AMICAS is finding a new opportunity in the midst of misfortune.
The Boston-based provider of radiology and medical image and information management solutions is poised to acquire Emageon, Inc., for roughly $39 million. The deal is designed to boost AMICAS’ presence in the large hospitals and IDN market, but it probably never would have happened if not for the very public collapse of the Stanford International banking empire.
Following a year-long public sale process, Atlanta-based Emageon, which provides IT systems for hospitals, healthcare networks and imaging facilities, was to be acquired by New York-based Health Systems Solutions for roughly $62 million. That deal fell through in February, however, when HSS couldn’t get the backing from its financing firm, Stanford International Bank. Just days later, federal investigators swooped in and shut down the Stanford empire amid charges of fraud.
AMICAS, which had been identified as a potential buyer along with HSS, then stepped in and negotiated a deal.
Once completed, the combined AMICAS-Emageon will offer radiology and cardiology PACS and information systems, revenue cycle management systems, referring physician tools, business intelligence tools and enterprise content management capabilities, as well as a shared client base of more than 1,000 customers.
“It’s an issue of scale,” said Paul Merrild, AMICAS’ vice president of marketing, who will lead the project to integrate the two companies. “AMICAS needs to be a larger organization to compete with the big guys, so to speak. … This is a good deal for us.”
“Emageon and AMICAS are two of the largest independent image and information management companies in the market,” said Chuck Jett, Emageon’s president and CEO. “We believe that the combined companies will be able to capitalize more fully on the opportunities in the industry by combining our resources, scale, and knowledge.”
“Emageon’s significant market presence in providing radiology and cardiology IT solutions to large IDNs complements AMICAS’ comprehensive solutions for radiology practices, imaging centers, and hospitals,” said Stephen Kahane, MD, AMICAS’ president, CEO and chairman. “Together, we have a presence in virtually every location where imaging services are provided to patients. We will be able to offer a comprehensive set of solutions to meet virtually every image and information management need healthcare providers have when they are delivering the best quality of healthcare possible to their patients – while managing their business in an optimal manner.”
Merrild said the deal, which is expected to be completed sometime this month, will allow the company to take advantage of a large hospital and IDN market that’s in flux, looking to replace outdated legacy systems with best-of-breed solutions.
“We believe that hospitals like the best-of-breed approach to imaging,” he said. “They’ll want a strong, independent provider that is really, really focused.”
The merger hasn’t stopped AMICAS from pursuing other contracts. The company announced on March 4 a deal to integrate its PACS product with Epic’s Radiant RIS at the Monroe Clinic, a Monroe, Wis.-based not-for-profit health system that includes a multi-specialty clinic and hospital with more than 80 providers, home dare and hospice services and 10 clinics in southern Wisconsin and northern Illinois.
