IBM pays $2.6 billion for Truven Health Analytics

IBM Corp.is building the analytical muscle of its Watson Health unit with a .6 billion acquisition of medical data company Truven Health Analytics announced Thursday. The deal is expected to be completed later this year, they said.

IBM bought Phytel, Explorys and Merge Healthcare before Truven. The acquiree will subsequently be incorporated in the IBM Watson Health division.

Meanwhile Truven’s team, including clinicians, epidemiologists, statisticians, healthcare administrators, policy experts and healthcare consultants, will be joining the IBM business unit.

This makes IBM’s fourth major health data acquisition in less than 12 months, totaling more than $4 billion, the company said. That way, healthcare providers are paid to keep people healthy and help improve the condition of people living with chronic conditions like diabetes in an evidence-based way.

Truven, owned by Veritas Capital, is a provider of cloud-based healthcare data analytics, with 8,500 clients ranging from U.S. federal and state agencies to hospitals, health plans, clinics, life science companies, and employers. Its data inform benefit decisions for one in three Americans, according to the copmanies’ press release. “Truven’s impressive team, extensive client roster, and expansive data sets complement Watson Health’s broad-based team, capabilities and offerings”.

The deal will double the size of IBM’s IBM, +5.11% Watson Health business unit to 10,000 employees as the company adds new technology services to sell to doctors and hospitals. While traditional health systems have paid for volume based on a fee-for-service model, value-based care models use payment incentives that aim to advance quality outcomes at lower cost. Watson Health has a wealth of data on clinical studies and patient engagement, as well as the ability to read and analyze the literature. “It’s about expertise”, said Dr. Anil Jain, vice president of IBM Watson Health. It has also partnered with Apple, Medtronic, Johnson & Johnson, Teva Pharmaceuticals, Novo Nordisk, and CVS Health.