IBM Watson Health to Acquire Truven Health Analytics for $2.6B

Watson Health, IBM’s artificial intelligence computer system. has announced plans to acquire Ann Arbor, Mich.-based Truven Health Analytics, a provider of cloud-based healthcare data, analytics and insights, for $2.6 billion.

According to IBM officials, Truven will bring more than 8,500 clients, including U.S. federal and state government agencies, employers, health plans, hospitals, clinicians and life sciences companies, to the IBM Watson Health portfolio. Upon completion of the acquisition later this year, IBM’s health cloud will house one of the world’s largest repositories of health-related data, representing an aggregate of approximately 300 million patient lives acquired from three companies, its officials said. IBM plans to integrate Truven’s cloud-based data set spanning hundreds of different types of cost, claims, quality and outcomes information with its existing data sets.

Indeed, Truven Health Analytics represents IBM’s fourth major health-data related acquisition since launching the Watson Health unit in April 2015, following Phytel (population health), Explorys (cloud-based healthcare intelligence) and Merge Healthcare (medical imaging).

Upon close, IBM will have invested more than $4 billion to acquire and build an array of cognitive healthcare capabilities intended to help professionals improve health outcomes, control costs, and advance value-based care solutions, officials said. 

“With this acquisition, IBM will be one of the world’s leading health data, analytics and insights companies, and the only one that can deliver the unique cognitive capabilities of the Watson platform,” Deborah DiSanzo, general manager for Watson Health, said in a statement. “Truven’s impressive team, extensive client roster, and expansive data sets complement Watson Health's broad-based team, capabilities and offerings. Together, we’re well positioned to scale globally and to build first-in-class offerings designed to help our clients apply cognitive insights in a value-based care environment.”

In the 2015 HCI 100, a ranking of the 100 vendors with the highest revenues derived from healthcare IT products and services earned in the U.S. based on revenue information from the previous year, Truven Health Analytics came in 26^th with a reported HIT revenue of nearly $545 million.