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AAC Announces Restructuring, Layoffs Amid Big Operating Loses PDF   E-mail
Addiction Treatment Industry Newswire

12/07/2018 -ATIN- Struggling American Addiction Centers (NYSE: AAC) will be restructuring its operations in the wake of earnings reports showing that the provider is bleeding red ink. The restructuring includes the appointment of new executives in the c-suite as well as 100 layoffs, many at the company's headquarters just outside of Nashville.

CEO and founder Michael Cartwright told Treatment Magazine that the layoffs amount to between 3% and 4% of the company workforce.

AAC's stock is trading near all-time lows and Cartwright is betting that new talent in the c-suite will right the AAC ship - specifically new operating chief Michael Nanko as well as Stephen Ebbett, who will run marketing.

The company also will be looking at a "strategic alternative" (read: a sale) for its Townsend brand outpatient operations in Louisiana. AAC will also be seeking to merge outpatient and sober living assets in the San Diego marketplace.

Despite losing more than $7M on an operating basis in Q3, AAC says it remains optimistic as it "participates in an addressable market (the treatment market) that management believes is in excess of $30 billion with attractive underlying industry trends, contributing to market growth in excess of 4% per annum"

However, even as demand for services is exploding amid an unprecedented addiction epidemic, the treatment industry is not seeing a corresponding increase in revenues. The problems at AAC, as well as the bankruptcy of industry giant Elements Behavioral, are symptomatic of the difficult operating environment being felt in the industry.

Hundreds of treatment centers, some estimate as many as 800, have closed their doors in recent years. This coming amid intense competition from medical surgical hospitals, who have been building new treatment centers on their campuses at a rapid clip. Also, many new players are employing a local catchment client acquisition model - Brian O'Neill's East Coast Recovery Centers of America is a key example.

Particularly hard hit have been the treatment center hubs, especially Florida, as the "destination" treatment model - based largely on attracting those with outpatient benefits - appears to be broken. Insurers are increasingly refusing to pay any outpatient benefits at all.

And this is occurring as marketing costs skyrocket - particularly Google Ad Sense - putting providers in a vice grip between falling reimbursement and rising expenses.

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Methadone Treatment Giant Settles Wrongful Death Claim for Huge $10.5M PDF   E-mail
Addiction Treatment Industry Newswire

12/05/2018 - ATIN- Methadone treatment giant New Seasons, formerly called Colonial Management Group, has settled a wrongful death claim out of South Carolina for a staggering $10.5M, one of the biggest wrongful death settlements in addiction treatment industry history.

Details of the settlement are sketchy as non-disclosure was a key requirement of the big payout. New Seasons has said however that the settlement has exhausted the limits of its liability insurance coverage. The lawsuit involved a client of its West Columbia, SC clinic who killed three people in an auto crash while under the influence of drugs.

Founded in the mid-1980s as Colonial Management Group, New Seasons has grown into a for-profit giant with about 100 clinics in 28 states. Before the introduction of Suboxone, and the growth of new MAT clinic chains in recent years, New Seasons was the biggest methadone clinic company in what was a $1B a year national methadone marketplace.

Around the year 2000, CRC Health Corp., now part of publicly traded treatment behemoth Acadia Healthcare, overtook Colonial as the largest methadone clinic operator through an aggressive acquisition rollup campaign of mom-and-pop clinics across the country.

The notion of the methadone clinic has become somewhat outdated due to the growth of Suboxone, which was developed and manufactured by the former Reckitt Benckiser Pharmaceuticals, now called Invidior. At its zenith Suboxone was a gigantic seller for Reckitt Benckiser, selling $2B a year globally, now down to $1B due to generics competition.

Last week Invidior shares tanked by over 60 percent when a New Jersey federal judge lifted a temporary injunction thereby allowing the widespread marketing of generic Suboxone, a move seen as opening the floodgates for much cheaper buprenorphine-based pharma products and the end-of-line for the monopolistic hold Invidior for years held on the buprenorphine marketplace.

New Seasons executives were not immediately available for comment.

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Discovery Behavioral Acquires Ambrosia's NJ Facility PDF   E-mail
Addiction Treatment Industry Newswire

12/04/2018 -ATIN- Fast growing West Coast provider Discovery Behavioral, formerly Cliffside Malibu, has acquired Ambrosia Treatment Center's facility in New Jersey, Discovery's first M&A foray outside of California. Ambrosia still retains three centers in Florida and one in California.

