Oracle’s Cerner acquisition – loss for healthcare data privacy?

21 December 2021

Oracle is confirmed to be buying Cerner, which makes software that hospitals use for digital recordkeeping, for US$28.3 billion, the companies announced this week. The acquisition will signal more concrete steps for the tech giant into the healthcare and digital medical records spaces which it already has a sizable footprint in, complementing its other data analytics capabilities.

“Working together, Cerner and Oracle have the capacity to transform healthcare delivery by providing medical professionals with better information — enabling them to make better treatment decisions resulting in better patient outcomes,” Oracle’s Chairman and Chief Technology Officer Larry Ellison said in a statement.

The deal is Oracle’s largest-ever acquisition, and according to the statement will see the company pay US$95 in cash for each share of Cerner, with an expected closing date of the end of next year. Cerner will be a “huge additional revenue growth engine for Oracle for years to come as Oracle expands Cerner’s business into many more countries throughout the world,” the statement said.

Cerner specializes in electronic health records (EHR) and data analytics, with innovations like its Essential Clinical Datasets tool advancing the use of patient data for better clinical outcomes. The company’s specialization raises questions about how the private patient medical data and records would be made available to one of the biggest private technology companies in the world. But the vast majority of EHR in the US is now digitized, and that information is managed or overseen by tech giants is nothing new.

Cerner’s data will run on Oracle’s Gen2 Cloud, with the goal of delivering zero unscheduled downtime to hospitals and medical centers — barring maintenance periods, by running 24 hours a day, every day. But both companies assert licensed medical professionals would be able to access the data. According to Cerner’s own statement on the buyout, “With Cerner systems running on the Oracle database, only specifically authorized medical professionals can access patient data. IT professionals running the systems are unable to look at patient data.”

Oracle is one of the US tech industry’s largest firms, and is worth nearly US$260 billion on Wall Street. Its purchase of Cerner will “provide our overworked medical professionals with a new generation of easier-to-use digital tools that enable access to information via a hands-free voice interface to secure cloud applications,” Ellison said.

Founded in 1979, Cerner makes software to help doctors and nurses keep track of patients’ records at more than 27,500 hospitals and clinics worldwide. The company is based in Kansas City, Missouri, and has more than 28,000 employees.

During keynote remarks at its annual conference in October, Cerner’s new CEO, and former Google Health chief, Dr. David Feinberg said, “Usability of technology is just the beginning, not the true promise of the digital age. Fixing the EHR is our first job. The pipes are laid through 40 years of digitization, which is wonderful. But now we have to make it easier to get the right information to the right people at the right time.”