Healthcare information technology (HCIT) solutions provider
) and medical technology company
) recently announced the implementation of interconnected systems
at the well-regarded teaching and research hospital Penn State
Milton S. Hershey Medical Center.
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The systems which share data will improve medication management at
the Magnet organization, Penn State Hershey. The latest
offering by CareFusion and Cerner allows data sharing and
assimilation of clinical information between the automated
medication dispensing technology of CareFusion's Pyxis MedStation
4000 system and the Cerner Millennium electronic health record
(EHR) system, via Cerner's CareAware iBus integrated device
The features of this joint offering will improve standards of care
by reducing time and enhancing efficiency of medication dispensing.
The integration of these leading technologies underlines the
strategic initiatives of CareFusion to reform medication
Earlier in 2010, CareFusion and Cerner inked a strategic agreement
to develop solutions to improve quality of care via
interoperability and system connectivity, on the back of
amalgamation of the pioneering technologies. The integration
allowed CareFusion to unify its Pyxis medication technologies,
Alaris infusion pumps and Ventilation systems with Cerner's
CareAware iBus and Cerner Millennium.
Cerner continues to extend its existing broad footprint in the
domestic market. Such integration is expected to allow the company
to gain hospital deals. Cerner remains the trend setter among
pure-play, publicly traded healthcare IT (HCIT) vendors. Its second
quarter revenues climbed 22% year over year to $637.4 million on
the back of Support, Maintenance and Services (up 19.9% to $426
million), robust System sales (up 24.2% to $195.3 million) and
higher revenues from Reimbursed Travel (up 36.3% to about $16.0
We believe long-term investors may consider Cerner, which serves a
sizeable installed hospital base. It requires composite
clinically-focused applications complying with 'meaningful use'
requirements, reimbursement problems and complex coding challenges.
The company has long-standing, integrated and seamless solutions
for both inpatient and ambulatory settings.
On the negative side, the federal Stimulus program will gradually
wind down. Cerner faces stiff competition from established HCIT
players, such as
) and many others in a crowded field. The company is developing
multiple growth drivers which will ensure its future growth.
We have a long-term 'Neutral' recommendation on Cerner. The stock
currently retains a Zacks #3 Rank, which translates into a
short-term Hold rating.