Betsy Ryan has just been named to replace Gary Carter as president and

chief executive officer of the New Jersey Hospital Association; she

will assume her new position at the end of June. In the meantime, she

says, "I get to have one of best hospital executives in the nation

show me the ropes."

Ryan always had a healthy interest in the political process and public

policy, but she had her mind set on becoming a lawyer as early as her

freshman year at Rutgers University’s Cook College. After graduating

with a degree in political science in 1982, she went straight to Seton

Hall University School of Law, followed by a clerkship with a Mercer

County judge and two years in private practice with a small Mount

Holly firm.

In the late 1980s when she stepped over into the policy realm. She

took a job with the New Jersey Election Law Enforcement Commission,

which regulates money issues around New Jersey candidates for public

office. She then worked as assistant counsel for Governor Jim Florio,

focusing on health-care policy and legislation.

In 2000 she was hired by the New Jersey Hospital Association as

general counsel. She was subsequently named chief operating officer,

and in the spring will become president.

She prepares to take on this job at a time when insufficient

reimbursement of hospitals, in particular by government payers but

also by some commercial ones, is destroying hospitals’ viability. "In

New Jersey one of the big payers for the disadvantaged is Medicaid,

and the reimbursement rate is woefully inadequate," says Ryan,

explaining that Medicaid covers only 69 percent of inpatient costs.

Medicare is a little better, but still does not cover costs. As a

result, New Jersey has had five hospital bankruptcies and two hospital

closures in the past several months.

The hospitals’ hands are tied. Under New Jersey law, all are required

to treat everybody. "If anyone presents, we must provide soup to nuts

care, including surgery and treatment in outpatient clinics," says

Ryan. "It is laudable, but we are woefully underpaid to provide care."

The state’s hospitals provided roughly $1.6 billion in charity care

services to needy New Jerseyans in 2006. But the state budget for 2008

allocates only $716 million to reimburse hospitals for this care.

Another critical area for healthcare is patient safety. To deal with

safety issues, the New Jersey Hospital Association has established

what it calls "collaboratives," which bring together experienced

personnel from different hospitals. One success was reducing the

incidence of bedsores, or pressure ulcers, by 70 percent in the

nursing homes and hospitals that participated. Once acquired, these

sores are difficult to get rid of, painful, and subject to infection.

The participants in this collaborative first agreed on best practices,

which were not always being followed. "It wasn’t routine to

immediately do an assessment of the skin of all patients of a certain

age in certain clinical categories and to always ensure that the

patient is moved a certain amount of times," says Ryan. The model

developed by the collaborative has gotten national attention; it has

been recognized by the Centers for Medicare and Medicaid Services, and

speakers from the New Jersey Hospital Association have been invited to

other states and even to Europe to discuss its efforts. Other

collaboratives are working to reduce the incidence of infections

related to catheters and central lines.

Another area of focus is MRSA infections. The association, for

example, strongly supported a bill recently signed into law that

requires reporting of infections in four disease categories, which

will make reporting more uniform across the state. Another bill,

passed by the New Jersey legislature in August, requires all patients

in intensive-care units to be tested for MRSA. Of course, the top way

to prevent MRSA infections is to have both professionals and patients

wash their hands. "We’re doing everything we can," says Ryan. "Don’t

forget that the incidence of MRSA has gone down in New Jersey despite

everything you are reading. We’re on top of it."

Both individual hospitals and the state government are now working to

bridge the gap between the high costs for patient care and the low

level of reimbursement.

"Hospitals are doing all they can to try to improve themselves," says

Ryan, "to market themselves to patients who can pay." As a result,

they are having to make capital expenditures to stay current with

available technology, in order to attract the paying patients who will

help keep their doors open.

To advise the state about the health-care system, Governor Corzine

created the Commission on Rationalizing Health Care Resources, headed

by Uwe Reinhardt, a health economist at Princeton University. Its

interim report, released at the end of June, analyzes the financial

condition of the state’s acute-care hospitals and outlines a method

for determining which hospitals are essential. Its final report

addresses access and equity for the medically underserved.