Last year, Cliffside Malibu founder Richard Taite recruited well known treatment exec John Peloquin from Acadia with a mandate to grow the Cliffside platform, which had already expanded from its high end Malibu center roots to include outpatient as well as more affordable centers in So Cal.

Peloquin has since rebranded Cliffside as Discovery Behavioral and in September beefed up the c-suite with the recruitment of a new COO and a new CFO.

The facility in Medford, NJ is a large residential one on 40 acres directly adjacent to a state park. It is ideally suited to service the huge population center along the NYC/Philadelphia corridor.

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Invidior Shares Slammed After Bup Generics Court Ruling  E-mail
11/21/2018 -ATIN- Expecting cutthroat competition in the buprenorphine pharmaceutical marketplace, a more than $1B blockbuster pharma sector, investors pummeled the shares of the former Reckitt Benckiser, now called Invidior, after a federal court lifted an injunction against the introduction of buprenorphine generic drugs.

Invidior, the developer of buprenorphine, which is the company's sole pharma product, has long kept prices of the drug high, extending and milking patents by tweaking the formula - adding naloxone to make Suboxone and now offering monthly injection Sublocade - and by going to court to keep generics competition off the market.

The importance to Invidior of the legal fight, which has played out in New Jersey federal court, became abundantly clear this week after a federal court lifted a preliminary injunction against Indian generics manufacturer Dr. Reddy's Laboratories, one of three companies planning to introduce generic buprenorphine. Investors have driven Invidior shares more than 60 percent lower after the ruling.

Dr.Reddy's Laboratories plans to introduce generic Suboxone, good news for consumers who have paid cash pay prices of hundreds of dollars a month for their daily maintenance dose of Suboxone. Suboxone is also used extensively to taper opiate addicts while detoxing.

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Silver Hill Appoints New President and Medical Director PDF   E-mail
Addiction Treatment Industry Newswire

11/13/2018 - ATIN- Nationally renowned Silver Hill Hospital, a nearly 90-yr-old private psych hospital with a storied history, has appointed a new president and medical director. Dr Andrew Gerber was recruited from the famed Austin Riggs Center in Massachusetts, where he was CEO and medical director.

Dr. Gerber's appointment at Silver Hill is one of the most prestigious positions in American psychiatry and behavioral health. He is a Harvard med school grad, with a long list of behavioral health and psychiatric bona fides, including associate and adjunct professorships at Yale and Columbia.

Silver Hill Hospital admits more than 3,000 adolescents and adults annually for disorders that include addiction, depression, bipolar disorder, eating disorders, personality disorders and schizophrenia among others.

The hospital sits on a unique suburban campus, 44 acres in New Canaan.


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Long Island Med Surg in Huge Addiction Center New Build PDF   E-mail
Addiction Treatment Industry Newswire
11/01/2018 -ATIN- In one of the biggest projects in contemporary addiction treatment industry history, Northwell Health, a Long Island med surg, in a partnership with New York real estate developer Engel Burman are building a big addiction treatment and research facility in the town of Riverhead on Long Island.

To be called Wellbridge, the new $90M center will sit on 40 acres in the Calverton Research Park, and have 80 beds, along with an addiction research program. Groundbreaking was held this morning.

The partnership between Engel Burman, active in the New York tri-state real estate market, and Northwell Health, a huge non-profit with 20 med surg hospitals, is a unique collaboration that will last long after construction is completed late next year. Engel Burman will remain as an operating partner, managing all non-clinical operations at Wellbridge.

Currently Engel Burman is conducting a nationwide search for an executive director to head up the new Wellbridge center.

"Wellbridge will serve as a learning laboratory that provides traditional and alternative treatments, giving addiction specialists and researchers the ability to assess the short- and long-term progress of clients, identify clues to improve therapies and prevent relapse, and study the neurobiological effects of addiction through brain imaging and other neuroscience investigational methods," according to a press release announcing the ground breaking.

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ARS Teams With South Jersey Med Surg in Big Addiction Center New Build PDF   E-mail
Addiction Treatment Industry Newswire
10/29/2018 -ATIN- South Florida-based Advanced Recovery Systems, a rapidly expanding specialty addiction treatment provider, has teamed with South Jersey's Cooper University Health Care to build a new addiction treatment center in Cherry Hill, NJ, which is considered to be part of Philadelphia's metro market.

