Vection Technologies Ltd (ASX: VR1) has made a bold leap into the healthcare space with a $1.6 million deal, licensing its soon-to-be-subsidiary, The Digital Box’s (TDB) proprietary artificial intelligence solution to Brexia Med, a European healthcare company. This move not only strengthens Vection’s profile in AI but also positions it for future gains within the healthcare sector through Brexia Med’s innovative “Hub & Spoke” model. Set for a three-year span, the contract also includes a two-year extension option, potentially raising the deal's total to $2.5 million.
The Deal
Vection announced its intent to acquire TDB, a generative AI company, in August 2024, and the acquisition is on track for completion in Q2 FY25. This latest contract, signed by TDB with Brexia Med, exemplifies the revenue-generating potential Vection sees in its upcoming acquisition. Brexia Med, focusing on localised private healthcare solutions, will use TDB’s Algho AI platform to streamline patient screening within its service model, thus meeting growing demands for efficient healthcare delivery.
The contract’s recurring revenue is based on ongoing Algho AI licences and related services, signalling a stable and potentially expanding revenue stream as healthcare providers seek to incorporate more AI-driven efficiencies.
A “Game Changer” for Healthcare
TDB’s Algho AI platform, the backbone of this deal, will play a central role in Brexia Med’s screening processes. Through automated, AI-powered analysis, Brexia Med aims to expedite patient screening, creating a more efficient and accessible system for patients. As Gianmarco Biagi, Managing Director of Vection, remarked, “This contract marks a significant milestone in showcasing the power of TDB’s AI capabilities… [and] highlights the potential of AI in driving innovation…across the medical industry and beyond.”
The implementation of Algho AI into Brexia Med’s operations taps into a trend where healthcare providers leverage AI to handle high-volume, routine tasks that require accuracy and speed. Such technology reduces the burden on healthcare professionals, freeing them for more specialised tasks, while giving patients quicker access to services—a win for both operational efficiency and patient experience.
Strategic Growth and Financial Impact
For Vection, the TDB acquisition represents a strategic expansion into AI-driven services, with healthcare now clearly marked as a priority sector. By introducing Brexia Med to AI-enhanced screening, Vection gains a tangible foothold in the European healthcare market. Given the optional two-year extension, this partnership could further entrench Vection’s role in this sector as it pushes the total contract value beyond the initial $1.6 million, allowing Vection to build a presence in AI solutions that target healthcare efficiencies.
On the financial side, the contract's size has triggered Vection’s materiality threshold as it exceeds TDB’s FY24 unaudited revenue by 10%, underscoring its immediate significance for the company. For investors, the deal demonstrates not only growth potential but the revenue-generation capabilities of Vection’s new AI division.
A Step Forward for Vection’s Vision
Vection’s journey from extended reality (XR) solutions into the AI domain demonstrates its commitment to bridging the digital and physical worlds across diverse sectors, from industry to healthcare. With offices worldwide, Vection is positioned to expand its service offerings, leveraging 3D and AI technologies to meet the specific needs of global enterprises. Brexia Med’s adoption of the Algho AI system may well serve as a proof point for Vection’s solutions, potentially attracting further healthcare partnerships.
As Vection inches closer to its acquisition finalisation, the Brexia Med contract hints at what investors might expect from this AI venture: consistent, scalable revenue opportunities in sectors that increasingly depend on advanced technology solutions. The Brexia Med project is not just a high-value sale; it could set a precedent for how Vection’s AI capabilities integrate into high-stakes industries like healthcare.
In summary, Vection’s $1.6 million licensing agreement isn’t just a financial boost—it’s a strategic step into the healthcare market, a sector that increasingly demands innovation. With this deal, Vection is not only demonstrating the revenue power of its AI offerings but also setting the stage for a broader role in transforming healthcare solutions worldwide.
