ALDA & Associates International, Inc. Newsletter
2020 SUMMER EDITION
Features & Articles in this issue
- Is Telehealth/Telemedicine Here to Stay and What Comes Next-The New Normal By David H. Fater
- Clinical Research in the Time of COVID is the Ultimate Trial by Combat by Jules Mitchel, Ph.D.,Christian Macedonia, MD and Joyce Hays, MS
- ALDA Representative Engagements
- The ALDA Team
Breaking News
A reminder about our Newsletter. Since we specialize in Healthcare, the feature article will always deal with healthcare. Its content will benefit all constituents-providers, insurers and patients so even though you may not work in healthcare you will benefit in knowing what is emerging which may affect your patient experience. The second article may also feature healthcare but may also focus on an aspect of business that will be of interest to our readers. Additionally, earlier editions of the Newsletter will be archived on the website. Readers can find them by scrolling down to the bottom of the newsletter.
In this edition, as the entire country is consumed by the Corona Virus Pandemic, the status quo cannot remain. There is so much material to be distributed for the American people to absorb concerning our health, our economy and way in which we conduct our lives it cannot be done in one edition. We have combined two articles concerning Telehealth and what may become the New Normal in order to include an article concerning the conduct of clinical trials in a COVID environment.. It was authored by Jules Mitchel and Joyce Hays of Target Health (one of ALDA's strategic partners) and Christian Macedonia, MD, the CEO of Lancaster Life Sciences Group LLC. Given the push to develop a vaccine or drug treatment for COVID-19, there are numerous clinical trials underway, not to mention ongoing clinical trial for other medicines, that have to be conducted during the pandemic we thought it was important to include it in this edition.
There is so much that has changed regarding the reopening of the economy and the return to the workplace that there is not sufficient room here to include it. Suffice it to say many protocols for hiring, monitoring the work place and ongoing daily business have changed and we will address them in a special edition of the Newsletter next month.
ALDA continues to add client engagements in the industry and is now working with several drug development companies to assist in refining their strategy, capital raising, getting their drug candidates through clinical trials and thus adding to their product pipeline and navigating the Food and Drug Administration. We also have been retained by a healthcare institution to conduct due diligence on a company that is negotiating for the rights to a drug under development pursuant to a license agreement.
Book News
- Essentials of Corporate and Capital Formation published by Wiley & Sons and authored by ALDA's Chief Executive Officer, David H. Fater, is available online and in bookstores as well as in a Kindle version.
Essentials of Corporate and Capital Formation
by David H. Fater
ISBN (13): 978-0-470-49656-5
ISBN (10): 0-470-49656-8
Cost: $39.95
Paperback: 224 pages
Brief Description: A simple and effective guide to the mechanics of finance and corporate structure.
- Explains ways to form a business and finance it
- Reveals how to avoid securities laws pitfalls
- Practical terms and examples of the necessary mechanics of finance and corporate structure
- Helps analyze the decision to "go public" and provides pointers on operating a public company
About ALDA:
ALDA & Associates International, Inc. is a business and financial consulting firm committed to assisting companies with:
- Management
- Capital Acquisition and Allocation
- Profit Maximization
We help physicians, scientists, entrepreneurs and managements change the world. Our experienced professionals are dedicated to helping clients unlock inherent value and create new value. The real-world experience of the ALDA team is leveraged for each client's unique circumstances, challenges, and people.
Among ALDA's hallmark services:
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EOM (Executive Outsourcing Model)
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ARS (ALDA Rapid Solutions)
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Financing Assistance
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Mergers and Acquisitions / Due Diligence / Post Merger
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Intellectual Property and Regulatory Affairs (FDA)
Our experienced professionals can show you all the right steps. For additional information on how we can help, please contact us by email at dfater@alda-associates.com or rcohen@alda-associates.com.
