ARA Results and Plans

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American Renal Associates Holdings (ARA) (Beverly, MA) launched an initial public offering in April 2016, and has now grown to 217 clinics serving more than 15,000 patients with 385 nephrologists.

Second quarter 2017 net patient service operating revenues increased 0.2% to $186.0 million, compared with $185.6 million for the prior year period.

ARA stated that 32 new clinics had signed with the company in the first half of 2017 and noted the large dialysis market presents a growing joint venture opportunity in the nephrology community. To date 4% of US nephrologists have joined with ARA. The company also noted that it has a “predictable de novo clinical growth model.”

The company configures its partnerships such that a nephrologist owns a non-controlling interest in an ARA clinic. Average ownership” is 53% by ARA and 47% by physician partners. The nephrologist’s role in the clinic is oversight of clinic and staff, patient assessment, and patient care and treatment. ARA provides the back-office support of the clinic’s operations.

With 10,000 practicing nephrologists in the United States, and a dialysis market that historically grows at 3% to 5% per year, “we believe a significant portion (of nephrologists) treat patients at clinics in which they have no ownership interest” which demonstrates opportunity to grow as a joint venture model operator within the nephrology community, the company noted in a highlights slideshow.