The $27M new build, one of many integrated centers being built nationwide by medical surgical providers, is slated to open in late 2019, will have 90 beds and extensive amenities. The synergies with Cooper's med surg operations are extensive, with Cooper saying it treats as many as 20 people every day for substance use disorder in its emergency room.

ARS is one the fastest growing addiction treatment providers in the nation, with operations in five states, including Florida and Colorado. ARS was founded by Mitch Eisenberg, along with renowned addiction doc Lewis Gold. Eisenberg is the co-founder of Sheridan Healthcare, a medical services outsourcing concern.

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Alkermes Posts Strong 3Q Sales Uptick for VIVITROL PDF   E-mail
Addiction Treatment Industry Newswire
10/25/2018 -ATIN- Sales of pharma Alkermes' MAT therapeutic intervention VIVITROL jumped 15% in the third quarter to almost $80M, with Dublin-based Alkermes predicting that full year 2018 sales of the anti-craving med would reach a range of between $300M and $330M.

VIVITROL is clearly benefiting from the strenuous efforts of health insurers and public health policy makers to find solutions to the addiction epidemic, which has finally gained centerstage in the national healthcare debate in the wake of blanket media coverage around opiate use disorder. President Trump just this week signed a batch of bills that will unleash $8B in federal funding to fight drug addiction, of which MAT therapeutic interventions like VIVITROL will be substantial beneficiaries.

There are only a tiny handful of MAT interventions for addiction. VIVITROL is among the most prominent of these, but is far behind the blockbuster billion dollar buprenorphine compound of which Suboxone is the best recognized brand. VIVITROL is a monthly injection of the naltrexone compound, a drug that has been available in very cheap generic form for decades.

Alkermes launched VIVITROL to great fanfare over a decade ago, forming a marketing partnership with Cephalon, now part of pharma giant TEVA Pharmaceuticals. For years Alkermes had trouble pushing annual sales of VIVITROL past $20M, despite spending heavily on marketing.

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$8M High End Detox Opens in Manhattan PDF   E-mail
Addiction Treatment Industry Newswire

10/23/2018 -ATIN- In a major development in the difficult NYC addiction treatment market, which is beset by daunting regulatory and cost barriers, a new detox has opened its doors just off Park Ave on the upper East Side, an $8M treatment project that has been years in the making.

Behind the new Ascendant center is an anonymous, wealthy West Coast backer who has long been concerned about the addiction problem and who, when he saw a huge NYC market bereft of specialty addiction centers, was surprised.

"He soon learned why it's like that in NYC," says Shari Noonan, former head of the New York state addiction regulator OASAS. Noonan was brought on at Ascendant to navigate NY's byzantine and expensive regulatory shoals. Along with Robin Goldman, a savvy executive with extensive experience in startups and tech, the two have brought the unique center to fruition, just this week breaching the JCAHO accreditation hurdle.

In a testament to the high barriers to entry in the NY addiction market, barriers that have stopped national players like the former CRC Health Corp. and Michael Cartwright's AAC at the state line, Ascendant has spent four years dealing with certificate-of-need level regulatory scrutiny, as well as the tough real estate exigencies of Manhattan.

But now that Ascendant has surmounted the barriers, it is in an enviable competitive position in the NYC market. "It's early now, but we expect to eventually leverage our licensure and expand out the care continuum and also by opening new locations within the five boroughs," says Goldman.

Ascendant took a 20-yr lease and completely transformed a townhouse on East 60th, designing a striking, modern new entrance for the 18-bed detox, which has nearly 70 employees.

Ascendant will be operating on an out-of-network reimbursement model, accepting all major insurance and will offer all the amenities and therapeutic interventions that luxury, highly individualized care demands. The facility expects to have extensive referral relationships with quality treatment providers nationwide.

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MAP Signs Big Addiction Chronic Disease Model Deal With NJ’s Top Health Insurer PDF   E-mail
Addiction Treatment Industry Newswire

10/19/2018 - ATIN- MAP Health Management, the addiction telehealth aftercare services outsourcer based in Austin, has signed a key deal with NJ's largest health insurer Horizon Healthcare Services to deploy MAP's Peer Recovery Support Service, PRSS, to Horizon's 3.8M covered lives.

