As the electronic-commerce bandwagon gets rolling in healthcare, a pair of high-profile executives from traditional supply businesses have decided to hop aboard.
James Hersma, 50, has been named executive vice president at Medibuy.com, an Internet start-up based in La Mesa, Calif., MODERN HEALTHCARE has learned. He quit group purchasing giant Novation, Irving, Texas, in February after a year as its first president and chief executive officer (March 1, p. 4).
Separately, Neoforma, another Internet commerce venture based in Santa Clara, Calif., named Robert Zollars as its new chairman, president and CEO late last month. Zollars, 41, was group president at Cardinal Health, Dublin, Ohio, where he oversaw Owen Healthcare, an outsourcer of hospital pharmacy services, and Pyxis Corp., a leading maker of automated pharmacy inventory management systems.
Zollars replaces Jeff Kleck, a founder of Neoforma, who will remain on the board.
The recent appointments of the two industry veterans add luster and credibility to the fledgling companies. Both firms aim to get healthcare purchasers to buy supplies and services over the Internet.
The healthcare industry, never a model of purchasing efficiency, could use some help. Despite the appeal of the Internet as a better purchasing mousetrap, however, these companies must overcome buying traditions, a lack of Internet access at the working level in most hospitals and competing efforts to computerize purchasing by traditional intermediaries such as purchasing groups.
Medibuy, launched last November, uses the Internet to electronically distribute buyers' requests for proposals to multiple suppliers. The service is free to buyers. Vendors pay a fee based on the value of consummated transactions. Its Web site is at www.medibuy.com.
Hersma will be point man in developing relationships with suppliers and key multihospital systems, said Dennis Murphy, Medibuy CEO.
Hersma said the market opportunity for e-commerce is "enormous" and that company management is "strong, excited and focused" to make Medibuy the Internet business-to-business commerce option for healthcare buyers.
Medibuy also conducts on-line auctions. On July 20, Medibuy will auction refurbished medical equipment, valued at about $600,000, following last month's debut of the auction approach.
Neoforma, founded in 1996, has a three-part business strategy.
One leg consists of tools on its Web site to help in architectural design and equipment purchasing. Another offers electronic trading for used and refurbished equipment and surplus supplies. The third is the operation of a standardized electronic catalog for more than 8,000 categories of supplies. Neoforma's Web site is at www.neoforma.com.
"Neoforma is not about trying to shave a nickel from the price of gauze but getting at the process and eliminating cost for the supply chain," Zollars said.
A Cardinal spokesman said Zollars' responsibilities have been shifted to John Kane, president and chief operating officer, on an interim basis while a search for a permanent successor continues.