Healtheon/WebMD Announces Agreement to Acquire Kinetra; Strategic Relationships
With EDS and Lilly
Acquisition Provides 100+ Contracts With Over 200 Organizations, Including
50,000 Physicians at 50 Million Clinical Transactions Annually
Powerful Affiliations Between Healtheon/WebMD, EDS and Lilly to Enhance
Physician Adoption and Leverage Consumer Distribution
ATLANTA and PLANO, Texas and INDIANAPOLIS, Dec. 21 /PRNewswire/ --
Healtheon/WebMD (Nasdaq: HLTH), EDS (NYSE: EDS) and Eli Lilly and Company
(NYSE: LLY) announced today that Healtheon/WebMD has agreed to acquire
Kinetra, a joint venture between EDS and Lilly. Coincident with the
acquisition, Lilly has agreed to utilize Healtheon/WebMD's Internet content
and services, and EDS and Healtheon/WebMD have formed a strategic relationship
integrating Healtheon/WebMD's suite of provider and consumer Internet
offerings with EDS' healthcare solutions including integrating EDS'
MetaVance(TM) product into WebMD Practice(TM) and promoting WebMD Practice to
EDS customers.
Healtheon/WebMD indicated the value of the combined transactions,
including the acquisition of Kinetra and the strategic partnerships with EDS
and Lilly, was approximately $300 million.
Kinetra is a leading provider of clinical document distribution solutions
and administrative transactions to Integrated Delivery Networks (IDNs),
large hospitals and payors. The company processes over 50 million electronic
clinical transactions per year for more than 200 healthcare organizations
with more than 50,000 physician users.
Under the terms of the agreements:
-- As previously announced, Healtheon/WebMD will integrate EDS'
MetaVance Health Care Portfolio, a suite of managed care products for
healthcare payors, into its flagship Internet service product. The
two companies will jointly develop other Internet product offerings
designed for the healthcare marketplace;
-- Healtheon/WebMD's consumer healthcare portal - www.webmd.com -
will be EDS's preferred source of healthcare information for
consumer offerings; and
-- EDS will promote WebMD Practice as the preferred provider desktop
with its existing healthcare clients. EDS currently manages more than
200 million transactions per month among its healthcare customers;
-- Lilly will undertake a multi-media program - including advertising
and sponsorships with Healtheon/WebMD and use of their Internet
content and services - to effectively communicate with physicians and
consumers. The total communications program is valued at $60 million
over three years.
"This acquisition and our new, strategic partnerships with EDS and Lilly
allow Healtheon/WebMD to further its goal of using the Internet to
facilitate a new system for delivering health care," said Chief Executive
Officer Jeff Arnold of Healtheon/WebMD. "By acquiring existing
relationships and migrating Kinetra's current hospital, IDN and payor
connectivity to our Internet-based transactions, we will accelerate our
growth of electronic clinical transactions. The partnerships with EDS and
Lilly clearly support our strategy of building relationships with both
physicians and consumers by providing trusted and credible healthcare
content under the WebMD brand and translating those relationships into
electronic transactions."
"Healtheon/WebMD is the recognized leader in providing information
technology services to the healthcare provider and consumer market. EDS
complements the Healtheon/WebMD team with our 35 years of history and strong
market share in the insurance and government markets and our end-to-end IT
to Internet capabilities," said Jeff Kelly, vice president of delivery for
EDS' Information Solutions business line. "This agreement with
Healtheon/WebMD will expand our provider presence and bring the provider,
payor and consumer closer together. The end result will be a very powerful
service offering."
WebMD Practice uses the Internet to provide physicians and their offices
with comprehensive content, secure communications and transaction services
including the automation of the workflow associated with determining patient
eligibility, referring a patient to a specialist and authorizing treatment.
It also automatically links eligibility and authorization information to
medical claims submitted electronically. Using the service, a patient's
insurance coverage can be quickly verified online and a referral or
authorization can be obtained in seconds, rather than days, thus speeding
access to care while reducing effort and cost.
"We needed a partner that understands and delivers complex healthcare
solutions and that manages a tremendous volume of transactions from a wide
range of sources. EDS is the clear winner," said Mike Long, chairman and
chief operating officer of Healtheon/WebMD. "We are very impressed with
Lilly's understanding of the value of the Internet and are looking forward
to this partnership to help bring them closer to physicians and consumers."
"The new ownership arrangement provides fresh opportunities to grow and
implement business strategies in an environment that is uniquely suited to
take advantage of the Internet as a communications vehicle," said Charles E.
Golden, executive vice president and chief financial officer for Lilly.
"Likewise, the use of new technologies improving connectivity will help
Lilly enhance its core business - creating pharmaceutical innovation and
demand for its products in the marketplace."
About Healtheon/WebMD
Healtheon/WebMD is the first end-to-end Internet healthcare
company connecting physicians and consumers to the entire healthcare
industry. Healtheon/WebMD is using the Internet to facilitate a new system
for the delivery of healthcare, resulting in a single, secure environment
for all communications and transactions that will enable a more efficient
and cost effective healthcare system. With corporate headquarters in
Atlanta and technology headquarters in Silicon Valley, the company was
formed in November 1999 as a result of the merger of Healtheon Corporation,
WebMD Inc., MEDE America and Medcast. For more information, visit
webmd.com .
About Kinetra
Kinetra, based in Golden, Colorado, leads the nation in providing health
information networks and services that enhance decision-critical information
flow within the healthcare field. Today, more than 50,000 physicians,
several hundred hospitals, managed care organizations, clinical reference
labs, pharmaceutical companies and other healthcare organizations
communicate via 50 Kinetra enterprise, regional and multi-sponsor networks.
Kinetra is a trademark of Kinetra LLC, an EDS - IMS MEDACOM company.
About EDS
EDS, a leader in the global information technology services industry for
more than 35 years, delivers management consulting, electronic business
solutions, and systems and technology expertise to improve the performance
of more than 9,000 business and government clients in about 50 countries.
EDS reported revenues of $16.9 billion in 1998. The company's stock is
traded on the New York Stock Exchange and the London Stock
Exchange. Visit EDS via the Internet at eds.com .
About Lilly
Lilly is a global research-based pharmaceutical corporation headquartered
in Indianapolis, Ind., that is dedicated to creating and delivering innovative
pharmaceutical-based health care solutions that enable people to live
longer, healthier and more active lives. Lilly can be visited via the
Internet at lilly.com .
Other than historical information set forth herein, this announcement
contains forward-looking statements that involve risks and uncertainties,
including those relating to the ability of Healtheon/WebMD's services to
decrease costs and improve patient care. Actual results could be materially
different from those discussed in this announcement. Factors that could
cause actual results to differ include, among others: Healtheon/WedMD's
limited operating history, continued growth in the use of the Internet, and
acceptance of the Internet as a secure medium over which to conduct
transactions. Additional risks associated with Healtheon/WebMD's business
can be found in its recent Registration Statement on Form S-4 and other
periodic filings with the SEC.
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