Press release: NewIcon is organising a share issue – the goal is to raise a good slice of the pharmacy automation market worth more than 9 billion euros
The target of NewIcon is to achieve a market-leader position in all the Nordic countries and to grow rapidly in the Middle East and, with the cooperation of partner company General Icon established in 2018, also in China. In 2018, the company’s turnover increased by 65 percent to EUR 7.3 million.
“We are aiming for a turnover of more than 60 million euros in 2024. We will then be a major pharmacy automation supplier in Europe and will have also made an opening for the North American markets,” says Ossi Parviainen, Chief Executive Officer for NewIcon Oy.
The aim of the share issue is to raise up to 4.99 million euros of investments, which will be used for internationalization and for building scalable business operations. Alongside geographic expansion, the company is seeking growth by supplementing its product portfolio.
“Our innovative product development team is planning new scalable digital solutions and automation systems to cover the entire continuous medication chain,” says Parviainen.
Market value of 9 billion euros
The average annual growth rate of the pharmacy automation system market has been forecast to be in excess of 7% and, for example, in China no less than 13%. In 2025, the total market value is estimated to be around 9 billion euros.*
“New solutions to improve the efficiency of nursing work and to cut costs are constantly being sought. To achieve results, hospitals and pharmacies are prepared to make big investments. The automation of pharmacy services will provide direct cost savings as it can help to improve nursing practices, reduce the capital invested in inventory and minimise the wastage of medication,” explains Parviainen.
The demand for automation solutions will further increase due to the increased awareness of the cost implications of medication errors for society. Medication errors are a big problem all over the world. For example, approximately 40% of adverse events reported in Finnish hospitals are allocated to medication errors, while in England, there are 237 million medication errors every year.
“Patient safety and occupational safety improves when the digitalisation and automation of activities can be used for reducing human error, unintentional drug exposures and processing errors related to the dilution phase of medicines. By automating the routine pharmacy work stages, pharmacy professionals will have more time for expert tasks,” Parviainen sums up.
Investments into growth, internationalization and product development
NewIcon’s share issue is organized by investment house Springvest Oy, which also organized NewIcon’s previous round of financing in 2017. At that time, NewIcon raised 4.3 million euros, which brought nearly 300 new shareholders to the company.
In 2018, a Chinese company called Highlight Health Investment Limited invested 4.5 million euros in NewIcon. At the same time, NewIcon established a joint venture in Shanghai with a market leader in the local pharmacy automation industry. The European Investment Bank (EIB) has also trusted NewIcon, and granted loan financing to the company in 2016.
NewIcon has used the investments in growth, internationalization and product development. The largest investments have been in the development of sales, marketing and distribution channels. In 2018, NewIcon extended its operations to five new countries and gained more market penetration in Israel, where it expanded its operations from the pharmacy sector to the hospital market.
“Although the gained investments have been significant, they are moderate in proportion to the size of the market. In order for the company to have the ability to grow, it is necessary to make investments in growth using a frontloaded strategy,” says Parviainen.
*Source: Grace Market Data: Global Pharmacy Automation Systems Market 2017-2025 by End-user, Product and Region June 2018.
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Founded in 2007, NewIcon Oy is a health tech company specialising in pharmacy automation systems. The company has delivered pharmacy automation solutions to more than 100 pharmacies and hospitals in Finland, Denmark, Russia, Israel, Iran and China. The number of staff is about 60. The company has a certified ISO 9001 quality System.