By all known laws of natural selection, Drkoop.com probably should have been put to rest a long time ago.
After all, it was way back in March 2000 that the beleaguered online healthcare site -- which declared bankruptcy this week -- first joined the ranks of the dot-com living dead, when a Barron's magazine study ranked the company seventh in a list of 207 cash-burning firms on the brink of running out of funds. Barron's estimated that the site only had enough cash to stay afloat for three months.
Even Drkoop itself painted its odds for survival in dismal tones back then. In April 2000, it warned investors that unless fresh funding came in, the firm was on track to run out of cash in four months.
But somehow -- contrary to nearly everyone's projections -- Drkoop didn't die with the first round of dot-com flameouts.
In the months that followed its dire warning to investors, the firm named after former U.S. Surgeon General C. Everett Koop managed to finagle emergency funding, bring on to a new CEO, and reconfigure its business into a hybrid online and offline venture that was structured to be less dependent on the erratic flow of advertising dollars.
Somehow, it clung to life support until this week, when the company announced it had run out of options for reinventing itself and was planning to file for Chapter 7 bankruptcy.
"Efforts to obtain additional financing and sell certain of its assets have not been successful," the company explained in press release published Sunday night. As a result, the release concluded, Drkoop will be closing down.
The news was not exactly a shocker for analysts who were still following the company.
"I'm surprised it took so long coming," said Stacey Rich, an analyst at Jupiter/Media Metrix who follows the online healthcare business. "They've teetered on the brink of survival several times, and at each point they managed to raise capital."
Rich says that Drkoop's fame was probably a double-edged sword for the struggling firm. As one of the first large healthcare sites to debut on the Web, Drkoop gained advantage from its association with the famed ex-surgeon general whose name it bears.
But the company gambled unwisely in 1999, when it inked a couple of flashy deals with larger sites to build up traffic. In the first deal, signed in April 1999, Drkoop agreed to pay Disney's Internet division a total of $57.9 million over three years in exchange for the privilege of being designated the premier provider of healthcare information on its sites. Three months later, the company entered a similar, four-year agreement with America Online for $89 million.
Like a lot of Internet companies doing business at the height of the dot-com boom, Drkoop had expected to make its money through selling advertising on its network of healthcare information sites.
But when the advertising dollars dried up, that plan quickly turned stale. Drkoop renegotiated its agreements with AOL and Disney in April 2000, in an attempt to cut ballooning expenses.
This year, the company branched off into offline business in an attempt to turn profitable. It dropped the dot-com, renamed itself Dr Koop LifeCare Corp, and purchased assets in August of a company called Ivonyx Group Services, which provides in-home intravenous therapy. The company also launched a line of Dr. Koop-branded health supplements.
But those efforts weren't enough to cure Drkoop's longstanding financial woes. In the course of its operating history, the company had run up cumulative losses of $207 million. In its most recent quarter, which ended Sept. 30, Drkoop reported $3.2 million in revenue and a net loss of $4.5 million.
As it prepares for bankruptcy proceedings, Drkoop told shareholders that it doesn't expect to have any money left over for them, once it liquidates its assets.
Investors, for their part, seem to be taking Drkoop's word.
The stock dropped 92 percent Monday, closing at a minuscule seven-tenths of one cent per share.
