Healthcare providers use the company’s software in a variety of processes. Credit: National Cancer Institute/Unsplash.

US technology company NextGen Healthcare is exploring options, including sale, for its business, reported Reuters, citing sources.

NextGen has called in investment bank Morgan Stanley as the adviser for the talks with potential buyers, the sources said.

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The sources added that there is no certainty that the company will reach a deal to sell itself.

NextGen, which is engaged in offering technology solutions for the healthcare sector, does not have a physical headquarters as many of its staff work remotely.

Healthcare providers use the company’s software in a variety of processes, from the digitalisation of patient health information to the management of money.

In the fiscal year 2023, the company generated $653.2m in revenue, 90% of which was recurring.

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Deal activity in the healthcare sector has increased as businesses strive to increase size and reduce costs, the news agency reported.

It has been further driven by private equity investors’ bet on a sector that has historically demonstrated resilience in a bad economic environment, it added.

Last month, the business agreed to pay $31m to resolve allegations made by US authorities that it overstated the capabilities of its software and paid users kickbacks to promote it.

The accusations came from a lawsuit brought in 2018 by two medical professionals who had used NextGen’s software.

“The company denies that any of its conduct violated the law, and the settlement agreement does not include any admissions of wrongdoing,” a NextGen told the news agency in an email following the settlement.