Competition fears over £1.2bn health software takeover

An initial investigation by the Competition and Markets Authority (CMA) has found UnitedHealth Group’s £1.2bn deal to buy Leeds-headquartered EMIS could harm competition.

The regulator says this could lead to “worse outcomes for the NHS and ultimately patients and UK taxpayers.”

EMIS is a large supplier of data management systems to the NHS. This includes supplying the electronic patient record system used by the majority of NHS GPs in the UK.

Optum, part of the US healthcare giant UnitedHealth, currently supplies software used by GPs when prescribing medicines, as well as data analytics and advisory services that the NHS uses to help improve overall healthcare and health service provision.

A phase one probe by the CMA found competition could be “substantially reduced”, specifically in the Population Health Management and medicines optimisation software markets, which enable the safe and effective use of medicines).

The CMA is concerned the deal could impact services provided by Optum’s competitors.

It explains Optum and its competitors rely on digital connections to the data that EMIS holds, and integrations with EMIS’s electronic patient record system.

The CMA warns Optum could, if the merger went ahead as planned, choose to limit these connections, so the regulator believes this could unfairly undermine competing businesses. The NHS, as the customer of these products, could then face fewer options and higher prices or lower quality offerings.

Sorcha O’Carroll, senior mergers director at the CMA, said: “The NHS and the millions of patients under its care depend on critical behind-the-scenes technology to ensure people are looked after and receive the treatment needed to get better.

“This deal could see the NHS lose out on the benefits of competition, including innovation in these products and services and getting better value for money. UnitedHealth has the opportunity to address our concerns, otherwise it will progress to a more in-depth investigation.”

UnitedHealth and EMIS have five working days to offer legally binding proposals to the CMA to address concerns.

The CMA would then have a further five working days to consider whether this answers its concerns, or if the case should be referred for a more in-depth phase two investigation.

EMIS has today – 17 March – said it will continue to offer its full support to UnitedHealth to obtain the necessary clearance for the acquisition. The business says UnitedHealth now intends to engage with the CMA to try and agree suitable undertakings.