FDAnews Device Daily Bulletin

DEVICE REPROCESSORS ALLIANCE, VANGUARD APPROVE MERGER

Dec. 21, 2005
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The boards of Alliance Medical and Vanguard Medical Concepts have approved a merger agreement between the two leading third-party reprocessors of single-use medical devices (SUDs).

Alliance and Vanguard, which collectively have reprocessed more than 30 million SUDs for over 1,700 healthcare facilities nationwide, proposed the merger agreement in August. "As one company, we will be able to offer our customers greater value thanks to an expanded family of products and enhanced customer service," said John Grotting, CEO of the new company.

The new company's new name is expected in the first quarter of 2006. All existing shareholders for the individual companies will continue as shareholders of the combined company, the firms said. The reprocessing industry continues to experience tremendous growth, the companies said. In the coming year, the combined company said it expects to help its customers save more than $92 million in supply expenses. In addition, the combined company expects to eliminate over 7,000 tons of medical waste from the nation's landfills annually.

The industry growth comes amid new scrutiny of the safety of reprocessed devices. A yearlong investigation by the Washington Post reported dramatic examples of failed reprocessed devices, such as an electrode from a catheter that broke off in a patient's heart. The articles prompted several House lawmakers to seek information from the FDA on the safety and oversight of the reprocessed medical devices.

The Association of Medical Device Reprocessors (AMDR) blasted the Post story, but said it would work with the lawmakers. "The article was irresponsible in avoiding a basic fact: that no surgery is without risk, and that hundreds of surgical incident reports are filed every year as a result of unreprocessed or 'original' devices," AMDR said.