Patrick Soon-Shiong seeks to buy St. Vincent hospital, create ‘central command’ for coronavirus
A family foundation controlled by Dr. Patrick Soon-Shiong is seeking to buy an empty hospital near downtown Los Angeles and turn it into a sprawling campus for COVID-19 patients and coronavirus research.
Soon-Shiong and his wife, Michele B. Chan, run the Chan Soon-Shiong Family Foundation, which has offered to purchase St. Vincent Medical Center out of bankruptcy for $135 million.
Soon-Shiong, who owns The Times, said in an interview that the goal was to create a “central command” center that would attract doctors and experts on the virus, and relieve pressure on other hospitals.
The state recently moved to lease the property to help the region cope with the coronavirus outbreak, and Soon-Shiong said his purchase would bolster that effort.
“That’s what every city should have done, they should have established a central command,” Soon-Shiong said, adding that “we are in a war zone now.”
A judge on Wednesday approved the Chan Soon-Shiong Family Foundation as the lead bidder for the hospital at a federal Bankruptcy Court hearing. Competing offers must be submitted to the court by Friday.
St. Vincent has been closed since January amid bankruptcy proceedings, a blow to the working-class, predominantly Latino neighborhood served by the hospital.
Politicians talked this year about using the medical center at 3rd and Alvarado streets to help the area’s homeless population, but the proposal didn’t gain traction.
The foundation’s bid marks the latest twist for St. Vincent, which was founded in the 1850s by the Daughters of Charity — six nuns who wanted to offer services to the poor and saw a need for healthcare in a growing L.A.
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It is now owned by Verity Health System, a nonprofit operator of California hospitals, which filed for Chapter 11 bankruptcy protection in 2018.
At the time, Verity officials said the company had more than $1 billion in debt from bonds and unfunded pension liabilities and needed cash to make seismic ugrades to its aging facilities. They said they purchased St. Vincent and five other hospitals in 2017 hoping to restore them to financial health but could not.
The bankruptcy creditors include the hospital system’s former management company, Integrity Healthcare, which is controlled by NantWorks, the Culver City company led by Soon-Shiong.
NantWorks-related entities contributed more than $300 million in unsecured and secured loans and investments to the chain as part of Integrity’s efforts to recapitalize and revitalize the hospitals. Verity opted to cancel the contract with Integrity as part of its bankruptcy proceedings, ending Soon-Shiong’s relationship with the hospitals, according to court records.
The Chan Soon-Shiong Family Foundation was founded in 2009. Soon-Shiong said the foundation has “nothing to do with” NantWorks.
The long-term plan for St. Vincent Medical Center is still being worked out, Soon-Shiong said. If the sale to his foundation goes through, the infrastructure “needs a significant amount of work,” he said, and it’s unclear whether the center would operate as a hospital after the pandemic.
“I think we have to address the homelessness issue, we have to address the mental health issue, we have to address the poverty issue, and that’s the mission of the foundation,” Soon-Shiong said.
Soon-Shiong said the state will be in charge of staffing the hospital. Court filings show that the state will pay $2.6 million a month to lease St. Vincent.
The court set a hearing Monday for an auction if other bids are submitted. A final hearing on the sale is scheduled for later next week.
Louis Cisz, attorney for American Hospital Properties of California, said his client also hoped to bid on the center and was disappointed with the timeline.
“Because of the ruling [Wednesday], and the short time frame, we’re not sure we can complete the bidding in time,” Cisz said. “This is a very accelerated process. In our view, the lead bidder wanted to close the sale as soon as possible.”
Soon-Shiong said that bankruptcy proceedings had been going on for two years, challenging criticisms that the sale process is now moving quickly.
However, there “is an urgency in regards to COVID,” Soon-Shiong said. “We literally have weeks before we have a huge surge.”
Times staff writer Alejandra Reyes-Velarde contributed to this report.
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