Intermountain sells supply chain management business to Vizient

By | November 6, 2020

Dive Brief:

  • Vizient will purchase Intalere, Intermountain Healthcare’s supply chain management business, for an undisclosed sum, the parties announced Thursday. The deal is expected to close in the first quarter of next year. Intermountain will work with Vizient moving forward on its supply chain management.
  • The deal is likely intended to streamline the rambling operations of Intermountain, which is both the dominant hospital operator and health insurer in Utah. Last year, it spun off a company intended to create value-based programs for providers.
  • The deal adds to Vizient’s portfolio, and gives the Texas-based company another way to collaborate with other healthcare organizations whose ongoing operations are reliant on data collection and analytics.

Dive Insight:

Vizient has been a well-known company known for its data analytics. However, it’s taking a big step from consulting with healthcare organizations to actual management with this announcement.

“This acquisition builds on the strengths of both Vizient and Intalere and furthers our ability to meet the growing needs of the increasingly diverse range of members and customers we serve,” Vizient CEO Byron Jobe said in a statement.

Vizient entered into 19 agreements with healthcare providers during the first half of this year, the company said. Last year it entered into a significant deal with Civica Rx to monitor drug costs and availability.

Having its own supply chain arm could prove crucial for Vizient’s future growth. The need to ship and manage supplies has become particularly important as hospitals have merged into integrated healthcare systems that often have to keep dozens of acute care facilities, clinics and doctors supplied on an ongoing basis.

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Group purchashing organizations have become increasingly important as a result, particularly given the pressures from COVID-19 and the impending flu season. And even Amazon is trying to get into the healthcare business, although it has had more success procuring non-clinical supplies. Vizient itself is a spinoff of the VHA group purchaser.

At the same time, Intermountain, which operates 28 hospitals in two states, will likely use the opportunity to focus more on its acute care services while farming out a critical component of its operations — and no longer have to worry about growing it as well.

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