When combined with a similar deal reached with Aetna previously, MAP now has 26M covered lives in 12 states, with 3000 detox, residential beds/ IOP seats contracted to discharge into MAP's aftercare services. MAP is by far the nation's largest specialty addiction aftercare services concern.

MAP CEO Jacob Levenson, a scion of the Texas entrepreneurial family that founded Origins Behavioral Healthcare, sold last year to the billionaire Rowling family of Dallas, founded MAP in 2011 with the aim of improving addiction treatment outcomes by pushing a chronic disease model of care, launching PRSS for that purpose. The chronic disease model has been the mantra of top treatment executives and clinicians for two decades, but Levenson has put his money where his mouth is, spending millions to build a platform that meets the data integrity standards of the nation's top health insurers.

With 100 employees at MAP, and looking to aggressively recruit more, Levenson says the key to success with payors when it comes to the chronic disease model is proving that it delivers cost savings, something treatment outcomes studies have mostly failed to do conclusively.

"If you can't show that emergency room visits are down, as well as non-routine medical visits and the like, then you are going to fail to get the attention of the payors," says Levenson. "We are putting a book end around the addiction treatment outcomes conversation with our deliverable outcomes data for the payors."

Levenson, after years of effort, is finally within sight of building an aftercare services product that will provide a recognized benchmark for measuring outcomes success with the payors. He says that in two years MAP expects to have signed deals with health insurers with over 100M covered lives in at least 29 states.


READ OUR story on MAP's deal with Aetna, LISTEN to MAP's webinar with top Aetna Behavioral Health executives

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USHealthVest in Big Indianapolis Center New Build PDF   E-mail
Addiction Treatment Industry Newswire

10/18/2018 -ATIN- US Healthvest, which has extensive addiction and mental health assets in the Chicago metro market, has announced an alliance with Indianapolis med surg Hendricks Regional to build a new stand alone $25M integrated behavioral health center.

Behind USHealthVest is Richard Kresch, a well known behavioral health entrepreneur who is the founder of Ascend Health Corporation, a closely held concern that is among the nation's largest specialty operators of integrated psychiatric and addiction centers. In March, US Healthvest bought Vista Medical Center West, now renamed Lake Behavioral Health, in north suburban Chicago from Quorum Health Corporation. Lake Behavioral Health is expected to expand to 100 beds from 46 currently.

The new Indianapolis facility, to be called Indianapolis Behavioral Hospital, will be a 77K sf integrated psychiatric/addiction treatment center and is expected to open in early 2020, creating approximately 250 new jobs.

Another man who was instrumental in building Ascend, former Goldman Sachs banker Steve Page, is behind NJ-based Sun Behavioral Health, which just last week opened a $25M integrated psych/addiction new build facility in Delaware.

READ OUR STORY on how big Wall Street money is backing integrated psych/addiction center new builds.

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New York Investor Group Buys Kansas Addiction Center PDF   E-mail
Addiction Treatment Industry Newswire
10/16/2018 -ATIN- A New York investor group has acquired Sunflower Wellness Retreat, a 23-bed addiction treatment center located about an hour southwest of Kansas City.

"We looked at a lot of different addiction treatment center models once we decided to focus on the addiction treatment business," says Lawrence Weiss, principal at Sunflower, one of three investors that this summer got together and purchased the center.

The trio decided, after closely examining a facility near San Francisco, against getting into the high-end private pay side of the treatment business, specifically citing the risk of soaring  marketing expense associated with client acquisition as well as intense competition due to the proliferation of "six-bed model" centers throughout California. There are now over 2,000 such centers in the state.

What attracted Weiss and partners to Sunflower was its deep referral relationships in the local community surrounding the center. "Sunflower is not a destination treatment experience," says Weiss. "We get all our clients from a 90 mile radius."

From a clinical effectiveness standpoint, Weiss points out that focusing on local clientele makes for ease of participation by families in the treatment of their loved ones. Strong family participation in the treatment experience correlates highly with outcomes success, research has shown.

Weiss and partners are far from the only investors who have sought to chip away at the dominance of national treatment "hubs" in Florida, Arizona and California, states that are overflowing with "destination" addiction centers.

