EMIS Group, the healthcare software provider, saw its share price plummet almost 16% in morning trading.
The share price slide occurred after the company board admitted there had been a failure to meet certain service levels and reporting obligations with NHS Digital, relating to the EMIS Web product for GPs in England.
EMIS said the findings had been fully disclosed to NHS Digital, but had only very recently come to the board's attention.
In a statement EMIS said: “We are currently working in collaboration with NHS Digital to confirm the scale of the issue and assess the full service and contractual impact; however, we confirm that neither patient safety nor patient data has been put at risk as a result of this issue.”
A spokesperson for EMIS said: “It is too early to quantify precisely the financial impact of this issue but in light of the current position, our estimate is that this will be in the order of upper single digits of millions of pounds. We will update the market as appropriate.”
Andy Thorburn, Group CEO at EMIS Group commented: "I am very disappointed to find that in this area we have fallen behind the high standards of customer and product support that NHS Digital and our wider customer base have rightly come to expect of us.
“We have committed to resolve this situation to the satisfaction of NHS Digital and our users as soon as possible."
The latest development will be seen as a serious blow to confidence in EMIS which had previously been picked out as a key provider in a drive to improve NHS efficiency.
Last year, Health Secretary Jeremy Hunt, visited EMIS's offices and said at the time: "I want to help doctors and nurses provide faster and better care - and improving technology in the NHS is a key way to do that.
“The systems I've seen here today are helping put people in the driving seat when it comes to managing their healthcare."