Community Health Systems, a chain of 40 hospitals in 17 states, reported a 115% increase in net income for the second quarter ended June 30 to $9.3 million, or 47 cents per share, from $4.3 million, or 28 cents per share, in the year-ago quarter. Revenues grew 21% to $137.4 million. For the six months, Nashville, Tenn.-based Community reported a 103% increase in net income to $21.4 million, or $1.08 per share, compared with $10.5 million, or 69 cents per share, in the year-ago period. Revenues grew 21% to $279.4 million.
Partners HealthCare System in Boston said it will cut $20 million from the $75 million it spends annually on medical-surgical supplies under an innovative agreement being negotiated with Owens & Minor. The Partners system includes 984-bed Massachusetts General Hospital and 751-bed Brigham and Women's Hospital. Under a letter of intent signed last week, Owens pledged to reduce the hospitals' supply spending by increments over the next three years until annual expenditures reach about $55 million. In return, the Richmond, Va.-based company will become Partners' sole medical-surgical distributor. Other features of the agreement include joint development of a new materials management system, use of stockless distribution and electronic data interchange.
Kansas City, Mo.-based Sprint last week launched a spinoff company that will develop community healthcare information networks. Sprint Healthcare Systems will target markets in which Sprint's telephone services are already available. The company wouldn't disclose how much it's spending on the new venture. "We're very interested in the healthcare market in general," said Dennis Wagner, Sprint's public relations manager. "We have a lot of territories that Sprint's telephone service is involved in, and we would like to go after those and other markets." With more than $12.6 billion in annual revenues, Sprint has a nationwide fiber-optic network, and its local telephone service reaches 19 states.
Witnesses who testified at a House subcommittee hearing last week alleged that the Food and Drug Administration carries vendettas against companies or physicians who irritate it. They charged that the FDA uses its authority to regulate the marketing and manufacture of medical products to punish those companies. The testimony was part of a series of hearings on the FDA being conducted by the Commerce Committee's subcommittee on oversight and investigations. FDA Commissioner David Kessler is expected to answer the charges; but, as of late last week, a date hadn't been set for his testimony.
Healthsource, a Hooksett, N.H.-based managed-care company, last week signed a letter of intent to buy Clackamas, Ore.-based PACC HMO and PACC Health Plans for $80 million. The move is Healthsource's first major foray into the Northwest. Healthsource already had some enrollees in Portland, Ore., after it acquired Provident Life and Accident Insurance Co. earlier this year. But the PACC acquisition will increase its national enrollment of 3 million by 108,000. Healthsource's business is primarily concentrated in the Northeast, Midwest and Southeast.
W.R. Grace & Co. reported a 19% increase in companywide net revenues to $937 million for the second quarter ended June 30. Net income was $79 million, or 83 cents per share, compared with a net loss of $134 million, or $1.43 per share, in the year-ago quarter. For the six months, sales grew 20% to $1.8 billion. Net income was $126.2 million, or $1.33 per share, compared with a net loss of $96.1 million, or $1.03 per share, in the year-ago period. Sales for Grace's healthcare operations rose 15% to $524 million in the second quarter and 19% to $1.02 billion for the six months. In June, the Boca Raton, Fla.-based company announced it will spin off its healthcare business, National Medical Care, to shareholders.