Robotic Pharmacy Investing

Robotics are going to be a rather big market in the near future. We’re moving toward automation in just about every context you can think of; to pick a controversial example: drone warfare.

A less controversial example, and likely much more widespread, would be the burgeoning use of robotics in hospitals, pharmacies, and healthcare in general.

Transparency Market Research has just emerged with a report that essentially confirms what we already suspected—robotics in pharmacies and hospitals are going to be huge. In fact, the pharmacy automation market should grow from $4.7 billion (2011) to nearly $7.8 billion (2018).

The report is quite comprehensive and addresses everything from emergent technologies to various recent developments and trending research. It also discusses different kinds of technologies, and that list is indicative of the possibilities inherent in robotics when applied to pharmacies.

We’re talking about automated dispensing mechanisms, automated packaging and labeling of medications (thus going a long way toward eliminating human error), automated storage and retrieval systems (did you know that many university libraries have already implemented such robotic equivalents too?), and so on.

It appears that the automated dispensing sector is a big grower; it holds 48.9 percent of the world’s automation system market and is valued at around $2.3 billion. By 2018, that is expected to grow to around $3.6 billion—a growth rate of about 6.7 percent in just six years.

Robotic Pharmacy Applications

At the UCSF medical center in California, such a system is already in place, and it is working wonders in terms of increasing efficiencies all around. Possibly the greatest benefit is the elimination of wrong dosage, wrong medication, and other errors largely contingent on human mistakes.

Hospital pharmacies used to be centralized, but the model is increasingly opening up. Larger hospitals have hundreds of beds and numerous divisions, and all the complexity basically means it can be difficult to keep track of medication’s flow from pharmacy to patient.

Automated systems mean such tracking can be made vastly more efficient. One problem, at least at this point, is that smaller hospitals do not have the capital at hand that’s necessary to account for the high upfront costs of installing such automated systems. However, there is a general shift toward that, which means costs will be going down in time.

Transparency’s report indicates that some of the big players now are CareFusion Corp. (NYSE: CFN) and Kirby Lester. The former leads the pharmacy automated systems market, and the latter is the leading provider of automated tablet counter platforms.

Some of the other major companies in the sector include OmniCell Inc. (NASDAQ: OMCL), AmerisourceBergen Corp. (NYSE: ABC), McKesson Corp. (NYSE: MCK), ScriptPro, and Swisslog Holding Ltd.

While North America currently accounts for more than half of all the growth in the automated systems market, it’s likely that the rest of the world is going to play catch-up soon as awareness spreads and interest grows.

Robotics Advances and Investments

Swisslog just recently introduced the TransCar Automated Guided Vehicle—an automated system for moving heavy payloads from loading docks to their final destinations, smoothly integrating with elevators and doors to navigate.

Laser, sonic, and photographic guidance systems all work in tandem to help the AGV operate efficiently. Obviously, that makes the AGV a hugely attractive proposition just about anywhere where massive payloads are delivered and have to be sorted out regularly.

So we’re talking about hospitals, schools, universities, cafeterias, hotels, perhaps even airports and train stations. The major benefit, though, is directed toward hospitals, which can standardize their delivery schedules using the AGV, thus freeing up valuable human resources.

Robotics in healthcare is already receiving serious attention and interest from big names. People like Bill Gates (who’s initiated a whole division at Microsoft dedicated to R&D for robotics) are talking about things much further ahead than iRobot’s (NASDAQ: IRBT) Roomba or the da Vinci robotic surgical system developed by Intuitive Surgical (NASDAQ: ISRG).

Amazon (NASDAQ: AMZN) recently acquired Kiva Systems for $775 million or so; Kiva manufactures robotic systems for moving large payloads around in warehouses. Clearly, robotics is revealing itself as an area that attracts diverse minds for diverse purposes.

Healthcare, hospitals, and pharmacies will see booming business in the near future as the baby boomer generation hits retirement. Expect to see major advances in healthcare-related robotics soon. 

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