TOTAL PHARMACEUTICAL CARE’s HOME INFUSION THERAPY SERVICE
Executive Summary
TOTAL PHARMACEUTICAL CARE's HOME INFUSION THERAPY SERVICE, antibiotics and other anti-infectives, including aerosolized pentamidine for Pneumocystis carinii pneumonia, is the biggest at-home drug therapy category provided by the firm. In a June 22 filing with the Securities and Exchange Commission, Torrance, Calif.-based Total Pharmaceutical Care, Inc. reported that antibiotics and anti-infectives generated 28% of the firm's $14.9 mil. in 1989 revenues (about $4.2 mil.) and 33% of sales in the quarter ended March 31, or about $1.4 mil. The company provides a full range of home infusion therapies to patients. In addition to anti-infectives, Total Pharmaceutical Care offers total parenteral nutrition therapy (25% of 1989 revenues, or about $3.7 mil.), enteral nutrition therapy (20%; about $3 mil.), pain management therapy (7%; nearly $340,000), continuous or intermittent I.V. chemotherapy (3%; almost$146,000) and other therapies (17%; roughly $826,000). These other therapies include immune gamma globulin therapy, Prolastin enzyme therapy, human growth hormone administration, Dobutamine for congestive heart failure or for those awaiting heart transplant, and anti-coagulant therapy. The company also delivers blood products and new therapies for AIDS patients, including interferon to treat immunosuppression and ganciclovir for cytomegalovirus retinitis. Total Pharmaceutical Care provides home infusion and related at-home therapies through 11 branch offices -- eight in California, two in Colorado and one in Kansas -- all accredited by the Joint Commission on Accreditation of Healthcare Organizations. The company commenced operations in July 1984 in Torrance and expanded to Colorado in April 1987 and Kansas in July 1987. The latest two branches were opened in June of this year in San Luis Obispo, California, and Colorado Springs, Colorado. Each branch contains a licensed pharmacy equipped with a "clean room" compounding facility and staffed by licensed pharmacists; registered nurses who train patients about home infusion procedures and/or administer the therapies and related medical support; and regional account managers and support staff who handle the therapy billing and reimbursement details and pharmaceutical deliveries. The SEC "red herring" filing outlines Total Pharmaceutical Care's plan to go public via an initial offering of 1.7 mil. shares of common stock at an estimated price of $11-$13 per share. Smith Barney and Furman Selz are underwriting the offering, which could gross $22.1 mil. The company estimates that net proceeds from an offering at an assumed price of $12 per share would provide $6 mil. for new branch facility development over the next two years, with the balance going to fund working capital and expenditures associated with the growth of its 11 existing facilities. TPC expects to open up to three new branches in northern California during the next six months. The opening of a new facility requires an outlay of approximately $400,000 fo pre-opening expenses and three quarters of operating losses. Baxter Travenol veteran Victor Chaltiel has been chairman, president and CEO of Total Pharmaceutical Care since March 1989. Chaltiel was a Baxter executive for 18 years; he left the company before Baxter's acquisition of Caremark, which dominates the home infusion industry with sales of approximately $500 mil. Chaltiel left Baxter in mid-1985 to become president and chief operating officer of Salick Health Care, which develops outpatient cancer and dialysis treatment centers.