Day: November 20, 2023

Categories : Hospitals Medical IndustryTags :

Netcare Reports Strong Growth in its 2023 Earnings Report

On By ModernMedia

For the year ended 30 September 2023, the Netcare Group’s profit after tax and exceptional items increased by 27.2% to R1 336 million (FY 2022: R1 050 million) and adjusted HEPS increased by 27.0% to 105.7 cents (FY 2022: 83.2 cents). A sustained improvement in activity, off a largely organic base, supported revenue growth of 9.5%. Coupled with tight cost control notwithstanding the high inflationary environment, this has resulted in excellent operating leverage, reflected in the 23.9% growth in operating profit.

Group chief executive officer, Dr Richard Friedland commented, “We are encouraged by the ongoing normalisation and resilient demand for private healthcare services, allowing the Group to continue on the solid trajectory reported during the first half of this past financial year.”

Total paid patient days (PPDs), inclusive of acute and mental health, increased by 6.7% with improved occupancies of 64.4% for FY 2023 (FY 2022: 60.1%).

Dr Friedland continued, “It is also very pleasing that we have made excellent progress in implementing our key strategic projects. The CareOn digitisation project is nearing completion and has been successfully rolled out at 38 acute hospitals to date, covering 90% of beds. The project is delivering tangible benefits for patients across the Netcare ecosystem, and the gross financial benefits of R104 million in FY 2023 have exceeded expectations.”

Similarly, Netcare’s environmental sustainability strategy continued to deliver financial savings and plays a pivotal role in reducing exposure to the impacts of the instability of the national electricity grid. In line with the 2030 sustainability strategy, the Group concluded an agreement for a renewable energy (RE) supply arrangement with NOA Group Trading, a renewable energy trader. This agreement will increase the proportion of Netcare’s total energy consumption derived from RE sources to c26% and represents an important step towards Netcare’s goal of achieving 100% reliance on RE sources by 2030. Netcare is currently exploring further grid-wheeling opportunities that will potentially increase RE-derived energy to c.40%. 

In order to address the growing demand for mental healthcare services in South Africa, Netcare successfully commissioned Netcare Akeso Gqeberha (72 beds) in May 2023. Sales of NetcarePlus products to the retail and corporate segments continue to gain traction, contributing to the Netcare ecosystem through increased access to private healthcare beyond traditional medical schemes and the increased use of its services. Netcare Diagnostics progressed with the rollout of validated and quality assured point of care devices across Netcare’s intensive and high care units, theatres and emergency departments as well as Medicross medical and dental centres.

Dr Friedland said, “We remain committed to our Consistency of Care strategy, broadening the measurement of clinical outcomes and patient experience to ensure we deliver on our core purpose of providing the best and safest care to our patients.”

Cash generated from operations was strong, increasing to R4 135 million (FY 2022: R3 950 million), and the cash conversion ratio amounted to 100.5% (FY 2022: 113.0%). In line with the capital allocation strategy of returning excess cash to shareholders, the Group executed a share buyback programme that, collectively, entailed the repurchase of 33.7 million shares at a cost of R444 million.

Similarly, in line with the dividend policy, which aims to provide shareholders with a sustainable dividend of 50% – 70% of earnings, the Board declared a final dividend of 35.0 cents per share. This, together with an interim dividend of 30.0 cents per share represents 61.5 % of adjusted HEPS and an increase of 30.0% over FY 2022.

Netcare is encouraged by the ongoing improvement in the Group’s financial performance as demand continues to normalise from the impact of the COVID-19 pandemic. The higher activity levels, coupled with ongoing efficiencies, resulted in strong operating leverage and an improvement in Group EBITDA margins of 120 basis points to 17.4%, from 16.2% in FY 2022.

Total capex, including strategic projects, amounted to R1.5 billion for the year, of which R136 million related to expansionary projects, including the completion of construction of the new Netcare Akeso Gqeberha facility and R82 million invested in the hospital digitisation project.

The Group incurred operational costs relating to strategic projects of R258 million (FY 2022: R249 million).

