IBM to Acquire Initiate Systems

Feb. 4, 2010

Armonk, NY – February 3, 2010 – IBM (NYSE:  IBM) today announced it has signed a definitive agreement to acquire Initiate Systems, a market leader in data integrity software for information sharing among healthcare and government organizations.   Initiate’s software helps healthcare clients work more intelligently and efficiently with timely access to patient and clinical data. It also enables governments to share information across multiple agencies to better serve citizens.  

Initiate Systems is a privately held company based in Chicago, IL  and marks the 30th acquisition IBM has made to advance its capabilities in information and analytics.  Financial details were not disclosed.  

Healthcare organizations and governments around the world today are embarking on new initiatives to improve healthcare and citizen safety.  In healthcare, this means finding ways to simultaneously improve health outcomes and efficiency of care.  In government,  this means providing better services to citizens in a more cost effective manner by combining information from multiple agencies such as child welfare and veterans’ programs.
A key requirement for all such initiatives is proper management and delivery of trusted and accurate information.  With the stimulus funding that is being invested around the globe, the number of these transformational projects is accelerating.  

Unmatched Technologies and Expertise for Improving Patient Care

In healthcare, hospitals, integrated delivery networks, insurers and governments are seeking to create systems that share a consistent view of all critical information as a means of improving both patient health and efficiency. Bringing together data from separate systems managed by hospitals, doctors’ offices and payers is a daunting task.  Initiate has helped clients meet this challenge at more than 2,400 healthcare sites, over 40 health information exchanges and multiple government health systems around the world.  

The software speeds the adoption and exchange of electronic medical records.  With easier access to accurate information, medical professionals can recognize patients at any facility within a health network with access to complete medical histories of patients, resulting in more timely and better informed patient care.  Like IBM, Initiate is committed to industry standards and its technologies support relevant healthcare regulations and standards including HL7 and HIPAA.

“With the addition of Initiate’s software and its industry expertise, IBM will offer clients a comprehensive solution for delivering the information they need to improve the well-being of patients at a lower cost,” said Arvind Krishna, general manager, Information Management, IBM.  “Similarly, our government clients will now have even more capabilities for gathering and making use of information to serve citizens in a timely and efficient manner.”  

Initiate’s healthcare clients include payers and providers as well as retailers selling prescription drugs.  Among these clients are Alberta Ministry of Health and Wellness, BMI Healthcare (UK), Calgary Health Region, CVS/Caremark, Humana, Ochsner Health System, the State of North Dakota’s Department of Health and Human Services and the University of Pittsburgh Medical Center.

For example, Sutter Health, a not-for-profit network of doctors and hospitals serving more than 100 communities in Northern California, is using Initiate’s technology to link its entire health network with accuracy and flexibility to enhance patient safety, customer satisfaction, and the efficiency of business operations.

Helping Government Agencies Make the Most of Their Budget

Initiate’s technology is also widely used to help government agencies of all sizes use information to boost efficiency.  Government agencies are stymied at times because they have no easy way to access pertinent information across multiple systems.  In combination with IBM InfoSphere software, Initiate software will expand capabilities for information governance and help agencies gain a single view of relevant information to better serve citizens.

For example, the North Dakota Department of Human Services (DHS) — which helps vulnerable residents of all ages with critical services such as Medicaid and child welfare programs — turned to Initiate to help it create a single view of all the citizens it serves.   Like other government agencies, DHS’s information on citizens was dispersed across numerous data silos.  DHS is now using technology to access a single view of all its clients, allowing the agency to share information across its many programs to increase citizen enrollment, speed the process of determining eligibility and more accurately measure program effectiveness.

“Our clients will be the ones who benefit most from this acquisition,” said Bill Conroy, president and chief executive officer, Initiate Systems.  “They will continue to get the software and expertise they depend on, plus the incalculable advantage they will gain through IBM’s global reach and its capabilities in enterprise software, hardware and services.”

Expands InfoSphere and Cognos Software for Integrating and Analyzing Information

Consistent with the company’s strategy, IBM will continue to support and enhance Initiate’s technologies while helping clients take advantage of the broader IBM portfolio.  Customers will benefit from additional information management capabilities including: clinical analytics, information discovery and transformation and data warehousing and business intelligence.  

IBM’s acquisition of Initiate extends the company’s business analytics strategy, including the range of offerings available through IBM’s recently-announced Business Analytics and Optimization Consulting organization which includes a team of 4,000 consultants, a network of analytics solution centers, and is backed by an overall investment of more than $10 billion in organic growth and acquisitions.

The transaction is subject to customary closing conditions and regulatory clearance and is expected to close in the first quarter of 2010.   IBM intends to integrate the Initiate organization with its Information Management business after the closing.

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