This Little-Known Firm Is Getting Rich Off Your Medical Data

You may never have heard of it, but IMS Health knows an awful lot about your medical history. A global company based in Danbury, Connecticut, IMS IMS 1.58% buys bulk data from pharmacy chains such as CVS CVS 0.72% , doctor’s electronic record systems such as Allscripts, claims from insurers such as Blue Cross Blue Shield and from others who handle your health information. The data is anonymized—stripped from the identifiers that identify individuals. In turn, IMS sells insights from its more than half a billion patient dossiers mainly to drug companies. So-called health care data mining is a growing market—and one largely dominated by IMS.

Last week, the company reported 2015 net income of $417 million on revenue of $2.9 billion, compared with a loss of $189 million in 2014 (an acquisition also boosted revenue over the year). “The outlook for this business remains strong,” CEO Ari Bousbib said in announcing the earnings. The company also said that it bought a subsidiary of Symphony Technology Group, which also owns IMS rival Symphony Health, a privately held company based in Conshohocken, PA. (Lawsuits between IMS and Symphony also ceased as part of the deal.) In its marketing materials, IMS says it helps advance healthcare by providing “reliable, connected information, and real-world insights.” Pharmaceutical sales and marketing are a key part of IMS’ business, and its data also helps Big Pharma justify prices for drugs by demonstrating their effectiveness...