Netcare experienced an average of Stage 3.6 loadshedding across its facilities during the year, resulting in a sharp increase in generator diesel costs to R124 million from R37 million in FY 2022.

At 30 September 2023, the Group‘s cash resources and available undrawn committed facilities amounted to R3.7 billion.

DIVISIONAL REVIEW

Hospital and emergency services

The segment delivered a steady performance for FY 2023, driven by continued recovery in demand and further normalisation of the post COVID-19 operating environment.

Revenue for the segment increased by 9.6% to R23 050 million (FY 2022: R21 024 million) and total patient days increased by 6.7% to 2 447 494 days in FY 2023 (FY 2022: 2 293 344 days). The steady increase in activity contributed to higher occupancy levels with total occupancy of 64.4% (FY 2022: 60.1%).

Notwithstanding the changes in various networks that were effective from January 2023, a milder flu season and extended vacations by specialists, acute hospital patient days increased by a solid 6.1% against FY 2022, equating to 95.1% of FY 2019 with ICU and high care PPDs being 10.1% higher than pre-pandemic levels.

In line with the trend reported in H1 2023, year-to-date growth in medical PPDs of 8.5% continued to outpace surgical PPD growth of 3.9%. Medical PPDs have recovered to 99.0% of 2019 levels, while surgical PPDs continue to be impacted by sector trends, inter alia, declining maternity cases, as well as an outmigration of lower margin day cases, and have recovered to 91.7% of pre-pandemic levels. Total surgical cases comprised 51.5% of patient days (FY 2022: 52.6%; pre-pandemic levels: 53.4%) and medical cases 48.5% (FY 2022: 47.4%; pre-pandemic levels: 46.6%). Surgical cases continue to contribute more than 70% of revenue.

Demand for mental healthcare remains strong with mental health patient days increasing by 12.7% compared to FY 2022. The newly opened Netcare Akeso Gqeberha facility contributed 2.3% of this growth. Activity has surpassed pre-pandemic levels by 5.4% (same store) and 11.6% inclusive of the 36-bed Netcare Akeso Richards Bay facility (commissioned in May 2022) and the 72-bed Netcare Akeso Gqeberha facility (commissioned in May 2023).

The strong increase in mental healthcare activity has resulted in occupancies improving to 72.7% (73.5% excluding Netcare Akeso Gqeberha) in FY 2023 from 68.1% in FY 2022 (FY 2019: 71.6%).

In 2023, Netcare Christiaan Barnard Memorial Hospital received Level 1 trauma accreditation from the Trauma Society of South Africa, which is aligned to the American Trauma Society accreditation principles. There are only four hospitals in South Africa that have achieved this status, all of which are in the Netcare Group.

Netcare’s geographic footprint, electronic medical records (EMR) offering, and highly accredited facilities, allow the Group to continue attracting specialists and a net 124 doctors were granted admission rights at acute and mental healthcare facilities during FY 2023.

Primary care

Total GP and dental visits decreased by 3.1% in FY 2023 compared to FY 2022. The decline in visits is predominantly attributable to the higher base in FY 2022, which was boosted by increased COVID-19 GP visits during the Omicron-driven fourth wave. Revenue increased by 4.6% to R663 million. EBITDA margins were adversely impacted by diesel fuel costs.

Strategic update

Netcare has made excellent progress in the implementation of its key strategic projects and is now well placed to benefit from the rapidly changing dynamics driving demand in the healthcare sector.

Digitisation: Significant progress has been made in the implementation of the CareOn hospital EMR offering, which is a major focus of the digitisation strategy. This new way of care has been successfully implemented at 38 of the 45 Netcare hospitals to date, comprising 8 645 beds (90% of registered beds). In addition, over 28 000 healthcare professionals, comprising nurses, doctors, allied health professionals and pharmacists are actively using the system. Rollout to the final seven hospitals (943 beds) will be completed by April 2024. Dr Friedland said, “We remain confident that this investment will create a sustainable competitive advantage for the Group and will prove pivotal in laying the foundations in achieving our strategy of person centred health and care that is digitally enabled and data driven.” Digitisation has now been completed across all ancillary businesses in the Netcare ecosystem spanning across Netcare Akeso, Netcare Medicross, Netcare 911, National Renal Care and Netcare Cancer Care radiotherapy.

