| To: Michael Olds who wrote (306) | 10/15/2001 1:54:07 AM | | From: tech101 | | | | WebMD Corp.
Improving Prospect Ahead -- Part 1
Ranking -- Accumulate, Long Term Buy
10 August 2001
David R. Risinger, CFA
First Vice President
Brandon R. Fazio
Industry Analyst
HIGHLIGHT
...
We continue to view WebMD as an interesting small to mid cap value situation. We think there is an opportunity for patient investors since the stock is only trading at an enterprise value multiple of 2x current revenue and its assets have the potential to deliver 20%+ operating margins over the longterm. Other leading healthcare IT companies are trading at 4x revenue.
...
From Marrill Lynch Research Report
The Research Reports are free for 30 days trial at
research.askmerrill.ml.com |
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| To: Michael Olds who wrote (311) | 10/15/2001 2:10:07 PM | | From: tech101 | | | | The settlement with Quintiles is certainly mutual beneficial.
However, the agreement probably means hundred million dollars, even billions of dollars (just look at MEDCO)for WebMD.
The result of this battle and how it was handled also shows that Wygod is indeed the strongman in the tough healthcare business and he knows how to play with it, which gives a lot of confidence to the stock. |
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| To: Keith Fauci who started this subject | 11/2/2001 2:28:00 PM | | From: Michael Olds | | | | WebMD Announces Increase in Stock Repurchase Program
PR NEWSWIRE - November 02, 2001 13:49
ELMWOOD PARK, N.J., Nov 2, 2001 /PRNewswire via COMTEX/ -- WebMD Corporation (Nasdaq: HLTH) today announced that it has utilized all of the $50 million previously authorized for its stock repurchase program and that an additional $50 million has been authorized. Under its stock repurchase program, WebMD may purchase shares of its common stock from time to time in the open market, through block trades or in private transactions, depending on market conditions and other factors. The previously announced repurchase of shares from Quintiles Transnational Corp. was not part of this stock repurchase program. |
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| To: Michael Olds who wrote (315) | 11/12/2001 2:22:52 PM | | From: tech101 | | | | Electronic Billing
Anthrax Scare Spikes Interest in Already Surging E-Billing
5 November 2001
Avivah Litan
Recent anthrax cases further heightened the trend toward consumers viewing and paying bills electronically. However, high costs and inconvenience still keep some from adopting this technology.
Recent anthrax cases further heightened the trend toward consumers viewing and paying bills electronically. However, high costs and inconvenience still keep some from adopting this technology.
Event
On 5 November 2001, Gartner reported a large increase in the number of consumers signed up for e-billing applications in 2001:
By the end of 2001, Gartner forecasts that 32 million Americans will view credit card and other statements online, a 60 percent increase over the 20 million who did so at the end of 2000.
Nearly 27 million of these consumers will view their credit card accounts online. Gartner expects the number of consumers viewing bills and accounts electronically to reach 64 million by year-end 2003.
Although the spike largely stems from the increasing popularity of online e-billing, some Gartner clients report a 20-percent increase in consumer enrollment since the anthrax scare began in September 2001.
First Take
Mail safety concerns raised by recent anthrax scares encourage consumers and billers to pursue e-billing and payment channels more aggressively. Even without these concerns, Gartner has found that e-billing has finally started to take off in 2001. One major factor unrelated to recent events is that credit card issuers have succeeded in attracting consumers to online account management by giving them value-added services such as daily balances and responsive self-service.
According to a recent Gartner survey, consumer preferences differ when choosing how to receive and access bills online. Options for service range from e-bill aggregation services offered by banks, brokerage firms, and popular portals such as America Online, Yahoo and Quicken.com. More than 48 percent of consumers prefer going to their billers' Web sites directly to access and pay bills while 24 percent prefer to receive a consolidated set of bills at their banks' Web sites.
