American Blood Institute Files for Bankruptcy

Gerant Companies Inc. said Monday that its commercial blood bank subsidiary filed for Chapter 11 bankruptcy protection last week and has ceased operations in Southern California.

American Blood Institute, a subsidiary of Beverly Hills-based Gerant, was a major supplier of blood to Southland hospitals and had an estimated 13% share of the region’s blood market, Gerant officials said.

Cheryle Babbitt, director of donor services for American Red Cross Blood Services in Southern California, said ABI’s withdrawal from the market has had a significant impact on local blood supplies, particularly during the usual holiday season shortages.

Babbitt said ABI supplied about 40,000 units of blood a year to Southern California, compared to about 300,000 annually for the Red Cross. Since ABI halted its local operations on Dec. 6, the Red Cross has been supplying an additional 1,000 units of blood each week beyond its normal 7,000 units.

Gerant said it has implemented an orderly transition of ABI’s operations to other blood banks in the area.

Alfred Moran, Gerant’s president and chief executive, said California’s high operating costs made it too expensive for ABI to collect blood here. ABI had revenue of $7.4 million in 1992.

Gerant also said it was unable to obtain support from creditors for a restructuring plan.

California is the only state in the nation that requires licensed personnel, such as medical technicians, registered nurses or doctors, to draw blood, Babbitt said.