Part 1
Is Telehealth/Telemedicine Here to Stay and What Comes Next-The New Normal—How Will the Pandemic Change Our Lives?
by David H. Fater
The pandemic has brought the entire world to its knees and affected almost every aspect of everyday life. The practice of medicine has had to grapple with significant changes down to its very core, some of which may have been overdue and some of which are ahead of their time. One of the most visible changes has been the increased use of telemedicine/telehealth/virtual visits.
Telemedicine was working its way into the system but in little increments, most of which were driven by reimbursement (or should we say the lack of it- as we know physicians do not like to not get paid a reasonable fee for the provision of their services). The introduction of a pandemic virus brought fear into the minds of patients and caregivers alike starting with the notion of sitting in a crowded waiting room with “sick” people. Preventive and routine visits suddenly started getting cancelled. Sensing the need for flexibility, Health and Human Services (“HHS”) responded with a host of regulatory waivers. These included Center for Medicare and Medicaid Services (“CMS”) expansion of Medicare reimbursement, Congress giving HHS authority to waive originating site requirements for Medicare beneficiaries and states waiving licensing restrictions.
Patients being offered virtual visits initially experienced uncertainty. They were not necessarily tech savvy and may not have even been certain that their computer had a camera. Much of this uncertainty was alleviated by the use of smartphone technology and amplified by the comfort of not being exposed to any germs in the waiting room or physician offices.
As recently as last year, only 8 percent of Americans had ever used telemedicine. Overnight in the spring of 2020 that has changed to where 95 percent of patient visits are now virtual and insurance companies and health providers have begun advertising their telemedicine offerings. Telemedicine is defined as a visit between a patient and a health care provider by telephone, smartphone, tablet or computer and is just one part of telehealth which also includes programs such as at-home patient monitoring and physician-to-physician consults. (One of the most obvious examples of this is teleradiology in which CT scans and MRIs are interpreted by radiologists who can even be on a different continent than the patient’s physician).
Innovative telehealth programs are successfully reducing the need for patients to go to the emergency room or the hospital and are proving so attractive to patients and health care providers that this is evolving into becoming mainstream. Additionally, more and more applications or instruments are being deployed that automatically transmit the captured information to the provider thus providing an updated patient chart and treatment modifications as necessary.
If a patient has a chronic condition such as diabetes, congestive heart failure or chronic obstructive pulmonary disease, they will benefit from this type of virtual care. Atrium Health serves 37, 800 patients across Georgia and the Carolinas has seen this use increase 500% since the pandemic began. In fact, they have a program for heart patients who require heart surgery called Perfect Care that follows patients before, during and after surgery. When patients go home, they are equipped with a smartphone (if they do not have their own) along with a weight scale and wearable devices that monitor heart rate, the number of steps they take and their sleep patterns that are transmitted to a patient dashboard that enables the provider to manage care from afar and reduce emergency visits and hospitalizations.
Making Change Last
So the big question is -Will telehealth become the “new normal”? This, of course, depends on how insurers and government agencies decide to approach the complicated web of the American healthcare system.
Historical regulations have restricted access to a patient’s health records. Regulations have also required electronic communications (including virtual visits) to be encrypted in order to avoid security breaches of a patient’s personal medical record. With the onset of the pandemic, HHS relaxed its privacy rules permitting physicians to utilize previously off-limits technologies such as FaceTime, Skype and Zoom. While certain service levels provide greater access, HHS encourages providers to notify patients that these third-party applications potentially introduce privacy risks. If and when the pandemic passes, what will happen to these regulations?
Another obstacle is the digital divide. Approximately 21,000,000 Americans lack broadband internet access. This issue is especially serious in rural areas and amongst the poor. This does not include those patients who have no smartphone and those patients who have poor reception which makes even simple phone visits difficult to impossible. In consideration of this, Congress has allocated $200 million for expanded telehealth services in its current pandemic legislation but there is no assurance that this funding will reach those in need. The adequacy of the broadband infrastructure also will need to be addressed and strengthened.
