WESTMINSTER, Colo. and BLUE BELL, Penn. – March 20, 2006 – Global Healthcare Exchange (GHX) has acquired the assets of Ideal Systems, Inc., a company that provides rebate and contract management software and consulting services to branded pharmaceutical manufacturers. With the acquisition, GHX retains the products, customer contracts, intellectual property and other business assets of Ideal Systems. Ideal Systems founder and chief executive officer, Chris Biddle, along with his entire staff, will join GHX and be relocated to the company’s office in Ambler, Penn. The acquisition was completed on March 10, 2006. Terms of the deal were not disclosed.
Ideal Systems provides software and services that give pharmaceutical manufacturers more control over their contracts and the complex rebate process. Better management in these areas can minimize overpayments of rebates to health maintenance organizations (HMOs) and pharmacy benefit managers (PBMs).
Pharmaceutical manufacturers process large volumes of rebate data received quarterly from multiple PBMs. This data often contains calculation errors caused by inaccurate, incomplete or duplicate data entries. PBMs create formularies and negotiate pharmaceutical prices for consumers and serve as intermediaries between their customers and pharmaceutical companies. PBM customers include insurance companies, pharmacies, hospitals, HMOs and other health plan providers. The number of parties involved in the rebate process and the variety of complex contracts between them makes it difficult to track and verify rebates. Consequently, pharmaceutical manufacturers in the United States overpay prescription rebates each year by an estimated three to 10 percent, adding billions of dollars annually to healthcare costs.
“This acquisition continues to expand GHX’s contract management offerings,” says GHX Chief Executive Officer Mike Mahoney. “Through a combination of process automation, accurate data and real-time reporting, we can help branded pharmaceutical manufacturers realize significant savings by reducing or eliminating overpayments.”
Ideal Systems’ claims validation and processing software is currently being used by six of the top 10 pharmaceutical manufacturers in the United States. The application imports, formats, validates and processes rebate submission data before it is exported into a pharmaceutical manufacturer’s contract management system. The software also produces real-time reconciliation reports that provide prescription-level information for better claims analysis.
Ideal Systems’ contract management solution streamlines and automates contract setup, manages contract amendments, and calculates chargeback and rebate payments for commercial contracts. Manufacturers also have access to adequate audit trails because their contracts are administered and stored in an automated environment.
“Becoming a part of GHX gives Ideal Systems the ability to more effectively communicate the savings opportunities we can provide to pharmaceutical manufacturers,” says Chris Biddle. “Ideal Systems and GHX share a common vision of identifying and enabling cost reduction strategies for our healthcare customers.”
About Global Healthcare Exchange
Global Healthcare Exchange (GHX) provides an open and neutral electronic trading exchange, as well as complementary products and services, designed to improve the procurement-to-payment process in the healthcare supply chain. Service offerings include:
- Exchange services that support trading partner connectivity and provide electronic transaction sets, order validation and reporting tools
- Content services utilizing the GHX AllSource® product content repository as the foundation for data synchronization and advanced content services
- Contract services that allow users to maximize contract utilization
- Procurement services that enable automation of the requisitioning process
- Business Intelligence reports designed to provide strategic decision-making data
Through these services, healthcare providers and suppliers can improve efficiencies, automate processes and reduce operating expenses. Equity owners of GHX are Johnson & Johnson Health Care Systems Inc.; GE Healthcare; Baxter Healthcare Corp.; Medtronic USA, Inc.; Abbott Exchange, Inc.; Siemens; Becton, Dickinson & Co.; Boston Scientific Corp.; Tyco Healthcare Group, LP; Guidant Corp.; C.R. Bard, Inc.; AmerisourceBergen Corp.; Cardinal Health, Inc.; Fisher Scientific International, Inc.; McKesson Corp.; B Braun Medical Inc.; Premier, Inc.; HCA; VHA Inc. and University HealthSystem Consortium. For more information, visit www.ghx.com. About Ideal Systems
Ideal Systems, Inc. has provided business and technical consulting services to the pharmaceutical industry since 1994. The company offers several enterprise-level software solutions to address critical industry needs related to contract management, rebate processing, chargebacks, Medicaid, government pricing, data warehousing, reporting, and sales force automation. Visit www.idealsystems.com for more information.