NHS Trusts Agree to Adopt CSC's Lorenzo System
Computer Sciences Corporation (CSC) has made significant strides in its negotiations with the National Health Service (NHS) regarding the Lorenzo software, but a formal agreement has yet to be reached.
The journey began in March, when CSC and the Department of Health signed a 'letter of intent' for the purchase of Lorenzo software. This was followed by the delivery of the care management software to three NHS Trusts in the latest financial quarter, marking a key milestone in CSC's engagement with the NHS.
CEO Mike Lawrie expressed optimism about the negotiations, stating that they are "pretty close" to getting a tenant agreement with the NHS. However, as of today, no agreement has been reached.
The currently negotiated certificate completion contract was signed by CSC, but it's important to note that no government approval has been received as yet. Once a tenant agreement is reached, it will still need government approval.
The written-off amount equals all the money CSC invested in the Lorenzo contract up to this point. In February, CSC wrote off $1.5 billion expected from Lorenzo contracts in the NHS.
Despite the challenges, Lawrie has been reluctant to disband the UK team working on Lorenzo. The current team comprises 200 people. In May, CSC announced a $1 billion cost-cutting drive that included job cuts to its Lorenzo team in the UK.
Lawrie, however, does not anticipate large cash charges associated with disbanding the UK team. He remains hopeful, expressing optimism that a conclusion will be reached at some point in time.
In the meantime, the combined tally of NHS Trusts to have adopted Lorenzo stands at 13. Despite the setbacks, the progress made so far in the negotiations has established new principles for localised initiatives due to devolved decision-making within the NHS, as outlined in the letter of intent.
CSC's net income for the latest quarter was $40 million, a significant drop from $183 million in the same period of last year. The overall revenue for the latest quarter fell 2% to $3.96 billion.
As negotiations continue, both parties will be hoping to reach a successful conclusion that will benefit the NHS and CSC alike.
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