Early last week, Optum announced that it would buy Alere’s health management business in a $600M cash deal. With this spin-out, the vision of Ron Zwanziger – Alere’s founder and former CEO – to create a comprehensive PHM platform that extended from devices, through IT infrastructure and care management services has come to an end.
This announcement has three implications for the market at large:
1. The market is simply not ready to sole-source such a significant, complete PHM platform from any one vendor. There are too many moving pieces, too many legacy apps, services and tools already adopted and many question marks remain as to just how big PHM will become to make such a big bet this early.
2. Vision is great, but being able to effectively execute on today’s more mundane market needs is critical to keep investors from getting overly anxious and involved.
3. Optum continues to effectively use the cash spill-over from UHG to remain acquisitive. While this acquisition will likely see more internal business from UHG than outside, Optum continues to aggressively build out its portfolio and more acquisitions are assured.