The private cancer diagnostic and treatment company Rutherford Health has been placed into liquidation. Only eight months ago the opening of a new community diagnostics hub (CDH) within a partnership between the company’s subsidiary Rutherford Diagnostics and the NHS’s Somerset Foundation Trust (SFT) was heralded as “game-changing” for the trust’s capacity to carry out diagnostics.
The new stand-alone CDH, opened by Sir Mike Richards, the author of the 2020 report that pushed the idea of CDHs to expand diagnostic capacity, was part of a five year partnership deal with SFT begun in July 2020 (with the option to extend to ten years).
The centre was to provide diagnostic services including Magnetic Resonance Imaging (MRI), Computed Tomography (CT), Ultrasound and X-Ray using equipment provided by Rutherford’s technology partner, Philips, in an effort to reduce the significant waiting lists for such procedures.
Rutherford Health has other contracts with the NHS – its four cancer centres treat private and NHS patients and it also holds a two-year “framework agreement” with NHS England for cancer care.
Arrangements are now being made to transfer patients to other facilities. In Somerset, Peter Lewis, Chief Executive for Somerset NHS Foundation Trust, said:
“We are looking to maintain the diagnostic centre in Taunton for our patients with minimal disruption. We will contact patients directly to reschedule their scans if this is necessary as we look to implement alternative arrangements.”
The liquidation has come as a shock to employees at the company and they are now wondering how they will pay their bills at the end of the month, according to the Society of Radiographers (SOR).
A radiographer who wished to remain anonymous told the SOR that people are “devastated at the moment and really scared – we don’t even get redundancy pay, we have to get statutory, so naturally everybody is really worried about bills etc especially as most hospitals have already finished their recruitment drives for the year.”
The source said the mood among employees was extremely negative.
“People are really angry to be honest. We had even just hired an apprentice rad a couple of months ago and nobody is having their questions answered at the moment – all the senior managers in the big Teams call this morning were acting as if we should be grateful that we have a job until Thursday, even though people have no idea how they will pay their mortgages and bills by the end of the week.”
According to a statement on Monday 6 June by Rutherford’s owners Schroder UK Public Private Trust, from 2015 to 2019 the company had pursued a “flawed expansion strategy” which laid the ground for an “unsustainable funding need”. During this time the company opened oncology centres, known as the Rutherford Cancer Centres, in South Wales, Northumberland, Liverpool and the Thames Valley which required £240 million in capital expenditure.
Sean Sullivan, the company’s interim CEO, said the pandemic had been “particularly damaging for us as fewer cancer patients have been presenting to our centres.”
The company had tried to win more contracts with the NHS but was unable to gain sufficient and this combined with “severe financial pressures on the business” following the rapid expansion meant there was no other option but to put the company into liquidation.
In January this year, Rutherford Health offered the NHS a not-for-profit three-year national contract for cancer care services, but the company said “this was not taken up”.
During a visit by PM Boris Johnson to the Somerset centre in January this year, Sullivan said that he’d “explained to the Prime Minister that we were looking to support the NHS further by offering diagnostic and cancer treatment services at all of our five centres across the UK on a not-for-profit basis.”
Rutherford Diagnostics has for some time planned its expansion strategy around the NHS investing significantly in private partnerships for CDHs. Back in June 2020 the company reported plans for five CDHs under a £55m agreement with “infrastructure investor and developer” Equitix. The Somerset CDH was the only one to have become reality, albeit for a brief eight months.
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