One of's Two Suitors Drops Bid

MillenniumHealth Communications Inc., one of the two companies that announced offers to buy Inc. last week, today said that talks between it and the struggling online medical information provider have broken off.

MillenniumHealth, a Reston, Va.-based company that operates a health care news service and an online marketplace for buying and selling medical equipment, said it held "several serious discussions" about the proposed deal with Drkoop's senior management. But the two companies couldn't reach an agreement, and no further negotiations are planned, MillenniumHealth added.

Officials at Austin, Texas-based Drkoop declined to comment today on the end of the talks. Last week, Drkoop said it was considering MillenniumHealth's offer but noted that it was "highly premature" to predict whether a deal could be reached.

The other offer to buy the company came from, a little-known Beverly Hills, Calif.-based company that's setting up an Internet-based information service for health care professionals. Drkoop was markedly cool toward that bid, saying it had already rejected two earlier proposals from Undertherapy after deciding they weren't "in the best interests of the company or its stockholders."

The two offers came just days after Drkoop warned in a filing submitted to the Securities and Exchange Commission that it expects to report a second-quarter loss on revenue of just $2.5 million to $3 million. The company also said that both its chief operating officer and its chief financial officer were resigning.

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