WBMD » Topics » Product Development, Marketing and Related Arrangements

This excerpt taken from the WBMD DEF 14A filed Nov 5, 2008.
Product Development, Marketing and Related Arrangements
 
On January 31, 2006, HLTH and WebMD entered into agreements to support each other’s product development and marketing of certain product lines. The parties agreed that WebMD would, in general, manage the product development and marketing of HLTH’s and WebMD’s product lines in the following areas:
 
  •  online tools and applications that are displayed to physicians and consumers that provide “quality” ratings of providers and that analyze patient care (we refer to these types of applications as External Clinical Quality Applications); and
 
  •  online tools and applications that are displayed to end-user consumers, plan members and/or patients to assist in (a) communicating with, or viewing information from, providers or payers, (b) making informed benefit, provider and/or treatment choices, through access to content, personal health records, plan comparison tools, benefit comparison tools, cost treatment indicators, calculators, etc. or (c) managing and utilizing consumer-directed health plans and the related health savings accounts and other consumer directed financial accounts (we refer to all of these types of applications as Consumer-Directed Applications).
 
The agreements provided that HLTH could continue to develop and market products and services principally provided for internal use by healthcare payers. The provisions of these agreements applicable solely to relationships between HLTH and WebMD have been terminated. However, in connection with the EPS Sale, the 2006 EBS Sale and the 2008 EBS Sale, separate agreements were entered into with EPS and EBS with respect to certain matters under those agreements, and the separate agreements continue in effect with respect to the following products and services:
 
  •  EPS has agreed to continue its relationship with WebMD to exclusively integrate WebMD’s personal health record with EPS’s clinical products, including EPS’s electronic medical record.
 
  •  EBS has agreed to continue its strategic relationship with WebMD and to offer WebMD the opportunity to provide EBS with External Clinical Quality Applications and Consumer Directed Applications subject to mutual agreement on certain terms. In addition, if WebMD determines to pursue a Consumer Directed Application for the financial administration of the patient encounter, such as clinical


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  messaging or a personal financial record, and requests EBS to assist WebMD in that regard, WebMD and EBS have agreed to use reasonable efforts to integrate and market such applications. In addition, EBS agreed to license certain de-identified data to HLTH for use in the development and commercialization of certain applications. In the Termination Agreement relating to the merger with HLTH, HLTH agreed to assign this license to WebMD.
 
These excerpts taken from the WBMD 10-K filed Apr 29, 2008.
Product Development, Marketing and Related Arrangements
 
On January 31, 2006, HLTH and WebMD entered into agreements to support each other’s product development and marketing of certain product lines. The parties agreed that WebMD would, in general,


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manage the product development and marketing of HLTH’s and WebMD’s product lines in the following areas:
 
  •  online tools and applications that are displayed to physicians and consumers that provide “quality” ratings of providers and that analyze patient care (we refer to these types of applications as External Clinical Quality Applications); and
 
  •  online tools and applications that are displayed to end-user consumers, plan members and/or patients to assist in (a) communicating with, or viewing information from, providers or payers, (b) making informed benefit, provider and/or treatment choices, through access to content, personal health records, plan comparison tools, benefit comparison tools, cost treatment indicators, calculators, etc. or (c) managing and utilizing consumer-directed health plans and the related health savings accounts and other consumer directed financial accounts (we refer to all of these types of applications as Consumer-Directed Applications).
 
The agreements provided that HLTH could continue to develop and market products and services principally provided for internal use by healthcare payers. The provisions of these agreements applicable solely to relationships between HLTH and WebMD have been terminated. However, in connection with the EPS Sale and the 2006 EBS Sale and 2008 EBS Sale, separate agreements were entered into with EPS and EBS with respect to certain matters under those agreements, and the separate agreements continue in effect with respect to the following products and services:
 
  •  EPS has agreed to continue its relationship with WebMD to exclusively integrate WebMD’s personal health record with EPS’s clinical products, including EPS’s electronic medical record.
 
