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Ion Healthcare Profiting From Helping Patients Get a Good Night's Sleep

Richmond Times
December 2, 2006

Roger Ortega's wife kept telling him he had a problem.

Snoring. Thrashing around. All night.

So Ortega saw his doctor, who referred him to a sleep disorder clinic in Colonial Heights. Ortega slept over one night, and specialists at the lab studied his nighttime behavior. Periodically, Ortega would stop breathing for several seconds. Then his body would flog around, and he'd begin breathing again. It happened again and again throughout his night. Ortega was diagnosed with a condition known as sleep apnea.

And that's when the clinic referred him to Ion Healthcare Inc.

The company answered all of Ortega's questions about his newfound health problem, and it hooked him up with the most common apnea treatment, a CPAP device. The mask resembles one a fighter pilot wears, fitting over the nose, mouth, or both, and blowing air down the throat to keep the airway open and people breathing normally throughout the night.

"I tell you what, from the very first night on I slept great," said Ortega, owner of a Midlothian underground drilling company. "I got up rested and refreshed."

He's a 57-year-old poster child for Ion.

The company identifies and diagnoses at-risk sleep apnea patients, then provides them access to proper treatments, staying at its patients' sides through the years as a counselor for the condition.

Ion raised $5 million in venture capital in June, led by Anthem Capital Management with participation from Harbert Venture Partners.

Harbert Venture principal Tom Roberts said Ion was an attractive investment because it can serve such a large and underserved market: those unaware they have apnea. And when such "disease management" companies are eventually bought, acquired or their stock is sold publicly, returns to investors aren't bad either, he said.

Ion's new CEO, Mike Rowe, began Monday, faced with the task of expanding Ion tenfold -- from three offices in Chesterfield County, Roanoke and Tidewater to 30 locations throughout the mid-Atlantic. Rowe had been the chief operating officer at a dialysis company in Maryland, where he helped expand that firm in a similar fashion.

About 18 million Americans suffer from sleep apnea, according to the National Sleep Foundation, though Ion founder Steve Burton notes only a quarter of them are aware of it. Among other health problems, apnea can lead to high blood pressure, heart disease, daytime sleepiness and cause car accidents.

"Sleep apnea will shorten your life. It won't kill you instantly like a heart attack, but [if] left untreated, can reduce your life by as much as 10 years," said the 50-year-old Burton, also the company president. "Ion is something I'm very passionate about."

A graduate of Thomas Dale High and the College of William and Mary, Burton has studied sleep for about 26 years. He stumbled upon apnea in 1981 after witnessing a man repeatedly stop breathing during the night while conducting a sleep study. Since earning a doctorate in clinical psychology in 1985 from the University of Southern Mississippi, Burton has established five health-care companies including Ion. His first venture developed a sleep data analysis software program. It was funded by maxing out several dozen credit cards.

Ion works closely with sleep laboratories and physicians to manage care of patients with apnea, decreasing the cost of therapy and increasing the time it takes to start treatment. Ion's clinically proven home test for sleep apnea, for instance, is less expensive and can be completed within 24 hours at home compared with an overnight study done in a sleep lab, Burton notes.

Symptoms of apnea, including snoring, also may signal a range of other disorders that could be discovered at a sleep center, said Dr. Richard Parisi, medical director at the Sleep Disorders Center of Virginia, which has three Richmond-area locations.

Parisi said Ion is trying to streamline the process so that people who obviously have apnea can be diagnosed faster with a limited sleep study. He said Burton is "a very bright businessman who is trying to fulfill a need."

Ortega, one of Ion's first customers, said his needs for sleep were filled and created a positive side effect: losing weight. With a combination of apnea therapy and a diet, he lost 63 pounds. Because he's not as tired during the day, he's not eating as much to try to energize.

"It was amazing the rest you get when sleeping like you should be sleeping," he said. "When you actually sleep through the night you get up refreshed and you're ready to go out the door, mentally sharper and mentally more acute. It's been a great experience."

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