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Technology beats tedium: Kit Check nabs $10M to help hospitals automate inventory tracking

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About two years ago, Kevin MacDonald, a former RFID engineer for Sun Microsystems, was sitting at dinner with his wife and her friend, when the friend started describing her day.

As a hospital pharmacist, she told him, she’d sometimes have to spend an entire workday manually sifting through stacks of hospital “kits,” which include drugs and supplies, to make sure they were complete and up to date.

“It seemed absurd to me that someone that highly educated and highly compensated would be manually sorting through hundreds of items and expiration dates,” MacDonald said.

Given his background in RFID technology, he figured there had to be a more efficient way to track the inventory. And after nine months of working out the details, he launched Kit Check last April. The company attaches RFID tags to each item in a kit to automate the tracking process so that a pharmacist can scan an entire kit for missing and expired items within seconds.

On Tuesday, the startup said it had raised a $10.4 million Series A round to build out its sales and delivery teams and develop the infrastructure to meet increased customer demand. The round, which follows $100,000 in seed funding raised through its participation in the Rock Health accelerator, was led by New Leaf Venture Partners and included Sands Capital Ventures, Easton Capital Investment Group and LionBird.

At hospitals across the country, pharmacists are responsible for maintaining kits of drugs and supplies necessary for various procedures. The contents vary between hospitals, but the different kits – from those for anesthesia to eye surgery – could include up to 100 different items that need to be checked regularly to make sure the drugs haven’t expired and that all the items are in place.  What makes the process especially labor-intensive, said MacDonald, is that two different individuals in pharmacy need to manually check and re-check the kits. His firm estimates that kit checking costs hospitals $2 billion a year in labor and that Kit Check’s solution is 90 percent faster than the typical manual process.

Kit Check isn’t the first company to automate kit checking with technology, but McDonald said that while competitors, which include MedKeeper and McKesson, may use barcodes, Kit Check uses RFID tags, which enables hospitals to track items more quickly and comprehensively.  With barcodes, pharmacists still need to touch each item in a kit to scan them. But with RFID technology, hospital workers can put an entire kit into an oven-like container MacDonald said some call the “magic box” to track items.

By freeing pharmacists from the time-consuming kit checking process, MacDonald said they’re able to spend more time with patients and potentially save hospitals money by recommending more cost-effective drug options and doses. Kit Check’s technology is currently being used in seven hospitals and the company said it would add nine new clients in the next month.