EHR Supplier Base in EMEA Consolidates
Published: January 13, 2021
Written by Alex Green, Cranfield, UK, 13th January 2021 – Two trends defined the European EHR market in 2020, the impact of COVID-19 and the level of M&A activity that has occurred amongst the EHR supplier base.
On the first point, the EHR market across Europe, and EMEA in general, has fared better than the two other global regions (the Americas and Asia) in 2020 according to Signify Research’s just published market report EHR/EMR in Acute and Ambulatory Applications – World – 2021. Whereas the Americas market is estimated to have declined in 2020, driven by particularly tough market conditions in the US where contracts and rollouts were delayed due to COVID-19, the market in EMEA has accelerated slightly. It is estimated the EMEA market was worth $3.9B in 2020 (up by 4.4% on 2019).
This has been driven by several government led initiatives in Europe that have supported market growth. For example, the extension of the Telematics Infrastructure (TI) implementation in Germany to the acute sector (soon to be amplified by additional investment relating to the Hospital Futures Act), the continued development of GHT procurement in France and the NHS Long Term Plan in the UK, to name just a few. Reaction to the COVID-19 pandemic has also driven some additional market growth, particularly in the ambulatory EHR market as telehealth solutions were rapidly rolled out to primary care providers, in many cases using modules provided by incumbent EHR vendors.
That is not to say there have not been challenges that have hampered market growth in EMEA, and there have been several new EHR implementations that have been pushed back, such as in parts of the Nordics. However, the region has performed better than the Americas which has seen a decline, largely driven by delays in new EHR implementations and rollouts in the US acute market, and the US market’s reliance on a largely private provider customer base which has been financially hit hard due to significant reductions in areas such as elective procedures.
The second major trend in Europe, that of supplier consolidation, has seen several shake-ups which have changed the complexion of vendor market shares across the region. This includes:
- Dedalus’ acquisition of Agfa’s HCIS business in early 2020. The complexion is likely to be further changed in 2021 as it also merges DXC’s Provider Healthcare business into its portfolio (announced in July 2020 and expected to be completed during the first half of 2021). Note the combined Dedalus/Agfa HCIS market share is shown in the table below. However, DXC is kept separate.
- CompuGroup Medical’s (CGM) acquisition of parts of Cerner’s non-Millennium/i.s.h.med European business in February 2020, specifically much of the business in DACH, France and Spain. This is not reflected in the 2019 market share table below as the deal took place in 2020. However, it has resulted in CGM significantly increasing its EMEA share at the expense of Cerner in 2020, despite some significant recent wins for Cerner in the Nordics and the Middle East.
- The merger of two of the largest EHR vendors in the Nordics, Tieto and EVRY, which was completed at the end of 2019 (the combined estimated EHR revenues of the two companies are included in the table below).
Examining the competitive environment in several major countries/sub-regions in EMEA:
The acute market in UK/Eire is served by many suppliers with Cerner, InterSystems, iMDsoft, System C, Allscripts, Epic and DXC Technology having the largest share of acute trust business in the UK in 2019 and MEDITECH, DXC Technology and Cerner dominating Eire. A different set of vendors serve the primary care market with Emis, TPP, Cegedim (Vision Health) and Clan William having the largest shares, partly due to some regionalised procurement.
The French market is highly fragmented with Dedalus (including the legacy Agfa business), Maincare Solutions, MiPiH, CEGI, SIB and Softway Medical having the largest share of the acute market in 2019. CGM is likely to rise up the rankings in 2020 following its acquisition of Cerner’s French EHR business. Cegedim, Image Edition and Sephira are the leading primary care EHR vendors. Dedalus, CGM, InterSystems, Maincare, Pharmagest and Softway Medical are set to consolidate their position to some extent going forward, having been contracted in 2020 to supply the core IT of the computerised patient records (DPI) element of the GHT initiative.
