Cognizant Technology Solutions ( CTSH Quick Quote CTSH - Free Report) recently announced that its Shared Investigator Platform (SIP) has surpassed 250,000 users across 100 countries worldwide.
SIP is a life sciences Software as a Service (SaaS) solution that helps speed up clinical trial procedures by allowing clinical study documents and safety notifications to be exchanged fast and securely. SIP solution has helped to improve the development of pharmaceutical drug discovery faster even amidst severe supply chain issues globally and voluntary attrition rates rising in the labor market.
Cognizant established SIP in 2016 with TransCelerate, a group formed of the world's largest biopharmaceutical organizations, to standardize clinical trial documents into a single shared environment.
Standardization of clinical trials as a digital document to be shared easily reduced operational costs and increased production efficiency. As a result, SIP attracted new users and is currently used by seven of the largest global biopharmaceutical companies operating at more than 32,000 trial-ready sites. SIP utilization by clients has increased more than 65% in the last two years.
The adoption of digital solutions has been slower in the healthcare industry. However, the recent growth of Cognizant’s SIP solution reflects how healthcare clients globally are transitioning to digital operating models to increase operating efficiency. Cognizant is well-poised to benefit from such new trends in the market amid the fourth industrial revolution.
Cognizant Top Line Benefits From Digital Solutions Adoption
Cognizant is experiencing significant growth in its digital business operations, which is outgrowing the BPO market, thus reflecting momentum in AI, AR, automation, blockchain, IoT, quantum computing and as-a-service solutions.
Adoption of digital solutions in the healthcare sector is significantly contributing to digital business revenue growth, as reflected in the second-quarter 2022 results. Healthcare revenues (28.7% of revenues) increased 7.6% year over year at cc to $1.41 billion. The growth was driven by higher demand for its digital services among pharmaceutical clients.
To benefit from the growing adoption of digital solutions in the healthcare industry, Cognizant has been building strategic partnerships with companies like
Microsoft ( MSFT Quick Quote MSFT - Free Report) to capitalize on the opportunity for an intersection between health and cloud services.
Cognizant has collaborated with Microsoft to leverage their Cloud for Healthcare solution and built a new solution to aid in remote patient monitoring for improved medical care.
However, Cognizant shares have been negatively impacted by the current macroeconomic situation and geopolitical tensions. Various factors like global inflation, interest rate hike by the U.S. Federal Reserve and the Russia-Ukraine war have negatively impacted its outlook.
Cognizant shares have fallen 30.2% year to date compared with the Zacks
Business-Software Servicesindustry’s decline of 36.1%.
Cognizant is also facing a significant threat in the AI industry and the cloud space from companies like
International Business Machines ( IBM Quick Quote IBM - Free Report) and Accenture ( ACN Quick Quote ACN - Free Report) .
IBM is poised to benefit from strong demand for hybrid cloud and AI, which will drive its top-line growth. IBM recently expanded its collaboration with the U.S. federal government to address current problems like cybersecurity and supply chain sustainability via its data fabric solutions and IBM Watson.
Accenture is improving its market share in the industry with its recent acquisition of digital engineering and operational technology from Trancom ITS. This, in turn, will help Accenture provide customers with cloud-based logistics systems and merge warehouse operations with IoT and sensor technology.
Amid tough competition and rising volatility in the tech industry, Cognizant which currently carries Zacks Rank #3 (Hold), is looking to address changing dynamics in the healthcare industry to counter competitors in the AI space. You can see
. the complete list of today's Zacks #1 Rank (Strong Buy) stocks here
Pandemics and wars can no longer be addressed as black swan events as these occur every few decades. Their impacts on people and society need to be considered a common incidence, and this changes operational dynamics in the healthcare industry.
Biopharmaceutical companies need to reduce processing time and shift operations to the cloud supported by AI and automation to reduce manual efforts and produce life-saving drugs faster.
Cognizant’s recent investments in developing its digital business model will help the company address the changing dynamics and contribute to top-line growth.