Entrepreneur Steve Malik founded health portal Medfusion, sold it to Intuit and bought it back only to now face a gigantic challenge: A lawsuit against electronic health records [EMR] giant Allscripts.

But Malik has no regrets about reacquiring the Cary-based company and says the fight that could be worth millions of dollars is “where the market is going and where Medfusion can be.” 

This is the classic David vs. Goliath business story, pitting the 120 employees of Medfusion against Allscripts, with a market value of $2.7 billion, annual revenues of well over $1 billion and thousands of employees. The company has a substantial presence in the Triangle and employs thousands nationwide.

However, Medfusion has filed a lawsuit seeking what could be worth millions of dollars against Medfusion, charging that Allscripts has not paid for services and other reasons. 

Malik also insists that Medfusion “remains strong” despite the fact he says in the suit that Allscripts owes millions of dollars. 

In a Q&A with WRAL TechWire, Malik talks about the suit, the challenges, and what lessons other entrepreneurs can learn from his experiences.

  • Any regrets now about buying the company back? 

The challenge of dealing with difficult situations like this is worth it in the face of the opportunity to deliver a truly connected patient provider relationship. This isn’t about where the company was. This is about where the market is going and where the Medfusion can be.

  • Does Allscript’s non-payment put the future of Medfusion in financial jeopardy?

Medfusion remains strong. We continue to move forward and now have an improved opportunity to deliver on the promise of a connected patient to provider relationship. We continue invest in our growth opportunities as evidenced by the appointment of Michael Raymer as VP of Solutions Management. We have also added 30 people to the team in the last 90 days. Medfusion welcomes the opportunity to compete in the marketplace.

  • Was Allscripts your largest customer? Are you making progress is finding new clients?

Medfusion solutions are targeted to clinicians themselves, not their EHR vendors. Upon learning about the opportunity to work directly with Medfusion, the reaction from the provider community has been overwhelmingly positive.

The benefits of having direct access to innovation and to leverage the investment that they have made in registering patients, and establishing processes for communicating with them online are some of the top reasons they are choosing work with Medfusion directly.

  • Will you embrace a strategy going forward of approaching medical practices individually rather than through a big partner?

Medfusion’s roots are based in working directly with healthcare providers. We now have an improved opportunity to deliver on the promise of a connected patient to provider relationship. Providers choosing Medfusion have immediate access to features such as mobile and Pay Now as well as future innovations such as patient forms.

  • Had Allscripts talked with Intuit about buying Medfusion/Intuit Health before buying your competitor? (Read related story for more details.)

No comment.

  • Had Medfusion complained to Allscripts prior to the deal seriously coming apart in April? Did you seek arbitration to settle the dispute?

As detailed in the complaint, there is a history of Allscripts not meeting its commitments to Medfusion. We followed the dispute resolution procedures in our contract and made multiple attempts to find resolution to our concerns. Our goal was and remains to provide value to healthcare providers.

  • You mention “brand value” in the suit. Has the Medfusion brand been harmed by this?

Medfusion’s Net promoter scores, a measure indicating how willing our customers are to refer us, skew higher in our non-Allscripts based clients.

Medfusion is no longer limited by Allscripts in the innovations that it can bring to providers. Since ending our agreement with Allscripts, the provider community has had an overwhelmingly positive reaction to working with directly with Medfusion.

  • Have some of your joint accounts with Allscripts shifted to you directly as a result of this dispute?

Medfusion has enjoyed an overwhelmingly positive response from the provider community. We are winning everything that we should to and some things that we didn’t initially expect to.

Customers now have a choice in portal providers and Medfusion welcomes the opportunity to earn their business. We are offering free services through the end of May. Beyond that, Medfusion is also offering month-to-month contracts to allow providers time to make the decision on which portal solution is right for them.

  • What lessons could other entrepreneurs gain from this dispute?

No matter who your partners are, never lose sight of your customers. They will recognize and appreciate a quality product, stellar customer service and a partner that acts with their best interests at heart.