Internet Healthcare Shops for Companies

Prakash R. Patel was named VP of acquisitions at e-health company Internet Healthcare Group (IHCG) in mid-August. “No constituent in the health care universe is satisfied with the options available to them. We see a universe of problems to be solved,” he says. He formerly served as VP of Branford, Conn.-based Scheer & Co. Patel, who earned his medical degree from Cornell University, is also a co-founder of Achillion Pharma-ceuticals and has worked with a number of large pharmaceutical and medical device manufacturing companies. Patel’s appointment comes against a backdrop of turmoil at the intersection of e-commerce and health care. A number of high profile e-commerce health care companies have made announcements that they will reduce staff in an effort to cut expenses. PlanetRx said in late August that it would cut as much as 15% of its work force, while DrKoop.com announced that it would cut up to a third of its staff at about the same time. Patel sketched out IHCG’s business plan for Mergers & Acquisitions and in doing so he noted that it differed from some competitors in the e-health care sector. “We seek out high value-added companies that are strong enough to do well on their own,” he states. IHCG, based in Avon, Conn., is a business-to-business e-commerce company that is focused on e-health care and e-insurance. It oversees a collection of 15 emerging B-to-B Internet health care companies. Among the IHCG portfolio companies are electronic broker Digital Insurance; Healant, a developer of shared interest groups on health topics; Navimedix, which automates relationships between physician offices, insurance companies, and laboratories; and other health care startups. Patel reiterated that IHCG expects that as opposed to some roll-up plays in the health care sector, the companies that make up IHCG are expected to function as independent companies. On the strategic question of how to implement e-business solutions in health care, Patel says that many startups in the industry have failed to solve real business problems. “There are critical needs in all segments of the health care industry, and these are the tasks companies must address.” He points to patient encounter administration, supply chain management, and initiatives to refocus the choice of a health plan from the employer to the employee as sectors that he expects to generate significant m&a activity in upcoming quarters. Other parts of the health care universe ripe for growth in m&a activity in the near future are companies that play a role in assisting research and development at pharmaceutical companies. Patel also cites operations that offer real-time solutions to the bundling and processing of claims as well as companies working on the introduction of wireless platforms for health care management as likely candidates for consolidation. Overall, he says that the health care industry is about seven years behind many other parts of the economy in using the Internet to solve real business practices. He added that the next generation of business applications is only in the process of being constructed by e-commerce health care companies. As for IHCG’s role in that process, Patel says, “One thing that distinguishes the IHCG family of companies is that we have deep financial resources and a long-term view of the industry.” Bear, Stearns & Co. Inc. – Telly Zachariades has joined the firm as senior managing director, and Gary Denning has joined as a managing director. The two former Chase Securities chemical industry bankers will be in charge of building and managing Bear, Stearns’ chemicals investment banking practice. George K. Baum & Co. – Charles S. Johnson has joined the company as EVP and managing director of investment banking. He will focus on strategic advisement and m&a. Johnson had been associate general counsel in the m&a department of Monsanto Co. Deutsche Bank – Bob Cotter was named global head of m&a. He most recently was a managing director and co-head of m&a at Salomon Smith Barney. Recent deal highlights were advisory roles to Bestfoods in its pending acquisition by Unilever and to U.S. Airways Group in its pending deal with UAL Group. Houlihan Lokey Howard & Zukin – Julie I. Hixson has been appointed VP in the company’s San Francisco office. She had been with PricewaterhouseCoopers. KPMG LLP – The firm has named Robert F. Arning to the post of national industry director of the firm’s banking practice. He had been director of the firm’s investment banking practice. M&A West Inc. – Gary K. Jennings was hired as VP of acquisitions at this acquirer and developer of Internet and technology companies. He had been a research analyst at the company. Air Methods Corp. – Stephen J. Lewis has been named director of corporate business development, with responsibility for implementing the company’s strategic plans to grow its core service businesses both organically and through m&a. Air Methods supplies emergency aero-medical transportation. Blair Corp. – William E. Warrin has been appointed VP of corporate development at Blair, a national catalog and direct-mail marketer. He had been CFO at ARAMARK. In his new role he will explore and develop new external business opportunities, including acquisitions and joint ventures. BuildPoint Corp. – Alec Neville was named CFO at this e-commerce company for the construction industry. He had been director of investment banking at SG Cowen. California Software Corp. – Larry Jagiello was named CFO at this software firm. He had been CFO for WWW.com Inc., an Internet music service. coolsavings.com Inc. – David Jacobson was named EVP of m&a at this e-marketing company. He had been VP of operations at the company. Cox Communications – Dallas Clement was promoted to SVP of strategy and development. Among other duties he will spearhead Cox’s investments in broadband. Cox provides cable TV and other communication services. CyberSight – Benjamin Vaughan has been named VP of corporate development at this Internet professional services firm. He had been CFO of Canoe, an online news and information service. eschoolmall.com – Thomas F. McAllister was named SVP of business development, with responsibility for acquisitions and managing all partnerships and joint ventures. He had been SVP at Sanchez Computer. eschoolmall.com provides online procurement services for schools. iBasis Inc. – D.J. Long was named VP of corporate development at this developer of internet-based communications. He had been SVP of business development at i2i Inc., a business-to-business startup. Jetstream Communications – The company has named Manish Gupta as VP of corporate development, responsible for business development and m&a. He had been VP of marketing and business development at Intera Systems. Jetstream is a provider of voice over broadband services. Netgov.com Inc. – William “Bill” Williams has joined the company as CFO and administrative officer. He will oversee Netgov.com’s finance, legal, m&a, and administrative functions. He most recently served as SVP and director at Stern Stewart & Co. Netgov.com is a provider of e-government services. NetMorf Inc. – Roger Hodskins was hired as SVP of corporate development and strategy at this producer of mobile commerce platforms for e-business. He had been VP at NetGenesis Corp. Net-Strike Worldwide – Iyad Darcazallie has been named CFO and VP of corporate development at this employment agency for IT professionals. He joins the firm from Ernst & Young, where he lead m&a, JV, and new business initiatives. ObjectSpace – This provider of business-to-business software has named John Mecke as VP of business development, responsible for strategic alliances and m&a. Joseph E. Seagram & Sons Inc. – Mau-reen Hannan has been appointed VP of strategic planning and m&a. She had been assistant controller. Sensormatic Electronics Corp. – R. James Assaf was named to the newly created position of director of m&a. He had been a member of the company’s legal department. Sensormatic makes electronic security systems. Time Domain Corp. – This developer of wireless technology has named Jeffrey L. Ross to the post of VP of corporate development and strategy. He had been an attorney at Patton Boggs LLP.