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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
Current Report Pursuant to Section 13 or 15(d) of
the Securities Exchange Act of 1934
FEBRUARY 16, 2000
Date of Report (Date of earliest event reported)
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HEALTHEON/WEBMD CORPORATION
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(Exact name of registrant as specified in its charter)
DELAWARE 0-24975 94-3236644
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(State or other jurisdiction of (Commission File Number) (I.R.S. Employer
incorporation) Identification No.)
400 THE LENOX BUILDING
3399 PEACHTREE ROAD NE
ATLANTA, GEORGIA 30326
(Address of principal executive offices, including zip code)
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(404) 495-7600
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(Registrant's telephone number, including area code)
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(Former name or address, if changed since last report)
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ITEM 5. OTHER EVENTS
On February 15, 2000, Healtheon/WebMD Corporation, a Delaware
corporation ("Healtheon/WebMD") and OnHealth Network Company, a Delaware
corporation ("OnHealth") entered into an Agreement and Plan of Merger (the
"Merger Agreement"), providing for the acquisition of OnHealth by
Healtheon/WebMD through the merger of OnHealth with and into a newly formed
subsidiary of Healtheon/WebMD, with OnHealth as the surviving corporation and
thus becoming a wholly owned subsidiary of Healtheon/WebMD (the "Merger").
Pursuant to the Merger Agreement, each share of common stock of OnHealth issued
and outstanding immediately prior to the effective time of the Merger will be
converted into the right to receive .189435 shares of common stock of
Healtheon/WebMD.
Consummation of the Merger is subject to certain conditions, including
(i) approval by the stockholders of OnHealth and (ii) expiration or termination
of the waiting period under the Hart-Scott-Rodino Antitrust Improvements Act of
1976, as amended.
In connection with the Merger, certain stockholders of OnHealth have
entered into voting agreements, dated as of February 15, 2000, pursuant to which
those stockholders agree to vote in favor of adopting the Merger Agreement and
approving the Merger.
A copy of the joint press release issued by Healtheon/WebMD and
OnHealth on February 16, 2000 is attached hereto as Exhibit 99.1 and is hereby
incorporated by reference in its entirety. The Merger Agreement and the voting
agreements described herein will be filed on a Form 8-K promptly after the date
hereof.
ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS
Exhibit 99.1 Joint Press Release, dated February 16, 2000, by
Healtheon/WebMD Corporation and OnHealth Network Company.
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EXHIBIT INDEX
EXHIBIT
NO. DESCRIPTION
99.1 Joint Press Release, dated February 16, 2000, by Healtheon/WebMD
Corporation and OnHealth Network Company.
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SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
HEALTHEON/WEBMD CORPORATION
Dated: February 16, 2000 By: /s/ Jack Dennison
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Name: Jack Dennison
Title: Executive Vice President and
General Counsel
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HEALTHEON/WEBMD TO ACQUIRE ONHEALTH NETWORK COMPANY TO CREATE THE MOST
COMPREHENSIVE AND TRAFFICKED HEALTH PORTAL ONLINE
TOP TWO LARGEST CONSUMER HEALTH SITES COMBINE TO MAKE WWW.WEBMD.COM NUMBER ONE
HEALTH SITE WITH PROVEN APPEAL TO WOMEN AND ONE OF TOP 25 LARGEST INTERNET SITES
IN MEDIA METRIX RANKINGS
INCREASING HEALTHEON/WEBMD'S CONSUMER BASE EXPECTED TO EXPAND PHYSICIAN AND
PATIENT COMMUNICATIONS AND ACCELERATE DEPLOYMENT OF CONNECTIVITY SERVICES
ATLANTA and SEATTLE (February 16, 2000) - Healtheon/WebMD Corp. (Nasdaq: HLTH),
the first end-to-end Internet healthcare company connecting physicians and
consumers to the entire healthcare industry, has announced a definitive
agreement to acquire OnHealth Network Company (Nasdaq: ONHN), an award-winning
online health and wellness destination for consumers. With this acquisition,
which combines the two largest consumer healthcare websites, WebMD expects to
become the most trafficked health site for consumers and physicians. The two
companies' health content and demographics are highly complementary, and the
combination will create the most comprehensive source for consumer health
information, communities, ecommerce and healthcare transactions on the Internet.
