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WebMD, DuPont End Online Deal

December 28, 2000

ELMWOOD PARK, N.J. (AP) _ WebMD Corp. has ended its online revenue sharing agreement with DuPont Corp., which had paid for doctors’ subscriptions to the site.

The move comes as WebMD, which recently shuffled top management and relocated its headquarters from Atlanta, reorganizes its business as it seeks profitability.

The company, a collection of more than a dozen health-care enterprises, is working to integrate the paperwork among doctors, patients and insurers into a Web-based model.

DuPont, based in Wilmington, Del., agreed to underwrite six million months of subscriptions for the more than 100,000 doctors using the Web site’s patient management services. Eventually, doctors who want to continue using WebMD’s services will have to pay for themselves.

Under terms of the deal, WebMD promoted DuPont’s products online and through broadcast and print outlets. The deal was to have expired in March 2004.

The companies began the agreement, which was supposed to last at least five years, in March 1999. Under its terms, DuPont was also the exclusive provider of information on WebMD’s subscription physician service andfree consumer site about prescription drugs, over the counter medicines, nutritional supplements and medical foods.

Analysts said WebMD’s initial success with terminating its revenue-sharing deal with DuPont might be a positive sign for its ability to withdraw from others.

One of the biggest such agreements is with Microsoft, which invested $150 million last year to underwrite physician subscriptions.

``I think they’re realizing that long-term they’re going to need to have physicians buy into their model as opposed to having it subsidized,″ said Bruce Hochstadt, an analyst at Thomas Weisel Partners.

Two weeks ago, DuPont announced that it plans to spin off its DuPont Pharmaceuticals subsidiary.


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