Gary Van Meer is founder of Palm Harbor Medical in Tarpon Springs, Fla., which resells surgical disposables.
Q: What does the resale of surgical disposables involve?
Gary Van Meer: It's about purchasing surgical disposables that had been sitting on another facility's shelf, were never used and are still in mint condition. Knowing they would never use these items, facility staff sold these items to a company like Palm Harbor Medical. The company verifies their quality and then resells them to another domestic-based facility that wants them.
Q: What sort of product lines do you handle?
GVM: We generally stick with prescription medical devices, ordered by physicians, such as arthroscopy shaver blades. We don't get into general medical supplies, such as tape and Band-Aids, but we do offer gloves and drapes.
Q: What sort of discounts can the buyer expect?
GVM: The discount on resold products varies depending on the style, but generally it is 20-30 percent lower than ordering direct from the manufacturer or through a distributor.
Q: How do you vouch for the quality of the product?
GVM: Everything we buy has to come through our facility in Tarpon Springs so that our team can inspect it and make sure it's still sterile. On many occasions we throw things away because they do not meet our standards.
Q: What sort of facilities do you have as customers?
GVM: Surgery centers, hospitals and physicians' offices. We're even starting to get involved with GPOs. One of the biggest GPOs in the country recently signed up with us because they were unable to get discounted pricing with a certain original equipment manufacturer.
Q: Is there a limit on the volume of products available?
GVM: We're limited to what is sitting on people's shelves. It really varies, depending on the specific style of product you want. For example, arthroscopy shaver blades come in about 45 styles but only 12 styles sell on a consistent basis. Because of limited availability, at times we don't advertise the fastest moving products. We have private sales of those styles. These products may include some types of arthroscopic shaver blades, harmonic scalpels and some shoulder anchors. The demand is usually very specific because a surgeon won't switch to another style.
Q: Do you offer newly launched products?
GVM: We often start stocking a new product about six months after introduction. That's because when a new product is launched, an ASC or other facility puts it through a trial stage. It will order a certain quantity for the surgeons to try out. If the surgeons don't happen to like it, the facility immediately has products it will probably never use, which we call "non-moving inventory." A facility can also find itself with non-moving inventory when its converts to a competing product and has some of the previous product left on its shelves.
Q: When an ASC buys resold disposables, doesn't it have to worry about the expiration date?
GVM: These products still have substantial time before the expiring, at which point the item is considered non-sterile. Generally speaking, most of the items in our inventory have expiration dates that are at least three years out. Our policy is if you purchase anything from Palm Harbor Medical and it sits on your shelf and nears expiration, we will replace it with the same product. Or, if the product is not available, we will provide equal dollar value for anything else in our inventory.
Q: How long has the disposables resale industry been around?
GVM: The capital equipment resale industry has been around for some time, but the market for surgical disposables is less than 15 years old. I started my company 11 years ago. At the time, I was a sales rep for a large orthopedic manufacturer. One day I noticed one of the nurses at an ASC was throwing out a whole bunch of arthroscopy shaver blades. Her surgeons were no longer using them, but they were still in pristine shape. It seemed to me that somebody could use them.
Q: What is the future of the industry?
GVM: As prices for equipment continue to rise, these items become an increasingly viable alternative. Customers have saved a ton of money buying products that are bought off-contract and even for some products where GPO pricing isn't strong.
Resold disposables can also be a good alternative when your surgeons switch products when prices get too high or when the manufacturer falls off a contract. Switching to a new product is an involved process, requiring physicians to undergo trials on various new products and adding new part numbers into purchasing systems. In many cases, resold disposables allow you to stay with the same product at the old price.
Learn more about Palm Harbor Medical.
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