For all the Internet's glitter, gold from online sales of healthcare supplies to hospitals and doctors is proving scarce.
Neoforma.com, a brash start-up preparing to raise an estimated $57 million by selling 7 million shares of stock to the public, released its preliminary prospectus just before the new year.
The initial public offering could go to market as soon as the end of this month, Neoforma.com said. If that happens, the company would be the first publicly traded dot-com dedicated to healthcare supply purchasing.
The 130-page stock prospectus offers ample evidence of the vicissitudes of the emerging virtual marketplace.
Neoforma.com lost $25.6 million during the nine months ended Sept. 30, 1999. Sales were miniscule for the Santa Clara, Calif.-based company, which had revenues of $464,000, primarily from fees for online auctions of used equipment and surplus supplies, during the same period.
In August 1999 Neoforma.com started an online market for a wide variety of supplies a la consumer buying sites like Amazon.com. From August through mid-December, though, Neoforma.com's Internet shop garnered just $38,000 in revenues, mostly through sales to doctors.
Company officials said they could not comment on their results or plans, citing the Securities and Exchange Commission's requirement for a quiet period prior to stock offerings.
But the Neoforma.com prospectus warns, "We have a history of losses, anticipate incurring losses in the foreseeable future and may never achieve profitability."