  •  EBS has agreed to continue its strategic relationship with WebMD and to offer WebMD the opportunity to provide EBS with External Clinical Quality Applications and Consumer Directed Applications subject to mutual agreement on certain terms. In addition, if WebMD determines to pursue a Consumer Directed Application for the financial administration of the patient encounter, such as clinical messaging or a personal financial record, and requests EBS to assist WebMD in that regard, WebMD and EBS have agreed to use reasonable efforts to integrate and market such applications. In addition, EBS agreed to license certain de-identified data to HLTH for use in the development and commercialization of certain applications.
 
Product
Development, Marketing and Related Arrangements



 



On January 31, 2006, HLTH and WebMD entered into agreements
to support each other’s product development and marketing
of certain product lines. The parties agreed that WebMD would,
in general,





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manage the product development and marketing of HLTH’s and
WebMD’s product lines in the following areas:


 


























  • 

online tools and applications that are displayed to physicians
and consumers that provide “quality” ratings of
providers and that analyze patient care (we refer to these types
of applications as External Clinical Quality
Applications); and
 
  • 

online tools and applications that are displayed to end-user
consumers, plan members
and/or
patients to assist in (a) communicating with, or viewing
information from, providers or payers, (b) making informed
benefit, provider
and/or
treatment choices, through access to content, personal health
records, plan comparison tools, benefit comparison tools, cost
treatment indicators, calculators, etc. or (c) managing and
utilizing consumer-directed health plans and the related health
savings accounts and other consumer directed financial accounts
(we refer to all of these types of applications as
Consumer-Directed Applications).


 



The agreements provided that HLTH could continue to develop and
market products and services principally provided for internal
use by healthcare payers. The provisions of these agreements
applicable solely to relationships between HLTH and WebMD have
been terminated. However, in connection with the EPS Sale and
the 2006 EBS Sale and 2008 EBS Sale, separate agreements were
entered into with EPS and EBS with respect to certain matters
under those agreements, and the separate agreements continue in
effect with respect to the following products and services:


 


























  • 

EPS has agreed to continue its relationship with WebMD to
exclusively integrate WebMD’s personal health record with
EPS’s clinical products, including EPS’s electronic
medical record.
 
  • 

EBS has agreed to continue its strategic relationship with WebMD
and to offer WebMD the opportunity to provide EBS with External
Clinical Quality Applications and Consumer Directed Applications
subject to mutual agreement on certain terms. In addition, if
WebMD determines to pursue a Consumer Directed Application for
the financial administration of the patient encounter, such as
clinical messaging or a personal financial record, and requests
EBS to assist WebMD in that regard, WebMD and EBS have agreed to
use reasonable efforts to integrate and market such
applications. In addition, EBS agreed to license certain
de-identified data to HLTH for use in the development and
commercialization of certain applications.


 




This excerpt taken from the WBMD DEF 14A filed Aug 14, 2007.
Product Development, Marketing and Related Arrangements
 
On January 31, 2006, HLTH and WebMD entered into agreements to support each other’s product development and marketing of certain product lines. The parties agreed that WebMD would, in general, manage the product development and marketing of HLTH’s and WebMD’s product lines in the following areas:
 
  •  online tools and applications that are displayed to physicians and consumers that provide “quality” ratings of providers and that analyze patient care (we refer to these types of applications as External Clinical Quality Applications); and
 
  •  online tools and applications that are displayed to end-user consumers, plan members and/or patients to assist in (a) communicating with, or viewing information from, providers or payers, (b) making informed benefit, provider and/or treatment choices through access to content, personal health records, plan comparison tools, benefit comparison tools, cost treatment indicators, calculators, etc. or (c) managing and utilizing consumer-directed health plans and the related health savings accounts and other consumer directed financial accounts (we refer to all of these types of applications as Consumer-Directed Applications).
 
