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CMA concerns over £1.2billion EMIS deal

emis

The Competition and Markets Authority (CMA) believes the proposed takeover of EMIS by UnitedHealth could lead to higher costs for the NHS.

The £1.2bn acquisition was announced last year, with the CMA starting a Phase 1 investigation in January.

Today the CMA stated that the deal could reduce competition “leading to worse outcomes for the NHS and ultimately patients and UK taxpayers.”

Leeds-based EMIS provides healthcare software and systems to 10,000 organisations across the UK.

“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,” said Sorcha O’Carroll, Senior Mergers Director at the CMA.

“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.”

The CMA said it had examined what the deal would mean to the supply of digital and data analytics products to the NHS.

“The CMA is concerned the deal could impact services provided by Optum’s competitors. Optum and its competitors rely on digital connections to the data that EMIS holds, and integrations with EMIS’s electronic patient record system,” read the report.

“Optum could, if the merger went ahead as planned, choose to limit these connections and the CMA 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.”

UnitedHealth and EMIS have 5 working days to offer legally binding proposals to the CMA to address the concerns identified.

Following this, the CMA would have a further 5 working days to consider if these addressed the issues, if not, it will move into a Phase 2 investigation.

In a statement this morning, EMIS said:

“EMIS will continue to offer its full support to Bidco in order to obtain the necessary clearance; and Bidco, with the full support of EMIS, now intends to engage with the CMA with the objective of agreeing suitable undertakings in lieu of a Phase 2 reference. 

“Given the CMA’s procedure for considering and accepting undertakings, EMIS expects to be able to provide a further update on or around 31 March 2023, which is the statutory deadline for the CMA to determine whether the undertakings in lieu of a Phase 2 reference are acceptable in principle.”

“Bidco” is Bordeaux UK Holdings II Limited, an affiliate of Optum Health Solutions (UK) Limited and a wholly-owned subsidiary of UnitedHealth Group Incorporated and EMIS.

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