A third variable in this complicated equation is the uncertainty of how insurance companies view telemedicine. To no surprise, a 2018 survey found that the leading reason physicians were reluctant to offer telemedicine services was because insurers either didn’t cover these services or reimbursed them at significantly reduced rates. While as stated earlier, CMS passed emergency legislation to raise Medicare rates to equal in-office visits as did private insurers, these rates are temporary.
One of the avenues to ensure that telemedicine continues to be used is make the reimbursement adjustments permanent. CMS Administrator Seema Verma has suggested that some of the telemedicine waivers granted during the pandemic remain in place.
On the other side of the coin is the interesting anomaly that if these reimbursement and other waivers remain, we may find that total healthcare expense may go up instead of down. It may turn out that the technology and other costs (which make it convenient for the patients) actually drives total costs up. Could the increased costs be justified because of the other benefits telemedicine provides and what about the patients who have evolved to endorse telemedicine and the virtual visits. Will they still be advocates if they have to bear a portion of the increased cost?
The Road Forward
The expanded use of telemedicine during the pandemic provides a unique opportunity to study what is working, what is not and what should become permanent. Its use has exploded onto the scene by circumstances no one anticipated and we should utilize the opportunity to make it even better. We firmly believe that telemedicine is here to stay but needs to be optimized.
Part 2
What Comes Next? The New Normal-How Will the Pandemic Change Our Lives?
Unlike anything we have seen in our lifetime COVID-19 will change everything in our lives from how we greet each other, how we work, how and how often we travel and what might be on our bucket list. The experiences we have had over the past several months will dramatically change how we do things for years. Let us predict what is coming, what may be on the ropes and what we may lose forever in this crisis.
The wearing of masks won’t just make it harder to hear on socially distant walks. Masks will be reshaping lines politically and personally and between young and old. The mask wearing will be sending a message as to how seriously someone takes public health warnings, about views on personal liberties and even generational differences, especially since adults 70 and older rate the threat of COVID-19 as more serious than younger people; HOWEVER, the events of the past several weeks may change that perception as the 25-44 year old age bracket has been viciously attacked by the virus.
Clean will become the new green as businesses will attempt to show an increased attention to hygiene. There will plexiglass partitions between customers and sales personnel and even temperature check stations to enter a building. We will be attempting to migrate to a touchless or contactless economy. Online ordering will become the norm for millions of people and a lifeline for older adults. Downloads of shopping apps have quadrupled in one month. The use of bots is increasing and there is much experimentation in expanding their use for delivery.
2. The Knockout Punch. COVID-19 has successfully put the mall, dinner and a movie and the morning paper on an endangered species list. Retail companies that were already reeling through 8 rounds of online competition finally succumbed to filing bankruptcy. It is estimated that as many as 15,000 stores could ultimately close. One media analyst has decried the pandemic as an “extinction event” for print as newsstand sales, subscriptions and advertising dollars shrivel.As we enter a world where no one is going out, diversions are disappearing. The restaurant industry was already challenged by low margins but now it is estimated that one in ten establishments could close for good. Restaurants and bars accounted for 60% of job losses in the month of March alone. Those jobs may never come back as well as some items such as salad bars and buffets.
People are enjoying the new abundance of streaming video which is great news for Netflix and Amazon Prime but it could put the lights out permanently at movie theaters. Staying away from theaters may become an issue of life or death for the population most at risk. On the other hand, drive-in theaters may see a resurrection with families remaining in their cars and concessions by phone.
3. Peoplephobia. Our collective mindset is shifting on everything from stadium gatherings to dream trips. The days of packed stadiums may be over and the athletes may perform to empty stadiums (or life size cut-outs).
The use of mass transit will be affected as well. Public transportation ridership demand has dropped 75 percent nationally during the crisis. The New York subway traffic is down 93 percent. There is an even more telling statistic on this—It took six years for transit ridership to return post 9/11 and people were not worried about pathogens and germs as they ride crunched in together.
