Proton Therapy Project in Adelaide Collapses: Was It Avoidable?

Ambitious plans for the Southern Hemisphere’s first proton therapy cancer unit in Adelaide now lie in tatters. The South Australian Health and Medical Research Institute (SAHMRI) is pursuing legal action, suing ProTom International for $48 million over allegations of deceptive conduct. ProTom, for its part, maintains its readiness to deliver the promised technology, were the contract revived.

The vision was compelling: a state-of-the-art facility using proton beams, not X-rays, to precisely target and destroy cancer cells. A hefty $115 million in public funds fueled the project, aiming to treat 700 patients annually, particularly children with specific cancers and adults facing rare tumors. So, what went wrong?
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Reports suggest warning signs were present before the deal solidified. KPMG’s due diligence in 2017 apparently flagged concerns about ProTom’s financial stability, pointing to a “high risk of delinquency” and a track record lacking demonstrable success. Did decision-makers overlook these red flags in their eagerness to secure this groundbreaking technology? It’s a question that demands scrutiny.

Court documents depict a grim scenario. A January meeting revealed ProTom’s dire financial straits. The new CEO, Paul Tso, is quoted as saying the company was “not making any money” and needed more funds to complete the project, suggesting the initial contract was already running at a loss. The request for an additional $57.2 million – on top of the previously agreed $49.5 million – seems to have been the breaking point. SAHMRI terminated the agreement in October 2024 and initiated legal proceedings.

Tso, speaking from Toronto, expresses disappointment and suggests mediation should have preceded litigation. He attributes rising costs to the pandemic and claims the $57 million request was later revised down to $25 million. He asserts ProTom was prepared, with components and software ready prior to the global disruption. Yet, his explanation seemingly clashes with earlier reports of financial instability.
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The core issue, beyond legal arguments, is the delayed arrival of proton therapy in Australia. Currently, patients must seek this advanced cancer treatment overseas, incurring significant expenses. Tso claims acquiring a unit from another manufacturer would be far more expensive and pose logistical challenges, given the existing, purpose-built bunker. He defends ProTom’s technology and insists their system is currently treating patients daily. He adds the project can be resuscitated with “determination” and “full cooperation,” claiming delivery is possible within 22 months if the contract returns.

Federal Health Minister Mark Butler placed blame on previous administrations for engaging with ProTom. He questioned the company’s track record, citing a single delivered unit primarily used for research. Again, Tso refutes this, affirming his system’s clinical operation at Massachusetts General Hospital, treating a significant number of patients daily.

He also dismisses the 2017 KPMG report, arguing ProTom’s proposal was superior to competitors’. He maintains that without the pandemic-induced delays, Australian patients would already be receiving treatment. It’s worth noting that he attributes fault to the pandemic, not any failures on his company’s part.

SAHMRI claims ownership of equipment, including a Synchrotron, stored in the United States and Slovenia. While SAHMRI wants the equipment, Tso says it has already been transferred.

SAHMRI declined to comment due to the ongoing legal proceedings. The case heads back to court, and its resolution is likely distant.

Despite the stalled Adelaide project, Butler has indicated the federal government is open to establishing a proton therapy unit elsewhere in Australia if progress in South Australia remains blocked. He emphasized that this will be a national, not state-specific, service.

This leaves Australia in a frustrating situation. A specialized bunker sits unused, while cancer patients continue to face the hardship of traveling abroad for potentially life-saving treatment. The debacle underscores the complexities of procuring cutting-edge medical technology, especially from relatively unproven entities. What appears to be crucial now is a swift resolution, be it through the courts or a renewed commitment to delivering proton therapy to Australian patients. The need for this service is undeniable. The lingering question is how to guarantee its safe and effective delivery, given the lessons learned. Was the selection process rigorous enough? Did political factors outweigh sound business judgement? A transparent review of this project is essential to prevent similar failures in the future and ensure Australians finally gain access to this advanced cancer treatment.

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Keywords: Proton therapy Adelaide, SAHMRI lawsuit ProTom, proton therapy Australia, cancer treatment abroad, proton beam cancer treatment, medical technology procurement, Synchrotron equipment, Mark Butler proton therapy