News in brief - Sept. 12, 2005

Former HealthSouth CFO sentenced to prison - SEC sues former Bristol-Myers Squibb executives - ProxyMed reorganizes - Quest Diagnostics acquires LabOne

Former HealthSouth CFO sentenced to prison

Aaron Beam, who helped found HealthSouth Corp. and served as its chief financial officer, has been sentenced to three months in prison for his role in the massive accounting fraud at the outpatient services giant.

The 61-year-old, who had previously pleaded guilty to bank fraud, was also fined $10,000 and ordered to pay $275,000 in "ill-gotten gains" at his sentencing in U.S. District Court in Birmingham, Ala., on Aug. 25.

Beam was one of five former chief financial officers to plead guilty to criminal charges in the $2.7 billion accounting scandal at HealthSouth, and one of at least 18 former executives who faced charges from prosecutors.

He cooperated with the investigation and testified against the company's lead founder and former chief executive, Richard Scrushy, at his trial earlier this year. Scrushy, who was accused of being the mastermind of the scheme, was acquitted of all charges.

SEC sues former Bristol-Myers Squibb executives

The Securities and Exchange Commission on Aug. 22 sued two former executives of Bristol-Myers Squibb Co. in a New Jersey federal court, accusing them of defrauding investors by improperly booking $1.5 billion in revenue in 2000 and 2001. In its civil suit, the SEC allege Frederick Schiff, former chief financial officer, and Richard Lane, former worldwide group medicine president, of paying incentives to get wholesalers to take more inventory than they needed, thus inflating Bristol-Myers revenue. Attorneys for the two men said their clients dispute the allegations and will contest the charges, the Associated Press reported.

ProxyMed reorganizes

As part of an internal reorganization, ProxyMed Inc. announced Aug 15 that it terminated John Paul Guinan, executive vice president and chief technology officer, and Jeffrey M. Markle, a senior vice president of cost services, as part of a restructuring. The Norcross, Ga.-based seller of medical transaction processing services said it doesn't intend to appoint replacements at this time. ProxyMed also announced that it appointed Douglas O'Dowd as interim chief financial officer, replacing Gregory J. Eisenhauer, who resigned to pursue a new business opportunity.

Quest Diagnostics acquires LabOne

Quest Diagnostics Inc., Teterboro, N.J., has agreed to acquire LabOne Inc. for $934 million in cash. The acquisition is expected to close in the fourth quarter. Quest and LabOne, Lenexa, Kan., offer diagnostic testing services.