Neoforma.com and Novation Reach Target Ahead of Schedule; 79 Hospitals Representing $2 Billion in Purchases Sign Up with Marketplace@Novation
SAN JOSE, Calif. & IRVING, Texas--(BW HealthWire)--Sept. 7, 2000-- Neoforma.com, Inc. (Nasdaq:NEOF) and Novation today announced the addition of 39 new healthcare facilities, bringing to 79 the number of hospitals signed to purchase supplies through Marketplace@Novation(TM), the online purchasing solution powered by Neoforma. This figure exceeds Neoforma's goal to have 56 hospitals signed onto Marketplace@Novation before year end.
The 79 healthcare organizations that have aligned themselves with Marketplace@Novation represent more than $2 billion in annual medical supply purchases. These healthcare organizations have committed a minimum of 50 percent of their total supply purchases to Marketplace@Novation.
Of the 79 hospitals that have joined to date, 56 are members of VHA Inc. and 22 are members of the University HealthSystem Consortium (UHC), the two healthcare alliances that own Novation. In addition, one healthcare organization that purchases supplies through HealthCare Purchasing Partners International(TM), a group purchasing company owned by VHA and UHC, has signed up to use Marketplace@Novation.
"The fact that it is early September and we have already substantially exceeded our hospital sign up goal for the year is a true testament to the services offered by Marketplace@Novation," said Bob Zollars, chairman, president and chief executive officer of Neoforma. "Decision makers at hospitals and other healthcare facilities across the country have realized the significant benefits of procuring through this private marketplace and are enthusiastically anticipating the benefits that online purchasing will offer them."
"We recognized the purchasing solution provided by Neoforma and Novation as the best fit for our facility," said David Pindroh, director of materials management at University of California, Davis, Health System. "We are excited to enter the era of Internet-based procurement and believe that Marketplace@Novation will offer the most efficient and effective means to do so."
Each of the 39 new hospitals will be individually integrated into Marketplace@Novation, allowing each organization to utilize the Marketplace's contracting, procurement and supply chain solutions, while leveraging the healthcare organization's existing information systems technology without jeopardizing its established trading relationships. The first wave of hospitals is in the technology integration process and will go live in early November. The next wave of hospitals will go live in early December.
"We are delighted by all the activity surrounding Marketplace@Novation: the rapid stream of hospital sign ups, as well as the integration and implementation work by Neoforma," said Mark McKenna, president of Novation. "We began the year with the mission to introduce online purchasing to members, and I'm pleased to see that mission quickly becoming reality."
In May 2000, Neoforma signed an exclusive 10-year amended agreement to provide e-commerce procurement solutions for Novation, the largest supply cost management company in healthcare. In conjunction with this agreement, the two companies established Marketplace@Novation. In related agreements, VHA Inc. and the University HealthSystem Consortium, the owners of Novation, also purchased ownership interests in Neoforma.
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