By Joe Hoppe

 

The U.K. competition regulator's initial investigation into UnitedHealth Group Inc.'s 1.24 billion-pound ($1.50 billion) deal to buy EMIS Group PLC could reduce competition, leading to worse outcomes for the National Health Service and patients and taxpayers, it said Friday.

The Competition and Markets Authority said the deal to combine the healthcare software and data specialists could lead to lower quality and more expensive software options for the NHS.

In particular, competition could be substantially reduced in the so-called population health management and medicines-optimization software markets, which enable the safe and effective use of medicines, the CMA said.

EMIS said in a statement that it continues to offer its full support to the takeover in order to obtain the necessary clearance, and it will engage with the CMA together with the offeror with the objective of agreeing suitable undertakings, instead of a Phase 2 investigation referral.

The takeover offer was first disclosed in June, and was made by Bordeaux UK Holdings II Ltd., an affiliate of Optum Health Solutions (UK) Ltd., and subsidiary of UnitedHealth.

The CMA is concerned the deal could affect services provided by Optum's competitors, as they rely on digital connections to the data EMIS holds, and integrations with EMIS's electronic patient record system.

If the merger went ahead as planned, Optum could choose to limit these connections and undermine competitors, the CMA said.

UnitedHealth and EMIS have five working days to offer legally binding proposals to address the concerns. The CMA then has five further working days to consider the proposals, or if the case should be referred to a further investigation.

EMIS said it expects to provide the market an update around March 31.

 

Write to Joe Hoppe at joseph.hoppe@wsj.com

 

(END) Dow Jones Newswires

March 17, 2023 04:07 ET (08:07 GMT)

Copyright (c) 2023 Dow Jones & Company, Inc.
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