It seems like the guessing game is now over about the continuing status of Epic as a private corporation (see: Faulkner funds foundation to keep Epic private). The founder and CEO Judith Faulkner has announced that she will leave much of her stock holdings in the company to a charitable foundation. Below is an excerpt of an article announcing this news with some of the details:
Epic Systems Corp. founder and CEO Judith Faulkner has decided to leave much of her holdings in her privately held company to a specially created charitable foundation that will operate and fund not-for-profit organizations in healthcare and other areas....The donation will come following Faulkner's death....“I am, fortunately, healthy,” said Faulkner, 71. The foundation also will help Faulkner keep Epic in private hands, a goal she has long cherished....The foundation will control the stock. This plan is designed to preserve the company as a private company forever....Epic's gross revenue in 2014 was $1.77 billon, Faulkner acknowledged. Publicly traded EHR competitor Cerner Corp., Kansas City, Mo., reported revenue of $3.4 billion in 2014 and, with a share price of $70.14 at the market close Monday, had a market capitalization of $24.08 billion. Calculating a straight comparison of revenue to market cap, Epic would be worth about $12.5 billion. Last year, Forbes placed Faulkner at 239th on its list of the 400 wealthiest Americans at $2.4 billion. It has since upgrade her wealth to $2.8 billion....The trust is being called the Epic Foundation, for the time being, but the name will likely be changed....Faulkner has been adamant about the company she leads remaining privately held. When a company is private, “You don't have to have the tyranny of the quarter,” Faulkner said
So all of this puts to rest the periodic rumors that Epic could get snapped up at some point by a for-profit diagnostics or pharmaceutical company. However, no knowledgeable industry observers have ever given much credence to this idea given Faulkner's penchant for control and micromanagement. Moreover, she has never seemed all that interested in matters outside of the company and the world of science fiction fantasy. To restate the obvious, however, there are a lot of things that can happen to a septuagenarian and most of them are not all that favorable. I am not a lawyer so I can't speculate on the ways that a charitable foundation interacts with a company for which it holds all of the stock. One thing about all of this is sure, however. Epic without Faulkner at the helm would look and operate differently than the company as it stands today, even if the management team was composed of veteran Epic insiders. The fate of the company post-Faulkner is obviously of great interest to hospitals that may have invested millions of dollars in an Epic EHR. Today's news provides details about only one piece of this puzzle.