The resignation of Jay Gilbertson as chief operating officer of WebMD last week did not surprise analysts who follow the Internet-based healthcare information company.
It's the second time in seven months that Gilbertson, 39, resigned from a high-profile healthcare information services company in the aftermath of a merger. He joined Atlanta-based WebMD in November 1998 after resigning as chief financial officer of Atlanta-based HBO & Co. just before it merged into McKesson Corp. to form McKesson HBOC.
"In my view, this was always a when, not an if," said Benjamin Rooks, a Chicago-based healthcare analyst with CIBC World Markets. "This means they don't have to explain Jay's role with the company (to investors)."
Since Gilbertson's move to WebMD, auditors have found irregularities in the way HBO & Co. recorded millions of dollars in revenues during the time he was CFO, twice announcing restatements that reduced previously reported earnings per share. The merged company's stock has plummeted as a result, and indications are the auditors' work is not finished.
Meanwhile, WebMD announced in May that it would merge with Santa Clara, Calif.-based Healtheon Corp., which meant making room for that company's executives. "It's not uncommon for there to be people displaced" in a major merger, said Seth Frank, a healthcare analyst with Nashville-based SunTrust Equitable Securities Corp.
A WebMD spokesman declined to comment.