CMA gives provisional green light to healthcare tech deal

The Competition and Markets Authority announced its decision on 11 August. In a press release it said:

The NHS is increasingly seeking digital and data-driven solutions to help improve the delivery of healthcare in the UK. EMIS supplies data management systems to the NHS, including 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.

While the merging businesses do not supply competing services, Optum and its competitors use the data that EMIS holds and integrate their own software with EMIS’s electronic patient record system to compete in other markets, including the supply of population health management services and medicines optimisation software.

A CMA Phase 1 investigation had identified initial concerns that the merger ran the risk of worse outcomes for the NHS by reducing competition. These concerns have been probed in more detail in a Phase 2 investigation overseen by an independent panel which has now provisionally found the merger does not raise competition concerns.

The investigation confirmed that EMIS, as the lead supplier to NHS GPs across the UK, holds a particularly strong market position in the supply of electronic patient record systems but, further evidence-gathering and analysis found the combination of this position with Optum’s activities should not present competition concerns.

In the supply of population health management services, the independent panel provisionally found that the merged business would not, in practice, be able to use the EMIS business to harm the competitiveness of rivals. This is primarily because the NHS would be able to use its oversight role to prevent the merged business from pursuing this kind of strategy.

In relation to the supply of medicines optimisation software, the independent panel has provisionally found that it would not be commercially beneficial for the merged business to restrict access to EMIS’s electronic patient record system. In particular, a more detailed analysis of the market shows that such a strategy would likely be unprofitable with any possible gains being limited and capable of being reduced through intervention by the NHS.

The CMA's findings are provisional and the agency will now consult on its findings and listen to any further views before reaching a final decision.