The Competition and Markets Authority has provisionally cleared UnitedHealth’s proposed £1.2 billion purchase of listed HealthTech firm EMIS. This all-cash purchase was approved by shareholders of EMIS Group in August 2022.
Due to both companies providing services to the NHS, the CMA launched a merger inquiry in January 2023. Instead of accepting UnitedHealth’s proposal to divest certain businesses, the CMA chose to launch an in-depth investigation.
EMIS, featured on our HealthTech 50 ranking, currently employs around 1,500 staff. The company supplies data management systems to the NHS, including the electronic patient record system used by the majority of NHS GPs. On the other hand, Optum supplies software used by GPs when prescribing medicines, as well as data analytics and advisory services that the NHS uses to improve overall healthcare and health service provision.
While the merging businesses do not provide competing services, they utilize the data held by EMIS and integrate their software with EMIS’s electronic patient record system to compete in other markets. This includes the supply of population health management services and medicines optimization software.
Following a Phase 2 investigation overseen by an independent panel, it has been provisionally determined that the merger does not raise competition concerns.
In relation to the supply of electronic patient record systems, EMIS holds a strong market position, but further evidence-gathering and analysis found that the combination of this position with Optum’s activities will not present competition concerns.
For the supply of population health management services, the panel has provisionally found that the merged business would not be able to use EMIS to harm the competitiveness of rivals. The NHS’s oversight role would prevent such strategies.
Regarding the supply of medicines optimization software, the panel has provisionally found that it would not be financially beneficial for the merged business to restrict access to EMIS’s electronic patient record system. Detailed market analysis showed that such a strategy would likely be unprofitable, with any potential gains limited and capable of being reduced through NHS intervention.
Kirstin Baker, chair of the independent inquiry panel, emphasized the importance of investigating this deal thoroughly to ensure the NHS continues to benefit from innovation and efficiencies brought about by technology services. After carefully considering a broad range of evidence, the provisional finding is that this deal is not expected to harm competition or adversely affect patients.
The CMA will now consult on the findings and consider any further views before reaching a final decision and issuing a final report on 5th October 2023.
