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US firm bows out of major UK IT modernization project

US firm bows out of major UK IT modernization project

A Burlington, Vt.-based software vendor working on an US$11.2 billion IT overhaul of the U.K. National Health Service (NHS) has been removed from a major part of the project.

IDX Systems Inc., a maker of medical applications, announced last week that it had agreed to end its contract with Fujitsu Services Ltd. to co-write an application for the NHS's Southern Cluster region, which is made up of a handful of counties and islands. The goal of the 10-year project, dubbed the National Program for IT (NPFIT), is to update the health agency's operations so it can deliver better patient care and service.

It was not clear why Fujitsu ended the contract with IDX, and the company did not respond immediately to a request for comment.

The NHS's Connecting for Health agency, which is overseeing the IT overhaul, allowed Fujitsu to replace IDX's enterprise clinical software, Carecast, with the Millennium health care application from Kansas City, Mo.-based Cerner Corp. Telecommunications company BT Group PLC, IDX's partner on the south cluster, will continue to collaborate with IDX for work on the NHS's London cluster.

The move by Fujitsu, the prime contractor on the IT overhaul, follows a warning in March by Richard Granger, director general of the NPFIT, who said contractors failing to meet deadlines might be dropped from the project.

"It was always envisaged that there might be some change of suppliers," said an NHS spokesman via e-mail. "Senior figures in Connecting for Health have publicly stated this on several occasions and this demonstrates that the robust contracts we have in place are working. We remain confident that the national program will be a success and will deliver very real benefits to patients and clinicians."

He said the move isn't expected to affect the overall project. According to a statement on the NHS Web site, "this change in the south provides the opportunity for BT and IDX to redouble their focus on the delivery of services to the NHS in London."

The NHS spokesman referred specific questions about IDX's removal to Fujitsu.

For its part, IDX declined to comment, referring instead to comments made by CEO James Crook Jr. in the June 1 statement.

"Fujitsu Services' decision to withdraw from the 'common solution' and to align itself with another provider for the southern cluster is disappointing," said Crook. "We believe that, together with our prime contractor BT, we have overcome numerous obstacles in delivering on the national program, which is unprecedented in scale, complexity and schedule, and will ultimately deliver real benefits to patients, care givers and NHS staff."

He predicted a deployment of Carecast to the London region later this year, and said the cost of extricating itself from the south cluster effort would run between US$2 million and $4 million.

According to Tola Sargeant, an analyst at London-based research firm Ovum Ltd., Fujitsu's move to sever connection with IDX is no surprise, after "some well-documented delays" to the rollout of Carecast. "BT has clearly had significant problems fitting IDX's software to the U.K. system, and we find it hard to believe that Fujitsu and Cerner won't face many of the same challenges," Sargeant said in a note regarding the project.

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