Although competition may be generally good for hospitals, Ryan is

concerned – with 18 hospital closures in the last 10 years – that it

is no longer a matter of the herd being thinned. "I’m worried that

we’re getting beyond the thinning stage," she says.

– Michele Alperin

From Survivor To Entrepreneur

Kevin Zepp, 28, is a cancer survivor, diagnosed at age 21 with

advanced testicular cancer. He went to Lance Armstrong’s doctor,

Indianapolis-based Lawrence Einhorn, who prescribed a similar but

stronger protocol than Armstrong had, and he took that chemotherapy at

the University of Pennsylvania. "Now I am free and clear," he says.

But Zepp’s close encounters with the medical profession instigated his

own career in healthcare. "I am basing my business on how I have seen

my parents be caregivers," he says. Last fall Zepp bought a

five-year-old firm, Liberty Healthcare Services, an accredited

homecare provider that is reimbursable by Medicaid, veterans’

benefits, HMOs, as well as private payments. His goal is to take a

personalized hands-on approach to every aspect of running a

traditional homecare agency.

The previous owner, Keith Shevlin, had expanded the business last

summer with a move from 1603 South Broad to 1,650 square feet at 2333

Whitehorse-Mercerville Road. Both buyer and seller worked with a

business broker, Chip Measells of Wyatt Matas in Washington, D.C.

With six current employees in the office, and about 100 in the field,

Zepp plans to open offices, or buy other agencies, in Toms River and

Burlington County within the next 18 months. "It can be more practical

to combine two agencies than to start one from the ground up," he

says.

Zepp is a Medford native who now lives in Mount Laurel. His father

owns a construction equipment company, and his brother is a computer

science major at Rowan University. After majoring in accounting at the

University of Richmond, Zepp was an auditor for a national healthcare

lender, CIT, traveling to all kinds of healthcare facilities and

businesses to conduct due diligence for acquisition, merger,

restructuring and recapitalization financing. Then, after completing a

management training program with Universal Health Services, the third

largest hospital chain in the country, he went to west Texas, where he

was one of the youngest hospital CFOs in the nation.

After those experiences, he did not want to buy a franchise. "I don’t

believe in franchised health care. I wanted a business small enough to

get my hands around it. We pride ourselves that we are individually

owned.

Zepp’s clients pay an average of $18 an hour for a 15-hour week, or

$14,000 a year. Round the clock live-in care costs $62,000 a year.

This contrasts to the $50,000 and up that a nursing home costs, but

insurance sometimes pays for part of the nursing home fees.

His biggest competition is the underground networks that pay cash

under the table ."Most people don’t know that the healthcare workers

would not be covered under their homeowners policies," he says.

Zepp also is looking at advanced caregiving technologies, such as

bundling hands-on care with virtual visits and partnering with an

emergency response company to provide smart bracelets and the latest

in monitoring devices and in-home thermal and motion sensors. "Some

don’t want or need someone in their house every single day, but the

virtual visits would add to the comfort level of the family."

With the goal of being a one-stop agency, Zepp plans to have a small

stable of recommended attorneys and social workers. For right now,

though he is focusing on publicity. "I went to get our name out there

and build up the brand."

Zepp is active in the cancer advocacy community and is a legislative

ambassador for the American Cancer Society, traveling to share his

story of survivorship with congressional representatives. Says Zepp:

"I truly believe the cure will be found in my lifetime."

– Barbara Fox

Liberty Healthcare Services Inc., 2333 Whitehorse-Mercerville Road,

Suite B, Hamilton 08619; 609-890-0311; fax, 609-890-3499. Kevin Zepp,

president. www.libertyhealthnj.com.

