Seven non-profit health systems in the US have set up a for-profit organization to provide an independent vehicle through which hospitals can cooperate with other on strategic initiatives.
St Joseph Health, a $5bn health system, became the first founding member of the Innovation Institute, which has also set up a strategic alliance with Cleveland Clinic.
The institute has three business units: an Innovation Lab as its incubator, the Enterprise Development Group for shared services and a quasi-corporate venturing unit, Growth Funds, as a portfolio of investments in emerging businesses and assets.
St Joseph Health, through the Innovation Institute, is the seventh partner to join the Cleveland Clinic’s Healthcare Innovation Alliance.
Cleveland Clinic’s Innovations corporate venturing unit to develop its health system’s intellectual property has filed more than 400 active licenses and formed 55 start-up companies and set up the Healthcare Innovation Alliance to manage the commercialization process for others.
Chris Coburn, executive director of Cleveland Clinic Innovations, said: “The addition of the Innovation Institute will give Cleveland Clinic Innovations and our Alliance members the opportunity to foster meaningful growth on the west coast [of the US] and with Catholic health systems.”
Joe Randolph, executive president of Innovation Institute, said: “Sometimes the biggest obstacle to change is ourselves. Our unique business model not only fosters collaboration through common ownership and shared vision, but it also offers new revenue opportunities, better quality and faster execution through this independent vehicle.”
Larry Stofko, chief technology officer of The Innovation Institute, said: “By actively engaging with physicians and employees, we can help hospitals tap into a wealth of their own innovative potential and streamline the process of delivering these great ideas to patients.”
Deborah Proctor, executive president of St Joseph Health, added: “In response to healthcare reform, every health system is looking for ways to promote value through increasing efficiency and ensuring high quality. Incremental changes from traditional methods may no longer be sufficient or offer sustainable solutions. The Innovation Institute provides St. Joseph Health with a vehicle for us to explore effective, thoughtful responses to health care challenges and collaborate with others who share our focus and vision.”
Separately, a charitable foundation and three family offices have invested $6m in NanoViricides to boost its cash to $19m.
NanoViricides said it would begin its first human clinical trials for its broad-spectrum anti-influenza drug candidate, FluCide.
The investors purchased unsecured convertible debentures with a four-year term and that offer an annual coupon interest rate of 8%. The investors can convert the principal and any accrued interest into common stock at a fixed price of $1 per share.