Keto HEAL Clinics suddenly close

Heal clinics

A network of medically-supervised low-carb clinics across the US, co-founded by Dr. Eric Westman, announced this week that it was ceasing operations because the business model was not viable.

HEAL Clinics website: Heal Clinics will cease operations immediately

A well-respected, pioneering researcher and clinician in the low carb movement, Dr. Westman said he still believes strongly in the benefits of the keto lifestyle, but the premium-priced medical service the clinics offered to patients “is no longer suited to capitalize on the current enthusiasm for the keto lifestyle.”

Dr. Westman’s comments were made in a video posted on the company website and in an FAQ also posted on the site May 31, 2019.

My passion has always been to bring the benefits of a keto lifestyle and the remission of type 2 diabetes and obesity without medications to the masses. To that end, I hope HEAL Clinics has helped educate and spread awareness. But as a business model we’ve concluded that HEAL Clinics cannot be financially sustained.

In the video, Dr. Westman explains that the decision to close down arose after the company’s CEO Richard Koffler resigned May 20th, 2019, “for purely personal reasons to pursue other career opportunities.” Koffler began with the company in 2014 and took over as CEO in 2018. Dr. Westman said Koffler was critical to the creation and implementation of the company’s business strategy and to the raising of capital. With his departure, Dr. Westman said, the board of HEAL Clinics felt they were no longer in a position to continue operations.

The news came as a huge surprise to HEAL Clinic patients, investors, and the global low-carb community. Many comments on the HEAL Clinics Facebook page expressed deep sadness and thanked Dr. Westman for his hard work to spread the benefits of the low-carb lifestyle over the last 15 years.

However, a number of people — especially individual investors who believed in the power of low carb to improve health — expressed dismay, concern and even anger. That is because the company as recently as a month ago was still actively promoting shareholder investment opportunities in the clinics through an online public offering. Why didn’t they shut down HEAL Clinics prior to taking money from new investors? The FAQ said this:

We earnestly believed the Online Public Offering would carry us until our financial model turned cash-flow positive. It is clear it will not. We decided the best course of action in terms of all our stakeholders was to stop the continuing losses and wind down the business while we still had cash to pay our bills and make a “soft landing.”

The company said on its websites any funds remaining after paying final bills will be returned to shareholders on a pro rata basis. As well, they stated that patients with active subscriptions at the clinics will also receive a refund on unused portions and be sent an email listing medical resources to help them in continuing their low-carb care.

This is an unfortunate development for all concerned — patients, founders, doctors and staff who worked in the clinics, and long-time and recent investors who believed in the company’s future.

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