Babylon Health faces legal headache over AI claims

A British tech company hailed as the future of healthcare by former Health Secretary Matt Hancock may face legal action in the US after its collapse.

Babylon Health, which has 100,000 NHS patients, is being sold after losing almost all of its value since founder Dr. Ali Parsa floated it on the New York Stock Exchange in 2021 for £3 billion.

Last month, Jersey-registered Babylon announced that London-based AlbaCore Capital would acquire its assets without shareholder approval and that it was also appealing to UK-based administrators.

Parsa, a former refugee, saw his net worth rise to £825 million after investors were attracted by his promise to revolutionize healthcare by leveraging artificial intelligence (AI).

This included a controversial chatbot, which claimed to be able to diagnose diseases, despite repeated criticism from senior health experts. Parsa also claimed that the company had designed software that “changes Alexa” [Amazon’s virtual assistant] to a doctor’. But an unnamed investor is now said to have assembled a British legal team over claims surrounding Babylon’s technology.

David Watkins, an NHS adviser and arch critic of Babylon, said: “The investor is considering legal action in relation to the company’s AI and I have been asked to speak to their legal adviser.”

Last year, Babylon and the NHS agreed to terminate two long-term contracts due to “challenging global and macroeconomic conditions.”

However, the company insists it will continue to run its GP@Hand app contract at Hammersmith & Fulham, which allows patients to make virtual appointments. Hancock previously said he wanted GP@Hand to go nationwide.

Filings with US authorities show Parsa received £5.6 million in wages and perks for 2022. In March, he claimed Babylon’s 2022 accounts showed “continuous improvement” and predicted profitability by 2024 despite losses of £409 million in the three years through 2022. Babylon has been repeatedly approached for comment.