The agreements provided that HLTH could continue to develop and market products and services that are principally provided for internal use by healthcare payers and that provide clinical quality measures of physicians, hospitals and providers, and analytics and reporting to such payers on the quality of patient care (we refer to these types of applications as Internal Clinical Quality Services) and that WebMD may develop and market its own Internal Clinical Quality Services and that WebMD may, but is not required to, sell HLTH’s Internal Clinical Quality Services. The parties have also agreed to work together to try to develop certain other products and services.
 
In connection with the EPS Sale, HLTH, WebMD and EPS amended the existing arrangements applicable to EPS, including by placing the provisions relating to EPS in a separate agreement. In the separate agreement, EPS agreed to continue its relationship with WebMD to exclusively integrate WebMD’s personal health record with its clinical products, including its electronic medical record.
 
In connection with the EBS Sale, HLTH, WebMD and EBS amended the existing arrangements applicable to EBS, including by placing the provisions relating to EBS into separate agreements. In the separate agreements, EBS agreed to continue its strategic relationships with WebMD and to market WebMD’s online decision-support platform and tools that support consumer directed health plans and health savings accounts to its payer customers for integration into their consumer directed health plan offerings. In addition, EBS agreed to license certain de-identified data to HLTH and its subsidiaries, including WebMD, for use in the


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development and commercialization of certain applications that use clinical information, including consumer decision-support applications.
 
Following the amendments described above, HLTH and WebMD continue to be parties to a Business Services Agreement. The terms of this agreement, which will remain in effect until January 2011, unless terminated earlier in accordance with its terms, include the following:
 
  •  External Clinical Quality Applications.  HLTH will provide a perpetual license to WebMD of HLTH’s External Clinical Quality Applications. In addition, WebMD will be permitted to develop, market and sell its own or other third party External Clinical Quality Applications. During the term of this Agreement, HLTH will not provide External Clinical Quality Applications as stand-alone products other than through WebMD; provided, however, that HLTH will be permitted to offer External Clinical Quality Applications to its potential or current payer customers in connection with the integration of External Clinical Quality Applications with other HLTH core services. During the term of this agreement, WebMD will pay HLTH a 20% royalty on net sales of HLTH’s External Clinical Quality Applications (or, in particular instances, other mutually agreed on royalties). In addition, if WebMD requires customization or incremental development of an HLTH External Clinical Quality Application in connection with a potential sale, and/or if WebMD needs assistance in resolving a performance issue regarding an HLTH External Clinical Quality Application, HLTH will charge WebMD customary rates for such assistance. The pricing pursuant to which WebMD will make the HLTH External Clinical Quality Applications available to an HLTH customer will be competitive with the pricing it provides to other similar customers purchasing substantially the same products at the same volume or commitment levels. Upon termination of the agreement, HLTH has agreed to provide WebMD with a copy of the underlying source code and documentation for the External Clinical Quality Applications so that WebMD may continue to use the perpetual license to such products.
 
  •  Internal Clinical Quality Applications.  HLTH may make available to WebMD customers HLTH’s Internal Clinical Quality Services for integration with WebMD’s products and services. The pricing pursuant to which HLTH will make HLTH’s Internal Clinical Quality Services available to WebMD customers will be competitive with the pricing it provides to other similar customers purchasing substantially the same products at the same volume/commitment levels. WebMD may also develop and sell its own Internal Clinical Quality Services or license and work with third parties for such services. HLTH will pay WebMD a 10% sales commission on net sales of HLTH’s Internal Clinical Quality Services by WebMD.
 
  •  Consumer-Directed Applications.  HLTH has, in general, agreed that WebMD will manage the product development and marketing of Consumer-Directed Applications and that, except as described below, HLTH will not make such applications available itself or through a third party, other than in conjunction with WebMD.
 
