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posted by martyb on Sunday June 12 2016, @10:10PM   Printer-friendly
from the Hooked-on-Profits? dept.

The recent uptick in heroin and opioid addiction along with new laws are making addiction treatment an attractive target for investors:

Every crisis presents an opportunity, as the saying goes. And when it comes to opioid addiction, investors and businesses are seeing a big opportunity in addiction treatment. Places like [Gosnold on Cape Cod] are being gobbled up by private equity companies and publicly-traded chains looking to do what is known in Wall Street jargon as a roll-up play. They take a fragmented industry, buy up the bits and pieces and consolidate them into big, branded companies where they hope to make a profit by streamlining and cutting costs.

One company that advises investors listed 27 transactions in which private equity firms or public companies bought or invested in addiction treatment centers and other so-called behavioral health companies in 2014 and 2015 alone. Acadia Healthcare is one national chain that has been on a shopping spree. In 2010 it had only six facilities, but today it has 587 across the country and in the United Kingdom.

What's driving the growth? The opioid addiction crisis is boosting demand for treatment and two relatively recent laws are making it easier to get insurers to pay for it. The Mental Health Parity Act of 2008 requires insurers to cover mental health care as they would cover physical health care. "Mental health parity was the beginning. We saw a big benefit. And then the Affordable Care Act was very positive for our industry," says Joey Jacobs, Acadia's CEO. He spoke at an investor conference last month.

Marketplace has an article about how data and new databases are being used to track and prevent addiction. It cites the following report from Health Affairs:

Prescription Drug Monitoring Programs Are Associated With Sustained Reductions In Opioid Prescribing By Physicians (DOI: 10.1377/hlthaff.2015.1673)


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  • (Score: 0) by Anonymous Coward on Monday June 13 2016, @12:36AM

    by Anonymous Coward on Monday June 13 2016, @12:36AM (#358994)

    Opioid should be reserved for dying patient. Amphetamines are generally more effective to manage chronic pain when there is no inflammation (I learned that in a footnote in the Canadian vyvanse monography and tested it on my wife), cannabis is as effective when there is inflammation (see patent US6630507 secondary claims) and NDMA agonist like ephenidine, ketamine or tiletamine are stronger for acute pain. The fact that opioïdes are still preferentially used for pain management reeks of hypocrisy and ignorance

  • (Score: 0) by Anonymous Coward on Monday June 13 2016, @12:39AM

    by Anonymous Coward on Monday June 13 2016, @12:39AM (#358997)

    Or maybe malice and rent seeking