Health-care innovation booming in rural Pa.

Compared with the swath of health-care businesses spread out on either side of Interstate 95 from New York to Washington, tiny Danville and Riverside, Pa., at first glance don't seem to have much to offer that industry.

But the two hamlets, across the Susquehanna River from each other about 150 miles northwest of Philadelphia, are homes to organizations trying to spark a boom in health-care innovation in rural Pennsylvania.

One is Danville's Geisinger Health System, which has attracted national attention for providing quality patient care at relatively low costs.

The other is Cherokee Pharmaceuticals L.L.C., which is based in Riverside and is a unit of Philadelphia's PRWT Services Inc. Last week, Cherokee sponsored a conference on expanding pharmaceutical and medical jobs in this state's countryside.

Rural Pennsylvania could attract some of those high-paying health-care jobs if it figures out how to capitalize on the businesses and research facilities in Philadelphia, several experts said at the conference.

"Rural Pennsylvania is very fortunate to have one of the top life-sciences clusters in the country in Philadelphia," said Ross DeVol, the Milken Institute researcher who oversaw a study naming Philadelphia as second only to Boston as a leader in life sciences.

PRWT bought Cherokee, which makes ingredients for several pharmaceutical companies, from Merck & Co. Inc. in 2008. It has since expanded employment from 399 to 420 people and plans to add an additional 35 by the end of the year, company vice chairman Jerry Johnson said.

Some of that growth results from a contract PRWT signed Aug. 3 to make a new product for a division of DuPont Co. The companies did not name the product or put a value on the deal.

The Milken Institute study said that relative to other regions, Philadelphia lacks venture capital to fertilize small biotechnology companies.

Johnson said Cherokee has tried to counter that problem in several ways, including manufacturing early-stage compounds for young companies at reasonable prices.

"We have the laboratory space; we have the infrastructure to support them," Johnson said.

PRWT also is partnering with Geisinger, which won plaudits from President Obama in June for improving patient care while reining in expenses.

One of its programs, Proven Health Navigator, gives Geisinger primary-care doctors a nurse who oversees the most chronically ill patients. By closely monitoring such measures as blood sugar levels, the nurses keep emergency-room visits - and costs - down. Another Geisinger program guarantees the price of heart surgery, recovery, and therapy from the day of diagnosis until 90 days after the operation, giving doctors and other providers incentives to avoid errors.

The innovations and savings have not come cheaply, Howard R. Grant, Geisinger's chief medical officer, told conference attendees.

Geisinger's electronic-records system, which helps the health system keep tabs on every aspect of patient care, costs tens of millions per year, Grant said.

"We believe it's valuable. We believe it leads to better care, but people need to understand the size of that investment as well," he said.

Cherokee has begun working with Geisinger to help store some of the health system's vaccines and to attract new employees to the region. Johnson hopes that having two growing health-care businesses in the area will create more opportunities for couples seeking new jobs together.

"If Geisinger is trying to hire a doctor and there's a wife who needs some kind of opportunity that Cherokee can avail ourselves of and vice versa," Johnson said, "we're going to be able to recruit high-quality families."