by Thom Doherty

The reason Intelligent Hospital Systems Inc. (IH Systems) acquired AmerisourceBergen Technology Group

Today IH Systems announced the acquisition of AmerisourceBergen Technology Group (ABTG) creating the most integrated pharmacy technology company in the industry, and strengthening our position in the pharmacy automation market.

Worldwide, pharmacy automation purchases are growing with a compounded annual growth rate (CAGR) of 8%, and the Pharmacy Purchasing and Products, State of Pharmacy Automation August 2014 report, identifies that “With growing budgets, the next few years should provide ample opportunities within the pharmacy to improve patient safety through new technology adoptions and the exploitation of existing automation to deliver increased efficiencies”.

 

However, many pharmacies adopting automation operate with fragmented work processes, and low integration of equipment, that together make it difficult to meet the growing demands for medications with the expected response times, safety, quality and cost targets.  Pharmacies recognize the need to turn to technology to support an increasingly industry-like focus on productivity and efficiency.  Currently it is a challenge to achieve efficient operations due to the lack of integration between inventory systems, IV automation, oral solids automation and workflow.

It has been IH Systems’ vision to provide an answer for pharmacies, and we developed a concept we called the “Total Dose Solution” – a lean, integrated, computerized end to end dose preparation system that provides safe and efficient preparation of doses and provides workflow and material management for all pharmacy activities from drug order to delivery.

As part of our concept we identified over 400 key requirements and an integration concept covering vial filling and unit dose packaging; IV dose preparation; inventory control; and workflow and planning software.

Achieving the Total Dose Solution requires integrating currently disjointed pharmacy processes and technology that are seen in the market today.  We recognize that market consolidation and the resulting product integration represent the best opportunities to build the overall pharmacy solution.  It is important to note that some pharmacy automation technologies are highly commoditized (where similar functionality is available from multiple vendors); while other areas are very unique, so appropriate consolidation offers a strong value.  By putting the right pieces together, a company can develop a comprehensive solution and a competitive advantage.

We used the Total Dose Solution concept in a systematic way to analyze product offerings from different companies, to determine how well combined products can fit the solution needs, and ultimately to analyze combinations of companies.   IH Systems’ vision behind all of this was to build an integrated total (end to end) pharmacy automation solution, focusing on improving safety, productivity and efficiency.

In our assessment of the landscape, the combination of ABTG’s oral solid automation, inventory systems, cabinets and software, with IH Systems’ RIVA, a fully automated IV compounding system, provides the most comprehensive end to end pharmacy solution available (see figures 1 and 2).  When the opportunity presented itself, it became our goal to acquire ABTG and build a combined company that together can provide the key pieces of the Total Dose Solution (see figure 3).

The integrated ABTG/IH Systems company, named ARxIUM, will lead the market in fully automated IV compounding, scheduling and workflow software, open interfaces, and will be competitive in all other areas.

ARxIUM becomes a strong platform company where pharmacies will benefit from one company being able to offer all the pieces in an integrated solution.  There are now three major ways that we can serve this growing market:

• Pharmacies can buy the individual products from the integrated company as they need,
• Pharmacies can add our products to what they already have in place (to help integrate their systems), and
• Pharmacies can buy a total integrated solution (the software, the systems, the workflow).

This is an important step for us as a company and for the market as we can offer the equipment and tools to enhance safety, efficiency and productivity for the entire pharmacy.  Pharmacists can reduce their time spent in preparation, distribution, ordering and management of workflow, and can redirect their focus to patient care, exactly what a Total Dose Solution should enable.

Figure 1

Figure 2

Figure 3

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Thom Doherty is the Chief Technology Officer at Intelligent Hospital Systems