Bit Computer, Non-Face-to-Face Medical Care Faces 'Stagnation'; Trust Lies in Hospital Information System 'Klemer'

As confirmed cases of the novel coronavirus infection (COVID-19) surge, social demand for non-face-to-face medical consultations is growing. President Moon Jae-in stated in his third anniversary speech on the 10th of last month, "We will focus on fostering non-face-to-face industries such as healthcare, education, and distribution." Although the Korean Medical Association and the Korean Pharmaceutical Association oppose it, public opinion largely favors the introduction of non-face-to-face medical consultations. While it may not be easy to fully implement non-face-to-face medical consultations, the possibility of regulatory relaxation has increased. The non-face-to-face medical consultation industry, based on existing online platforms, is expected to grow. Asia Economy reviews the status of companies promoting non-face-to-face medical consultation and related businesses.

[Asia Economy Reporter Yoo Hyun-seok] Bit Computer, a medical information specialist company, is one of the few listed companies with experience in building non-face-to-face medical consultation systems. However, due to the delayed market development, it has not been able to fully spread its wings. Recently, it has started to enter a growth trajectory by strengthening its integrated medical information system 'CLEMR' business, which it has positioned as a breakthrough for improving its recent performance. It is expected that the growth trend will steepen once the non-face-to-face medical consultation market fully takes off.

Bit Computer recorded consolidated sales of 7.5 billion KRW and operating profit of 1.7 billion KRW in the first quarter of this year. Although sales decreased by 4.5% compared to the same period last year, operating profit increased by 51.08%, improving profitability. By business segment, medical information accounts for the largest share at 65.39%, followed by education (29.37%) and leasing business (5.24%). Among these, the medical information business, which accounts for 65% of sales, is divided into medical information systems (55.16%) and digital healthcare (10.23%). The medical information systems division provides integrated medical information system (HIS) solutions necessary for the operation of hospitals, clinics, and pharmacies, while the digital healthcare division has various solutions required for building non-face-to-face medical systems.

Bit Computer has attracted attention because of non-face-to-face medical consultations. As of the end of 2018, it had built non-face-to-face medical systems for over 900 domestic and international institutions, ranking first in construction performance. It has also exported to overseas countries such as Cambodia, the United Arab Emirates (UAE), Mongolia, Brazil, and Thailand. In 2015, it was selected as the builder of the non-face-to-face medical consultation system introduced by the Armed Forces Medical Command.

However, as non-face-to-face medical consultations have not yet fully developed, Bit Computer's growth has also stagnated. Last year, sales in the digital healthcare sector were 4.7 billion KRW, showing little increase over several years. Recently, the atmosphere has begun to change. Due to the COVID-19 situation, non-face-to-face medical consultations via telephone examinations have been temporarily permitted, raising expectations for market development. Lee Sang-heon, a researcher at Hi Investment & Securities, said, "The non-face-to-face medical care temporarily permitted by the government plays a significant role in alleviating concerns about hospital infections as well as medical blind spots," adding, "COVID-19 is expected to pave the way for allowing telemedicine, and the timing for permitting non-face-to-face medical care may come sooner than expected." Non-face-to-face medical consultations are also expected to secure growth momentum along with the recent increase in demand for medical information systems utilizing cloud technology.

As the efficiency of the cloud service CLEMR improves, orders have been increasing since the second half of last year. As a result, annual sales, which have remained in the 30 billion KRW range, are expected to exceed 40 billion KRW this year. According to FnGuide, securities analysts forecast Bit Computer's sales and operating profit at 40.6 billion KRW and 5.8 billion KRW, respectively. Sales are expected to increase by 8.64% year-on-year, while operating profit is expected to decrease by 4.38%. Moon Kyung-jun, a researcher at IBK Investment & Securities, said, "Growth centered on the medical information system and digital healthcare businesses is expected to continue," adding, "Some projects delayed to the second quarter or the second half due to the impact of COVID-19 will improve performance as the year progresses."