Philadelphia real estate developer Brian O'Neill founded Recovery Centers of America with a local catchment model of client acquisition in mind. He has bought centers and upgraded them and done greenfield new builds as well as property conversions, mostly in the middle Atlantic states and the Northeast.

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Gateway Corrections Sees Big Jump in Community Treatment Contracts PDF   E-mail
Addiction Treatment Industry Newswire

10/13/2018 -ATIN- Gateway Chicago's corrections addiction treatment division, the second largest corrections provider in the nation, is seeing a big move away from in-prison treatment contracts toward community based treatment of offenders.

"There is a major trend, which in one form or another is happening in virtually every state, to move corrections treatment out of jails and prisons and into the community," says Gregg Dockins, president of Gateway's corrections unit.

He says that 50 percent of Gateway Corrections' expected $43M in revenue this year will come from community-based contracts, up from just 5 percent a couple of years ago.

Gateway Chicago CEO Tom Britton says he expects overall Gateway revenues, which include its big consumer business, driven by revenue from commercial payors, to reach $135M this year, up from $112M the year ended June 30. Gateway's consumer side is largely focused on Illinois, where it is by far the largest player with 14 centers, but Britton has been pursuing an M&A growth strategy and has been targeting acquisitions in at least four states.

One feature of the community based treatment contracts, and one Dockins expects to be a significant source of growth going forward, is that county and state governments are widening the scope of services they are contracting out to providers like Gateway.

"In a significant number of cases we are not just being hired to run the treatment side, but are also responsible for the overall management of offenders, which typically in the past was handled by probation officers and the like," says Dockins.

The nation's largest corrections treatment provider, by far, is the big private corrections contractor GEO Corrections, based in South Florida. The GEO Care division, which Gateway competes with, comprises GEO's privatized mental-health and residential-treatment services business. Last year, GEO paid $360M for Community Education Centers, CEC, which was previously the second largest corrections addiction treatment provider. Westcare of Las Vegas is also a significant player in corrections care.

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Banyon Buys Sunspire's Heartland Illinois Addiction Center PDF   E-mail

10/08/2018 -ATIN- Florida's Banyon Treatment Centers, one of the most aggressively expanding specialty addiction providers in the nation, has reportedly purchased Sunspire Health's Heartland center, a now defunct facility that Banyon may be planning  to resurrect.

A well placed source from Chicago, which is about 60 miles from the Heartland property, says Banyon is actively seeking to fill an executive director position for Heartland, but Banyon executives were not immediately available for comment.

Sunspire Health was sold by its founder, Ben Klein, a couple of years ago to prestigious private equity firm Kohlberg & Co. Klein has recently taken control of addiction treatment giant Elements Behavioral Health through a bankruptcy auction and plans to take the CEO slot when the deal is given final approval by a federal judge. After buying Sunspire, Kohlberg paid big bucks for the world famous Arizona center The Meadows, which was one of the first addiction treatment industry forays by a private equity investor fifteen years ago.

Since the Sunspire buy, Kohlberg has been trimming its assets shutting down a facility in the Northwest and now apparently offloading the Heartland property. A treatment center CEO in Chicago who was pitched as a possible buyer said Heartland was quite rundown and in need of significant investment.

Banyon has an outpatient center in Chicago, so Heartland will presumably allow Banyon to serve the nation's second largest metro market with a broader continuum of care.

Banyon Buys BHOPB

Earlier this year, Banyon made one of the biggest deals in the specialty addiction marketplace by buying struggling Behavioral Health of the Palm Beaches, BHOPB, which had about 200 beds but was imploding under CEO and co-founder Jack Coscia. BHOPB began bleeding staff, which were hired by centers like The Florida House, among others. At one time, under the astute management of treatment exec Alan Stevens, BHOPB was a thriving center whose properties were arguably the best in the huge South Florida hub and whose cutting edge clinical models were widely admired and emulated.

What reportedly brought BHOPB down was a botched takeover deal, allegedly epicly mishandled. About three years ago a Colorado private equity firm approached BHOPB and, sources say, offered about $130M for the provider, which if the deal went through would have been one of the largest transactions in addiction treatment history. Instead, sources say, BHOPB held out for more money, a source says just $3M. The Colorado private equity buyer, allegedly frustrated, walked away from the deal.

