SEC Report:
September 29, 1999
HEALTHCENTRAL.COM (HCEN)
S-1 Filing (SEC form S1)
Our company provides online healthcare content and e-commerce to consumers through our HealthCentral.com network, which consists of the following websites:
. www.HealthCentral.com. HealthCentral.com is our flagship website that provides original, trustworthy, up-to-date and personalized online healthcare information to consumers. The cornerstone of HealthCentral.com is our relationship with Dr. Dean Edell, a widely recognized television and radio personality who has a daily syndicated radio program that is broadcast on over 300 radio stations, and a syndicated television report broadcast in over 50 television markets, reaching a combined 20 million individuals per week. In August 1999, according to an audit completed by Nielsen I/PRO, www.healthcentral.com attracted five million page views, and according to Double Click 599,400 unique users.
. www.ePills.com. ePills.com is our online drug store, offering over 23,000 stock keeping units, or SKUs, a term used to describe distinct retail products. ePills.com has fulfillment agreements with Bergen Brunswig, a major drug distributor, for health and beauty aids, over-the-counter products and prescription drug orders. ePills.com is one of five health anchor tenants on the America Online HealthOnline Pharmacy Channel.
We intend to expand our HealthCentral.com network through additional websites and relationships. We recently entered into an agreement with AltaVista under which we will be the exclusive healthcare content provider to its website, subject to conditions, and we expect to launch a co-branded health channel in the first quarter of 2000. In the fourth quarter of 1999, we intend to launch www.peoplespharmacy.healthcentral.com, featuring pharmacy-related content provided exclusively by the authors of The People's Pharmacy, a newspaper column published three times a week in over 100 markets. We also have an agreement with MediaLinx, a Canadian portal, to launch a co-branded health channel focusing on Canadian health content, which we intend to launch in the fourth quarter of 1999.
In addition, we act as an application service provider for healthcare institutions by designing, hosting and maintaining private label websites for them. Some of our current clients include Brown and Toland, Scripps Clinic, Sutter Health and Catholic Healthcare West.
Our Market Opportunity
The Internet has become an increasingly popular source of healthcare information and products. Consumer research conducted by Cyber Dialogue in 1999 found that 24.8 million U.S. adults search for health information on the Internet, with the number expected to grow to 30 million in the year 2000. The explosive growth in demand for online health information has been driven by consumers seeking to make better informed personal healthcare decisions. Consumers are also increasingly purchasing healthcare products on the Internet. Forrester Research estimates that 31.6% of surveyed Internet users shopped for healthcare products online during the previous six months. In addition, Jupiter Communications estimates that consumer purchases of healthcare goods are expected to grow from $2.4 million in 1998 to $1.7 billion in 2003.
Our Business Model
We believe we are strongly positioned to integrate a wide range of health- related content with a complete healthcare e-commerce solution. Through our HealthCentral.com network, we derive revenue from advertisements, sponsorships and e-commerce. Through our institutional Internet services business, we derive revenue from annual license fees for applications, content, hosting and maintenance services, as well as from development fees for customization services. Our goal is to become the consumer's most trusted and complete online source of healthcare information and products.
Our Strategy
Our business strategy incorporates the following key elements:
. build our brands and drive network traffic by using cross-media exposure
through our relationships with established medical professionals in
traditional media such as Dr. Dean Edell and Joe and Teresa Graedon,
through our portal deals with AltaVista, America Online and MediaLinx and
through television, radio and newspapers;
. cultivate our multiple revenue streams of sponsorship and advertising
fees principally from our flagship HealthCentral.com website, e-commerce
revenue from ePills.com, and fees and licensing revenue from products and
services that we provide to our institutional clients;
. continue to add unique and compelling content to our HealthCentral.com
network;
. attract a growing base of customers to ePills.com and provide them with a
superior shopping experience by offering them a complete line of drug
store products and useful links to content on HealthCentral.com and
PeoplesPharmacy.HealthCentral.com;
. leverage personalization features and interactive tools to increase
users' return visits to our network;
. maintain and strengthen a relationship of trust with our users and
consumers; and
. leverage our existing strategic relationships with AltaVista, America
Online and Bergen Brunswig, and pursue additional complementary
relationships.
Our principal executive offices are located at 6001 Shellmound Street, Suite 800, Emeryville, CA 94608. Our telephone number at that location is (510) 250- 2500. Information contained on the websites on the HealthCentral.com network, including www.healthcentral.com and www.epills.com, does not constitute part of this prospectus.
ePills Inc.
In September 1999, we entered into an acquisition agreement with ePills Inc., an online drug store company with the website www.epills.com. Under the terms of the acquisition agreement, ePills.com will become a wholly-owned subsidiary of HealthCentral.com in exchange for 1,776,923 shares of our common stock. We believe that the acquisition of ePills will enhance our e-commerce strategy. The acquisition is subject to conditions to closing, including that all representations and warranties must be materially true at closing and that we shall have entered into employment and noncompetition agreements with officers of ePills.com. This prospectus assumes that all conditions to closing have been satisfied and that the acquisition of ePills.com has been consummated. |
