by Maureen Flanagan
Since 1993 physicians interested in staying on top of the latest information about drugs and treatments for cancer have turned to the Network for Medical Communication & Research, LLC (NMCR). Through a variety of forums, NMCR gives doctors and other medical personnel an opportunity for educational exchange as new drugs are tested for FDA approval and come on the market for mainstream use. Founded by two prominent oncologists, NMCR has been an enormously successful venture, attracting top talent among academic physicians and earning the support of the ten largest manufacturers of oncology drugs. The company's meetings, events, and published materials maintain a broad-based, scientifically rigorous basis and are recognized and respected for their quality and integrity.
In a January 7, 2002 transaction, American Capital Strategies (Nasdaq: ACAS), a publicly traded buyout and mezzanine fund with capital resources exceeding $1 billion, invested $22 million in NMCR.
"The company's founders laid a strong foundation that enabled NMCR to flourish as a vital medical communications network for the medical community. The new ownership will further the growth of the network as it moves into new medical specialties and continues to provide a unique service to pharmaceutical companies, physicians and their patients," said Frank Tidikis, NMCR's CEO.
Based in Atlanta, GA, the network was founded by Stanley H. Winokur, MD, one of the first practicing oncologists in the country, and Joseph C. Allegra, MD. Originally set up as the Network for Oncology Communication and Research (NOCR), the founders created separate companies for similar networks for urology and gastroenterology. In 1997, they combined the companies to form NMCR.
NMCR's products and services have become increasingly popular with pharmaceutical manufacturing companies and biotechnology companies as well as oncologists and other medical professionals. The company has developed different formats to provide education and communication opportunities for the medical and pharmaceutical communities. These include the Challenging Case SeriesSM, an interactive exchange of prominent academic physicians and practitioners focusing on selected case studies; Highlights Meetings, offered in a similar format, to discuss information presented at the annual meetings of major medical societies; and Advisory Boards, or focus groups that address a specific issue of concern to a single pharmaceutical manufacturer. NMCR also presents educational meetings geared specifically for nurses and administrative personnel and for medical fellows.
NMCR produces tangible materials such as monographs and audiotapes in addition to interactive fax case series and weekly faxes that go out to 9,000 oncologists. In January 2001, the company launched NMCR Online, an interactive platform offering CME-accreditation for peer discussion of cancer treatment options.
In contrast to promotional events, NMCR's multi-sponsored, theme-based meeting series set it apart from its competitors. Sponsoring an event on a specific disease rather than a manufacturer's specific drug product allows the company to recruit talented and widely known professionals as moderators and panelists and assemble top practicing physicians as participants. The scientific focus attracts several sponsors per event, enabling the company to maximize sponsorship revenues and increase the success of other services such as its faxes, monographs/audio tapes and NMCR Online.
The $22 million investment in NMCR is American Capital's first transaction of 2002. Best, Patterson, Crothers & Yeoham, a Dallas-based investment firm, also provided financing. Alongside American Capital, NMCR's founders and senior management maintain an ownership stake in the company.
"As the population ages and demand for prescription drugs increases, American Capital is pleased to support a company focused on the vital information exchange within the medical community," said Darin Winn, ACAS Managing Director and Principal.
American Capital is an equity partner in management and employee buyouts; invests in debt and equity of companies led by private equity firms, and provides capital directly to private and small public companies. American Capital funds growth, acquisitions and recapitalizations.
Click here for more information about American Capital's portfolio companies.
This is American Capital's fourth investment in the health care industry. Other ACAS healthcare investments include (i) Auxi-Health, Inc., a provider of home health services in the Southeast and Midwest. (ii) IGI, Inc., a pharmaceutical and consumer products company, and (iii) Patriot Medical, a provider of testing and repair services for diagnostic and other medical equipment.
Prescription drugs are an important business segment in the United States, generating $102.5 billion in revenues in 2000. Revenues increased 16% from 1999 to 2000 and have grown by 85% since 1995. More than 1000 new drugs are in development, of which 402 - more than for any other disease -- are new treatments for cancer.
The market for oncology drugs reflects this rapid growth, with even greater increases on the horizon. Analysts expect the $5.8 billion oncology market, now 5% of the total pharmaceutical market, to grow substantially as the population ages and is at higher risk for cancer. Furthermore, 80% of oncology drug prescriptions are written for off-label uses, raising the possible treatment options exponentially. In fact, the exchange of information about the latest test data and treatments for off-label uses is one of the major concerns to NMCR's clients.
NMCR has structured its products and services to fill the much needed niche of information exchange within the physician community. Well respected in its market for the quality of its programs and integrity of market research, NMCR is now ready to expand its products for oncologists, offer additional theme-based programs and target a broader health care audience. It has also taken steps to develop the same caliber programs for urology and gastroenterology. Two well-respected academic physicians have been approached about joining the company to head up these new areas.
NMCR is poised to help the medical community gain a better understanding of new pharmaceuticals, treatment options, and ways of doing business. Its unique model and product offerings, ability to assemble top talent and forge strong customer relationships within the pharmaceutical and biotechnology industries promise to give medical providers the information and tools they need to meet the health care challenges of the future.