  —  If HLTH identifies a need for a Consumer-Directed Application in order to support a business requirement related to the marketing of its core services, HLTH will first present WebMD with the opportunity to meet HLTH’s requirement. If WebMD elects not to pursue this opportunity or if, after electing to do so, fails to meet the applicable delivery schedule, HLTH may pursue that opportunity through a third party or on its own, on substantially the same terms. For each Consumer-Directed Application provided to HLTH, WebMD is paid the greater of: (a) WebMD’s cost plus 50%; or (ii) WebMD’s established market price for such product (which price will be competitive with the pricing WebMD provides to other similar customers purchasing substantially the same products at the same volume/commitment levels). In addition, if HLTH sells the Consumer-Directed Application to a third party, HLTH will pay WebMD a 10% royalty on net sales of the application.
 
  —  In addition, WebMD and HLTH have agreed to work together to develop a potential Consumer Directed Application that may provide information regarding the potential cost of care or financial responsibility for individual medical and/or drug claims. HLTH has agreed that any such product developed that provides a patient or plan member view as to the portion of the cost of care for


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  which the patient or plan member is responsible shall be provided through WebMD, and during the term of this agreement, HLTH will not make such product available itself or through a third party other than in conjunction with WebMD. If HLTH and WebMD develop such product, they have agreed to negotiate an equitable allocation between the parties of the sales price for such product.
 
  —  The provisions of the agreement relating to Consumer-Directed Applications do not apply to certain HLTH products and services, including services provided by VIPS under contracts with the United States government and/or state governments.
 
This excerpt taken from the WBMD 10-K filed Apr 30, 2007.
Product Development, Marketing and Related Arrangements
 
On January 31, 2006, Emdeon and WebMD entered into agreements to support each other’s product development and marketing of certain product lines. The parties agreed that WebMD would, in general, manage the product development and marketing of Emdeon’s and WebMD’s product lines in the following areas:
 
  •  online tools and applications that are displayed to physicians and consumers that provide “quality” ratings of providers and that analyze patient care (we refer to these types of applications as External Clinical Quality Applications); and


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  •  online tools and applications that are displayed to end-user consumers, plan members and/or patients to assist in (a) communicating with, or viewing information from, providers or payers, (b) making informed benefit, provider and/or treatment choices, through access to content, personal health records, plan comparison tools, benefit comparison tools, cost treatment indicators, calculators, etc. or (c) managing and utilizing consumer-directed health plans and the related health savings accounts and other consumer directed financial accounts (we refer to all of these types of applications as Consumer-Directed Applications).
 
The agreements provided that Emdeon could continue to develop and market products and services that are principally provided for internal use by healthcare payers and that provide clinical quality measures of physicians, hospitals and providers, and analytics and reporting to such payers on the quality of patient care (we refer to these types of applications as Internal Clinical Quality Services) and WebMD may develop and market its own Internal Clinical Quality Services and it may, but is not required to, sell Emdeon’s Internal Clinical Quality Services. The parties have also agreed to work together to try to develop certain other products and services.
 
In connection with the EPS Sale, Emdeon, WebMD and EPS amended the existing arrangements applicable to EPS, including by placing the provisions relating to EPS in a separate agreement. In the separate agreement, EPS agreed to continue its relationship with WebMD to exclusively integrate WebMD’s personal health record with its clinical products, including its electronic medical record.
 
In connection with the EBS Sale, Emdeon, WebMD and EBS amended the existing arrangements applicable to EBS, including by placing the provisions relating to EBS into separate agreements. In the separate agreements, EBS agreed to continue its strategic relationships with WebMD and to market WebMD’s online decision-support platform and tools that support consumer directed health plans and health savings accounts to its payer customers for integration into their consumer directed health plan offerings. In addition, EBS agreed to license certain de-identified data to Emdeon and its subsidiaries, including WebMD, for use in the development and commercialization of certain applications that use clinical information, including consumer decision-support applications.
 
