IBM Adds Data With $2.6B Truven Health Deal

The acquisition brings IBM's investment in medical tech companies to $4 billion over the past year.
Matthew HellerFebruary 18, 2016
IBM Adds Data With $2.6B Truven Health Deal

IBM said Thursday it had agreed to acquire Truven Health Analytics for $2.6 billion, adding another major source of data to its Watson Health unit.

Truven Health provides data to hospitals and pharmaceutical companies to help them determine the efficacy of products and services. With the acquisition, IBM expects the Watson Health Cloud will host one of the world’s largest and most diverse collections of health-related data.

“Through the Watson Health Cloud, health-care organizations will be able to take previously disparate data sets, including vast amounts of unstructured data, and combine them together to create unique insights that help inform a broad range of health decisions,” the company said in a news release.

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The acquisition will double the size of Watson Health to 5,000 employees and bring IBM’s investments in medical technology companies to $4 billion over the past year. Other acquisitions include Phytel and Explorys, which maintain clinical data on more than 50 million patients, and Merge Healthcare, which specializes in medical imaging.

“With Truven, as with a number of other recent IBM acquisitions, the prize is data,” the Wall Street Journal said.

Truven, formerly the health-care division of Thomson Reuters, was sold in 2012 to private-equity firm Veritas Capital Fund Management for $1.25 billion. It has more than 8,500 clients for its data, including U.S. federal and state government agencies, employers, health plans, hospitals, clinicians, and life sciences companies.

Truven’s annual “100 Top Hospitals” survey analyzes public data to rank the performance of U.S. hospitals both in terms of their current performance and their rate of improvement.

John Kelly, IBM’s senior vice president of solutions portfolio and research, told the WSJ that much of Truven’s data relates to medical costs, which would fill a hole in the Watson Health product line. “We have all of the major data sets that we need,” he said.