Society is about to do a major rethink on commuting now that telecommuting is here and is a real option. This also has made the status around clustering in a city center less desirable. Interestingly, American cities will reassess the width of sidewalks, the access to parks and the need for cars. New York City has already made plans to close 100 miles of streets for pedestrian use. It will be extremely difficult give back all that opened space.
5. Oh, That sounded great at the time. In the good old days (defined as February and before) we viewed staying in a stranger’s guest unit as the smart way to avoid high-priced hotels. The pandemic has drastically changed that view. Airbnb recently laid off 25% of its workforce and is implementing new rigorous cleaning guidelines including the ability to block off 72 hours between guest visits. While 74% of people surveyed indicated a preference of staying in a home where they had more control of their surroundings as opposed to a densely populated hotel, the question to ask is “Do you really want to sleep in a room cleaned by someone who is doing this as a hobby?”.
Retirees who were considering downsizing and moving to an apartment in town are rethinking that choice as well. Aging in place is going to mean aging with more space. Americans who thought the best place to retire would be somewhere dense with access to transportation, restaurants are rethinking that as cities like New York became the epicenter of the virus.
6. The Unknowns. Life as we know it is changing and there is really no way to accurately predict what all that change will be. You can pick any concern and it is punctuated by question marks. The Economy? Medicare? There is no doubt the downturn will be the worst since the great depression. Voting in the new era will be a learning experience that hopefully we will accomplish before the November election.
This capsule hasn’t even dealt with some very significant issues like:
- Remote Work and Work from Home Policies
- Office Building Use
- Company Travel
- Reopening the Workplace Protocols that include:
- Operating the Business Safely and Legally
- Workplace Safety Protocols
- Screening for Illness
- Compensation Reductions
- Families First Coronavirus Response Act (FFCRA)
- Qualifying Reasons for Emergency Paid Sick Leave Act (EPSLA)
- Returning Employees to the Workplace-What You Should Ask and When You Need to Ask It
- Managing Decisions About Who to Recall, Notifications and Employee Refusal to Return
- Nursing Homes in general and with COVID-19
- Many more too numerous to mention.
Conclusion
We have attempted to deal with the broad brush as to how the Pandemic will change our lives and there are many challenges ahead. There are more changes coming (especially with the significant increases the last two weeks). We may put out a special edition to cover the issues expressed above concerning the issues surrounding the reopening of the workplace and telecommuting. Companies should review what they are doing with independent consultants and their legal counsel. America has always demonstrated its resiliency and we have to hope that it will do so again both to deal with the current crisis and to better prepare us for the next..
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To explore ways in which we can provide assistance with your strategy or decipher the changing reimbursement rules being promulgated by CMS in this evolving health care environment, please contact David H. Fater at dfater@alda-associates.com or Richard M. Cohen at rcohen@alda-associates.com
Clinical Research in the Time of COVID-19 is the Ultimate Trial By Combat
“Thus, though we have heard of stupid haste in war, cleverness has never been seen associated with long delays.” -Sun Tzu, The Art of War
“Most of warfare is about convincing an enemy to give up. The greatest difference now is that the “enemy” is totally unthinking and unpersuadable, and will never give up.” (Christian Macedonia, MD)
Both the U.S. Healthcare Agencies and the U.S. Military and have mutually supporting roles in maintaining strong security and safety measures for American citizens at home and abroad. The arrival of COVID-19 is an event of unprecedented strain on the health systems and security of our interconnected world.
COVID-19 is caused by coronavirus SARS-CoV-2. Older adults and people who have severe underlying medical conditions like heart disease, lung disease or diabetes seem to be at higher risk for developing more serious complications from contracting COVID-19.
Traditionally, clinical research is performed in a careful and meticulous manner to assure, first and foremost, the safety of the study participants. Secondarily, clinical research provides quality data to assure the safety and effectiveness of treatments which the FDA and other regulatory bodies then allow marketing of these novel therapies to the general public.
