Omnicell's G4 Reaches Middle East - Analyst Blog

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Omnicell, Inc. ( OMCL ), a leading developer and marketer of end-to-end automation solutions for the medication-use process, will showcase its newly launched fourth-generation G4 solutions in the presence of 70,000 healthcare professionals at the Arab Health 2012 Congress and Exhibition, scheduled from January 23 to January 26.

Given the fact that very few hospitals have adopted medication control systems in the international market, Omnicell is presently working hard to establish its presence in the global arena, especially in markets with huge potentials.

Earlier in May last year, Omnicell set up its Middle East regional office and training center in Dubai, which is considered to be path breaking for healthcare customers and business partners in that region. This center has already organized several training sessions for students from six countries. The company is also looking forward to provide training using the G4 platform to hospitals in that region.


Presently, outside the US, Omnicell operates in Canada, Europe, South America, Australia and Asia with supply chain sourcing in Asia. The company aims to derive 20% of its revenues from international operations in the longer term compared with the current level of 5%.

To achieve this, the company is aiming at expanding its international footprint through various strategies. The company expects the adoption curve to show an ascending pattern going forward, as it is on track to develop products incorporating new technologies, to capture more market share from its competitors and continue winning more deals.

Despite the tough economic conditions in Europe, we are optimistic about Omnicell's growth prospects in the international arena. In November 2011, Omnicell launched its Mandarin-language versions of G4 platform for clinical use in China. Additionally, Omnicell announced a partnership with China Resources Beijing Pharmaceutical for distributing its automated medication dispensing systems in China.

Considering the increased investment in information technology ( IT ) by healthcare providers and the huge untapped market for automated healthcare management systems in China, we expect Omnicell's initial entry into the Chinese market to further enhance the company's international endeavor in due course.

Athens Regional Hospital in Georgia has adopted the upgraded version of OptiFlex supply management solutions. Wellmont Health System in Tennessee and Sentara Health in Virginia installed the company's new controlled-substance management solution.

Notwithstanding the concerns arising from several macro-economic uncertainties as well as intense competition from major players such as CareFusion Corporation ( CFN ) and McKesson Automation ( MCK ), we are optimistic about Omnicell's growth prospects globally. We are also looking forward to the Omnicell's fourth quarter and full year 2011 result which is expected to release on Thursday, January 26, 2012.

Currently, Omnicell retains a short-term Zacks #2 Rank (Buy rating). However, over the long term, we remain Neutral on Omnicell.


 
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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of The NASDAQ OMX Group, Inc.



This article appears in: Investing , Business , Stocks

Referenced Stocks: CFN , IT , MCK , OMCL

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