IBM Corp., Armonk, N.Y., announced it will acquire Initiate Systems, Chicago, the provider of record-matching technology to prescription drug and other key national health information network exchange systems and a company that was at least partially owned by the investment arm of the U.S. intelligence community.
Initiate is privately held. Terms of the deal were undisclosed.
Initiate software employs a technique called “probalistic matching” to mathematically calculate the likelihood that a record identified actually belongs to the patient whose records are being sought. Instead of a single patient identifier, the technique uses multiple data fields such as a patient's first and last names, ZIP codes, gender, dates of birth, etc.
The software was at one time used by Surescripts, the largest national prescription drug exchange, to identify patient drug histories. A Surescripts spokesman at deadline could not confirm the company still used Initiate Systems software.
The Markle Foundation, a New York-based think tank for both healthcare IT and the intelligence community, while not mentioning Initiate Systems by name, specified in its Common Framework, a blueprint for structuring regional health information organizations that as a technological baseline, participating healthcare organizations use a centralized record-locator service with probalistic matching to identify patient records.
In 2006, In-Q-Tel, a venture capital firm established by the Central Intelligence Agency to invest in promising technologies that might prove useful to spies, purchased a stake in Initiate Systems. Neither the dollar amount In-Q-Tel invested in Initiate nor the size of the ownership interest the spy agency received were disclosed.
According to Arvind Krishna, general manager of information management, who spoke on a conference call about the acquisition, Initiate software is deployed at 2,400 healthcare sites and is used by 40 health information exchanges. Its customers include the Veterans Affairs Department and drugstore and pharmacy benefits manager CVS Caremark, Krishna said.
Initiate President and CEO Bill Conroy said on the call that the market for what he described as “master data management products” was “exploding” and asked, rhetorically, “Could we, as a small company, keep up with the exploding market?” to which Conroy answered with another question, “Who better than IBM to help us to go global?”
Initiate Systems announced in November 2009 that it had acquired software maker Accenx Technologies.
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