FINANCIAL WOES AT PACE
Under pressure from heavy fourth quarter 1997 revenue losses, clinical information system vendor Pace Health Management Systems, Inc., West Des Moines, Iowa, announced it would lay off 40 employees--more than 50 percent of its workforce. Losses are attributed to a lack of capital on the company’s balance sheet which forced Pace to delay fulfilling several contract installations. Pace reported fourth quarter net revenues were down 55 percent. Revenues for the year ended December 31 were down 3 percent.
QUADRAMED BUYS CONSULTING COMPANY
QuadraMed Corp., Larkspur, Calif., again expanded its business by acquiring Cabot Marsh Corp., Bethlehem, Pa., for $11.5 million in cash. Cabot Marsh is a consulting company specializing in provider Medicare compliance services. The Cabot Marsh purchase will provide additional marketing opportunities for QuadraMed’s fraud and abuse compliance product QuanTIM FACTS, says a QuadraMed spokesperson.
MEDPLUS RESTRUCTURES BUSINESS LINES
MedPlus, Cincinnati, announced it has sold its core business, the IntelliCode computer bar coding division, to medical device company Becton Dickinson, Franklin Lakes, N.J., for $17.4 million in cash and a percentage of IntelliCode revenues during the next five years. IntelliCode was MedPlus’ original product when the company was founded in 1991. Becton Dickinson also purchased $2 million in MedPlus common stock and contracted to resell MedPlus’ Optimaxx document archiving and retrieval software. The funds will be directed toward MedPlus’ Optimaxx and Chartmaxx product operations. The company also announced that it has spun off Chartmaxx, making it a wholly-owned subsidiary of MedPlus.
MedPlus also declared that it had significantly increased its investment in DiaLogos, Inc., the Cincinnati-based developer of distributed intelligence software. MedPlus acquired an additional 54 percent of DiaLogos’ common stock, bringing its ownership stake to 57 percent.
SMS INVESTS IN PRACTICE MANAGEMENT COMPANY
SMS, Malvern, Pa., announced it has become part owner of Visteon, the Maitland, Fla.-based physician practice management systems vendor. Along with the equity investment, SMS has agreed to sell Visteon’s technology under the name NOVIUS Physician Enterprise Manager. NOVIUS is a suite of healthcare applications developed by SMS.
HBOC’S NEW VENTURE
Atlanta’s HBOC announced it has started HBOC Ventures, a business that will finance small healthcare IT companies. The new firm signed an agreement with venture capital fund The Ohio Partners to invest $30 million in healthcare IT over the next three years.
HBOC’s board of directors also voted to increase the number of shares of common stock from 250 million to one billion. Stockholders will vote on the amendment at HBOC’s annual stockholder meeting in May.