The billers have done the best job in providing easy-to-use services, while banks and other service providers that aggregate consumer bills still have a long way to go in providing comparably easy services. Although recent events provide customers with more reasons to start accessing their bills online, the barriers to getting started, especially with aggregated e-billing services, remain too high for most consumers.
The anthrax scare has heightened interest in a market already poised to take off. The e-billing market has a long way to go before it replaces all consumer billing paper, but consumers recently have shown their enthusiasm for signing up for biller-direct systems. Banks and other second-party billers need to make their bill aggregation and payment services just as easy to use as the biller-direct systems before they can enjoy similar success with consumers.
Analytical Source: Avivah Litan, Financial Services Payment Systems
Written by Dean Lombardo, gartner.com |
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| To: Keith Fauci who started this subject | 11/12/2001 4:04:34 PM | | From: Michael Olds | | | | WebMD Announces Third Quarter ResultsLoss Before Restructuring and Non-Cash Items Declines 70% From Prior Year and 18% From Last Quarter
PR NEWSWIRE - November 12, 2001 16:01
ELMWOOD PARK, N.J., Nov 12, 2001 /PRNewswire via COMTEX/ -- WebMD Corporation (Nasdaq: HLTH) today announced financial results for the quarter ended September 30, 2001.
Revenue for the September 2001 quarter was $167.0 million compared to $151.2 million for the September 2000 quarter. The loss from continuing operations, excluding restructuring, integration and non-cash expenses, for the September 2001 quarter was ($19.5) million or ($0.05) per share, compared to ($65.8) million or ($0.27) per share for the September 2000 quarter. The Company recorded a non-cash charge during the September 2001 quarter of $3.827 billion or ($10.64) per share related to the impairment of its long-lived and other assets, primarily goodwill and other acquired intangible assets. The net loss, including the non-cash charge discussed above, for the September 2001 quarter was ($4.624) billion or ($12.86) per share compared with ($786.9) million or ($3.17) per share for the September 2000 quarter.
As of September 30, 2001, the Company had approximately $586.8 million in cash and short-term marketable securities compared to $588.2 million as of June 30, 2001.
Anthony Vuolo, Chief Financial Officer stated: "The results for the September 2001 quarter are consistent with the objectives we outlined a year ago to continually reduce the Company's loss before restructuring and non-cash items during 2001 with the goal of eliminating this loss as we enter 2002. During the quarter, the loss from continuing operations before restructuring, integration and non-cash items declined by 70% compared to September 2000 and by 18% compared to June 2001. We are well positioned to take advantage of the significant opportunities that lie ahead with ample financial resources and the leading assets in the industry."
Revenue categories are as follows (in millions):
Q3 2001 Q3 2000 Q2 2001
Transaction services $91.6 $88.2 $96.9
Physician services 61.1 29.0 65.1
Portal services 14.3 28.6 15.9
Other products -- 5.4 0.8
Total revenue $167.0 $151.2 $178.7
Transaction Services revenue was $91.6 million for the September 2001 quarter compared to $88.2 million in the September 2000 quarter and $96.9 million in the June 2001 quarter. Total electronic transactions were 523 million for the September 2001 quarter compared to 487 million transactions in the September 2000 quarter and 536 million in the June 2001 quarter. The revenue increase compared to the September 2000 quarter was due to the inclusion of CareInsite for the full September 2001 quarter offset by reductions related to consolidating duplicative product offerings and certain legacy products. The decline in transaction services revenues compared to the June 2001 quarter reflects decreases resulting from a combination of seasonality factors and the anticipated reduction in revenues related to consolidating duplicative transaction services offerings and to certain legacy product offerings.
Physician Services revenue was $61.1 million for the September 2001 quarter compared to $29.0 million in the September 2000 quarter and $65.1 million in the June 2001 quarter. The increase in physician services revenues compared to the September 2000 quarter was due to the inclusion of Medical Manager Corporation for the full September 2001 quarter partially offset by the revenues from sponsored subscriptions that were eliminated effective December 31, 2000 as a result of the termination of the Company's agreement with Dupont and the revisions to the Company's agreement with Microsoft. The decrease in physician services revenue compared to the June 2001 quarter resulted from the previously announced impact on new system sales associated with travel and scheduling conflicts and other delays in the month of September.
