Proving the Business Case for the Internet of Things

Cerner completes $1.3bn acquisition of Siemens Health Services

Steve Rogerson
February 18, 2015
 
Cerner has completed its US$1.3bn acquisition of Siemens Health Services’ assets, client relationships and associates. Cerner and the former Siemens business unit have a combined annual research and development investment of more than $650m.
 
The cumulative resources are expected to speed delivery of the company’s next generation of health IT products, enabling clients to control costs and improve health care outcomes in their communities.
 
“By combining client bases, investments in R&D and associates, we are in a great position to lead clients through one of the most dynamic eras in health care,” said Neal Patterson, CEO and co-founder of Kansas City-based Cerner. “Cerner remains focused on key development areas including population health, physician experience, open platforms, revenue cycle and mobility. We see these as critical areas of investment to ensure providers can meet growing regulatory demands and control costs, while continuing to improve quality of care.”
 
Cerner and Siemens, the former parent company of Siemens Health Services, are also moving forward with a strategic alliance to advance industry innovation. The alliance pairs Cerner’s health IT leadership with Siemens’s device and imaging expertise. Each organisation expects to invest up to $50m during an initial three-year term. The early focus of the alliance is on integrating diagnostics and therapeutics into the electronic health record.
 
“Siemens is a tenured company with a long and respected track record in health care,” said Patterson. “A unique feature of this acquisition is we’ll continue working with Siemens in an R&D capacity, in order to advance the interoperability of electronic health records with medical devices.”
 
Cerner expects revenue in 2015 to be approximately $4.8bn to $5bn, with a client base spanning more than 30 countries across more than 18,000 facilities.
 
“The Cerner client family has grown and so has our team. We’re now more than 21,000 associates strong across a global network, all with the singular focus of advancing the state of the art in health and care,” said Patterson. “We’re assessing the unique business needs of our new clients, and are eager to leverage our combined experience to help them achieve their short-term business goals, and to prepare for what’s on the horizon.”
 
Support for Siemens Health Services core platforms will remain in place. Current implementations will continue, and Cerner will support and advance the Soarian platform for at least the next decade. Cerner says it will work with all clients to support their short-term and long-term business needs.
 
John Glaser, the former CEO of Siemens Health Services, has joined Cerner as a senior vice president and member of the company’s executive cabinet. Glaser will support former Siemens Health Services clients as they transition to Cerner. He will also leverage his health IT background to drive policy, strategic initiatives and market innovations for Cerner.