Investment firm Francisco Partners celebrated the close of its IBM Watson Health assets acquisition by announcing the launch of a new standalone data analytics company.
Called Merative, the Ann Arbor, Michigan-based business aims to offer its health data services to clients ranging from providers, health plans and employers to life sciences firms, imaging companies and government entities, according to the announcement.
Merative said it has six major product lines available off the bat: the Health Insights, MarketScan, Clinical Development, Social Program Management, Micromedex and imaging software offerings previously offered by Watson Health.
Merative is also coming to the table with “significant resources and opportunities for new investment, acquisitions, partnerships and growth” as a result of the investment from Francisco Partners, the companies said in the announcement. Additionally, the new company has picked up investments from True Wind Capital and Sixth Street, according to the announcement.
“Merative has market leading products, top clients and talented leadership,” Gerry McCarthy, the former CEO of eSolutions, president of TransUnion Healthcare and McKesson executive who has been tapped to lead Merative as CEO, said in a statement. “With the commitment, support and deep experience of Francisco Partners, we will invest heavily in expanding the reach of these products as we continue to work with clients to improve healthcare delivery, decision making and performance.”
Paul Roma, who previously served as general manager of Watson Health at IBM, will be transitioning to a senior advisor role at Francisco Partners, according to the announcement.
Francisco Partners has invested in hundreds of technologies companies, highlights among which are Availity, eSolutions, Capsule, GoodRx, Landmark, QGenda, Trellis and Zocdoc.
IBM and Francisco Partners first announced their transaction in January. The companies did not disclose the terms of the deal, although prior reports said IBM was shopping the business unit around in the $1 billion range.
Watson Health was launched in 2015 and was supplemented over time with roughly $4 billion in complementary tech acquisitions.
However, a series of issues surrounding data collection and interoperability hindered IBM’s high-profile AI system from revolutionizing healthcare as promised. IBM executives later acknowledged that the company was too optimistic about its AI’s potential in the sector.