We are living in extraordinary times when infectivity of a relatively large proportion of the population is real, with a high risk of imminent death and disability within the global population. It is quite sad to hear, that the risk of COVID-19 is at the feet of the elderly, and those with heart disease, lung disease and diabetes. We are a civilized society, where it is unconscionable just say that because you are vulnerable, “tough luck.”
The Enemy
The enemy is a dangerous new virus, SARS-CoV-2. First of all, clinical trial stakeholders, including study participants, clinical care providers, sponsors, regulators, pharmacies, as well as CRO’s like Target Health are all under stress to deliver and complete high quality studies, now effectively in a war zone, with Covid-19 ravaging our citizens.
Years ago, Target Health met with the Defense Threat Reduction Agency (DTRA), a division of the US Army, for a product to treat neuroactive chemical agents in a war zone. Besides being impressed by the quality and commitment of the DTRA team, it was very clear that first and foremost, the goal was to reduce mortality and morbidity by quick action in a war zone, while at the same time, get FDA to approve the product. For example, one requirement was to quickly administer the countermeasure and then evacuate the soldier to the nearest medical unit.
The Pharmaceutical Industry
Some of the very exciting phenomena we are seeing due to the current public health emergency is the behavior of the pharmaceutical industry as it reacts to devastating Covid-19 statistics, including:
- repurposing of off-patent marketed drugs
- repurposing of currently marketed novel drugs
- identification of new indications of drugs currently in development
- resurrection of drugs that have failed for one indication, which can be applied to COVID-19
Study endpoints are measures that often involve symptoms of a disease like reduction of blood pressure in hypertension, reduction of hemoglobin A1C in diabetes and joint pain in arthritis. Other endpoints may include patient reported outcome (PROs) such as “I can now play sports.”
In COVID-19 studies, virtually all studies have the same key endpoints with the following parameters:
- NIAID ordinal assessment
- WHO Ordinal Scale for Clinical Improvement
- Death within certain number of days from first dose of study drug
- Time to extubation
- Length of hospitalization
- Length of ICU stay
- AEs and SAEs
- SARS-CoV-2, a heartless enemy:
- Is like a roadside bomb, hiding ready to launch toward us at any moment.
- Is like a chameleon, changing its camouflage depending on the background of the environment
- Easily attacks the weak and vulnerable
- The virus itself knows no fear, has no regard for diplomacy, and cannot be placated with overtures of money or power.
- The “enemy” has only one mission and that is to reproduce as many copies as possible.
- Protective gear is needed to fend off attacks
- Access to the zone of operations is often denied.
- The situation is often fluid and chaotic and defenders and planners do not have the luxury of time.
- Murphy’s Law applies: “What can go wrong will go wrong.”
- Like a War Zone, even when the plan is executed perfectly there still innocent lives lost in the process.
- To identify and empower intelligent and capable leaders
- To meet the virus head on while at the same time keeping a safe distance
- To take risks to find its vulnerabilities
- To develop countermeasures at all levels
- To reward and indemnify leadership that is wise, bold, and decisive.
- To eschew a “zero defects” mentality.
- Jules T. Mitchel, MBA (Pace University) PhD (NYU) , CEO, Target Health LLC;
- Christian Macedonia, MD, Adjunct Associate Professor, Johns Hopkins University, School of Medicine, CEO Lancaster Life Sciences Group LLC
- Joyce Hays, MS (Columbia University), VP, Operation and Administration, Target Health LLC
Representative Engagements
- Advisor to three drug development companies for raising capital, designing and implementing clinical trials and interfacing with the FDA.
- Initiated and developed a de novo Accountable Care Organization to participate in the Medicare Shared Savings Program which grew to over 250 physicians over three years which successfully generated savings.
- Financial advisor to large physician practice in connection with a potential acquisition transaction where engagement includes determination of strategic and fair value and assisting in negotiations for closing the acquisition and in post acquisition integration.
- Review and in-depth analysis of new Medicare Reimbursement rules for subsidiary of Fortune 50 insurance company and assistance in developing a business model enabling the capture of a new revenue stream for both physician practices and affiliated providers.