The DACH region (Germany, Austria, Switzerland) has seen the most change in terms of the competitive environment in 2020 owing to the Dedalus-Agfa and CGM-Cerner deals. CGM had the largest revenue share in 2019 across both the acute and ambulatory sectors, a share that increased in 2020 as it took on Cerner’s business. Dedalus is now a leading vendor in the market since acquiring the Agfa HCIS business, particularly in the acute sector. Other key vendors in the acute market are Nexus, Telekom Health, Meierhofer and ISolutions, although Epic and Philips are also present. The ambulatory market across this region is highly fragmented with only CGM straddling both acute and ambulatory.
Cerner and DXC Technology have historically benefited from large EHR contracts in several of the 17 autonomous regions in the Spain/Portugal. The CGM-Cerner deal will now also mean that CGM has significantly expanded its footprint in the region. However, several other international and local vendors such as Dedalus, Indra, Everis, Alert and Oesia also had sizeable shares. Integrated care initiatives will drive market growth in Spain; however, this is not forecast to result in significant vendor consolidation.
The Nordic region has regionalised much of its EHR procurement over recent years with several countries focusing on integrated care initiatives (e.g. development of sote-areas in Finland). This has resulted in some consolidation in the supplier base; however, it is local vendors such as TietoEVRY, Systematic, DIPS, and Cambio Health that still hold the largest share. That said, international vendors, namely Cerner and Epic, have rapidly gained share over the last three years and are expected to continue to disrupt the market.
The Italian EHR market is largely served by local IT generalists such as Engineering Ingegneria Informatica, Reply and GPI Group. Regionalised procurement has resulted in some vendor consolidation over the last few years. Dedalus has also had success with regionalisation and is the exception in that it is the only Italian EHR vendor to have a sizable international business.
The Middle East & Africa region bucks the trend for local vendors to some extent. Cerner, DXC Technology, InterSystems and Epic have all won sizeable contracts in recent years, particularly in the UAE and Saudi Arabia.
Outlook for EMEA EHR Market Competitive Environment
Although there has been a certain level of consolidation in the European market, across the region the supplier base remains relatively fragmented, with most countries still dominated by a mix of local vendors and international vendors. The fact that our market share table shows that the “Others”, outside the top 15 ranking, accounted for 36% of the market in 2019 illustrates this well.
The last two years have seen Dedalus emerge as a leading supplier to the region via its acquisitions in France, the Agfa HCIS acquisition and more recently in relation to the future DXC deal. However, it will undoubtedly face challenges as it grapples with an extremely broad and fragment portfolio, as we discussed in our insight (published in July 2020) examining the deal.
CompuGroup Medical has also been able to scale its business, both in terms of size and geographic coverage via its acquisition of parts of Cerner’s EMEA business. More recently it has added to this via the acquisition of eMDs, which provides its first footprint in the highly competitive US ambulatory market. Both moves signal that it sees itself as a major international player and one likely to continue to expand via acquisition.
However, there have also been steps away from consolidation, Cerner’s decision to pull out of markets that were not driving its Millennium/i.s.h.med business being the most high-profile example. A sign that a broad footprint addressed via a broad portfolio does not always make the best business sense.
About the Report
“EHR/EMR in Acute and Ambulatory Applications – World – 2021” has been compiled by Signify Research using a database based on data from over 160 leading EHR vendors to create a complete bottoms-up view of the market. The robust dataset supplemented with insight gained through in-depth interviews provides an industry-leading assessment of the international EHR/EMR market. At a country level, the data is broken down in terms of revenues by vertical, product, public/private purchaser and vendor market shares. Forecasts are provided to 2024 with the report providing insight into major purchasing organisations/groups driving opportunities, as well as the vendors already serving these groups.
About Signify Research
Signify Research is an independent supplier of market intelligence and consultancy to the global healthcare technology industry. Our major coverage areas are Healthcare IT, Medical Imaging and Digital Health. Our clients include technology vendors, healthcare providers and payers, management consultants and investors. Signify Research is headquartered in Cranfield, UK.Share on LinkedIn