Omnicell, Inc. OMCL inked a six-year sole source agreement with Geisinger (a key health system, serving Pennsylvania and New Jersey) to improve clinical and operational efficiency, increase medication safety, and reduce costs. The ultimate aim of the agreement is to improve patient care.
Per the agreement, Omnicell will allow Geisinger to utilize its XT Automated Dispensing Systems to enhance nurse-pharmacy workflows, and medication safety and security. Omnicell noted that Geisinger recently upgraded its system to XT Anesthesia Workstation, just before the signing of the deal. Traditionally, Geisinger operated manually to access medications in the operating room.
With the partnership, Omnicell aims to strengthen its Automation & Analytics business globally.
Rationale Behind the Partnership
Omnicell believes that a fully-autonomous pharmacy paves the way for improved efficiency, regulatory compliance and patient outcomes through automation, data intelligence and expert services.
The company aims to deliver an error-free and fully-automated medication management infrastructure, thus allowing pharmacists to utilize their time for direct patient care. This will allow them to spend lesser time on administrative responsibilities involved in running a pharmacy.
Per a report by MarketsandMarkets, the pharmacy automation market is estimated to reach $5.38 billion by 2022 from $3.63 billion in 2017, witnessing a CAGR of 8.2% between 2017 and 2022. Factors like the growing need to minimize medication errors and the rapid decentralization of pharmacies are expected to drive the market. Factors like rising elderly population and mounting labor costs are other contributors.
Given the market potential, the collaboration is well-timed.
Recent Developments in Automation & Analytics
Of late, Omnicell has witnessed a slew of developments in its business arm.
In January, Omnicell announced that its point-of-care automated workflow technology — XT Automated Dispensing Systems — was adopted by various key health systems across North America. The health systems include Duke University Hospital, which aims to improve hospital efficiency and provide better patient care by adopting automation.
Further, Allegheny General Hospital, PA (part of Allegheny Health Network) incorporated Omnicell’s Central Pharmacy IV Compounding Service — a comprehensive, turnkey approach for insourcing some sterile compounding operations.
Omnicell signed a sole source agreement with Med Center Health in October 2019 to streamline and secure Med Center Health’s medication management process. Per the agreement, the health system will upgrade to Omnicell’s XT Automated Dispensing Cabinets to help improve security and nurse-pharmacy workflows.
Some other notable partnerships of the company are with Minnesota-based Fairview Health services, Adrian Mel in North Carolina, Cooper University Health Care in New Jersey, Benefis Health System in Montana, and Renown Health in Nevada leveraging automation and data intelligence to support improved efficiency and patient care.
Shares of Omnicell have gained 9.6% in the past year compared with the industry’s 17.3% rally.
Zacks Rank & Key Picks
Currently, the company carries a Zacks Rank #3 (Hold).
Some better-ranked stocks from the broader medical space are Phibro Animal Health Corporation PAHC, Hill-Rom Holdings, Inc. HRC and ResMed Inc. RMD.
Phibro currently sports a Zacks Rank #1 (Strong Buy) and has a projected long-term earnings growth rate of 3.6%. You can see the complete list of today’s Zacks #1 Rank stocks here.
Hill-Rom’s long-term earnings growth rate is estimated to be 11.1%. The company presently carries a Zacks Rank of 2 (Buy).
ResMed’s long-term earnings growth rate is expected to be 12%. It currently has a Zacks Rank #2.
5 Stocks Set to Double
Each was hand-picked by a Zacks expert as the #1 favorite stock to gain +100% or more in 2020. Each comes from a different sector and has unique qualities and catalysts that could fuel exceptional growth.
Most of the stocks in this report are flying under Wall Street radar, which provides a great opportunity to get in on the ground floor.
Today, See These 5 Potential Home Runs >>
Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
Omnicell, Inc. (OMCL) : Free Stock Analysis Report
ResMed Inc. (RMD) : Free Stock Analysis Report
Hill-Rom Holdings, Inc. (HRC) : Free Stock Analysis Report
Phibro Animal Health Corporation (PAHC) : Free Stock Analysis Report
To read this article on Zacks.com click here.
Zacks Investment Research