Netcare App: Netcare successfully launched its App in July 2023, which represents the next phase of the strategy to enable digital engagement with patients and clients. There has been a robust take-up of this App, which allows online pre-admissions, doctor appointments, the ability for Netcare 911 to geolocate someone in an emergency, access to a Summary of Care, and the ability to purchase NetcarePlus policies, with further services to be added in future.

Promoting access to healthcare: NetcarePlus has a portfolio of innovative healthcare products and funding solutions that promote access to affordable, quality healthcare in South Africa. In FY 2023, Netcare launched additional pre-paid procedures, completed enhancements to NetcarePlus GapCare and NetcarePlus Accident Cover, and also launched a new primary care offering.

Netcare Diagnostics: Netcare Diagnostics, which supports a Black female owned pathology service provider, Dr Esihle Nomlomo Inc., is gaining traction and made a positive contribution to EBITDA. The first stage rollout of 122 blood gas analysers at Netcare’s intensive care and high care units has been completed, with a further 70 point of care devices commissioned at ten emergency departments. Additionally, the service has been rolled out at ten Medicross facilities to date and will be extended to further sites in FY 2024.

Environmental sustainability: The first phase of the Group’s environmental sustainability strategy commenced in 2013. Since then, energy intensity per bed has reduced by 39%, exceeding the initial 10-year target. Similarly, the Group has exceeded its 2023 financial targets, achieving cumulative operational savings and benefits of more than R1.5 billion to date, yielding an IRR of 40%. In FY 2021, Netcare embarked on the second phase of its strategy, with a primary target of reducing Scope 2 emissions to zero by 2030 and Scope 1 and 3 emissions by a combined 84%. The Group’s 2030 strategy aims to achieve 100% utilisation from renewable sources, with zero waste to landfill and an additional 20% reduction of impact on water sources.

Outlook and guidance

Although the macro environment remains impacted by national power grid load shedding, global supply chain limitations, constrained consumers, and high levels of unemployment, Netcare has a number of measures in place to mitigate these challenges and remains focused on optimising the progress made in FY 2023. Furthermore, the environmental sustainability projects will continue to mitigate the significant escalation in costs associated with increased reliance on diesel powered generators resulting from the instability of the national electricity grid.

Although there has been limited growth in medical scheme membership, the pool of covered lives remains resilient and underscores the sustainable demand for quality private healthcare, which is exacerbated by the growing disease burden and ageing insured population.

For FY 2024, the Group expects revenue growth of between 7.5% and 9.5%. Total patient days are expected to grow by between 2.5% and 3.5% off a largely normalised base. The increased activity will drive further EBITDA margin expansion, improved earnings and a higher ROIC.

Netcare will continue to maintain an optimal capital structure, and the strength of the statement of financial position and the ongoing improvement in operational performance in the underlying businesses will continue to support dividend payments in line with the Group’s dividend policy.  Netcare will also continue to return excess cash to shareholders by way of share buybacks or special dividends.

Dr Friedland concluded, “We are confident that our strategy remains relevant, and we are firmly committed to realising growth opportunities, improving returns and the successful execution and completion of our key strategic projects. Notwithstanding the fluid economic environment, we expect ongoing improvements in the operational and financial performance of the business in FY 2024 and beyond.”

Categories : Antibiotics Diet and NutritionTags :

A Startling Connection between Malnutrition and Antibiotic Resistance

On By ModernMedia
Photo by Thought Catalog on Unsplash

A study published in Nature Microbiology has uncovered startling connections between micronutrient deficiencies and the composition of gut microbiomes in early life that could help explain why resistance to antibiotics has been rising across the globe.

A University of British Colombia team investigated how deficiencies in crucial micronutrients such as vitamin A, B12, folate, iron, and zinc affected the community of bacteria, viruses, fungi and other microbes that live in the digestive system.

