Philips to Acquire VISICU

The $430 million deal will grow Philips' technology presence in U.S. hospitals.

Royal Philips Electronics announced Dec. 20 it will acquire VISICU, a provider of patient monitoring systems in a deal worth $430 million. The sale is set to close in the first quarter of 2008 and comes only two weeks after Philips announced it would acquire Emergin, another clinical IT company that specializes in medical alarm software.

Martha Dolan, director of clinical care at Philips, said the acquisitions of VISICU, based in Baltimore, and Emergin, based in Boca Raton, Fla., will allow Philips to have a much stronger presence in more hospitals and that the technology would give nurses and physicians the ability to monitor and care for more Intensive Care Unit patients.

"VISICU's eICU technology allows one caregiver to monitor as many as 100 patients at the same time," Dolan said. A VISICU spokesperson said that currently one of their customers reported the technology allowed them to achieve a ratio of one caregiver to 135 patients. Dolan said that the average ratio was between 5 and 35 patients per caregiver, depending on the type of hospital, the location and the staff levels.

With an eICU facility linked via telemedicine and computer monitors to their hospital ICU rooms' intensive care teams are able to use software alerts to track patient vital trends and intervene earlier—before complications occur.

Dolan said the merger will also help increase the number of hospitals and ICUs using the VISICU technology. VISICU currently has 200 installations in U.S. hospitals, although neither company could disclose growth targets. The VISICU spokesperson said that Philips' extensive market presence will allow the firm to expand its technology focus to clinical areas other than the ICU, such as the emergency room, the neonatal intensive care unit and also to geographic areas outside the United States.

Philips currently carries approximately a 40 percent market share in the estimated $3 billion worldwide patient monitoring market, analysts said, and Dolan estimated the company currently has patient monitoring systems in place in about 4,000 U.S. hospitals.

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