Roche buys cancer EHR company Flatiron Health for $1.9B
- Swiss pharma Roche AG on Thursday snapped up oncology EHR company Flatiron Health, paying $1.9 billion to acquire the remaining 87.4% of the privately held tech company not already owned by Roche.
- Backed by both Roche and Alphabet's venture arm GV, Flatiron Health develops real-world data platforms for cancer research in addition to selling EHR software. Flatiron is partnered with over 260 community cancer clinics and 14 of the top 15 cancer companies.
- The companies expect the deal to close in the first half of 2018, from which point Flatiron will continue to operate as a separate legal entity alongside Roche's other business units and divisions.
Roche's deal for Flatiron is a clear signal of the growing usefulness of real-world evidence (RWE) to link therapeutic intervention with health outcomes. Pharma, insurers and regulators alike are exploring how RWE can be used to assess the efficacy of drugs outside of the controlled clinical trial setting as well as to better align payment with value.
Currently, uses of RWE for pharma are mostly limited to supporting efficacy and safety results already tested in clinical study — aiding the case drugmakers can make to insurers for their products. Changes in law, however, will push the FDA to incorporate RWE in its assessment and review of new indications for approved drugs.
And it's clear Roche is thinking ahead to how it can assemble RWE data packages to support regulatory decisions: "This is an important step in our personalized healthcare strategy for Roche, as we believe that regulatory-grade real-world evidence is a key ingredient to accelerate the development of, and access to, new cancer treatments," said Daniel O'Day, head of Roche Pharmaceuticals.
It's difficult pharma companies to create their own networks of information and data, and build teams of skilled data analysts, so deals like Roche to tap ready-made setups make sense. Given Roche's large presence in oncology, acquiring Flatiron looks to be a good fit to support the pharma's therapeutic focus, too.
While Flatiron will now be owned by Roche, the companies made clear its business would remain open to external partners.
"We have a clear mandate and structure to continue to operate industry-wide with all stakeholders and customers as we build a learning healthcare platform for oncology," wrote Flatiron co-founder and CEO Nat Turner in a blog post. "Importantly, this does not change our strategic objectives and our priorities; it only helps us get to the finish line faster."
The acquisition will allow Flatiron to invest further in its provider-facing technology and services platform, and in its evidence-generation platform.
This isn't Roche's first digital oncology deal this year. In January, the company entered a partnership with GE Healthcare to co-develop and co-market clinical decision support tools. Initially, these will be geared towards accelerating and improving individualized treatment options for cancer and critical care patients.
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