They discovered that these deficiencies led to significant shifts in the gut microbiome of mice – most notably an alarming expansion of bacteria and fungi known to be opportunistic pathogens.

Importantly, mice with micronutrient deficiencies also exhibited a higher enrichment of genes that have been linked to antibiotic resistance.

“Micronutrient deficiency has been an overlooked factor in the conversation about global antibiotic resistance,” said Dr. Paula Littlejohn, a postdoctoral research fellow with UBC’s department of medical genetics and department of pediatrics, and the BC Children’s Hospital Research Institute. “This is a significant discovery, as it suggests that nutrient deficiencies can make the gut environment more conducive to the development of antibiotic resistance, which is a major global health concern.”

Bacteria naturally possess these genes as a defence mechanism. Certain circumstances, such as antibiotic pressure or nutrient stress, cause an increase in these mechanisms. This poses a threat that could render many potent antibiotics ineffective and lead to a future where common infections could become deadly.

Antibiotic resistance is often attributed to overuse and misuse of antibiotics, but the work of Dr. Littlejohn and her UBC colleagues suggests that the ‘hidden hunger’ of micronutrient deficiencies is another important factor.

“Globally, around 340 million children under five suffer from multiple micronutrient deficiencies, which not only affect their growth but also significantly alter their gut microbiomes,” said Dr. Littlejohn. “Our findings are particularly concerning as these children are often prescribed antibiotics for malnutrition-related illnesses. Ironically, their gut microbiome may be primed for antibiotic resistance due to the underlying micronutrient deficiencies.”

The study offers critical insights into the far-reaching consequences of micronutrient deficiencies in early life. It underscores the need for comprehensive strategies to address undernutrition and its ripple effects on health. Addressing micronutrient deficiencies is about more than overcoming malnutrition, it may also be a critical step in fighting the global scourge of antibiotic resistance.

Source: University of British Columbia

Categories : New Compounds and Treatments Pain ManagementTags :

New Compound Outperforms Gabapentin for Pain Relief

On By ModernMedia
Photo by Louis Reed on Unsplash

A new compound reversed four types of chronic pain in animal studies, according to new research published online in the Proceedings of the National Academy of Sciences (PNAS). It outperformed gabapentin without troublesome side effects, providing a promising candidate for treating pain.

Researchers led by NYU College of Dentistry’s Pain Research Center developed this small molecule, which binds to an inner region of a calcium channel to indirectly regulate it.

Calcium channels play a central role in pain signaling, in part through the release of neurotransmitters such as glutamate and GABA – “the currency of the pain signal,” according to Rajesh Khanna, director of the NYU Pain Research Center and professor of molecular pathobiology. The Cav2.2 (or N-type) calcium channel is the target for three clinically available drugs, including gabapentin and pregabalin, which are widely used to treat nerve pain and epilepsy.

Gabapentin mitigates pain by binding to the outside of the Cav2.2 calcium channel, affecting the channel’s activity. However, like many pain medications, gabapentin use often comes with side effects.

“Developing effective pain management with minimal side effects is crucial, but creating new therapies has been challenging,” said Khanna, the senior author of the PNAS study. “Rather than directly going after known targets for pain relief, our lab is focused on indirectly targeting proteins that are involved in pain.”

Inside the channel

Khanna has long been interested in a protein called CRMP2, a key regulator of the Cav2.2 calcium channel that binds to the channel from the inside. He and his colleagues previously discovered a peptide derived from CRMP2 that could uncouple CRMP2 from the calcium channel. When this peptide – calcium channel-binding domain 3 (CBD3) – was delivered to cells, it acted as a decoy, blocking CRMP2 from binding to the inside of the calcium channel. This resulted in less calcium entering the calcium channel and less neurotransmitter release, which translated to less pain in animal studies.

Peptides are difficult to synthesise as drugs because they are short-acting and easily degrade in the stomach, so the researchers sought to create a small molecule drug based on CBD3. Starting with the 15 amino acids that make up the CBD3 peptide, they honed in on two amino acids that studies showed were responsible for inhibiting calcium influx and mitigating pain.

