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Philips' recent acquisition of Carestream Health's healthcare information systems gives Philips a bigger piece of the overall health IT market, while giving its customers more imaging tools.
Carestream Health's cloud-based enterprise imaging platform will expand Philips' radiology informatics portfolio for imaging data management, workflow enhancement, and advanced visualization and analysis, according to Philips.
While Philips previously held the third spot in the health IT market, generating around $800 million in health IT revenue, the Carestream Health healthcare information systems (HCIS) acquisition this month adds roughly $300 million to Philips' revenue stream, according to Andrew Thompson, director of therapy research and analysis, medical devices, at industry analytics company GlobalData.
The acquisition puts Philips on par with market leader GE Healthcare and ahead of market leader Fujifilm.
"This acquisition makes them No. 2, possibly No. 1 in the health IT market," Thompson said.
Carestream Health provides medical imaging and health IT products to hospitals, specialty medical clinics and imaging centers. With a strong global business base, Philips is in a position to bring the scale and market presence that could take the HCIS business to a higher level, Carestream Health spokesman Robert Salmon said.
"Philips has a well-known global brand and a loyal customer base," Salmon said. "The HCIS business will really be able to thrive by becoming part of a larger healthcare organization like Philips."
Carestream Health retains medical imaging tech
Philips will feature Carestream Health's enterprise imaging platform -- which includes vendor neutral archive (VNA), diagnostic and enterprise viewers, multimedia reporting, workflow orchestrator and clinical, operational and business analytics tools -- as part of the company's portfolio.
Robert SalmonCommunications director, Carestream Health
Carestream Health will retain its medical imaging, precision coating business, nondestructive testing, and dental and industrial films, according to a Philips news release. By selling the company's HCIS business to Philips, Carestream Health has an opportunity to sharpen its focus on its diagnostic imaging systems and X-ray equipment businesses, Salmon said.
"We're still in the modality business and very much committed to bringing new products to market," he said.
Philips' Healthcare Informatics business will absorb Carestream Health's HCIS business and its approximately 900 employees, according to Philips. The HCIS business will become part of the diagnosis and treatment segment.
Though financial terms have not been disclosed, Salmon said the sale is expected to close in the second half of 2019.