2012: A Look Back. Here are 5 notable business stories that made headlines in the MetroWest-495 region.
As the country continues to shake off the effects of the recession that hit in 2007, MetroWest's vibrant economy stands out.
There are still plenty of challenges and uncertainties facing area businesses, but the economy is improving. Unemployment in the region's 41 communities fell more than a full point through October to around 5 percent. That remains well below the state's seasonally unadjusted rate of 6.2 percent, which also fell significantly from 7.7 percent over the first 10 months of the year.
Some big news this year, like Marlborough's major commercial property victories, was driven by corporate growth and an improving economy. Others, like the plodding casino licensing process and consolidation in the health care sector, were driven in part by actions in Boston and Washington.
Indeed, there was plenty of business news to talk about, as evidenced by the following five stories: our picks for notable news of 2012 in the MetroWest-495 region.
Meningitis Outbreak Tied To Framingham Pharmacy
This list begins with the tragic. The New England Compounding Center (NECC) brought the national spotlight — and an unwanted one at that — to Framingham in October after an injectable steroid it manufactured was found to be contaminated with fungal meningitis. The medication had been shipped to health providers in 23 states before the contamination was discovered. Regulators scrambled to stem the outbreak, but patients had already been injected with the drugs. The death toll climbed to more than 30, with hundreds of others sickened.
The case led to the shutdown of NECC and a recall of its products in early October. Several class-action lawsuits have been filed against the firm.
Several weeks after NECC closed, Westborough-based Ameridose, which shares some of the same ownership, voluntarily shut down for inspection by regulators and also recalled its products. In November, it laid off approximately 700 employees. The company has said it hopes most of the layoffs are temporary, but also said it expects to reopen at reduced capacity.
The outbreak has led to finger pointing between federal and state inspectors, who share oversight of compounding pharmacies, as well as calls to give the U.S. Food and Drug Administration more authority.
Compounding pharmacies operate in a niche market, filling a need where major drug manufacturers can't or won't. They can create medications that are in short supply or back ordered, modify doses and certain ingredients, and change medications from solids to liquids. Hospitals rely on them for certain types of drugs.
The situation has other compounding pharmacies in the area concerned about the prospect of stricter regulations and increased inspections. Gov. Deval Patrick has already called for a more rigorous inspection schedule for the pharmacies.
With plenty of proposals for new rules and with NECC and Ameridose still shuttered, it remains unclear how this story will play out.
Marlborough's Quick Comeback
Marlborough kicked off 2012 with several massive vacancies — from the more than 600,000-square-foot Fidelity Investments offices that were vacated in 2011, to the 716,000 square feet of office and manufacturing space that once housed Hewlett Packard.
But the city is ending the year with much of that space soon to be filled by major companies, bringing with them upwards of 3,800 jobs, many of them transferred from Westborough and Boston.
Framingham-based TJX Cos., the parent of off-price retailers T.J. Maxx, Marshalls and HomeGoods, purchased the Fidelity property for $62.5 million in April. The $23.2-billion retailer also purchased its Framingham headquarters in July for $117 million, and has said the properties will act as dual-headquarter facilities.
Then, Quest Diagnostics, a major provider of medical laboratory testing services with $7.5 billion in annual revenue, announced in late October that it would occupy 200,000 square feet of the HP campus.
A month later came the cherry on top of a job-creation sundae. Natick-based Boston Scientific announced it would expand its Marlborough facility and establish its headquarters there.
Though the Quest deal is not yet official — a tax increment financing agreement is pending — Mayor Arthur Vigeant has expressed his pleasure over the development this year.
"It's an exciting time," he said. "I don't know if we're going to be able to replicate this."
Casino Speculation: Milford? Plainville? Neither?
Was the Massachusetts Gaming Commission's visit to Framingham in June the closest the region will come to casino gambling? The answer remains unknown.
Developers in Foxborough and Milford both made their wagers at the beginning of this year for one of three casino licenses. But Las Vegas casino mogul Steve Wynn's plans to build a casino on land in Foxborough owned by New England Patriots' owner Robert Kraft were scuttled by voters in a special town election in May.
Nearby, another MetroWest community, Plainville, may end up with the one slot machine license that the 2011 casino legislation allows. The owner of Plainridge Racecourse is the only developer that has submitted a preliminary application fee of $400,000 to the state for that license. Suffolk Downs is the only developer that has submitted its fee to bid for one of the three casino licenses.
And Milford developer David Nunes' competing proposal with Suffolk Downs appeared dead until recently, when he told the Boston Business Journal he was in talks with a new casino partner after a previous agreement with Warner Gaming — which operates Hard Rock Hotels & Casinos in Las Vegas — had expired. Nunes said he plans to present new plans to town officials by year's end. Opposition to a Milford casino has begun to percolate in the wake of that revelation.
So, as 2012 comes to a close, the fate of casino gambling in the region remains uncertain.
Changes In Health Care
The health care industry is changing quickly in the face of new state and federal laws that aim to change the way patient care is managed and paid for. One major trend has been consolidation and partnerships.
That impacted MetroWest in August with the sale of Milford Regional Medical Center's hospice and home health division to Salmon Health & Retirement, which operates assisted-living communities as well as skilled nursing and rehabilitation facilities in the area.
As hospitals shift to an "accountable-care" model, which offers financial incentives for limiting hospital readmissions and other outcomes, Salmon is positioning itself as a provider of a full spectrum of acute care services for patients once they leave the hospital.
With home health services, Salmon can transition patients from the hospital to one of its rehabilitation and skilled nursing centers, then provide home care once the patient is well enough to be discharged.
Another major development came in September, when Vanguard Health Systems, which owns MetroWest Medical Center's two hospitals in Natick and Framingham, announced the formation of a health care network with Tufts Medical Center in Boston. The two entities hope to affiliate with other hospitals and providers to bulk up the network. As a part of the agreement, Tufts also took a minority stake in MetroWest Medical.
With Nashoba Valley Medical Center scooped up by Steward Health Care last year, there remains only one independent hospital in MetroWest: Milford Regional Medical Center.
CEO Francis Saba told us in October that it's unlikely the hospital will be acquired, but that partnerships and other affiliations could be on the table in the future.
Advanced Cell In The Spotlight
Marlborough's Advanced Cell Technology (ACT) is wrapping up a big year that brought it media attention for its progress in stem cell treatment of eye diseases.
The company is not making money — in fact, it's losing quite a bit of it — but it has made hay of the fact that it's the only company in the world conducting FDA-approved human trials for a stem cell treatment. Initial results published by The Lancet medical journal early this year were seen as promising.
Those results showed that retinal pigment epithelium cells derived from human embryonic stem cells designed to treat Stargardt's macular dystrophy and dry age-related macular degeneration (AMD) showed no adverse safety issues in two patients, both of whom had measurable vision improvements that lasted for months. The company has added patients and treated about a dozen.
Riding high on the initial results, ACT shareholders approved a reverse stock split in April to boost share prices, a move aimed at a listing on a major stock exchange like the NASDAQ. The split has not yet taken effect.
With little revenue, ACT has consistently posted losses as it pushes toward eventual commercialization of its treatments. The company has posted more than $220 million in losses since 2007. But in September, the company received $35 million in financing from Lincoln Park Capital in the form of a common stock purchase agreement, which came with $800,000 up front. ACT said the financing would fund operations for the next two years.
If ACT can commercialize its stem cell treatments, it expects to create a $25-to-$30 billion market for dry AMD treatment in the United States and Europe alone. n
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