Portal Services revenue was $14.3 million for the September 2001 quarter compared to $28.6 million in the September 2000 quarter and $15.9 million for the June 2001 quarter. The decrease compared to the September 2000 quarter was attributable to the Company's relationships with News Corporation, Microsoft and Dupont which were restructured or terminated effective as of the end of December 2000 and the impact of the softening of the Internet advertising market on both the Company and certain of its customers. The decrease in revenues compared to the June 2001 quarter was attributable to a combination of the deferral of certain committed advertising sponsorship until the fourth quarter of 2001 and to the continued softening of the Internet advertising market.
Operating expenses before restructuring and integration, depreciation, amortization and other non-cash expenses were $192.9 for the September 2001 quarter compared to $226.9 million in the September 2000 quarter and $210.6 million in the June 2001 quarter, reductions of 15%, and 8.4% respectively. The reduction in expenses reflects the benefits of both the Company's integration initiatives and the restructuring of many of the Company's strategic relationships. Sales, marketing, general and administrative expenses included severance expenses of approximately $3.0 million related to the departure of the Company's former President during the quarter.
Interest income was $6.4 million for the September 2001 quarter compared to $9.9 million for the September 2000 quarter and $8.1 million in the June 2001 quarter. The decline was due to a decline in interest rates and lower amounts available for investment.
As the Company previously announced, WebMD determined that it was necessary to conduct a review of its long-lived assets, primarily goodwill and other acquired intangible assets for impairment. These assets were recorded as a result of a series of acquisitions completed between November 1999 and September 2000. The Company's common stock was the primary consideration for these acquisitions. As a result of this review, the Company determined that its long-lived assets were impaired and recorded a write-down of $3.827 billion or $10.64 per share to adjust the carrying value of its long-lived assets to fair value.
During the September 2001 quarter, the Company acquired approximately 2.7 million shares of its common stock for $9.4 million under its previously announced stock repurchase program. As a result of the settlement with Quintiles and an additional purchase under its stock repurchase program, the Company has reacquired a total of approximately 47 million shares for $235 million in private transactions since the end of the September 2001 quarter. Since October 2000, the Company has reacquired a total of approximately 77 million shares of its common stock, including common stock equivalents related to the convertible preferred stock reacquired in February 2001.
Martin J. Wygod, Chairman and Chief Executive Officer of WebMD, stated: "We believe that the restructuring effort initiated a year ago will be substantially complete by the end of the year. During this process, we have consolidated operations and products, realigned strategic partnerships, while continuing to invest in products and services that will drive growth of our business. Today, WebMD is a company with significant strategic assets that are free of encumbrances and with management and employees that are fully focused on the business and opportunities at hand. As we look forward, we are excited by the long-term outlook and the environment that exists for both revenue and earnings growth. With regard to 2002, we believe that we will not begin to see traction in revenue growth until the last six months of the year, due to the uncertainty of the economy, as well as the timing of both new product distribution and the first scheduled HIPAA transaction standard implementation date." |
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| To: tech101 who wrote (316) | 11/12/2001 8:18:03 PM | | From: i-node | | | | | The HIPAA regulations, which those of us in the medical software business are dealing with at this time, substantially limit flexibility in this area. Unless someone does something about the absurd requirements of HIPAA, I suspect it will be a long, long time before people will be billing PATIENTS electronically (although we're coding our new software to accomodate it should it come to pass). |
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| To: tech101 who wrote (319) | 12/6/2001 11:39:17 AM | | From: tech101 | | | | Doctors Are Now Online in Force
Wednesday December 5, 8:02 am Eastern Time
Press Release
SOURCE: The Boston Consulting Group
Doctors Are Now Online in Force -- and Their Medical Decisions Are Influenced by the Information They Find There.
