News in brief - May 22/29, 2000

Siemens buys SMS - Healtheon posts huge quarterly loss - Drkoop.com maneuvers for survival - Companies hop on ASP bandwagon - Axolotl, Passport Health form link - McKessonHBOC invests in Web venture - Express Scripts, Allscripts join forces

Siemens buys SMS

Siemens AG, Erlangen, Germany, said May 1 that it was acquiring Shared Medical Systems Corp., which sells information systems to hospitals and physician practices, for $2.1 billion in cash, or $73 a share.

Siemens executives said the acquisition of SMS, Malvern, Pa., would expand its product lineup from medical imaging to health information technology systems and services. The purchase also will enable Siemens to boost its U.S. market presence.

SMS was previously the target of an unsolicited takeover bid from Eclipsys Corp., Delray Beach, Fla., which dropped the bid after Neoforma.com Inc. agreed to acquire it in March.

Healtheon posts huge quarterly loss

Healtheon/WebMD Corp., Santa Clara, Calif., reported a net loss of $431.5 million for the first quarter ending March 31, vs. a loss of $18.6 million in the year-ago period. Revenue was $65.9 million for the first quarter of 2000, up from $17.6 million for the same period in 1999.

The quarterly results reflect last year's completion of the four-way merger between Healtheon, WebMD, MedE America and Medcast Networks. They also reflect this year's $1 billion partnership with News Corp. and acquisition of Kinetra LLC.

Drkoop.com maneuvers for survival

In a bid for survival, Drkoop.com Inc. announced a series of moves, including hiring Bear, Stearns & Co. Inc. "to explore strategic alternatives," a euphemism that usually means the company is for sale. Drkoop.com also has restructured agreements with America Online Inc. and Infoseek Corp., under which it slashed cash payments for space on the two Web portals.

As of March 31, Drkoop.com had about $24 million in cash, which the firm said would last a little more than four months.

Companies hop on ASP bandwagon

Kansas City, Mo.-based Cerner Corp. is making its physician practice management software available over the Internet, joining the growing ranks of companies delivering software through the application service provider model. ASPs lease software to physicians over the Internet for a monthly subscription fee.

Also, Shared Medical Systems, Malvern, Pa., and National Data Corp., Atlanta, announced an alliance under which physicians can process claims via an ASP model.

Axolotl, Passport Health form link

Axolotl Corp, which sells a Web-based clinical messaging system, has announced that it will market online administrative transactions, including eligibility verification, referrals and claims processing services, from Passport Health communications Inc. to its more than 52,000 physician customers. Passport Health is based in Brentwood, Tenn.

McKessonHBOC invests in Web venture

McKessonHBOC Inc. has invested $6.5 million to buy 2.6 million shares of Mediconsult.com Inc., a New York-based company that operates Web sites for doctors and consumers.

McKessonHBOC, a pharmaceutical distributor and health care information technology company, and Mediconsult.com plan to market Web-based applications and services to physicians, including practice management tools, physician-patient communication tools and pharmaceutical marketing solutions.

Express Scripts, Allscripts join forces

Express Scripts Inc. and Allscripts Inc., Libertyville, Ill., have formed an alliance in which doctors using Allscripts' wireless prescription pads will be able to access drug formulary and clinical information from Express Scripts, a pharmacy benefit manager in St. Louis.

Express Scripts also will market Allscripts' products to high-prescribing physicians who write the majority of prescriptions for its 38.5 million members.