Dive Brief:
- According to industry rumors, EMR giant Cerner may be looking into the possibility of acquiring Siemens Healthcare's health IT division, an EMR vendor that didn't increase market share last year.
- Siemens won't comment publicly on the idea, though it dropped a hint in its Q2 interim report, noting that "healthcare will be separately managed in the future" and that it planned to bundle its current 16 divisions into nine larger ones. Cerner has also refused to discuss its plans.
- Even for a giant like Cerner, which has 14,200 employees worldwide and booked $3.77 billion in revenues last year, an acquisition of this size would be a major step.
Dive Insight:
As Cerner continues to battle for market share, most notably with fellow EMR giant Epic Systems, it has to do something to step up its game. While Siemens' EMR may not have a huge market share, it does have large customers, and Siemens Healthcare has extremely strong brand in other critical areas of healthcare technology investment, such as medical devices. What's more, acquiring the SH health IT division would make Cerner the #1 vendor over fellow giant McKesson in revenue, according to one estimate.
But Cerner would be taking a big risk in picking up the division, which is rumored to be valued at $1.4 billion. Merely bulking up isn't enough to win hospitals' business,and integrating the sprawling new acquisition could take some time, undercutting Cerner's agility in the field. All in all, it will be intriguing to see how this plays out.
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