Doctors Who Search for Info Online or Use Online Tools for Patient Care Find that the Internet Enhances their Knowledge, Efficiency, and Quality of Care, According to BCG
BOSTON.
Dec. 5 /PRNewswire/ -- The Internet is already changing the physician behaviors that health care players seek to influence. Today, the vast majority of doctors use the Internet as a tool for enriching their medical knowledge, and the medical information these doctors are finding on the Internet is influencing -- in many cases significantly -- the types of diagnoses they are making and the kinds of medications they are prescribing. These unexpected findings are the result of interviews with more than 400 U.S. physicians, conducted as part of Doctors Say E-Health Delivers, the recent study on e-health by The Boston Consulting Group (BCG). The proprietary study was designed and conducted jointly with Harris Interactive.
Doctors Say E-Health Delivers also finds that about one-third of doctors are adopting or planning to adopt Internet technologies that enhance the care they deliver to patients.
The doctors who have already adopted electronic medical records, electronic prescribing, online communication with patients, and remote disease monitoring say that these online patient-care tools have boosted their efficiency and the quality of care.
And the remaining doctors are planning to adopt these tools in the future at relatively aggressive rates -- from about 10 percent to 20 percent depending on the tool -- greatly bolstering the e-health channel in the next year and a half.
Doctors Say E-Health Delivers explores physicians' use of e-health tools and examines the sector-specific implications for pharmaceutical companies, managed care organizations, and health-care-delivery systems. Its findings indicate that e-health is poised to quietly transform the economics of health care as well as the methods used to influence decision-makers in the industry. In such an environment, e-health strategies, which have failed Internet startups, could prove integral to the success of incumbent health care players.
Finding Medical Information Online
``Many industry experts expected that -- at best -- the Internet would prove a diversion for doctors who had light clinical practices or a serious interest in computers. But our interviews indicate that 89 percent of physicians use the Internet and that virtually all of these doctors have migrated some of their medical knowledge-enrichment activities online. Fully 90 percent of doctors online research clinical information on the Internet,'' says Carina von Knoop, a BCG vice president and co-leader of the firm's e- health initiative.
``Also significant is our finding that the busiest clinicians are most likely to turn to the Web to enrich their professional knowledge,'' Ms. von Knoop continues. ``These are the doctors who spend more time with patients and who therefore have more opportunities to diagnose conditions, manage patient care, select treatments, and write prescriptions. Quite simply, they are the very doctors that health care organizations target as they seek to influence the delivery of health care.''
These and other findings from the study have significant implications for health care players, explains Ms. von Knoop. ``The pharmaceutical industry in the U.S. alone spent $13 billion last year to reach doctors, but spent only 1 percent of this amount on Internet channels. These same companies continue to rely on drug reps as the preferred medium for physician education, but the average doctor spends less than one hour a week with reps-compared to about three hours a week seeking medical information online. This disparity suggests that companies that don't reallocate some of their marketing investments may soon find themselves underinvesting in a highly promising new channel.''
The study also found that the vast majority of doctors who visit health- related Web sites -- ranging from 70 percent to 90 percent depending on the survey question -- report that the information they find online has an impact on medical decisions about diagnoses and treatment. Roughly one-third of these same doctors report that the information they find on the Internet has a major impact on the way they interact with patients; around 20 percent say that it has a major impact on their knowledge of symptoms and diagnoses, as well as on the way they interact with patients; and 13 percent said that it has a major impact on the drugs they prescribe. These doctors may well represent the first wave of e-health practitioners.
``Clearly, in an environment of increased financial and competitive pressures, pharmaceutical companies, managed care organizations, and health- care-delivery systems cannot afford to ignore the potential advantages that online knowledge-enrichment tools offer,'' says Ms. von Knoop. ``Yet these advantages will not accrue to incumbents that continue to relegate e-health to small-scale experiments at the periphery of the businesses.''
