BREAKING: IBM to Acquire Merge Healthcare for $1B | Healthcare Informatics Magazine | Health IT | Information Technology Skip to content Skip to navigation

BREAKING: IBM to Acquire Merge Healthcare for $1B

August 6, 2015
by Rajiv Leventhal
| Reprints

The Armonk, N.Y.-based IBM has just made a big move in the area of advanced image analytics, announcing that it has acquired the Chicago-based Merge Healthcare, a provider of software for managing and processing medical images, for $1 billion.

Merge's technology platforms are used at more than 7,500 U.S. healthcare sites, as well as at leading clinical research institutes and pharmaceutical firms around the world to manage a growing body of medical images. The vision is that these organizations could use the IBM Watson Health Cloud to surface new insights from a consolidated, patient-centric view of current and historical images, electronic health records (EHRs), data from wearable devices and other related medical data, in a HIPAA-enabled environment, according to an IBM news release on the announcement. Watson will gain the ability to “see” by bringing together Watson’s advanced image analytics and cognitive capabilities with data and images obtained from Merge Healthcare, IBM officials say.

“As a proven leader in delivering healthcare solutions for over 20 years, Merge is a tremendous addition to the Watson Health platform.  Healthcare will be one of IBM’s biggest growth areas over the next 10 years, which is why  we are making a major investment to drive industry transformation and to facilitate a higher quality of care,” John Kelly, senior vice president, IBM Research and Solutions Portfolio, said in a statement. “Watson’s powerful cognitive and analytic capabilities, coupled with those from Merge and our other major strategic acquisitions, position IBM to partner with healthcare providers, research institutions, biomedical companies, insurers and other organizations committed to changing the very nature of health and healthcare in the 21st century. Giving Watson ‘eyes’ on medical images unlocks entirely new possibilities for the industry.”

In April, when the new Watson Health unit was launched, IBM said, “IBM Watson Health is creating a more complete and personalized picture of health, powered by cognitive computing. Now individuals are empowered to understand more about their health, while doctors, researchers, and insurers can make better, faster, and more cost-effective decisions.” It was at that time when IBM said it was acquiring both the Dallas-based Phytel and the Cleveland-based Explorys, in a combination that senior IBM executives said held great potential for the leveraging of data capabilities to transform healthcare.

Now, with this acquisition, Merge's clients could compare new medical images with a patient's image history as well as populations of similar patients to detect changes and anomalies. Insights generated by Watson could then help healthcare providers in fields including radiology, cardiology, orthopedics and ophthalmology to pursue more personalized approaches to diagnosis, treatment and monitoring of patients, IBM officials say.

Under terms of the transaction, Merge shareholders would receive $7.13 per share in cash, for a total transaction value of $1 billion, according to IBM officials. The closing of the transaction is subject to regulatory review, Merge shareholder approval, and other customary closing conditions, and is anticipated to occur later this year.

Get the latest information on Health IT and attend other valuable sessions at this two-day Summit providing healthcare leaders with educational content, insightful debate and dialogue on the future of healthcare and technology.

Learn More

Topics

News

Survey: Infrastructure, Interoperability Key Barriers to Global HIT Development

A new survey report from Black Book Research on global healthcare IT adoption and records systems connectivity finds nations in various phases of regional electronic health record (EHR) adoption. The survey results also reveal rapidly advancing opportunities for U.S.-based and local technology vendors.

Penn Medicine Opens Up Telehealth Hub

Philadelphia-based Penn Medicine has opened its Center for Connected Care to centralize the health system’s telemedicine activities.

Roche to Pay $1.9B for Flatiron Health

Switzerland-based pharmaceutical company Roche has agreed to pay $1.9 billion to buy New York-based Flatiron Health Inc., which has both an oncology EHR and data analytics platform.

Financial Exec Survey: Interoperability Key Obstacle to Value-Based Payment Models

Momentum continues to grow for value-based care as nearly three-quarters of healthcare executives report their organizations have achieved positive financial results from value-based payment programs, to date, according to a new study from the Healthcare Financial Management Association (HFMA).

Cerner, Children's National to Help UAE Pediatric Center with Health IT

Al Jalila Children's Specialty Hospital, the only pediatric hospital in the United Arab Emirates, has entered into an agreement with Washington, D.C.-based Children's National Health System to form a health IT strategic partnership.

Telemedicine Association Names New CEO

The American Telemedicine Association (ATA) has named Ann Mond Johnson its new CEO, replacing Jon Linkous who stepped down suddenly last August after 24 years as the organization’s CEO.