Access HealthNet Plans Chapter 7 Liquidation
Access HealthNet Inc., a once high-flying Westlake Village provider of high-tech communications systems for the health-care industry, has ceased operations and is seeking to liquidate under federal bankruptcy laws.
Access, whose problems surfaced last fall, when its president unexpectedly resigned and losses were announced for its most recent operating periods, had no choice but to seek bankruptcy court protection from its creditors, the company announced.
“The company exhausted all sources of borrowing and investment capital and has no operating revenues to support operations,” it said in a prepared statement. “As such, the company was forced to close its doors.”
Access filed a petition in late December under Chapter 7 of the federal Bankruptcy Code. Chapter 7 is typically used by concerns that are liquidating their assets.
The company’s chairman and chief executive, Steven E. Levy, was not available for comment. Calls to the company went unanswered last week, and the fate of its approximately 30 employees was not known.
Access, which was founded in 1988, claimed to be a leader in the use of computers and high-tech communications to give health-care providers quick access to lab results, patient and billing information and other medical records.
Through the years, the company said it signed deals to install its flagship systems, LabAccess and RemoteAccess, for numerous hospitals and other health providers across the country.
As recently as October, company officials said it had landed an important new customer, Tarzana-based Unilab Corp., which had contracted to install an information network for the Alameda Alliance for Health in Oakland.
Access’ MedLink technology would be used to link more than 900 physicians, several large hospitals and 25 clinics in Alameda County, the announcement said.
Joe Manheim, Unilab’s vice president of business development, said his company is going ahead with the project with the help of another software supplier. “As far as I can tell, Access has gone out of business,” he said.
With the signing of the Unilab deal, Levy said Access was positioned to benefit from the continued rapid growth of remote communications in the health-care industry.
He said the market for such systems had expanded to $800 million annually and was rising at a rate of about 35% a year.
Only a week later, however, Access President Keith M. Berman abruptly resigned amid reports of unexpected losses and an infusion of cash from directors and others.
Berman’s departure was never explained, and Levy assumed Berman’s duties.
Access reported in November that its revenues had almost disappeared in the six-month period that ended Sept. 30.
During that period, the company suffered a net loss of $6.2 million, or $1 a share, on revenues of only $63,000. A year earlier, Access posted a profit of $499,000, or 8 cents a share, on sales of $4.4 million.
Access said its revenues in the latest half were delayed by changes in operations requiring it to assume obligations that were previously the responsibility of distributors.
The company said it was dealing with a cash crunch by raising $2.5 million through the sale of convertible preferred stock to directors and others.
Another $500,000 was to be raised through the issuance of a promissory note and stock warrants to Threshold Technology Partners, an investor group.