- Acquisition due diligence and integration assistance for a public healthcare staffing company involved in numerous acquisitions. Retained by parent company to manage acquired company for 22 weeks through ALDA developed integration plan.
- Turnaround assistance for a near bankrupt client company, including tax and financial restructuring, and ultimate sale at a significant cash price.
- Leadership of development of client company's strategic plan for the next decade and assistance in repositioning the company.
- Determination of strategic value of a client company, packaging for sale and assisting in negotiations.
- Providing the entire management team for several life science and healthcare companies from early stage through obtaining additional patent protection, guiding clinical development plans, navigating the pathway through the FDA, establishing the manufacturing processes, initiating commercial sales and eventually transforming the Company into a publicly traded Company.
- Determination of strategic implications of a line of business with weak performance; development of strategies to maximize profitability contribution.
- Turnaround assistance for a troubled venture-backed company, including raising additional debt and equity capital.
- Acquisition and financing assistance for a public, international railroad in connection with a $300 million cross-border acquisition and refinancing.
Our experienced professionals are dedicated to helping clients unlock inherent value and create new value.
The ALDA Team includes, among others:
David H. Fater - Chief Executive Officer
Strategy, capital markets, restructuring, and mergers and acquisitions experience with public healthcare companies focused on physician management, rural healthcare, nursing homes, HMO's, diagnostic imaging and medical devices. Deeply involved in the implementation of the Affordable Care Act with Accountable Care Organizations, Independent Practice Associations and Management Services Organizations.
Richard M. Cohen - Senior Operations and Business Development Executive
Healthcare operations and worldwide sourcing experience. Skilled in healthcare (physician management, clinical trials, medical and patient process flow, diagnostic imaging and life science) operations as well as in issues dealing with importing, exporting and manufacturing operations in South America, Far East and Europe.
Thomas J. Bohannon - Senior Financial Executive
Accomplished, creative CPA, outstanding analytical and technical abilities. Has experience for over 40 years in public accounting and private industry including nursing homes, medical device companies, hospitals, not-for-profits, retail, manufacturing, import/export and natural resources.
A. Ronald Turner - Senior Healthcare Executive
Senior healthcare industry executive with strong entrepreneurial focus including CEO and COO positions with start-up hospital companies and a publicly-traded hospital company. Extensive and successful operations experience for more than 50 hospitals and 9 nursing homes, and senior reimbursement experience for a major publicly-traded hospital company and a national accounting firm. Experienced in mergers and acquisitions, led operational turnarounds and debt restructurings that created significant value.
Mark W. Caton – Senior Healthcare Executive
Senior hospital executive with over 30 years experience in operating not-for-profit and investor-owned rural/community hospitals as CEO or COO, and Regional COO with several national hospital companies. Skilled in strategic planning and business development, operations management, revenue cycle management, medical staff development, and quality/resource management.
Daniel N. Weiss, M.D., F.A.C.C. - Chief Medical Officer
Medical devices and healthcare practice experience, engaged in a private medical electrophysiology practice where he performs numerous invasive cardiac procedures and has served as a consultant for several Fortune 500 Medical Device Companies including Philips, Boston Scientific/Guidant, St. Jude and Medtronic, as well as for several medical device and drug start-up companies.
David Bott - Senior Information Technology Executive
Systems and network support solutions experience, proviedes analyis of strategic business needs and assessment of business models and their integration with technology.
Santiago Guzman - International Executive
Experienced in new project development for companies in a variety of industries from start-up to Fortune 500. Client relations management, fluent in English and Spanish. Skilled facilitator for introductions with influential leaders in South America including those in the health care industry.
With offices in:
- Delray Beach/Boca Raton, FL
- Atlanta
- New York
- Quito, Ecuador
For additional information, please contact:
David H. Fater, Chief Executive Officer
ALDA & Associates International, Inc.
15977 Brier Creek Drive, Suite 100
Delray Beach, FL 33446
(877) 845-4657
dfater@alda-associates.com