Under the terms of the agreement, shareholders of OnHealth stock are to receive
.189435 shares of Healtheon/WebMD Common Stock for each share of OnHealth stock.
Closing of the transaction, which will be accounted for as a purchase
transaction, is expected in the second quarter this year, subject to regulatory
approval, including the effectiveness of a joint registration/proxy statement on
Form S-4 to be filed with the SEC, and certain other customary conditions.
CRITICAL CONSUMER MASS WILL ACCELERATE PHYSICIAN ADOPTION OF NEW SERVICES
Based on Media Metrix's report issued in January, 90% of the audience for the
two combined sites is unduplicated. The additional consumer base brought to
Healtheon/WebMD as part of this acquisition is anticipated to create critical
consumer mass, which can be leveraged to encourage physician adoption and
utilization of new Healtheon/WebMD planned services and transactions.
"We believe that this acquisition will increase the direction of consumers to
one single portal, supporting our business model of bringing together the
physician and consumer to connect them with the entire healthcare industry and
facilitate a better healthcare delivery system," said Jeff Arnold, chief
executive officer of Healtheon/WebMD. "We will quickly enhance the breadth and
depth of our consumer offerings with OnHealth's quality, original content and
tools to solidify WebMD's position as the leading Internet portal for health in
the broadest sense."
IMMEDIATE INTEGRATION OF CONTENT, MARKETING AND ADVERTISING YIELDS NEW
OPPORTUNITIES
Healtheon/WebMD and OnHealth Network Company anticipate integrating content,
advertising and sponsorship programs immediately to leverage the sites'
complementary demographics and content focus. Partners and advertisers will now
have the opportunity to leverage the combined critical mass, resources and
strategic media assets of WebMD and OnHealth Network to increase brand awareness
with integrated campaigns across multiple media vehicles including broadcast,
cable, print, online, physician's office and in-store. Specifically, the
combined companies' advertisers can leverage Healtheon/WebMD's strategic
relationships with News Corporation, CNN, Reader's Digest and others for
integrated programming and cross-promotion on a global scale. It also
accelerates WebMD's ability to leverage several recently announced strategic
partnerships and alliances with major healthcare companies including Medtronic,
Humana and retail drugstore chain CVS.
OnHealth has attracted more than 100 advertisers and eCommerce partners and
developed customized sponsorship programs for many of these leading marketers
such as American Express, AstraZeneca Pharmaceutical, Merck, The Ford Motor
Company, Glaxo Wellcome, Nieman Marcus, Proctor and Gamble and Johnson &
Johnson.
"OnHealth's consumer marketing and content sensibility is a natural fit and
perfect addition to Healtheon/WebMD's strong offering and creates the clear
winner in the ehealth category," said Robert Goodman, president and CEO of
OnHealth Network Company. "We bring programming and communities focused on
health and wellness, which
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augments WebMD's content competencies in diseases and therapies. By combining
our content assets, we cover virtually every conceivable topic in healthcare,
medicine and wellness."
The benefits of bringing these two complementary companies together can be
categorized in four primary areas.
Consumer/Physician Momentum - With increasing numbers of consumers relying on
WebMD for information and services covering all healthcare areas,
Healtheon/WebMD is well positioned to attract more physicians and their patients
to its new transactional services. WebMD will act as a catalyst for healthcare
improvement - bringing patients and their caregivers together in ways that
enrich the relationship for both groups with services such as prescription
refills, appointment scheduling, insurance claims verification and personal
health record.
Enriched Consumer Experience - As a combined company, consumers will have a
single resource available to provide all of their healthcare information and
services needs. With access to over 90 communities focused on specific diseases
and general wellness topics, more than one million active and loyal members will
have a richer and more valuable user experience.