Following the amendments described above, Emdeon and WebMD continue to be parties to a Business Services Agreement. The terms of this agreement, which will remain in effect until January 2011, unless terminated earlier in accordance with its terms, include the following:
 
  •  External Clinical Quality Applications.  Emdeon will provide a perpetual license to WebMD of Emdeon’s External Clinical Quality Applications. In addition, WebMD will be permitted to develop, market and sell its own or other third party External Clinical Quality Applications. During the term of this Agreement, Emdeon will not provide External Clinical Quality Applications as stand-alone products other than through WebMD Health; provided, however, that Emdeon will be permitted to offer External Clinical Quality Applications to its potential or current payer customers in connection with the integration of External Clinical Quality Applications with other Emdeon core services. During the term of this agreement, WebMD will pay Emdeon a 20% royalty on net sales of Emdeon’s External Clinical Quality Applications (or, in particular instances, other mutually agreed on royalties). In addition, if WebMD requires customization or incremental development of an Emdeon External Clinical Quality Application in connection with a potential sale, and/or if WebMD needs assistance in resolving a performance issue regarding an Emdeon External Clinical Quality Application, Emdeon will charge WebMD customary rates for such assistance. The pricing pursuant to which WebMD will make the Emdeon External Clinical Quality Applications available to an Emdeon customer will be competitive with the pricing it provides to other similar customers purchasing substantially the same products at the same volume or commitment levels. Upon termination of the agreement, Emdeon has agreed to provide WebMD with a copy of the underlying source code and documentation for the External Clinical Quality Applications so that WebMD may continue to use the perpetual license to such products.
 
  •  Internal Clinical Quality Applications.  Emdeon may make available to WebMD customers Emdeon’s Internal Clinical Quality Services for integration with WebMD’s products and services. The pricing pursuant to which Emdeon will make Emdeon’s Internal Clinical Quality Services available to WebMD


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  customers will be competitive with the pricing it provides to other similar customers purchasing substantially the same products at the same volume/commitment levels. WebMD may also develop and sell its own Internal Clinical Quality Services or license and work with third parties for such services. Emdeon will pay WebMD a 10% sales commission on net sales of Emdeon’s Internal Clinical Quality Services by WebMD.
 
  •  Consumer-Directed Applications.  Emdeon has, in general, agreed that WebMD will manage the product development and marketing of Consumer-Directed Applications and that, except as described below, Emdeon will not make such applications available itself or through a third party, other than in conjunction with WebMD.
 
  —  If Emdeon identifies a need for a Consumer-Directed Application in order to support a business requirement related to the marketing of its core services, Emdeon will first present WebMD with the opportunity to meet Emdeon’s requirement. If WebMD elects not to pursue this opportunity or if, after electing to do so, fails to meet the applicable delivery schedule, Emdeon may pursue that opportunity through a third party or on its own, on substantially the same terms. For each Consumer-Directed Application provided to Emdeon, WebMD is paid the greater of: (a) WebMD’s cost plus 50%; or (ii) WebMD’s established market price for such product (which price will be competitive with the pricing WebMD provides to other similar customers purchasing substantially the same products at the same volume/commitment levels). In addition, if Emdeon sells the Consumer-Directed Application to a third party, Emdeon will pay WebMD a 10% royalty on net sales of the application.
 
  —  In addition, WebMD and Emdeon have agreed to work together to develop a potential Consumer Directed Application that may provide information regarding the potential cost of care or financial responsibility for individual medical and/or drug claims. Emdeon has agreed that any such product developed that provides a patient or plan member view as to the portion of the cost of care for which the patient or plan member is responsible shall be provided through WebMD, and during the term of this agreement, Emdeon will not make such product available itself or through a third party other than in conjunction with WebMD. If Emdeon and WebMD develop such product, they have agreed to negotiate an equitable allocation between the parties of the sales price for such product.
 
  —  The provisions of the agreement relating to Consumer-Directed Applications do not apply to certain Emdeon products and services, including services provided by VIPS under contracts with the United States government and/or state governments.
 
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