Partners HealthCare operating profit up

THE REGION

Operating profit at Partners HealthCare, the parent organization of Massachusetts General and Brigham & Women's hospitals, soared to $21.3 million in the second quarter of the fiscal year, from a loss of $2 million in the year-ago quarter. Operating revenue grew 11.5 percent to $1.2 billion in the quarter ended March 31, up from $1.1 billion for the second quarter last year. Partners executives said the year-ago quarter was unusually bad, and that a 3 percent increase in overnight patients and a greater number of patients with severe illnesses brought more money into the system. All Partners entities, including its Harvard Medical School teaching hospitals, community hospitals, and physicians' group, now are earning a profit. (Liz Kowalczyk)

BRA approves Russia Wharf project

The Boston Redevelopment Authority unanimously approved a $300 million waterfront office, hotel, retail, and residence development. Equity Office Properties said it hopes to begin construction next year on a 32-story tower behind the faades of the existing nine-floor brick buildings on historic Russia Wharf. Still requiring state approval for waterfront construction, the Congress Street development will have 50 loft-style residences on the new Rose Kennedy Greenway, 500,000 square feet of office space, parking underground for 512 cars, a jazz club, and walkway, and a 1/3-acre public plaza on the Fort Point Channel. It is expected to open in 2008 and, according to Equity Office, will contribute $28 million in related improvements in the area. (Thomas C. Palmer Jr.)

Dunkin' Donuts, Wal-Mart in venture

Dunkin' Donuts said it plans to open 10 shops inside Wal-Mart stores over the next three months with the first today in North Windham, Conn. The coffee-and-baked-goods shops will be located up front in Wal-Marts and will offer the full Dunkin' Donuts menu. Some stores will feature Baskin-Robbins ice cream. Both Dunkin' Donuts and Baskin-Robbins are owned and operated by Randolph-based Allied Domecq Quick Service Restaurants. Dunkin' Donuts will open shops inside Wal-Marts in Massachusetts, including a Walpole store; New York; Ohio; Pennsylvania; and Vermont. (Naomi Aoki)

Highfields raises stake in Janus Capital

Highfields Capital Management LP, a Boston hedge fund firm that's battled the management of Janus Capital Group Inc., increased its stake in the Denver investment manager while saying it won't seek further changes. Highfields, the second-largest stockholder in Janus, cited the company's recent moves as reasons for dropping its activist stance. Janus agreed on April 27 to $226 million in settlements with federal and state regulators investigating improper trading in mutual funds. A week before, the firm selected Steven Scheid to replace Mark Whiston as its chief executive. Highfields now owns 21.2 million shares, or 8.9 percent of those outstanding, according to a filing with the Securities and Exchange Commission. (Bloomberg)

THE NATION

Crude oil prices reach another high

Oil prices soared to a record on the New York Mercantile Exchange, crossing $41 a barrel and settling at the highest point in the 21-year-history of crude-futures trading in New York. June light, sweet crude oil futures settled at $41.08, up 31 cents from Wednesday, after touching an intraday high of $41.10. The old record was $41.07 on Oct. 11, 1990, in the run-up to the Persian Gulf War. That day, Brent blend crude oil futures settled at $41.15 on London's International Petroleum Exchange. Yesterday, Brent futures for June gained 54 cents to settle at $38.49 a barrel. "There is a war or fear premium built into the price of crude oil," said Ed Silliere, a vice president at Energy Merchant Corp. (AP)

Ex-Rite Aid CEO accepts 10-year jail deal

Rite Aid Corp.'s former chief executive Martin Grass agreed to serve up to 10 years in prison for directing an accounting fraud at the company, following a judge's rejection of an earlier sentencing agreement as too lenient. Grass and US prosecutors filed the new agreement in federal court in Harrisburg, Pa., where he pleaded guilty in June to conspiring to inflate earnings and obstruct US investigations of a four-year accounting fraud at Rite Aid. Last month, US Judge Sylvia Rambo said the eight-year maximum prison term in his first plea agreement wasn't long enough. Under Grass's agreement, his earlier guilty plea will remain in place, said Assistant US Attorney Kim Daniel. Prosecutors will ask Rambo to reduce the sentence because of his cooperation that helped convict three others, Daniel said. As a result of the fraud, Rite Aid had to erase $1.6 billion in profit in July 2000. (Bloomberg)

Minn. begins drug-importation plan

Minnesota state employees can now get certain medicines free if they order them from a state-inspected Canadian pharmacy. The move raises the stakes for numerous states' challenges to a federal ban on prescription drug imports. "The driving force is we can save money," Governor Tim Pawlenty said of the plan. The program applies to 45 of the most popular name-brand medicines that don't have generic alternatives, officials said. They estimate it will save the state $1.4 million a year because the medications, already covered under the state's health plan, can be purchased for less in Canada. About 120,000 Minnesota state employees and their dependents would be eligible. The state would cover all shipping fees, along with $15 per-medication monthly copayments. On average, employees would save about $180 each year for every medication they use, officials said. (AP)

MCI discounts targeted AT&T customers

MCI Inc., the second-biggest US long-distance telephone company, sought to lure away corporate customers from AT&T Corp. with discounts of as much as 40 percent, escalating competition between the companies. MCI made the offer around the end of March in letters to a few hundred AT&T customers, MCI spokesman Peter Lucht said. The letters offer discounts of 25 to 40 percent on any business shifted to MCI, the former WorldCom Inc., which came out of bankruptcy last month. The offer is a response to AT&T chief executive David Dorman's vow last year to no longer be undercut on corporate communications service contracts. (Bloomberg)

Drug makers press on cholesterol drugs

Some of the world's biggest drug companies are working to persuade regulators to let older cholesterol-lowering drugs be sold without a prescription in low doses, as Britain has just done. Approval by the Food and Drug Administration could significantly affect the nation's biggest public health problem, heart disease, and greatly expand sales in the top-selling drug category. Cholesterol drugs, or statins, raked in $26 billion worldwide -- $14 billion in the United States -- last year, according to IMS Health. The category is dominated by blockbusters Lipitor, made by Pfizer Inc., and Zocor, made by Merck & Co. (AP)

Backdating alleged in Adelphia case

Adelphia Communications Corp.'s outside law firm drafted and revised documents that were backdated by as much as two years, a witness testified in the fraud trial of the company's founder and two of his sons. Lawyers at the law firm Buchanan Ingersoll e-mailed the documents related to acquisition fees to cable company Adelphia, former Adelphia executive James R. Brown testified. One was backdated by two years and another by one year, Brown said. "I don't know what they were thinking when they drafted them," said Brown after Paul Grand, who represents Timothy Rigas in the case, asked if it was wrong. A spokeswoman for Buchanan Ingersoll had no immediate comment. (Dow Jones/AP)