Palantir (PLTR.US) faces strict scrutiny in the UK! Criticized as "unacceptable risk point" NHS $440 million contract may be terminated.

The UK is conducting a comprehensive review of the contract signed between the American data analytics company Palantir (PLTR.US) and the UK National Health Service (NHS). Under increasing political pressure, the UK government is being urged to activate the termination clause when the initial contract period ends in early 2027. The contract was awarded to Palantir in 2023 with the aim of building a platform that connects NHS medical data. The contract is set to continue until early 2027, at which point the UK government must decide whether to renew it. UK Technology Minister Liz Kendall stated on Tuesday that the review will assess whether to extend this 330 million (approximately $441 million) agreement based on the terms of the contract. According to the terms, the UK government can choose to extend the contract for up to seven years or terminate it directly. Liz Kendall stated in an interview, "The current Health Secretary is reviewing every aspect of the contract to ensure we secure the best deal for the UK." She mentioned concerns regarding patient privacy protection, public trust, and reliance on American suppliers. The UK Parliament urged the government last week to activate the relevant terms and terminate the contract. The House of Commons Science, Innovation, and Technology Committee released a report on June 2 describing Palantir as an "unacceptable risk point" in the public sector. The committee pointed out in the report that the NHS data platform, led by Palantir, is used to integrate medical service information. The report warned that the UK's increasing dependence on a few large American tech companies, including Palantir, poses "serious vulnerabilities" in critical national healthcare and defense infrastructure. Although the committee also acknowledged that government officials recognized the positive effects of Palantir's software in areas such as waiting list management, healthcare operations, and patient discharge planning. The MPs recommended that the UK government exercise the termination clause in the contract, due to take effect in February 2027, and switch to UK-based suppliers or develop systems independently to avoid "vendor lock-in." The committee also criticized Palantir's "values" as being "misaligned" with UK standards and cited controversial statements by its executives and its record of cooperation with the Israeli military and US law enforcement agencies like ICE. The report also revealed that the company also received another non-compete contract worth 240 million from the Ministry of Defense. In response to the criticism, the head of Palantir in the UK countered that these critiques were "sacrificing voter health services to grab attention." Meanwhile, advocacy groups and unions have also questioned the handling of sensitive medical data. Last month, reports indicated that NHS officials had proposed granting broad access rights to identifiable patient data in certain modules of the system to external staff (including Palantir employees). Full access rights were initially only granted to secure vetted internal staff of NHS in England, but external staff requested equivalent access rights claiming that requesting various types of necessary independent data access permissions (CDAs) one by one was too cumbersome. This contract is also being scrutinized further because Palantir also provides software services to the US military and immigration enforcement agencies. Additionally, the political stance of its billionaire co-founder Peter Thiel has sparked controversy. Peter Thiel was an early supporter of former US President Trump. Last month, London Mayor Sadiq Khan vetoed a police contract worth 50 million that was originally intended for Palantir. Sadiq Khan expressed concern about the cost-effectiveness of the contract and believed that ethical standards should be considered in the public procurement process. The UK government's review of the Palantir-NHS contract may be one of the obstacles that the company faces in its overseas business expansion, especially as the company heavily relies on the US market. The financial report released in early May showed that Palantir's revenue in the first quarter increased by 85% year-on-year to $1.63 billion, marking the highest growth rate since its listing in 2020; the US market became the absolute growth engine, contributing $1.28 billion in revenue, accounting for 78.5% of total revenue. Palantir has strong ties to the US government, particularly to the Department of Defense and immigration enforcement. Its technology is used for sensitive actions such as deporting illegal immigrants, which has drawn significant criticism. While this "patriotic" stance has won the company contracts with the US government, it has led to ongoing political and ethical controversies.