Athenahealth Acquires Epocrates: What it Means for Physicians

The announcement that athenahealth, one of the nation's largest providers of revenue cycle management and EHR services to physician practices, will acquire the well-known mobile health vendor Epocrates was described today by observers as a likely sign of things to come in an evolving health IT market.

"Generally speaking, I think you're going to see a lot of activity like this in the future. There's going to be some degree of consolidation in the future," Bruce Kleaveland a health IT consultant, told Physicians Practice.

Kleaveland said the move would have benefits for both companies, and will probably benefit users, too.

 "I think that certainly for athenahealth, it will be a good thing in the sense that Epocrates has done a really nice job on the e-prescribing side of things. And it's good for Epocrates in that it gives them a really nice partnership with a major vendor," he said. "There's always the question of whether it's good for the customers. I don't see any negative to them. These are both high quality companies."

Watertown, Mass.-based athenahealth agreed to pay about $293 million for San Mateo, Calif.-based Epocrates. In an interview with Physicians Practice, athenahealth CEO Jonathan Bush said it targeted Epocrates because of the company's huge name recognition with the physician community, which dwarfs his own company's.

"Epocrates is the most [well]-known, most trusted brand [among] doctors of the United States," he said. "We're at about 30 percent awareness; they're at about 90 percent awareness. Our ability to parlay that trusted brand into what athenahealth does just so doctors know we exist and what we do - that's a huge breakthrough."

Bush noted that while Epocrates has had huge success with its app and mobile technology, it has struggled with building an EHR. Under the acquisition, athenahealth clients who use Epocrates will enjoy a better experience: Currently, doctors on athenaClinical leave athenaClinical to open Epocrates and e-prescribe. With Epocrates technology fused into the athenahealth platform, physicians will be able to do everything in one place.

"There's no one that manages healthcare information across platforms like we do," said Bush. "What we're trying to do is line up our abilities against those of Epocrates so doctors can continue throughout the entire spectrum of care."

Athenahealth is likely to benefit from name recognition for the Epocrates app, which as of August was used by 338,000 U.S. physicians to call up summaries on drugs, including side effects and interactions, Bloomberg News reported.

Brad Boyd, a consultant with Culbert Healthcare, said Epocrates' signature mobile technology service will nicely augment athenahealth's service offering.

"Athenahealth's done a nice job of making investments in companies that are well established and brand spanking new," Boyd told Physicians Practice. "There's a couple of avenues where athenahealth can get value out of it … to leverage new entry points or get access to a broader customer base."