Illness Launches a Search for a Cure

Christopher J. Schaber, president and chief executive officer of DOR

BioPharma, joined the company in August, 2006, for a very personal

reason – his father has multiple myeloma and will shortly undergo a

stem cell transplant. Because DOR’s lead product treats the

gastrointestinal graft-versus-host disease that may follow his

father’s transplant, he wants to move it to market as quickly as

possible.

"I took on more of a personal charge to get this drug out there," says

Schaber. "Having it hit so close to home, and knowing what this

process of cancer can do to my family, I figure it is similar or worse

for others."

DOR, which relocated from Miami to Princeton in October, was founded

in the late 1980s. After a series of transitions and mergers DOR now

focuses on products that treat life-threatening side effects of cancer

treatments and serious gastrointestinal diseases as well as vaccines

for certain bioterrorism agents. Schaber initiated the move to New

Jersey as soon as he had the opportunity, without disrupting

regulatory filings, because this area is closer to home for a number

of DOR’s employees.

DOR’s lead product, orBec, treats graft-versus-host disease (GvHD), a

serious side effect of bone marrow or stem cell transplants that do

not come from the patient’s own body (which is the optimal source).

For leukemias these autologous transplants are often times not

possible, and donors are sought either among siblings or, if

necessary, from a stranger.

The first step in a transplant is treatment with radiation and

chemotherapy to kill cancer cells. These harsh measures, however, also

kill good cells and compromise the immune system. As a result, the

healthy donor cells administered during the transplant will often

attack the patient’s body, particularly the skin, liver, and

gastrointestinal tract. They will strip away the thin tissue lining of

the GI tract’s interior, leaving open inflammation through which

bacteria from the stomach or the intestines may enter the blood system

and cause infections.

Gastrointestinal graft-versus-host disease, because of its similarity

to ulcerative colitis and Crohn’s Disease, is currently treated with a

high dose of Prednisone, a systemic steroid with a host of detrimental

side effects when given for extended periods of time. Prednisone

quickly enters the bloodstream where high dosages taken for too long

can damage or weaken the body, increasing the likelihood of infection,

bone demineralization, muscle atrophy, hypertension, and even

psychiatric effects like depression.

Patients with graft-versus-host disease typically must stay on

Prednisone for four to six weeks, then taper off slowly. The whole

weaning process can take up to eight to ten weeks. But the cure can be

as bad as the disease, and indeed extended use of Prednisone can

result in a patient’s death. "Typically these patients succumb to the

systemic steroids they are taking, not to their graft-versus-host

disease," says Schaber. "The mortality rate is 25 percent in these

very sick patients."

Graft-versus-host disease is an orphan disease, or a disease that

affects a relatively small number of people. Of the approximately

12,000 transplants from strangers each year in the United States,

about half of the patients will develop gastrointestinal

graft-versus-host disease, about 5,000 cases per year. That is the

group for whom DOR’s treatment is designed.

"Like many biotech companies, we are going after something the big

pharmas wouldn’t bother with," says Schaber. He estimates the

worldwide market to be over $100 million, but as more patients are

getting transplants from other people, the patient population will

continue growing.

DOR BioPharma’s orBec is a new formulation of a topically active

steroid that has been used for 20 years as an aerosol to treat asthma

patients. DOR has developed a two-pill oral delivery system to treat

gastrointestinal graft-verus-host disease. One pill is an immediate

release tablet that dissolves quickly and treats the upper

gastrointestinal tract and stomach, and the other is a time release

that passes from the stomach to the small intestine and treats the

lower gastrointestinal tract.

The drug’s uniqueness lies in its being a topical rather than a

systemic steroid. It treats at the point of inflammation and less of

it is drawn into the bloodstream – 30 to 40 percent as opposed to

nearly 100 percent with Prednisone.

