Clarian, IU plan $100 million neurosciences center

Clarian Health and the Indiana University School of Medicine will invest more than $100 million in the next five years
to build a neurosciences hub in Indianapolis.

Their goal is to become a destination for patients throughout the
Midwest suffering from brain, nerve and mental maladies—and for the government and industry research dollars that can
fuel advances in care.

The neurosciences center will reside on the campus of Clarian’s Methodist Hospital and will have a key anchor:
a large neurosurgery group formed Jan. 1 by the merger of the IU neurosurgery department and Indianapolis Neurosurgical Group.

The new practice, called Goodman Campbell Brain and Spine, is now one of the largest neurosurgery practices in the
nation. Its 35 doctors work in all of Indianapolis’ major hospitals and some in surrounding areas, performing 7,000
high-dollar procedures every year.

Clarian wants to attract as many neurosurgeries as possible. So it’s spending
$27 million to renovate six operating rooms and build two new ones at Methodist. The new ORs, which will have cutting-edge
equipment, are supposed to be finished in December, after which most adult neurosurgeries from IU Hospital will shift to Methodist.
Clarian also owns IU Hospital, but not the medical school.

Clarian also is soliciting bids from contractors to
construct a 200,000-square-foot medical office building across the street from Methodist’s emergency room. It would
house offices for not only Goodman Campbell but also neurologists, psychiatrists, radiologists, pain doctors and rehab specialists.

The idea is to allow a patient to see all the specialists and receive all the diagnostic imaging he or she needs in
just one visit, said Dr. John Kohne, chief operating officer at Methodist. The building is scheduled to open in the first
quarter of 2012.

“We could really become a top-tier nationally recognized center,” Kohne said. U.S.
News and World Report currently ranks the Clarian-IU cluster of neurology and neuron surgery No. 26 in the nation.

Since 2003, Clarian and IU officials have been working on ambitious plans to boost their stature in neurosciences
and cancer. They opened a cancer hospital downtown in 2008.

Now, it’s neuroscience’s turn to get new
facilities. IU’s next research building is slated to be a neuroscience facility, which hospital officials want to build
adjacent to Clarian’s neuroscience medical office building. It would likely be about half the size of Clarian’s
building.

The state of Indiana approved funding for the building but has yet to release those funds due to falling
tax revenue. IU officials are hoping the building can open in 2013.

Budget constraints also have so far tabled
a plan by the state to move the Larue D. Carter psychiatric hospital to a new building constructed next to the Clarian and
IU facilities.

Larue Carter used to be housed near the IU medical campus but moved to Cold Spring Road northwest
of downtown in 1997.

Building on strengths

Centralizing patients and
researchers could be a boon for neurosciences research efforts in Indianapolis generally.

The IU School of Medicine
already has a substantial neurosciences research effort. Its Stark Neurosciences Research Institute includes 55 faculty members
and five postdoctoral fellows.

One of the Stark Institute investigators, Dr. Anantha Shekhar, was named in 2009
to lead IU’s new Clinical and Translational Sciences Initiative, when that program received a $25 million grant from
the National Institutes of Health.

So-called translational research—scientific investigation that aims to
find breakthroughs that can be quickly applied in new techniques or products—is the predominant kind of research the
U.S. government is now funding.

“It would be fantastic from both an educational standpoint and from a translational
[research] perspective,” said Dr. Paul Nelson, chairman of the IU Medical School’s Department of Neurological
Surgery. He is also vice president of Goodman Campbell. “It’s got lots of possibilities.”

The
Clarian-IU effort would complement a massive amount of neurosciences research already conducted in Indianapolis by Eli Lilly
and Co. The company became a neurosciences powerhouse with its 1988 launch of the antidepressant Prozac.

Today,
neurosciences drugs like Zyprexa and Cymbalta account for 40 percent of Lilly’s nearly $22 billion in annual revenue.
And among Lilly’s best hopes for a future breakthrough are two experimental molecules designed to reverse the progress
of Alzheimer’s.

David Johnson, CEO of the life sciences business development group BioCrossroads, likes what
Clarian is trying to do. He is in the midst of researching the health care industry clusters that have sprung up around the
Cleveland Clinic and the Mayo Clinic in Rochester, Minn., to see if Indianapolis-area hospitals could play a similar role.

“Mayo Clinic and Cleveland Clinic are unique institutions, but what they’re doing is instructive,”
Johnson said. “It certainly can give rise to new discoveries and new companies and new techniques. It’s the pooling
of scarce resources, which are the brilliant research minds.”

Lucrative segment

Neurosciences is a lucrative area for any hospital to chase, especially neurosurgery.

In 2008,
Methodist and IU hospitals, along with Riley Hospital for Children, performed 360 neurosurgeries for patients covered by Medicare
at an average of $63,000 per patient.

Those patients stayed in the hospital nearly seven days, on average, according
to Medicare data made available by the Web site AHD.com.

Most neurosurgeries deal with spine issues. A minority
are surgeries in the brain.

“There’s an aspect of neurosurgery that is very profitable for hospitals,”
said Mark Blessing, a health care accountant at BKD LLP in Fort Wayne. “These big cases are well reimbursed.”

Dr. Troy Payner, president of Goodman Campbell, emphasized that his physicians will continue to practice at the hospitals
operated by Community Health Network, St. Francis Hospital and Health Centers, St. Vincent Health, the Veterans Affairs Hospital,
Wishard Health Services and Witham Health Services.

“We have a commitment to every hospital in which we work
and we intend to maintain that commitment,” Payner said, sitting in his scrubs and white lab coat right after completing
a surgery at St. Vincent Indianapolis Hospital.

He added that having 28 neurosurgeons on board will make it easier
to provide emergency coverage at a variety of Indianapolis-area hospitals 24 hours a day, 365 days a year.

In addition,
he said, a larger group with higher volumes of patients can develop even deeper subspecialties, so they can more ably treat
the most rare and complex cases.

Combining those abilities with the 10 doctorate researchers that are part of the
IU neurosurgery department will give Goodman Campbell the ability to conduct and publish far more research.

That
should also make Goodman Campbell attractive to medical-device and pharmaceutical companies trying to develop medicines and
implants to help patients with neurological issues. They will likely want to use Goodman Campbell to conduct clinical trials
of their latest breakthroughs.

Clarian officials are hoping the same will occur for the entire neurosciences hub.

“We can build a lot of new careers and opportunities,” said Kohne, the Methodist executive. “Everybody
looks for a nidus to build things on. We have this nidus.” •