Microsoft Acquires Azyxxi Software to Step Into Healthcare
Microsoft announced yesterday that it has agreed to acquire the health intelligence software Azyxxi and to forge a strategic alliance with MedStar Health. Azyxxi was first deployed in 1996 in the emergency department of one of MedStar Health’s hospitals, Washington Hospital Center, in Washington, D.C. Azyxxi acts as a repository for all of a patient’s routine clinical information and provides caregivers with instant access to a comprehensive view of each patient including ECGs, scanned documents, X-rays, CT scans, MRI scans, PET scans, dynamic angiograms and ultrasound images. Azyxxi is being acquired by Microsoft for an undisclosed amount from two technology companies, Datomics Licensing and General Datomics, founded by Azyxxi’s creators. MedStar Health was a co-owner of General Datomics.
Drs. Feied and Iskandar, along with approximately 40 employees from the development team at Washington Hospital Center, will join Microsoft and continue to work on research and future enhancements to the product. Dr. Smith will remain as chairman of the emergency medicine department at Washington Hospital Center and will also serve as chief clinical liaison to Microsoft. The product is built on top of Microsoft components such as its SQL Server database as was documented in this case study two years ago. Its goal is to put an end to disconnected “data islands” within hospitals. (see this Washington Post article from last year for more backstory.) In other news Microsoft reported its FY2006 financial results on July 20.
Microsoft has historically been a platform player rather than a vertical software provider. The New York Times quotes Dr. Thomas J. Handler, a health technology analyst at IT specialist Gartner as saying: “This puts Microsoft in the uncomfortable position of potentially competing against its major customers.” Peter Neupert, the company’s Corporate Vice President for Health Strategy acknowledges this shows the beginning of a new strategy. Neupert worked in various capacities at Microsoft from 1987 to 1998. He left to serve as president and CEO then chairman of Drugstore.com between 1998 and 2004. He then served on President Bush’s Information Technology Advisory Committee (PITAC) from 2003 to 2005, to finally come back to Microsoft last year.
There is no public roadmap yet of Azyxxi’s future as a Microsoft product. HospitalBuyer is betting on the release of a package named “Microsoft Healthcare Server Patient Repository Data Mining Edition 2008″ about two years from now. More seriously, this product seems to be able to act more as an interconnection layer rather than a direct competitor to existing systems used by hospitals, which would make sense as a Microsoft product.
Related entry: Medical Device Makers Respond to Market Pressure to Innovate.
July 27, 2006 Related topics: Mergers & Acquisitions, IT & software