Banyon has also bought the Clearview center in Pennsylvania, and has opened a detox and residential property in Boca Raton. The only two BHOPB properties currently in operation under Banyon are a big center in western Palm Beach county, a motel conversion adroitly pulled off by Coscia, and the Seaside Palm Beach property just accross from the beach in Palm Beach Shores, one of the most valuable addiction properties in the nation.

Jack Coscia and Banyon operations chief Eric Oakes did not immediately respond to requests for comments.

READ OUR Special Report on Banyon's unique BHOPB Seaside Palm Beach property

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Charleston Naval Base in Residential Addiction Center Conversion PDF   E-mail
10/06/2016 -ATIN - Meridian Behavioral Health Systems, a for-profit with an eclectic mix of assets in five states, has bought a former naval information base in Charleston and is converting the 123-acre property into a specialty addiction center.

The new facility, which will have 95 beds, was bought in an auction held by the General Services Administration. Alabama-based Mellivora Capital Partners won the auction in December in 2016..

In February, Meridian Behavioral Health Systems, of which Charleston's Highland Hospital behavioral health facility is a subsidiary, announced that it had leased the base for use as a residential rehab center and planned to open in July.

The opening was pushed back to October and is now indefinite. Construction is needed to bring a base dormitory building's roof, kitchen and therapeutic areas up to regulatory standards.

The new addiction rehab is expected to employ 200 people.

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READ OUR STORY on Sun Behavioral's new facility

Suboxone Still Delivering Huge Profit Margins  E-mail
10/04/2018 -ATIN- Buprenorphine pioneer Invidior, a british pharma whose sole focus is addiction MAT therapies, is still pumping out huge profit margins on its core Suboxone branded medication, although generics competition has cut the drug's sales in half since 2012.

Last week, Invidior said it expects Suboxone sales of approximately $1B in its 2018 fiscal year with an eye popping net profit margin of 25%, or $250M.  The fat margins allowed Invidior to pay down $150M of debt earlier this year.

Invidior's bup strategy is twofold. On the one hand the company is aggressively pursuing patent infringement suits in Federal court against generic competition, while at the same time also pursuing the vintage pharma "old wine in a new bottle" sleight-of-hand.

Invidior this summer got a preliminary injunction barring New Jersey-based Dr. Reddy's Laboratories from selling its bup/naloxone generic. And the company is rolling out its Sublocade branded therapy. Sublocade is Suboxone delivered in a monthly injection format, which allows Invidior to charge far more because the drug operates under a new patent, thus "old wine in a new bottle."

Another pharma, Alkermes, pursued that same strategy when it put generic naltrexone in a monthly injection and called it Vivitrol, whose sales have been turbocharged of late as the opiate crisis has opened huge state, federal and private insurance funding for MAT therapies. President Trump is expected to sign a bill this month that allocates billions to the fight against opiate use disorder.

There is little doubt that Invidior will also be attempting to tap into the opiate funding wave with Sublocade. Though early results are disappointing. Last week Invidior lowered its sales expectations for Sublocade in 2018 to at most $10M, down from the previous estimate of $25M.

The advertised cash pay price for Sublocade is a staggering $18K, a price on which Individior will very likely offer large discounts. Still, the cost of generic Suboxone is now a few hundred dollars a month.

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Sun Behavioral In $25M New Build Treatment Facility  E-mail
10/02/2018 -ATIN- Sun Behavioral, an integrated mental health and addiction treatment provider, has just opened a $25M new build center on a six-acre campus in Georgetown, DE. The new facility will employ approximately 150 people.

New Jersey-based Sun Behavioral has similar facilities in Kentucky, Texas and and Ohio.

The company's CEO, Steve Page, is a former Goldman Sachs healthcare and M&A banker who was instrumental in building Ascend Health Corporation into one of the nation's largest behavioral health concerns.

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READ OUR STORY on how Wall Street money is backing new build, behavioral healthcare facilities nationwide

SAMHSA Doling Out Big Bucks to States  E-mail
10/02/2018 -ATIN- SAMHSA has lately begun to dole out big bucks to the states, with Ohio just one state that late last month was the recipient of big grant earmarks. Ohio, among the very hardest hit  by the addiction crisis, will get $71M to aid a medication-assisted treatment push, as well as substantial funds earmarked for treatment in underserved rural areas.

