SMITHKLINE BECKMAN's CORPORATE CONTRACT WITH HCA

Executive Summary

SMITHKLINE BECKMAN's CORPORATE CONTRACT WITH HCA covers three diverse product and service areas: SmithKline Bio-Science Laboratories, Allergan, and Beckman Instruments. Bio-Science will provide Hospital Corporation of America member institutions with clinical lab testing, Allergan will supply ophthalmic medications, and Beckman will provide diagnostic instruments and reagents. The corporate agreement expands on an earlier contract between HCA and Smith Kline & French Laboratories. Under the earlier accord, SmithKline is supplying HCA hospitals with cephalosporin antibiotic products, and Tagamet. While a number of SmithKline's businesses have purchasing contracts with hospitals, the company as a whole has only a few "corporate" alliances involving two or more SmithKline subsidiaries. Under the corporate agreement, SmithKline is designated as the primary supplier for the covered product areas. The firm did not say whether the agreement calls for minimum purchases by HCA. The contract took effect Jan. 1 and will run for three years with an option to renew. The HCA contract was arranged by SmithKline's corporate accounts office, which has been headed since last November by Vice President for Corporate Accounts Ronald Stewart. Since its start up in late 1985, the corporate accounts office has negotiated several other multi-hospital customers, including Humana, Prennier Hospital, Alliance and Universal Health. Stewart is a 23 year SmithKline veteran with a background in marketing and corporate personnel. Before taking over the corporate accounts position, he managed state government affairs for SK&F Labs.