Media and Demographic Strengths - WebMD's advertisers and sponsors will quickly
be able to leverage OnHealth Network's loyal user base, female demographic
reach, broad range of health and wellness content and deep understanding of
consumers. OnHealth Network advertisers, sponsors and partners have new
opportunities for integrated programs that leverage online, print and cable
through WebMD's unprecedented combination and broad reach of media assets,
resources and partnerships.
Added Resources and Expertise - Healtheon/WebMD expects to gain highly
knowledgeable and skilled staff in content, marketing and sales, allowing the
company to scale as needed to execute against its business initiatives.
"Now more than ever, WebMD will be the first choice for physicians, consumers
and partners in the healthcare industry," said Reggie Bradford, chief marketing
officer of Healtheon/WebMD. "We've created a comprehensive platform for
integrated marketing campaigns that reach people in the office, at the point of
care, in the store and at home. We are also delivering ever-increasing numbers
of consumers and providers who rely on us for trusted, timely health
information, support services and convenient transactions. We aim to enhance the
relationship and improve the dialogue between physicians and patients."
ABOUT HEALTHEON/WEBMD
Healtheon/WebMD (Nasdaq: HLTH) 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 http://www.webmd.com.
ABOUT ONHEALTH NETWORK COMPANY
Headquartered in Seattle, Washington, OnHealth Network Company (Nasdaq: ONHN) is
a leading Internet health information and services resource that empowers
consumers with integrated solutions to effectively manage their health and
well-being. In association with leading medical institutions, OnHealth's
seasoned health journalists and medical contributors offer unbiased and trusted
health resources via reference guides, up-to-date news feeds, deep research,
personalization and interactive tools. OnHealth.com is the single most
trafficked health site on the web with 3.2 million unique users, according to
the December 1999 Media Metrix report. The award-winning site was recently named
"Best Health & Medicine Web Site" by US News & World Report, "Best Overall
Health Content Site" by Gomez Advisors, and won three gold medals including "The
Best Consumer Healthcare Portal Site" at the November 1999 eHealthcare World
Awards. Over 500 different sites drive traffic to OnHealth.com through various
strategic alliances including AOL's Digital City, Inc., Ask Jeeves, About.com,
Better Homes and Gardens, Weather.com, Yahoo! and Microsoft's Hot Mail Web
Courier. OnHealth also attracts leading advertisers from Glaxo Wellcome, Johnson
& Johnson, Pfizer, Procter & Gamble and SmithKline Beecham to American Express,
AIG
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Insurance, Fidelity Investments, Ford, Kellogg's and Neiman Marcus, among
others. As part of strategic expansion, the company has recently acquired Health
Decisions International and BabyData.com.
Certain statements in this release, such as the Company's ability to pursue
strategic growth opportunities, increase its traffic levels and other statements
containing "expects," "anticipates," "intends," "hopes" or "believes" or
variations of such words and similar expressions are intended to identify
forward-looking statements and are subject to risks and uncertainties that could
cause actual results to differ materially from those projected. Potential risks
and uncertainties include such factors as acceptance of the Company's products
and services, including the re-launch of the Company's Web site, the Company's
ability to raise sufficient capital to fully implement the planned advertising
campaign, competition and other risks described in the Company's filings with
the Securities and Exchange Commission.
Other than historical information set forth herein, information in this press
release contains "forward-looking statements. "These statements involve risks
and uncertainties that could cause actual results to differ materially,
including without limitation, completion of the transaction, the ability of
Healtheon/WebMD's services to decrease costs and improve patient care,
Healtheon/WebMD's limited operating history, continued growth in the use of the
Internet, acceptance of the Internet as a secure medium over which to conduct
transactions, the performance of Healtheon/WebMD and risks associated with its
business, the volatility of the market for Healtheon/WebMD stock, actual
operating performance, the ability to operate successfully in the alliance, the
ability to maintain large client contracts or to enter into new contracts, and
the actual financial and accounting treatment of the transaction. Additional
factors that could cause actual results to differ materially are discussed in
each of Healtheon/WebMD and Quintiles' recent filings with the Securities and
Exchange Commission, including but not limited to S-1, S-3 and S-4 Registration
Statements, Annual Reports on Form 10-K, Form 8-Ks, and other periodic reports,
including Form 10-Qs.