And more money can be expected in the upcoming federal fiscal year, which begins in the fall, as Congress prepares to send an $8B special opiate appropriation bill to President Trump for his signature. While the appropriation does boost spending by about $3B, much of the money goes toward law enforcement and critics say it falls far short of other previous epidemic crisis responses, for example the $100B spent combating aids.

And the money is being spent in Ohio as the state gears up for a controversial ballot measure that would eliminate felony punishment for all types of drug possession, with the measure being retroactive. Liberal billionaires like George Soros, Mark Zuckerberg and Susan Pritzker have poured money into backing the initiative, which would put about 10,000 people currently jailed back onto the street again, significantly emptying state prisons. Money saved from the prison expenditures would go toward treatment.

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Orange County DA Hands Down Addiction Treatment Indictments  E-mail
09/30/2018 -ATIN- An Orange County DA has brought down a raft of charges against more than a dozen people alleging misconduct ranging from performing unnecessary medical procedures to patient brokering.

Particularly targeted were a group of doctors and outreach marketers that allegedly rounded up clients for expensive - $40K per procedure - naltrexone implant surgery, targeting those with good health insurance and offering kickbacks.

The charges are serious, carrying sentences of 10 yrs to 40 yrs, and come on the heels of vigorous prosecutions of addiction treatment industry wrongdoing in other parts of the country, particularly in Florida.

Orange County, like the rest of Southern California, has been the scene of an enormous increase in the number of addiction treatment and sober living centers, facilities that are only very loosely regulated. That situation is changing radically after Governor Jerry Brown last week signed into law a group of bills designed to rein in unscrupulous behavior and create basic common standards of addiction care.

The roots of the Southern California "Rehab Riviera" can be found in 1970s legislation creating the "six bed" model of care. Designed to end the warehousing of mentally ill patients in big, institutional settings, the law prohibited municipal jurisdictions from denying zoning permission for mental health facilities of six beds or less.

In the 1990s, Promises Malibu was the first high end addiction center to apply the legislation to the treatment industry and to luxury addiction care. Since then over 2,000 treatment centers have sprung up all over the state, making it a rival for Florida as the nation's biggest addiction treatment "hub."

In Southern California, the epicenter of the Rehab Riviera is in Newport Beach, residents of which have risen up in virulent NIMBY - not-in-my-backyard - reactions to the proliferation of addiction treatment centers.


READ OUR story on recent California addiction treatment regulatory legislation

READ OUR Special Report on the development of California's "six bed model" of addiction treatment

Gateway Chicago Opens Big New Illinois Center  E-mail
09/28/2018 -ATIN- Chicago's Gateway Foundation, one of the biggest non-profit addiction treatment enterprises nationwide with $115M in annual revenue, this week opened its fifteenth center in illinois, a state in which Gateway is by far the largest addiction treatment provider.

Gateway bought the former Wells Center site in downstate Jacksonville, IL earlier this year after that facility closed in 2017. Subsequent renovations gave the old facility a face lift. The center offers a full continuum of care, including aftercare sober living services.

Gateway derives 65 percent of its revenues from Illinois and also is among the largest corrections treatment providers, with prison operations in six states.

CEO Tom Britton, who took over from founding CEO Michael Darcy in 2015, previously ran the youth and wellness divisions at addiction treatment giant Acadia Healthcare.

Rosecrance, whose main campus is in Rockford, IL, has also opened a new facility in downstate Illinois this year and in recent years has been expanding aggressively, opening new centers on Chicago's North Side.

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Andrea Barthwell Named to Oversee Huge New Opiate Non-Profit  E-mail

09/26/2018 - ATIN- Renowned addiction treatment executive Andrea Barthwell has been named to a prestigious newly created post overseeing the non-profit foundation recently formed by medical services giant McKesson Corp., which has set the initial funding of the addiction charitable enterprise at a hefty $100M.

Also appointed to a top post at the Foundation for Opioid Response Efforts (FORE) is Karen Scott, who will fill the job of a hands on manager as president. Dr. Barthwell will be board chair.

Both women have had distinguished healthcare careers, where Barthwell is a former deputy Drug Czar for treatment, while Dr. Scott is well known for her work at global health care consultancy Health Management Associates.

In March McKesson, among the very largest healthcare concerns worldwide with $200B in annual sales, announced the formation of the opiate fund. Dr. Barthwell and Dr. Scott will have the immediate and very important task of setting spending priorities and mission goals for FORE.

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