“At that point, we realised that these two amino acids could be the building blocks for designing a small molecule,” said Khanna.

From 27 million to one

In collaboration with colleagues at the University of Pittsburgh, the researchers ran a computer simulation that screened a library of 27 million compounds to look for a small molecule that would “match” the CBD3 amino acids.

The simulation narrowed the library down to 77 compounds, which the researchers experimentally tested to see if they lessened the amount of calcium influx. This further pared the pool down to nine compounds, which were assessed using electrophysiology to measure decreases in electrical currents through the calcium channels.

One compound, which the researchers named CBD3063, emerged as the most promising candidate for treating pain. Biochemical tests revealed that CBD3063 disrupted the interaction between the CaV2.2 calcium channel and CRMP2 protein, reduced calcium entering the channel, and lessened the release of neurotransmitters.

“Many scientists have screened the same library of compounds, but have been trying to block the calcium channel from the outside. Our target, these two amino acids from CRMP2, is on the inside of the cell, and this indirect approach may be the key to our success,” said Khanna.

Four labs, four types of pain

Khanna’s lab then tested CBD3063 with mouse models for pain related to injury. The compound was effective in alleviating pain in both male and female mice – and notably, in a head-to-head test with the drug gabapentin, the researchers needed to use far less CBD3063 (1–10mg) than gabapentin (30 mg) to reduce pain.

To explore whether CBD3063 helped with different types of chronic pain, Khanna partnered with researchers at Virginia Commonwealth University, Michigan State University, and Rutgers University. Collaborators ran similar studies administering CBD3063 to treat animal models of chemotherapy-induced neuropathy, inflammatory pain, and trigeminal nerve pain – all successfully reversing pain, similar to gabapentin.

But unlike gabapentin, the use of CBD3063 did not come with side effects, including sedation, changes to cognition such as memory and learning, or changes to heart rate and breathing.

What’s next

The researchers are continuing to study CBD3063, refining its chemical composition and running additional tests to study the compound’s safety and assess if tolerance develops.

Long-term, they hope to bring a CBD3063-derived drug to clinical trials in an effort to offer new options for safe and effective pain relief.

“Identifying this first-in-class small molecule has been the culmination of more than 15 years of research. Though our research journey continues, we aspire to present a superior successor to gabapentin for the effective management of chronic pain,” said Khanna.

Source: New York University

Categories : Cancer Medical IndustryTags :

Redispensing Unused Cancer Pills could Save Millions

On By ModernMedia
Photo by Stephen Foster on Unsplash

Redispensing cancer drugs reduces both medical costs and environmental impact, according to research from Radboudumc pharmacy published in JAMA Oncology. The annual savings could amount to tens of millions.

Cancer drugs as pills are not always used up by patients. The drugs are mostly expensive and environmentally damaging, both in production and (waste) disposal. In her PhD research, Lisa-Marie Smale of Radboudumc investigated whether these unused drugs can be collected and reissued. Does such an approach ultimately lead to lower environmental impact and costs?

Redispense medication

When redispensing medications, the quality must be guaranteed. Therefore, in this study the medications were packaged separately and fitted with a sensor, which registers whether returned medications were kept within the required temperature. Smale: “If packaging, temperature and expiration date are in order, the returned medications can be redispensed. For two years we investigated this procedure in cooperation with the pharmacies of four Dutch hospitals; Radboudumc, UMC Utrecht, Jeroen Bosch hospital and St Antonius hospital. Over a thousand patients who were taking oral cancer medications at home participated in the study during that period.”

Saving tens of millions

The results look promising. The investment in the method, such as packaging with a temperature sensor, amounts up to 37 euros per patient per year. This is offset by savings of 613 euros. Annually, this results in a net saving per patient of 576 euros. Smale: “In the Netherlands, we can save between 20 and 50 million euros annually with this redispensing of medication. Meanwhile, we have further optimised the process, making a net saving of 655 euros per patient possible. In the Netherlands, we have relatively low drug prices. If you look at the US, where the price of new drugs is over 300 percent higher, in principle much more money can be saved there.”

