Something New, Something Used, Something Sterile: Stryker Embraces Recycled Medical Devices

6/29/11Follow @xconomy

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continued campaign for more regulation could drive up the cost of reprocessing devices, potentially erasing any price advantage they enjoy over new devices, the report says.

Lars Thording, Stryker’s senior director of marketing and public affairs for the Ascent business, has been quite vocal in decrying what he calls the “desperate tactics” of the medical device makers to thwart reprocessors. For instance, companies like Johnson & Johnson are pushing for exclusive sales agreements with surgeons that would shut out reprocessed devices, he says.

But there are larger macroeconomic factors shaking up the medical device industry that are working in the favor of reprocessors. In major categories like cardiac rhythm management (pacemakers and implantable cardioverter defibrillators), devices have become less about innovation and more about cost and volume.

Gone are the days where there is “technological innovation for the sake of technological innovation,” Thording says. “That’s fundamentally different from how medical device makers think, to push out innovative devices to move the bottom line.”

And hospitals need to save cash. The GlobalData report estimates a 100-bed hospital can save up to $100,000 a year by using reprocessed surgical tools like laparoscopic trocars, ultrasonic scalpels, and multi-clip appliers.

Of course Stryker already knows this. The company plans to invest heavily in Ascent, which it recently renamed Stryker Sustainability Solutions.

While Stryker units typically operate their own sales teams, the company is moving towards a more unified approach. That puts Stryker in the awkward position of trying to sell both its new devices and reprocessed ones to the same customer. In essence, the company may be competing with itself.

But that’s not how Stryker sees it. The company envisions itself as a partner that will help hospitals best meet their needs, which includes saving money.

“In order to compete, we have to offer more than just innovative products but also cost savings,” Kaminsky says. “We want to be the wingman to hospitals.”

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