Allscripts plans to expand its foothold in the EHR market by acquiring McKesson Corporation’s health IT businesses, the company announced on Thursday.
Allscripts will pay $185 million in cash for McKesson’s enterprise information solutions portfolio, which includes the company’s EHR platform, revenue cycle management solution and laboratory analytics, according to the announcement. Allscripts CEO Paul M. Black said the acquisition would increase the company’s scale and “further drive our investment in innovation.”
“The healthcare IT market remains highly fragmented,” he added. “Today’s announcement is a proactive and strategic measure to maintain Allscripts long-term leadership and position Allscripts for continued growth.”
The announcement comes after Allscripts reported its highest ever quarterly bookings totaling $407 million in the second quarter of 2017, 12% higher than the second quarter of 2016.
McKesson Chairman and CEO John H. Hammergren noted in the announcement that Allscripts “can serve the long-term interests of our customers,” praising the company for its “experience and capabilities to deliver value through its population health, precision medicine, consumer and care management solutions.”
The deal is scheduled to close in the fourth quarter of 2017 following a waiting period under U.S. antitrust laws. Allscripts indicated it plans to continue offering McKesson’s integrated EHR and revenue cycle management platform, Paragon, for the small hospital market. Allscripts' EHR platform, Sunrise, will continue serving larger hospital systems.