Data worth more in health mergers than software

It seems that health data banks are worth more than software in health IT mergers, and holders of data are moving to take advantage.

Proof comes from Medco's purchase of United BioSource Corp., which specializes in post-approval drug and device research. Medco is paying $730 million for UBC yet expects the deal to add to its earnings by next year.

In its press release, Medco said closely-held UBC had sales of $280 million last year, and that sales are growing 20 percent. In addition to seeing how products perform in the field, the company also performs cost-benefit and cost-effectiveness studies, a big market in Europe but something that's coming to the U.S. under health reform.

The prospects of applying UBC research in these areas to insurers and the U.S. government made the deal appealing, Medco CEO David Snow said.

Perhaps in anticipation of such a gain, IMS Health brought in Ari Bousbib from United Technologies as its new CEO, replacing David Carlucci. IMS was taken private earlier this year by some private equity firms and Canada's state pension system, which (unlike America's Social Security system) has the power to take some of its money to the dog track, investing in private companies.

Canadian pensioners can expect some tidy gains down the road. In the coming merger frenzy, IMS Health is an important arms merchant of information for all sides, and could easily become a target itself.