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Varsity Healthcare, in 2nd deal of week, backs opioid-treatment provider Ideal Option

  • Kennewick, Washington, company offers medication-assisted treatment & behavioral counseling for opioid addiction
  • Ideal Option operates 56 clinics in 10 states
  • Deal follows VHP’s investments in Probo medical, Emergency Care Partners

Through its second investment of the week, Varsity Healthcare Partners is the latest sponsor looking to help tackle the country’s opioid-abuse crisis.

The Los Angeles’ PE firm has completed an investment in opioid-treatment provider Ideal Option, Buyouts has learned.

Varsity, which backs lower-middle-market healthcare services companies, has provided growth capital in partnership with the company’s founders and physicians, Jeffrey Allgaier and Kenneth Egli.

Allgaier and Egli, whom founded the company in 2012, will remain investors in Ideal Option alongside other members of management. Both will remain senior executives.

Ideal Option, of Kennewick, Washington, provides medication-assisted treatment, or MAT, alongside behavioral counseling services to individuals suffering from opioid addiction. Its offerings include Suboxone and Vivitrol to treat opioid addiction and Acamprosate to treat alcohol addiction, among other treatments.

The company encompasses 56 office-based opioid treatment clinics across 10 states. In addition to its network of clinics, Ideal Option uses telemedicine to reach individuals in markets in which treatment is minimal or non-existent.

Amid heightened national awareness around the national opioid epidemic, Varsity’s transaction comes on the heels of the passing of an opioid bill by the House of Representatives just a few days ago. The bill is known as SUPPORT for Patients and Communities Act.

Private equity community has already proved eager to play a role backing treatment providers.

In other activity brewing, Frontenac-backed opioid-treatment-network Behavioral Health Group is also in the market. The company is being advised by Piper Jaffray, Buyouts reported.

For Varsity, the deal marks its third platform investment over the last month-period and the second this week.

On Monday, the firm said it had recapitalized Probo Medical, an Indianapolis reseller of refurbished ultrasound systems and ultrasound probes.

In mid-September, Varsity entered emergency medicine specialty through its formation of Lafayette, Louisiana-based Emergency Care Partners.

In November 2017, Varsity made an investment in Orthopaedic Institute, the largest provider of orthopedic services and ancillary offerings in north-central Florida.

Varsity, which partners with founders, entrepreneurs and management in the healthcare services field, also backs primary care provider Family Care Partners.

Headed by Founding Partners David Alpern and Kenton Rosenberry, Varsity is investing out of its second fund, which raised $300 million in January 2017.

Action Item: Get in touch with Varsity’s Kenton Rosenberry at KR@varsityhealthcarepartners.com