SEC y2k Disclosures and the Health Industries. (Quotes)

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Here are a few snips from the Heath Industry Y2K Disclosures. None of the examples are posted to give examples of likely failures. They are just examples of the challanges to the Health industry. In my previous post with the 10 - Q links I mentioned Texaco had a 15% failure rate in non IT equipment. It appears that it was LILLY ELI & CO. Texaco only had a 5% failure rate reported. My apologies to folks for the mistake.

LILLY ELI & CO - Quarterly Report (SEC form 10-Q)

Snip

The most important non-IT systems are various laboratory and process automation devices. The Company has completed a global assessment of all devices. Based on this assessment, only a small percentage (15 percent) of all automation devices appear to require upgrade or replacement.

 **UNITED HEALTHCARE CORP

Snip

OTHER YEAR 2000 MATTERS NON-INFORMATION TECHNOLOGY SYSTEMS. We have approximately 300 owned or leased facilities throughout the world. Over 50% of our mission critical facilities are compliant. We have contacted all of our facility managers regarding Year 2000 compliance issues. In addition, we have contracted with a real estate management company to assist in our Year 2000 compliance efforts. All mission critical facilities are scheduled to be Year 2000 compliant, or compliant with a work-around process by September 1, 1999.

DEPENDENCE ON THIRD PARTIES. We have a contractual relationship with approximately 300,000 different medical providers and over 92,000 vendors. Over 2,000 vendors have been identified as critical business partners and suppliers. We are currently in communication with these critical business partners to analyze their Year 2000 compliance efforts. We have completed our analysis of corporate critical vendor readiness and continue to identify alternative vendors, where necessary. Individual business units continue to analyze additional vendors for compliance and Year 2000 readiness.

Snip

 PHARMACIA & UPJOHN INC

Snip

Much of the Y2K effort is being supported by a reallocation of existing resources. The company anticipates total spending of $150 million between 1997 and 2000 largely on replacement of applications that, for reasons other than Y2K non-compliance, had been previously selected for replacement. Many of the replacement applications, such as the new SAP financial systems, offer improved functionality and commonality over predecessor systems and, at the same time, resolve the Y2K problem. To date, the company estimates actual spending of approximately $125 million of the total projected costs.

There are many factors beyond the company's control that could cause the Y2K problem to seriously disrupt operations and the company can provide no assurance that these factors will not cause it to experience business disruptions. For example, a widespread failure in the utilities industry could severely interrupt or even halt the company's operations. There are other risks, however, for which the company may prepare and, in so doing, reduce its exposure. These risks include a disruption in the supply of product with particular emphasis on failures of raw material suppliers, third-party manufacturers, and external distribution channels; internal infrastructure failures such as utilities, communications, internal IT services and integrated IT systems; non-U.S. government failures, especially as they impact import and export activity; and major customer failures or interruptions. The scope of the company's efforts regarding these risks is limited to key products, key markets, critical suppliers, and major customers.

 LILLY ELI & CO - Quarterly Report (SEC form 10-Q)

Snip

The most important non-IT systems are various laboratory and process automation devices. The Company has completed a global assessment of all devices. Based on this assessment, only a small percentage (15 percent) of all automation devices appear to require upgrade or replacement. As of June 30, 1999, the Company had completed remediation of approximately 90% of the critical devices which represents 100% of the devices that are available to be fixed. The remaining devices are scheduled for completion throughout the remainder of 1999 during routine scheduled maintenance.

Snip

 JOHNSON & JOHNSON

The Company has completed its review of its critical automated information systems and the remediation phase with respect to such critical systems is substantially complete. Full completion is expected during the fourth quarter of 1999.

The Company is also in the process of reviewing and remediating, where necessary, its other automated systems. The Company has substantially completed the assessment and remediation of all such other automated systems and full completion is expected during the fourth quarter of 1999.

Snip

The Year 2000 readiness of certain major customers is unclear. The Company has established a program to contact major customers to assess their readiness to deal with Year 2000 issues. If a significant number of such suppliers and customers were to experience business disruptions as a result of their of lack of Year 2000 readiness, their problems could have a material adverse effect on the financial position and results of operations of the Company. This analysis of potential exposures includes both the domestic and international operations of the Company. The Company believes that its most reasonably likely "worst case scenario" would occur if a significant number of its key suppliers or customers were not fully Year 2000 functional, in which case the Company estimates that up to a 10 business day disruption in business operations could occur.

Snip

With respect to critical suppliers, these plans may include, among others, arranging availability of substitute sources of utilities, closely managing appropriate levels of inventory and identifying alternate sources of supply of raw materials. The Company is also alerting customers to their need to address these problems, but the Company has few alternatives available, other than reversion to manual methods, for avoiding or mitigating the effects of lack of Year 2000 readiness by major customers. In any event, even where the Company has contingency plans, there can be no assurance that such plans will address all the problems that may arise, or that such plans, even if implemented, will be successful.

Notwithstanding the foregoing, the Company has no reason to believe that its exposure to the risks of supplier and customer Year 2000 readiness is any greater than the exposure to such risk that affects its competitors generally.