Large-scale consequence

Of all wasted medicine packaging, two-thirds could be reissued. Project leader Charlotte Bekker of Radboudumc says, “Based on the results, the study will be expanded to 14 hospitals. Again, we are looking at cancer pills. Reissue is only allowed in the context of a scientific study because of European rules. We hope that the approach can eventually be used nationwide, as well as for other drugs.”

Sustainability and social impact also benefit

“This approach is cost-effective for expensive drugs,” Smale says, “but ultimately there are other factors you want to consider, such as sustainability or social impact. Think of the environmental impact you can reduce by not destroying drugs but redispensing them; this can also be beneficial for drugs that are in short supply.”

Broad interest

To the researcher’s knowledge, this study the first to examine drug redispensing with guaranteed quality. The topic is attracting strong interest, not only in the medical community but also beyond. Several parties are committed to make further expansion possible. In addition to the participating hospitals, the Dutch Association of Hospital Pharmacists (NVZA) is also closely involved. And it is part of the Green Deal objectives to make healthcare more sustainable. Smale: “We are happy to work with all parties to address and reduce the cost and environmental impact of wasted medicines.”

Source: Radboud University Medical Center

Categories : General InterestTags :

Gift of the Givers Gaza Head “Paid the Ultimate Sacrifice”

On By ModernMedia

By Matthew Hirsch for GroundUp

A “gentle and loving” person who “paid the ultimate sacrifice” for making sure those who needed it received aid. This was how Ahmed Abbasi, who headed the Gift of the Givers office in Gaza, was remembered at an interfaith memorial service in St George’s Cathedral, Cape Town, on Sunday evening.

At least 400 people came to pay their respects. Several faith leaders were in attendance as well as government officials, including Cape Town Mayor Geordin Hill-Lewis and former international relations minister Lindiwe Sisulu.

Gift of the Givers’ Western Cape project coordinator Ali Sablay told GroundUp that Abbasi and his brother, Mustafa, were killed by a missile while returning from their morning prayer.

Abbasi leaves behind his wife and three children. They have been relocated to a place of safety.

Sablay said that Abbasi was responsible for setting up a women and children care centre, three desalination plants, supplying medicines to hospitals, and more.

“He was the head of this operation and in the last 40 days of this war, he’s been remarkable in the work he’s been doing in getting aid to those affected. He had the option to relocate but he said he could not leave the people behind. He stayed on with his family. Unfortunately, he paid the ultimate price.”

Sablay said the organisation backed President Cyril Ramaphosa’s decision to refer members of the Israeli government to the International Criminal Court (ICC). “We support the political parties that are asking that the Israeli ambassador be expelled. This is not an act of war, this is an act of genocide,” he said.

Reverend Michael Weeder, dean of the cathedral, led the service. Reverend Allan Boesak gave the sermon.

Megan Choritz read out a letter of condolence on behalf of South African Jews for a Free Palestine. “There has never been a moment of crisis where Gift of the Givers has not stepped up and offered help, solace, dignity and hope to those affected. Please, in this dark moment for you and your organisation, accept our prayers, solidarity and support.”

“We will continue to speak up, continue to disavow any claims that this war is waged in our names, or in the name of Judaism,” she said.

The service was interspersed with hymns, songs and poetry readings. Several faith leaders addressed the congregation.

In a pre-recorded message, Dr Imtiaz Sooliman, founder of Gift of the Givers, thanked Father Weeder for organising a memorial service for someone he had never met. “This is not a head of state, a minister, or a person of high rank. He’s just an ordinary Palestinian, but he works for Gift of the Givers and that makes him special, even if I say so myself.”

In an interview with GroundUp last month, Sooliman described Gaza as “the worst situation in the world because there is no exit route”.

“You can’t get out. The area is so small. It’s so easy to bomb it … Nobody can have a safety plan. Where are you going to hide? There’s no such thing as safety in Gaza,” he said.

The New York Times reported last week that over 100 aid workers in Gaza have been killed in the past five weeks.

Republished from GroundUp under a Creative Commons Attribution-NoDerivatives 4.0 International License.

Source: GroundUp