Inside the messy relationship between a medical records giant and healthcare's hottest AI startup

"The hottest AI startup in healthcare is at a crossroads: Medical scribe company Abridge's closest partner and former shareholder, health records giant Epic Systems, just became its biggest threat. In August, Epic said it plans to launch its own AI products to assist doctors with administrative tasks. One of those tools will automatically transcribe and summarize patient visits, the booming business behind $5.3 billion Abridge."

"Abridge notched a landmark partnership with Epic in 2023. With Epic's distribution, Abridge became one of the buzziest startups in healthcare, landing top hospital customers and raising hundreds of millions of dollars. The deal also gave Epic a single-digit percentage stake in Abridge, according to five people with knowledge of the deal. Two of those people said Epic sold its shares earlier this year."

"Epic's push into AI highlights a larger tension that's playing out across tech, mirrored in relationships like Microsoft-OpenAI to Google-Anthropic: In the fast-moving AI race, what happens when dominant incumbents morph from partners and shareholders into competitors? Abridge ran into a classic startup dilemma, building a business dependent on a giant's ecosystem that then risks being undercut once the giant rolls out a competing product. It will now have to navigate a minefield as it clings to Epic to maintain key hospital revenue"

Epic plans to launch AI products to assist doctors with administrative tasks, including tools that will automatically transcribe and summarize patient visits, the booming business behind $5.3 billion Abridge. Abridge secured a landmark partnership with Epic in 2023 that, together with Epic's distribution, helped it land top hospital customers and raise hundreds of millions of dollars. The partnership gave Epic a single-digit percentage stake, and two people said Epic sold its shares earlier this year. Epic's move into AI creates a direct competitive threat to startups like Abridge that built businesses dependent on a dominant electronic health record ecosystem that covers about 42% of US hospitals.

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