In 2004 DOR completed its first phase 3 trial of orBec in 129

patients. Although the trial’s primary end point did not achieve

statistical significance, orBec did demonstrate some success in

controlling graft-versus-host disease. For example, there was a 66

percent reduction in mortality at 200 days post-transplant among

patients taking orBec, with only 5 deaths as compared to 16 among

patients taking a placebo. Other key secondary end points were also

statistically significant.

DOR filed a new drug application with the FDA, but after a long

review, including a meeting with the advisory committee of the FDA,

the company received a not-approvable letter on October 18. Schaber

attributes the lack of approval to missing the primary endpoint even

though he believes the data was compelling.

People at the Food and Drug Administration have been working closely

with DOR to put together a confirmatory phase 3 clinical trial. The

FDA appears to be interested in getting the drug out to this small

patient population his company is targeting, says Schaber, who

suggests there may be ways to expand access to the drug to patients

outside of the protocol under what is called compassionate care

treatment.

DOR’s pipeline contains a number of other products, a number of them

in the preclinical phase. A phase 2 trial is now enrolling to use

orBec for prevention of graft-versus-host disease, and DOR is

exploring the use of orBec’s active ingredient to treat

gastrointestinal radiation injury. Other efforts involve Oraprine,

which uses a different immunosuppressant drug to treat oral lesions of

the mouth associated with graft-versus-host disease, and an oral drug

delivery system to encapsulate Leuprolide, a drug for the treatment of

prostate cancer and endometriosis that today is injectable only.

DOR BioPharma’s biodefense division has responded to post-9/11

concerns by developing vaccines to treat ricin toxin and botulinum

toxin. "We believe we are ahead of everyone else on in the deveopment

of a ricin vaccine," says Schaber. DOR has treated humans with the

vaccine, showing it can generate antibodies without bad side effects.

The vaccine has also been able to protect animals from high doses of

toxins that otherwise would have killed them.

This biodefense work is funded entirely by government grants of

approximately $5 million between the two toxin programs. Most of DOR’s

work so far has been with ricin toxin, and the company was recently

awarded a million dollar drug grant to do additional work in humans.

For the botulinum toxin, DOR is doing formulation and early animal

work.

DOR was originally incorporated in Delaware under the name Biological

Therapeutics in 1987 and two months later merged and changed its name

to Immunotherapeutics. Then in 1996 it became Endorex. The name DOR is

an acronym for (D)elivery of (Or)al biopharmaceuticals.

Schaber grew up in Philadelphia and moved to Pine Hill in South Jersey

as a teen. He comes from a blue-collar family where his father was a

machinist and his mother tended home and children. A student athlete

whose specialty was football, Schaber graduated from Western Maryland

College in 1989 with three majors – in business, economics, and

chemistry.

Schaber started his career in manufacturing and product development at

Elkins-Sinn in Cherry Hill, which was later bought by American Home

Products and Wyeth Ayerst, and while working he earned a master of

science in pharmaceutics at the Temple School of Pharmacy. He also

holds a doctorate in pharmaceutical biosciences from Union Graduate

School.

He then worked for several pharmaceutical companies, including

Liposome, where he worked on a number of products, gaining experience

in regulatory affairs, quality assurance, and operations, Acute

Therapeutics, where he was a cofounder and served as vice president of

regulatory compliance and drug development, and Discovery Laboratories

in Doylestown, where he was a cofounder and served as executive vice

president and chief operating officer from 1998 to 2006 and helped

develop Surfaxin, a product for premature infants with respiratory

distress syndrome.

Schaber lives with his wife and four children in North Hanover. DOR

Biopharma has six full-time employees and works with a number of

medical and regulatory consultants.

Schaber is looking to expand and grow the company in 2008 to support

ongoing and future clinical trials. Although DOR has enough money to

sustain itself for almost a year, it will need to raise significant

money to conduct long trials. Schaber will be looking either for

partners in pharma or biotechs, or will have to raise his own money

through financing. He expects in 2008 to have the potential to add 10

to 15 additional employees.

