UnitedHealth Group's $27 billion health information and technology business, Optum, has a new chief. Larry Renfro takes the top job as former Optum chief G. Mike Mikan departs to head an undisclosed private equity firm. UnitedHealth announced the change last week.
Renfro, a former Fidelity Investments executive, who joined UnitedHealth in January 2009, steps into the top post at Optum amid a time of rapid growth in the business, which serves many types of healthcare stakeholders--including 400 life sciences companies--make use of analytics and health informatics to navigate challenges in their businesses. His group accounts for about a quarter of health insurance giant UnitedHealth's total revenue, Dow Jones Newswires reported, and consists of three business units, Optum Health, OptumInsight and OptumRx.
For life sciences companies, OptumInsight's technology and services become useful as the firms try to figure out which markets to pursue with their products, what reimbursements are likely to be, and what regulatory hurdles they will face. As health payers become choosier about the new drugs and other medical products they reimburse, life sciences companies have had to carefully weigh such factors into decisions about their R&D, for example.
"As the healthcare landscape continues to evolve, Optum's deep understanding of the diverse and changing needs of participants across the health system enables it to deliver collaborative solutions that provide the insights and care to help build sustainable health communities," Renfro said. "We have an outstanding team in place that has been effectively building the Optum platform to make it easier for clients to connect with the broad skills and expertise, innovative capabilities and end-to-end solutions across our businesses."
Still, Mikan's departure from Optum to get into the private equity game has been viewed as a negative for UnitedHealth ($UNH). "The main negative here is not that there was a surprise change in management, but rather the loss of one of the strongest managers at the company," Barclays Capital analyst Joshua Raskin wrote in a research note, as cited by Reuters.