Health care companies that seek to tap into the power of online knowledge enrichment will find their task made simpler by the fact that, unlike patients, physicians are easy to find online. More than two-thirds of physicians surveyed behave like online consumers, returning regularly to between two and five sites. Doctors who visit at least one site regularly named WebMD, Medscape, and Physicians' Online as their top three destinations.
``But although it is relatively easy to find doctors online,'' cautions Ms. von Knoop, ``it will be challenging for health care organizations to market to them. It is important to remember that the sites to which doctors return most frequently place strict limits on sponsorship and content. Therefore, health care organizations will need to focus on devising unique and customized ways to get their messages to doctors.''
Using Online Tools for Patient Care
While not yet as popular as knowledge-enrichment tools, electronic tools that help physicians with their daily patient care promise to deliver additional value because they get to the heart of the health care delivery. The tools that offer the greatest potential to both doctors and incumbents are electronic medical records, electronic prescribing, online communication with patients, and remote disease monitoring. About one-third of the doctors in the BCG survey now use or plan to use at least one of the first three tools, and a smaller percentage plan to adopt remote disease monitoring.
Already 26 percent of physicians surveyed are communicating with patients over the Internet, and 22 percent are relying on electronic medical records to store and track information about their patients. On a smaller scale, 11 percent of doctors are prescribing drugs electronically and 5 percent monitor patients' health electronically, but planned adoption would roughly triple these percentages in the next 18 months.
``Such growth will arise primarily as word spreads among physicians that the tools deliver,'' explains Ms. von Knoop. ``Already most users in our survey report that online patient-care tools have improved their overall efficiency, enabled them to deliver better care, increase patient satisfaction, and, in some cases, saved their practices money. The early successes with patient-care tools illustrate the depth and breadth of the opportunities they present to doctors-and health care players.''
Because online tools for patient care are delivering on their promises, they are already creating value for doctors and patients. Incumbents such as drug companies, MCOs, and health-care-delivery systems can capitalize on this value and even capture some for themselves by adding these tools-or at least linking them-to current offerings. ``At a time when pharmaceutical companies are competing intensely for attention from physicians, offering valuable and unique online tools may help them differentiate themselves or gain more time with physicians. Likewise, as MCOs struggle to find new avenues for improving care and squeezing costs, they can turn to online tools to gain greater access to doctors -- and perhaps even to guide them -- as they make patient-care decisions,'' says Ms. von Knoop.
Additional BCG Research in E-Health
Doctors Say E-Health Delivers builds on BCG analysis in Vital Signs: The Impact of E-Health on Patients and Physicians (released in February) as well as The E-Health Patient Paradox, an April report exploring how the Internet influences patients to become more active in diagnosing and treating their own conditions. BCG will, on an ongoing basis, be updating this research on physicians and patients.
About The Boston Consulting Group
The Boston Consulting Group (BCG) is a general management consulting firm widely regarded as the global leader in business strategy. Since 1963, BCG has worked with companies in every major industry and global market to develop and implement strategies for competitive success. BCG has 52 offices in 34 countries around the world. More information on BCG can be found on its Web site: www.bcg.com.
SOURCE: The Boston Consulting Group |
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| To: tech101 who wrote (320) | 12/6/2001 1:23:39 PM | | From: Michael Olds | | | | Thinking about future valuation.
Many of the old WebMD shareholders were ticked off when MW managed to bump up the conversion ratio of MMGR shares to WebMD shares in the merger. At that time I suggested that what had happened was a leveraged buy-out using the stock of the company being bought in place of cash. Since that time, in spite of the fact that the intent (and scope in time) was made absolutely clear by management, the paying down of that debt (by way of restructuring, and stock repurchasing) has met with an endless stream of complaints. Now that that debt has largely been paid off or brought to reasonable proportions, the stock reflects only the value of the end-product of that re-valuation. I think this mistakes the show for the magician and represents a real opportunity for value investors.
