Looks like WebMD may need its own doctor.
The company announced today that its president and CEO Wayne T. Gattinella resigned from the health-care-information company, according to a story by Tess Stynes at the Wall Street Journal.
And its projected revenue will come in as much as two to eight percent lower than 2011, with most of the declines in the first half of the year, according to Stynes, with analysts projecting “revenue growth of one percent for next year,” according to the story.
That’s not the worst of it. WebMD also expects expenses will rise as much as five percent to eight percent.
The company also said it is no longer for sale.
Stynes reports that the company predicted lower revenue for 2012, due to a “pharmaceutical industry patent cliff (that) is taking a greater-than-expected toll on advertising and sponsorship product sales.”
Another reason for WebMD’s ill health, according to Stynes, is the stiff competition it’s facing in its consumer-products segment from a variety of ad networks and social-networking websites, including Facebook.
CBS News talked to Citi analyst Mark S. Mahaney, who said he saw the leadership change “as a negative for the company.” CBS News reports that he said in a research note that he had long considered Gattinella to be "a very capable executive.”
Another reason for WedMD’s distress? According to Tom Taulli at investorplace.com, the company “is facing downward pressure on its advertising revenues. For the most part, the big pharma operators have been pulling back on spending because of smaller new-drug pipelines, regulatory constraints and the sluggish economy.”
No reason was given for Gattinella's resignation, according to Stynes, and chief financial officer and chief operating officer Anthony Vuolo will head the company until a permanent successor is found, according to Stynes.
WebMD bills itself as “the leading source for trustworthy and timely health and medical news and information,” according to its Web site, covering everything from weight loss to ovulation predictors to what you should stay away from you’re allergic to peanut butter. It was one of the first healthcare information sites.
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Deborah DiSesa Hirsch is an award-winning health and technology writer who has worked for newspapers, magazines and IBM in her 20-year career. To read more of her articles, please visit her columnist page.Edited by
Rich Steeves