– Michele Alperin

DOR Biopharma Inc. (DORB), 850 Bear Tavern Road, Suite 201, Ewing

08628; 609-538-8200; fax, 609-538-8205. Christopher J. Schaber,

president and CEO. Home page: www.dorbiopharma.com.

Crosstown Move

Computer Associates, 200 Princeton South Corporate Center, Ewing

08628; 800-225-5224. Mark Thompson, managing director. www.ca.com.

Computer Associates has closed its offices at Route 206 and Orchard

Road. The company sold the building in 2005 to JER Partners, a real

estate investment company based in McLean, Virginia, and the move had

been in the works for quite some time. Employees from the 23 Orchard

road building have moved to Ewing, where they were joined by CA

employees from Mount Laurel and from Plymouth Meeting, Pennsylvania.

Michelle Healy, a CA spokesperson, says that there are 400 employees

in the international software giant’s new offices, which are headed by

Mark Thompson.

Healy says that the move came about as a result of the company’s

ongoing "evaluation of cost structure." Greater collaboration was also

a goal, she says. Most of the employees in the Ewing office are in

development, sales, and marketing.

At the time of its move, CA occupied some 100,000 square feet in the

238,000-square-foot building. Consulting firm Blessing White was a

tenant in the building, says a spokesperson, and is continuing on

under the new owner. The other new tenant is Oscient, which is

occupying 10,000 square feet.

JER Partners has put $3 million into a renovation of the property,

which is being marketed by Colliers Houston & Co. Charlie Parmelli,

who has been marketing the building for Colliers for about six months,

says that about 200,000 square feet are still available. He says that

the building’s multi-story atrium, running its entire length, and its

extensive common areas, including a cafeteria run by Chamber’s Walk

and a fitness center, are features that sets it apart from many office

towers. At under $22 a square foot, its space is also less expensive

than that in most Class A buildings on Route 1.

Urban Development

InterCap Holdings, 100 Overlook Center, Second Floor, Princeton 08540;

609-375-2802; fax, 609-375-2640. Steve Goldin, Chairman and CEO.

www.InterCapHoldings.com.

Looney Ricks Kiss Architects Inc., 182 Nassau Street, Suite 201,

Princeton 08542; 609-683-3600; fax, 609-683-0054. James Constantine,

principal. www.lrk.com.

InterCap Holdings, a development company, with a specialty in

mixed-use projects centering on train stations and Looney Ricks Kiss,

an architectural firm with a focus on planning and development, are

setting up and moderating a series of public meetings designed to find

the best use of an industrial property near the Edison train station.

Both companies have a bent toward New Urbanism, a trend that is

transforming formerly lifeless areas – like acres-large train station

parking lots – into lively communities that put apartments over

stores, incorporate something to do at night, and cut short commutes.

Like Hamilton, West Windsor, Trenton, North Brunswick, and many other

New Jersey towns, Edison is looking for ways to maximize the use of

land that, until now, has been used mainly for hosting commuters’ cars

while they go off to work in Manhattan.

Finding the best use for the land around train stations can be a

contentious business, which is where Looney Ricks Kiss’ expertise in

defining options and forming a consensus is expected to come in handy.

The workshops will consist of round-table meetings with community

leaders, members of the public, and representatives of various levels

of government to come up with ideas for the property.

The Edison Exchange, the township group overseeing the train station

project, will then propose a plan that balances the desires of

residents with the economic possibilities of the site. It will all end

with a preliminary concept plan.

Looney Ricks Kiss has a number of locations in addition to its office

on Nassau Street. Two are in the ground-up planned communities of

Celebration, Florida, and Rosemary Beach, Florida. Others are in the

revitalized cities of Nashville, Tennessee, and Memphis, Tennessee.

Intercap Holdings, headed by Steve Goldin, owns the property slated to

become 350 commuter parking spaces on Truman Drive near the train

station. Goldin is developing an expertise in transit villages. He has

been involved in plans for mixed use development, combining housing

with offices and stores, at the Hamilton train station, and has been

active in promoting a transit village at the Princeton Junction train

station.

