Healthcare information portal AmericasDoctor.com is scheduled to make its debut on Wall Street this week.
This development comes several months after the company filed with the Securities and Exchange Commission for its initial public offering. Industry observers will be carefully watching how AmericasDoctor.com’s offering fares on its first day out of the box — in light of some disappointing debuts that dot-com IPOs have recently experienced on Wall Street.
The Owings Mills, Maryland-based company plans to sell 7.25 million shares of stock priced at between $8 (US$) and $10 per share to raise about $60 million. Warburg Dillon is acting as the lead underwriter for the offering, which will be traded on Nasdaq under the symbol AMDR.
AmericasDoctor.com plans to use the proceeds to fund operating losses, expand its site, promote the brand, advertise and beef up its chat center.
A Crowded Field
After launching its service in September of 1998, AmericasDoctor.com was initially available only to America Online subscribers. In February of 1999, it also launched its service on the Internet. Its interactive healthcare site features a free 24-hour chat service, enabling users to have live online one-on-one chats with doctors and other healthcare professionals. It also boasts of having more than 20 information communities, covering ailments such as eating disorders, skin conditions and allergies. The company generates most of its revenue through sponsorships with some 35 hospitals, but plans to increase its advertising and e-commerce revenue.
While all of these plans certainly sound promising, analysts point out that competition in the online healthcare arena is nothing short of brutal. Just recently, former U.S. Surgeon General C. Everett Koop launched drkoop.com. The site has already attracted 1.4 million unique visitors and established 100 heath-related chat support groups. It also cut a $89 million deal with AOL to provide healthcare information to its subscribers. Observers feel that this arrangement must have been a bitter pill for AmericasDoctor.com to swallow.
Additionally, AmericasDoctor.com faces stiff competition from OnHealth Network, WebMD and at least six other healthcare Web sites.
In July, AmericasDoctor hired Charles R. Bland to become its president. Bland formerly served as chief operating officer at Quark, Inc., publisher of the QuarkXPress desktop publishing software. Bland’s hiring changed the company’s management structure, freeing co-founder Dr. Scott M. Rifkin from running the day-to-day operations. He has since focused on finding more investors for the company and marketing the business. Analysts praised the move when it happened.
AmericasDoctor.com was co-founded by Dr. Rifkin and venture capitalist Lewis Goodman in 1998. GE Equity holds an 8 percent stake in the company, which employs 41 workers.
For the first six months ended June 30th, the company posted an operating loss of nearly $12.9 million on revenue of just over $500,000.