How A Decades-Old Medical Records Company Made A Huge AI Bet To Save Itself

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Veradigm,Allscripts,Medical Records

I'm a senior writer at Forbes covering healthcare technology, and I also write the InnovationRX newsletter. I was previously a healthcare reporter for POLITICO covering the European Union from Brussels and the New Jersey Statehouse from Trenton. I was a 2019-2020 Knight-Bagehot Fellow in business and economics reporting at Columbia University.

Veradigm, formerly known as Allscripts, tried to outrun a series of crises with a rebrand. Now interim CEO Yin Ho has an audacious plan to use the $140 million acquisition of AI startup ScienceIO to tap into its one major competitive advantage over giants like Epic: data.hat looks to be a small wine fridge is tucked away inconspicuously in the corner of Veradigm’s 12th floor office in the Flatiron neighborhood of Manhattan.

ScienceIO was cofounded in 2019 by Will Manidis, a former researcher at cancer genomics company Foundation Medicine and a Thiel fellow. The 25-year-old CEO had raised $25 million from Quiet Capital, Section 32 and Lachy Groom touting an idea that predated the ChatGPT frenzy: the large language models that power AI chatbots could also be used to make sense of the all the clinical notes and records created by doctors and nurses.

That data is potentially very valuable, because it could help pharma companies understand how patients react to drugs over time, in the real world. Recently the FDA has started allowing real-world data from patients outside clinical trials to speed up the drug approval process, which also has the potential to significantly reduce costs. The market for this type of data is expected to hit $7.5 billion this year, according to investment advisory firm Beecher and Co.

In 1999, Allscripts went public and Tullman continued to buy and build additional functionality to make it into the electronic health records company that it’s known as today. But his last mega-deal, a $1.3 billion merger with hospital records company Eclipsys in 2010, caused a rift with the board. “The board started to fracture because I wanted to take the EHR to the next level,” Tullman told.

. “Because we brought it in house, we're not allowing it to be learning off of any data that we do not control,” said Ho. In addition to Veradigm’s data, they have also incorporated data from disease registry collaborations with the American College of Cardiology and American Diabetes Association.

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