Goldin speaks on transit villages on Friday, January 18, at 7 p.m. at

the Village Grande development in West Windsor. Call 609-918-9517 for

more information.

New in Town

Lutronic USA, 51 Everett Drive, Suite A-50, West Windsor 08550;

609-275-1565; fax, 609-275-3800. Jhung/Won Hwang, director of

operations. www.lutronic.com.

Lutronic USA has opened an office on Everett Drive. The 10-person

company sells equipment used by surgeons doing cosmetic and

reconstructive surgery. The equipment is made by the company’s parent,

which is based in South Korea.

Lutronic’s main product, the MOSAIC fractional laser system, was

approved for use in the United States by the FDA in July. Its selling

point is that it targets damaged skin without harming the skin around

it, thereby promoting faster healing.

The company also makes a surgical tool whose popular uses include the

removal of tattoos.

Leaving Town

LDMG LLC: Leatherman Builders, 100 Youngs Road, Suite 9, Mercerville

08619; 609-584-9751; fax, 609-584-8608. Todd Leatherman.

www.leathermanbuilders.com.

Todd Leatherman has moved his residential and commercial building

company to Ocean County.

It was a quality of life move. "It’s a better location," says

Leatherman. "I’m right at a marina, and just across from Jack Baker’s

Lobster Shanty. And I’m 10 minutes from home."

Leatherman does renovation and improvement projects throughout New

Jersey, and says it doesn’t much matter to his clients where his

office is located, so he chose a location that he enjoys.

Media Mastr Computer Products Inc., 7A Marlen Drive, South Gold

Industrial Park, Robbinsville. 609-586-7576. Bob Klar, president.

www.mmcpi.com.

Media Mastr has moved from the South Gold Industrial Park to

Burlington. The company sells computer supplies, data cartridges, and

storage media. It also has a specialty in CD-ROM manufacturing and

duplication.

The company’s new address is 340 East Broad Street, Unit 1A,

Burlington, 08016.

Name Change

RBC Capital Markets, 196 Princeton-Hightstown Road, Building 1A, Suite

9, West Windsor 08550; 609-514-0075; fax, 609-514-1087. Upendra Shah,

manager. www.rbccarlin.com.

Carlin Financial Group, a financial services group, has been acquired

by New York City-based RBC Capital Markets, the corporate and

investment banking arm of RBC that is involved in debt origination,

sales and trading, foreign exchange, infrastructure finance, metals

and mining, and energy.

Stock News

Pharmasset Inc., 303-A College Road, Princeton 08540; 609-613-4100;

fax, 609-613-4150. P. Schaefer Price, CEO. www.pharmasset.com.

Shares of Pharmasset, a biotech founded in 1998, reached a new

all-time high on January 7 after the company said that 85 percent of

patients dosed with its experimental drug, R7128, in combination with

two other drugs achieved undetectable levels of Hepatitis C virus

after four weeks.

The early-stage study of two dosing levels evaluated 50 patients who

had not previously been treated. Pharmasset said both dose levels were

safe and well-tolerated compared with placebo.

No serious adverse events were reported during the four-week treatment

period.

Hepatitis C is a blood-borne infectious disease of the liver and is a

leading cause of chronic liver disease and liver transplants. Nearly

180 million people worldwide are infected. The CDC has reported that

almost four million people in the United States have been infected

with HCV, of whom 2.7 million are chronically infected.

Shares in the company rose over $6, to $20, on news of the positive

results.

Deaths

Joseph H. Petrozzini, 88, on January 7. The Kingston resident was an

entrepreneur whose businesses included a direct mail company

specializing in lithographs.

Gerard J. Hogan, 55, on January 1. A Skillman resident, he was the

founder and president of Gerard Sheet Metal in East Brunswick.

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