Since the first quarter of 2004, the number of deals has increased by almost half. Still, most health IT merger and acquisition transactions remain relatively small.
In the first quarter of this year, there were 22 merger and acquisition deals for health care information technology companies. That number is an increase of 69 percent over the previous quarter and 47 percent over the same quarter one year ago, according to a recent report from health care market research firm Irving Levin Associates
The total value of the announced deals was $624 million, with only 13 of the 22 announcements releasing the amount of the deal value. The average deal size was about $48 million, with the median at around $11 million.
"A lot of them arent huge deals; people dont have expectations to make millions of bucks overnight," said the report editor, Sanford Steever. The most popular type of deals was with medical record companies because they provide a tangible service, Steever said.
Health care services company WebMD Corp.
and womens content network iVillage Inc.
each snapped up a health IT company to expand the content and tools the companies offer.
In March, WebMD announced its deal to acquire HealthShare Technology
, a company offering Web-based hospital-quality comparison tools, for $36 million in cash and milestone payments. HealthShare works with seven of the top 10 health plans, helping plan members make informed hospital decisions. It brings 85 million members to WebMD, which already serves 20 million consumers and health care professionals through its portal.
Read the full story on CIO Insight: Health IT M&A Grows in Q1