Oracle Acquires EHR Vendor Cerner for $28.3 Billion in Equity

Tech giant Oracle will acquire EHR vendor Cerner through an all-cash tender offer for $95.00 per share, or approximately $28.3 billion in equity.

"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," Larry Ellison, chairman and chief technology officer of Oracle, said in a press release.

"With this acquisition, Oracle's corporate mission expands to assume the responsibility to 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 continued.

Ellison said that the EHR vendor acquisition will usher in a “new generation of medical information systems” which is set to address clinician burden, improve patient privacy and outcomes, and lower overall healthcare costs.

The transaction is expected to close in calendar year 2022, subject to receiving certain regulatory approvals and satisfying other closing conditions.

"Cerner has been a leader in helping digitize medical care and now it's time to realize the real promise of that work with the care delivery tools that get information to the right caregivers at the right time," said David Feinberg, Cerner president and chief executive officer.

"Joining Oracle as a dedicated Industry Business Unit provides an unprecedented opportunity to accelerate our work modernizing our EHR, improving the caregiver experience, and enabling more connected, high-quality and efficient patient care.”

Officials noted that the acquisition should support continuous development and modernization of the EHR through Oracle’s cloud. Additionally, with Cerner systems running on the Oracle database, only specifically authorized medical professionals will be able to access patient data.

"Oracle's Autonomous Database, low-code development tools, and Voice Digital Assistant user interface enables us to rapidly modernize Cerner's systems and move them to our Gen2 Cloud," said Mike Sicilia, executive vice president of vertical industries at Oracle. "This can be done very quickly because Cerner's largest business and most important clinical system already runs on the Oracle Database.”

Oracle's focus on usability and voice enabled user interfaces is set to reduce the amount of time that medical providers spend dealing with health IT systems and increase the time they spend on patient care delivery.

“We will make Cerner's systems much easier to learn and use by making Oracle's hands-free Voice Digital Assistant the primary interface to Cerner's clinical systems,” Sicilia added. “This will allow medical professionals to spend less time typing on computer keyboards and more time caring for patients."    

Officials said that Oracle intends to maintain and grow Cerner's community presence, including in the Kansas City area, while utilizing Oracle's global footprint to reach new regions faster.

In an emailed statement to EHRIntelligence, Natalie Schibell, a senior analyst at Forrester, noted that the acquisition's success will be primarily determined Oracle’s cloud-first strategy. 

"The pandemic brought to light the fragmentation of care in healthcare systems and the persistent problem of disparate, siloed data," Schibell pointed out. "Hospitals have a complex web of electronic health record vendors as the average health system has 18. There is also a lack of interoperability frameworks across the industry that prevents clinicians from getting a 360-degree view of patients throughout the care continuum.

An Oracle-Cerner deal would require Oracle to push the throttle on Cerner’s move to the cloud to drive a new paradigm of data-driven healthcare," she added. "A forward-thinking cloud strategy must underpin data-sharing with interoperable data that is maintained on a longitudinal care record and exchanged securely. Leveraging the power of data is just important as keeping it secure. As Oracle attempts to make a bigger footprint in the health care sector, its investment in cybersecurity must also exponentially grow.”