The sickness: Fear on the part of investors that growth by merger and acquisition will dilute shareholder value (based on past experience) and that therefore it will not be done.
The cure:
Those with experience with MW know him as the inventor of the use of stock as currency (well, OK, that goes too far, but certainly he is a master of the art). (Fitting in a way that he should find himself needing to repair what some might consider the far extreme into absurdity of that strategy). Now that HLTH is past the restructuring phase, I think it is fitting to look at the way this management grew Medco Containment Services as the asset that is not being factored into the stock price.
However costly it may have been for MMGR, what the merger managed to do was to eliminate even the appearance of competition in this field. In the dominant position I think it is more than probable that what we will see is the use of stock to consolidate the company's position throughout the country and that in such a way as to consistantly add to real per share earnings; in other words: the use of stock as currency the way it should be done. That is what was done with Medco, and that is what I believe we will see here. Those who are taking the current assets and their earning power and projecting stock price out six months, one, two years are looking in the wrong place. That is how we are where we are. Where we will be in six months is going to be determined by the pace and value of future mergers and acquisitions. My prediction is the pace will be as breathtaking as was the pace of the elimination of debt.
I'm not going to hedge this "take". I say we are dealing with a team of work-aholics and they have finished one thing (not the restructuring, that was the last thing, the setting rolling of earning's "traction" from the existing structure...that's done); they are already looking at the next thing.
My say! |
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| To: Keith Fauci who started this subject | 12/26/2001 10:21:41 AM | | From: Michael Olds | | | | WebMD Acquires Medscape Portals to Create Largest Network of Online Medical Professionals and ConsumersIntegration of Assets to Strengthen WebMD's Offerings to Physicians, Consumers and Health Plans
PR NEWSWIRE - December 26, 2001 09:20
ELMWOOD PARK, N.J., Dec 26, 2001 /PRNewswire via COMTEX/ -- WebMD Corporation (Nasdaq: HLTH) today announced that the Company has acquired the portal assets of MedicaLogic/Medscape, Inc. (Nasdaq: MDLI), including the Medscape Medical Professional and Medscape Health for Consumers web sites, for $10 million in cash effective immediately. Medscape's Medical Professional portal will become the Company's online brand of information, research and educational services for physicians and allied medical professionals. WebMD Health(SM) will continue as the Company's brand of online information, community and services for consumers.
With the addition of the Medscape assets, the Company's newly expanded WebMD Medscape Health Network will reach more than 15 million cumulative monthly visitors, including approximately 575,000 members registered as physicians worldwide.
"This acquisition is a great opportunity to further strengthen our product offering for physicians and is in keeping with our goal of creating the leading communication channels connecting physicians and their patients with health plans, providers and suppliers," said Martin J. Wygod, Chairman of the Board and Chief Executive Officer of WebMD. "Although there are strategic synergies, we expect to incur certain costs and expenses related to the combination of the respective operations. The acquisition may impact our financial expectations by $1-2 million for each of the next two quarters as we complete the integration."
The Company plans to integrate the Medscape Medical Professional portal into its suite of professional products and services. The Medscape services will become part of the integrated portal offering of the Medical Manager(R), the leading brand of physician practice management software, used by more than 185,000 physicians, and into WebMD Envoy(R), the leading provider of electronic transaction services, used by more than 300,000 physicians.
"When consumers or medical professionals look for information online, they seek objective, credible and trustworthy sources for that information. The Medscape editorial team brings a longstanding track record for the highest quality medical journalism," said Roger C. Holstein, Chief Executive Officer, WebMD Health. "With unmatched brand awareness, distribution and utilization, the WebMD Medscape Health Network is now the most effective way, online or offline, to reach physicians in virtually every specialty, as well as healthcare involved consumers with specific diseases or conditions."
Both WebMD and Medscape are founding members of HI-Ethics, and WebMD was one of the first websites to receive the new URAC e-health accreditation. Going forward, WebMD is committed to continuing the standards of excellence in content delivery and information practices already in place. |
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