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Medscape has healthy IPO
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September 28, 1999: 4:49 p.m. ET
Online medical info provider jumps 72 percent on long-awaited stock launch
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NEW YORK (CNNfn) - Shares of Medscape Inc. rose as much as 113 percent on Tuesday, as the Web site for doctors made its initial public offering, jumping despite a crowd of Net health care players.
New York- based Medscape (MSCP) closed at 13-11/16, up 72 percent, after it priced at $8 per share, within the expected range. Soon after it opened, the shares leapt as high as 17-1/16.
A total 29 million shares traded -- more than four times the total offering of 6.75 million shares. The lead underwriter was Donaldson, Lufkin & Jenrette.
Medscape, founded in 1996, like many Internet firms has yet to make a profit. But the company is 35-percent owned by TV network CBS Corp. (CBS), which has agreed to spend about $150 million to promote cbs.medscape.com, a separate site.
The Internet medical site also has agreed to pay America Online Inc. a total of $30 million over two years -- in addition to $3 million already paid -- next three years as the online service feeds traffic to the Medscape site.
On June 30, the site had 1.2 million registered users. The company plans to launch a co-branded site with AOL in the fourth quarter 1999 or early in 2000.
The IPO comes in the wake of other high-profile medical sites such as drkoop.com (KOOP). But also inhabiting the space is Healtheon (HLTH), an Internet software firm, which recently bought private online medical information provider WebMD.
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Medscape
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