Becker's Hospital Review

12 CFO / FINANCE Pennsylvania man drives to Canada for son's $15K medication. The US price? $50K By Morgan Haefner A Pennsylvania man drives six hours to Canada every three months to purchase medication for his son, who has a skin condition called alopecia areata. e medication restores Jon Yeagley's 20-year-old son's hair for $15,000 a year — more than three times less than what it would cost the Yeagleys in the U.S., according to e Philadelphia Inquirer. Here are five highlights from the report: 1. Alopecia areata occurs when a person's im- mune system attacks hair follicles, leading to sudden hair loss. Xeljanz, made by Pfizer and used to treat the disease, would cost the Yeag- ley family $50,000 a year, as the medication is not covered by their health insurance plan. So the family uses a $15,000 Pfizer rebate to get three months of the treatment in the U.S., and then travels to Canada three times a year to get the rest of the treatment, costing $3,700 for a three-month supply. 2. Trips like Mr. Yeagley's six-hour drive to a Walmart in Canada, which he arrives at by crossing the border at Buffalo, N.Y., are like- ly on the rise. In the past nine months, the FDA projects about 22,000 FDA-regulated products were intercepted at international mail facilities. at's compared to 13,500 in- terceptions in the previous 12 months, for an increase of 62 percent, according to data cited by the Inquirer. 3. While the FDA prohibits importing pre- scription medication from other countries to the U.S., the agency rarely enforces the rules for individuals bringing in small amounts of prescription medication for personal use, ac- cording to the report. 4. At one time Mr. Yeagley did buy Xeljanz for his son in the U.S. However, the drug — which is approved by the FDA to treat rheumatoid arthritis, but is believed by some researchers to be effective in stimu- lating hair growth — began to rise in price. To get a prescription across the border, Mr. Yeagley met with a Canadian physician via video consultation. e physician wrote a prescription that could be filled in Canada near the U.S. border. 5. Jeremy Kahn, an FDA spokesperson, told the Inquirer in an emailed statement, "ere's no way for the FDA or any federal agency to truly know the scope of the prob- lem." While the agency staffs international mail facilities as a "frontline defense against illegal, illicit, unapproved, counterfeit, and potentially dangerous drugs entering the U.S.," he said, "the sheer volume of drugs that are being shipped through the IMFs far exceeds our interdiction capabilities." n CHS sees net loss narrow to $110M, pursues $2B hospital divestiture plan By Ayla Ellison F ranklin, Tenn.-based Community Health Systems, which operates 119 hospitals, saw its net loss shrink in the second quarter of 2018 as the company continues to refine its hospital portfolio. CHS said revenues dipped to $3.56 billion in the second quarter of 2018, down 14 percent from $4.14 billion in the same period of the year prior. The decline was largely at- tributable to CHS operating 24 fewer hospitals in the sec- ond quarter of 2018 than in the same period of 2017. On a same-hospital basis, revenues climbed 3.3 percent year over year. After factoring in operating expenses and one-time charges, CHS ended the second quarter of 2018 with a net loss attributable to stockholders of $110 million. That's compared to the second quarter of 2017, when the com- pany recorded a net loss of $137 million. "Our second quarter results reflect progress in our key areas of strategic focus, most notably improvements in same-store operating results, progress on divestitures and successful refinancings," said CHS Chairman and CEO Wayne T. Smith in an earnings release. As part of a turnaround plan put into place in 2016, CHS announced plans in 2017 to sell off 30 hospitals. The company completed the divestiture plan Nov. 1. To further reduce its debt, CHS intends to sell another group of hospitals with combined revenues of $2 billion. The company has already made progress toward that goal. During 2018, CHS has completed seven hospital divesti- tures and entered into definitive agreements to sell five others. CHS said it continues to receive interest from po- tential buyers for certain hospitals. "As we complete additional divestitures this year, we be- lieve our portfolio will become stronger, and more of our resources can be directed to markets where we have the greatest opportunities to drive incremental growth," Mr. Smith said. CHS' long-term debt totaled $13.67 billion as of June 30, a decrease from $13.88 billion as of the end of last year. n

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