$231 Million Paves Way for “Starbucks of Addiction Rehab”

Brian O'Neill aims to build the largest network of addiction treatment centers in the Northeast U.S.

There’s no such thing as a “Starbucks of Addiction Rehab,” but a King of Prussia-based company might soon be the closest thing.

Recovery Centers of America announced this week it has secured $231.5 million in funding to create and expand its network of addiction treatment centers. Deerfield Management Co., a health care-focused investment firm, is putting up the cash.

It’s one of the biggest venture-capital investments in local memory: It’s nearly half as much total funding as all Philly-area companies received in the first three quarters of this year. It dwarfs the biggest deal of the third quarter — a $47 million investment secured by SevOne Inc. an IT company in Wilmington.

Deerfield’s money comes a year after the Recovery Treatment Centers of America launched with $200 million in hand. The company opened its first campus in May. It aims to have 1,200 beds in Washington, D.C., Boston, Philadelphia and other locations on the Eastern Seaboard by the end of 2017.

The aim? To make community-based treatment more broadly and easily accessible — like, say, a certain famous coffee chain.

“For certain treatments, we have to send patients to Florida or California from Philadelphia, or the closest [Alcoholics Anonymous] meeting may be 10 miles away from a person’s home,” CEO Brian O’Neill said in a written statement about Deerfield’s investment. “When you think about asthma, diabetes and cancer, you can get treatment at community hospitals. But we make it so hard for addiction patients. As a result, often times, they don’t get the treatment or they don’t get the right treatment.”

One obstacle: Communities don’t always welcome rehab centers in their midst — a challenge great enough that it was also acknowledged in the Deerfield announcement. The company has gotten involved in legal wrangling over site selection for its proposed centers.

O’Neill didn’t sound like he intended to back down.

“We won’t be deterred by townships that want our patients to be unfairly treated. We use the legal system to our advantage,” he said in the written statement. “We aren’t looking to pick fights. We just want to save lives.”

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