager. Graham-Field, Atlanta, elected a new board of directors and appointed Michael Joffred as CEO and chairman of the board. Maddak Inc, Pequannock, NJ, manufacturer of AblewareŽ bathroom and daily living aids, formed an alliance with Independent Needs Centre, Markham, Ontario, Canada, manufacturer of Lifestyle Essentials. The two companies will team up on joint advertising projects, catalog ventures, and exhibits. SMT Health Systems, Detroit Lakes, Minn, is the new manager and distributor for the Homecrest, Wadena, Minn, Rock N Go wheelchair, a rocking wheelchair that can be customized through tilt and height adjustments. The Centers for Medicare & Medicaid Services has assigned a new Healthcare Common Procedure Coding System code to the CoughAssist distributed by Respironics, Pittsburgh. Medical World Communications Inc, Jamesburg, NJ, announces the promotion of Lonnie Hirsch to president of Practice Builders as part of an ongoing growth strategy for the subsidiary company of MWC. Practice Builders is a professional-practice health care marketing firm. |
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