UAHN/Banner merger will boost local economy, too

2014-07-12T12:00:00Z UAHN/Banner merger will boost local economy, tooBy Don Bourn Special to the Arizona Daily Star Arizona Daily Star

Tom Murphy, the former three-term mayor of Pittsburgh, is largely credited with leading the transformation of Pittsburgh from an ugly steel town into a leading research and technology center, now considered one of the most livable cities in the country.

In his whitepaper “Building on Innovation: The Significance of Anchor Institutions in a New Era of City Building,” Murphy writes: “The innovation economy is sweeping away the old rules of city building in the United States and ‘anchor institutions’ — research hospitals and universities — have become one of the primary drivers of this community-based change. … Today, the technology and information economy has created a tempo of quick-speed change and public/private community interdependencies that have grown so great they have generated a new paradigm of local economic development and city building.”

In Tucson, we are fortunate to have a research university and hospital, potentially creating a significant advantage in today’s competitive world. The University of Arizona is ranked 18th in research funding for public universities. Unfortunately, our research hospital has been undercapitalized and has fallen behind its peer group — ranking in only two specialties nationally as opposed to six specialties only a decade ago. Our College of Medicine now stands at 68th out of 150, according to US News and World Report rankings of medical schools by research.

We certainly would not find this ranking acceptable for our basketball program, and should not accept any less for our research hospital, where we train future physicians. Like the arms race in college athletics, you must invest in your facilities and have world-class leadership to recruit the “best in class” talent, if you hope to have a top program.

President Ann Weaver Hart and the UA Health Network President Michael Waldrum realized this challenge and were determined to “never settle.” They have created a bold plan to transform our research hospital into an elite program by recruiting a partner that will provide both tremendous capital resources and world-class leadership. That plan is a merger into the Banner Health Systems.

Banner Health, rated as one of the top five large hospital systems in the country, is a financially successful nonprofit and has been named one of Arizona’s most admired companies.

Prior to a presentation of the proposed transaction, I was skeptical and concerned that we were losing another one of our key assets to Maricopa County. Afterward I was uplifted to know that if the deal is closed under the negotiated terms of a letter agreement, UAHN/Tucson will be receiving a tremendous infusion of capital and leadership.

How diligently would we work to entice any leading U.S. company to invest over $500 million into our community? This investment will allow us to recruit world-leading research doctors to our university — and our city, potentially raising the level of health care in not only Tucson, but across the state and entire Southwest.

With the recent focus on tech transfer under the leadership of UA Vice President David Allen, it should create tremendous economic development opportunities. While Ventana Medical Systems is the flagship example of privatizing this research, recent examples include Sinfonia Healthcare Corp. purchasing technology developed in the UA College of Pharmacy and growing a company to over 150 employees overnight.

This deal is squarely in line with Tom Murphy’s view of leveraging anchor institutions, creative partnerships and cross collaboration to forge a unique and innovative competitive position.

As a community, we should not only support this bold vision, but use this as an example of turning our unique challenges into unique opportunities.

Don Bourn is CEO of Bourn Companies, LLC. Email him at dbourn@bourncompanies.com

Copyright 2014 Arizona Daily Star. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

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