Viacom, Medscape Scrap CBSHealthwatch Deal

Following the the termination of the pact, which shuts down the CBSHealthwatch.comsite, Medscape would return of approximately $111 million in outstanding CBS advertising inventory.

By Ryan Naraine

New York-based media conglomerate Viacom Inc. has terminated its two-year deal with Medscape, a move that effectively shuts down the CBSHealthwatch.com site.

Medscape , based in Oregon, said the scrapping of the deal would result in the return of approximately $111 million in outstanding CBS advertising inventory, which carries a book value of approximately $56.6 million.

No reasons were given for the termination of the original deal, which gave Medscape advertising inventory, health news content and trademark license rights in exchange for equity.

As part of the termination, Viacom said it would pay Medscape $10 million in cash and will transfer to Medscape all 4.6 million shares of Medscape stock that it now holds. Viacom also gives up its board seat rights and Andrew Heyward, president of CBS News, will step down from Medscape’s board of directors.

“In addition, Medscape will cease all uses of the CBS logo and trademark and the ‘healthwatch’ trademark after a short transition period. Medscape said its consumer site would be renamed Medscape Health for Consumers. Visitors to CBSHealthwatch.com is being directed to the Medscape site.

All content belonging to CBS, including archives of stories related to CBS News, has been removed from the renamed site.

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