Snip

 COLUMBIA HCA HEALTHCARE CORP/ - Quarterly Report (SEC

Snip

The Company is prioritizing its non-IT infrastructure efforts by focusing on equipment and medical devices that will have a direct impact on patient care. The Company is directing substantial efforts to repair, replace, upgrade or otherwise address this equipment and these medical devices in order to minimize risk to patient safety and health. The Company is relying on information that is being provided to it by equipment and medical device manufacturers regarding the Year 2000 status of their products. While the Company is attempting to evaluate information provided by its previous and current vendors, there can be no assurance that in all instances accurate information is being provided. The Company also cannot in all instances guarantee that the repair, replacement or upgrade of all non-IT infrastructure systems will occur on a timely basis or that such repairs, replacements or upgrades will avoid all Year 2000 problems.

The Company has initiated communications with its major third party payers, including government payers and intermediaries. The Company relies on these entities for accurate and timely reimbursement of claims, often through the use of electronic data interfaces. The Company has not received assurances that these interfaces will be timely converted. Because certain payers have refused or are not ready to test with the Company's systems, testing with payers and intermediaries will continue through the end of the year. Failure of these third party systems could have a material adverse effect on the Company's cash flow and results of operations.

Snip

 MILLENNIUM PHARMACEUTICALS INC - Quarterly Report (SEC form 10-Q)

Snip

To date, we have identified aspects of our computer hardware, network infrastructure and business systems that are not Year 2000 compliant. We have obtained and begun to implement vendor recommendations for correcting these deficiencies for identified critical systems and equipment. We have also identified aspects of internally developed software applications that are not Year 2000 compliant and have begun testing and corrective programs in this area. We expect to complete testing and remediation for critical computer hardware, network infrastructure, business systems and internally developed software applications by the end of the third quarter of 1999.

We completed an initial inventory and preliminary risk assessment of critical laboratory and facilities equipment and systems during the first quarter of 1999. We obtained and reviewed vendor provided documentation for these items. We expect to complete testing and any remediation of critical laboratory and facilities equipment by the end of the year.

Snip

-- Brian (imager@home.com), August 15, 1999

Answers

HHHMMMM

To avoid flames it should be 15% compliance issues LILLY ELI & CO have with their automated and process equipment :o)

-- Brian (imager@home.com), August 15, 1999.


Brian, These posts are very important. As a layman, I can't tell you whether y2k is or is not a hoax. But by reading legal documents filed by the largest and most important companies in the world, I can see that THEY say there is a problem with their mission critical systems. THEY say the problem is not fixed. THEY say their critical vendors may not be ready. The remaining period is about 3.5 months plus 3 days. The problem has been around for well over 30 years. The need for a fix has been well recognized for over 10 years and widely recognized those in the field for over 5 years.

Now where does Mr. Koskinen, Clinton's hand-picked Yale educated administrator, get his information that y2k is at most a three day problem. He may be a liar. I apologize to anyone who feels that word should not be part of the English language. Substitute any word that you feel is politically correct.

Now I am not calling Mr. Koskinen a liar. The SEC statements, such as those posted above, would indicate that he is wrong in his assessment, but he may have other information showing these companies really are ready.

But I reserve the right to call him a liar after January 1 if the facts show that his representations were made falsely or with no reasonably reliable supporting evidence.

In the interview with Scott Johnson, Mr. Koskinen said that he's staking his professional reputation on the quality of the fix. That was a great understatement.

-- Puddintame (achillesg@hotmail.com), August 15, 1999.


Puddintame

The Dislosures are handy ways to determine the industry progress - challanges involved. My idea is to get snips from each industry so a wider picture can develope. Funny how such a great resourse is so underutilized. But of course the SEC Filings are for the financial folk and is not set up for the great unwashed. (Me)

-- Brian (imager@home.com), August 15, 1999.


AMERICAN DRUG CO
 
 

In addition,  there is a risk, the  probability of which the Company is not in a
position to estimate, that the transition to the year 2000 will cause wholesale,
perhaps    prolonged,    failures& nbsp;   of    electrical    generation, & nbsp;  banking,
telecommunications  or  transportation  systems in the United  States or abroad,
disrupting the general  infrastructure of business and the economy at large. The
effect of such disruptions on the Company could be material.

The  Company's  various  departments  are  communicating  with  their  principal
customers and vendors about their year 2000  readiness,  and expect this process
to be completed no later than the third  quarter of 1999.& nbsp; None of the responses
received to date suggests that any  significant  customer or vendor  expects the
year 2000 issue to cause an  interruption  in its operations  which would have a
material  adverse  impact on the  Company.  However,  because  so many firms are
exposed to the risk of failure not only of their own systems, but of the systems
of other firms,  the ultimate effect of the year 2000 issue is subject to a very
high degree of uncertainty.

The Company believes that its  preparations  currently under way are adequate to
assess and manage the risks presented by the year 2000 issue,  and does not have
a formal contingency plan at this time.

The  statements in this section  regarding the effect of the year 2000 issue and
the Company's responses to it are forward-looking  statements. They are based on
assumptions  that the Company  believes to be reasonable in light of its current
knowledge and experience.  A number of contingencies  could cause actual results
to differ materially from those described in forward-looking  statements made by
or on behalf of the Company.

-- Brian (imager@home.com), August 16, 1999.


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