The European Commission has given NHS IT services provider CSC the clearance to acquire Australian healthcare software supplier iSOFT.
The $188 million (£116 million) transaction would mainly affect the UK market, where the CSC has a highly troubled £3.1 billion contract with the NHS for the National Programme for IT. iSOFT provides the patient administration software that CSC is installing under the NPfIT.
The move means that CSC, which runs NHS IT in North and central England under the troubled National Programme for IT, will acquire the maker of the patient administration software it is installing.
After examining the acquisition under the EU Merger Regulation, the EC concluded that the merger: “would not significantly reduce competing IT service providers’ access to healthcare software in particular in the UK, where the merging parties’ market shares are the highest.”
The EC found that there was a “sufficient” number of alternative healthcare software developed by iSOFT competitors for CSC competitors to partner with.
It also said that CSC still faced strong competition from alternative IT service providers, such as BT.
“In the UK market, the proposed transaction will not restrict competing healthcare software providers’ access to a sufficient customer base, due to the sophistication and buyer power of customers of CSC healthcare IT services which maintain a high degree of discretion as to their healthcare software provider,” the EC said in a statement.
A prominent MP on the Public Accounts Committee (PAC) recently joined analysts in saying that the NHS should tear up its £3.1 billion contract with CSC.
CSC has delivered patient record systems in three acute hospital settings in nine years under the National Programme for IT, prompting calls for it to be fired. The company insisted it has set the “foundations” for the future.
However, NHS Connecting for Health is expected to sign a new deal soon with CSC that could be worth about £2.5 billion.