Recalls and alerts as business drivers

Recent blanket recalls of widely used pumps, including flagship products of market leaders Baxter and Alaris (Cardinal Health), may push hospitals over the edge and motivate investment in the more advanced technologies. In this sense, recalls may spawn business for OEMs. In addition to recalls, the FDA also issues urgent device alerts that allow the pumps to remain in service until repaired. In either case, the regulatory enforcement has a largely favorable impact on the markets. Independent service providers (ISOs) also benefit.


"When a new pump comes out, end-users expect one or two recalls, whether it's a software glitch or mechanical failure," says Troy Goodhart, Sales and Marketing, Select POS and Peripherals LLC, Edina, MN, which services pumps. "Because of those recalls, the end-users have chosen to hold on to older [pumps] in lieu of upgrading to the new."

"We absolutely love the recall situation," says Les Sandlin, VP Sales, IV Technologies, Inc., Upperville, VA. He noted that recalls require parts. "There are still some companies out there that want to hold on to these pumps as long as they can for financial reasons, so they are looking for a source like us to come in and get them a better option as far as cheaper parts."

While the recalls and alerts have created chaos, they have also created opportunity, since sales of affected devices generally are frozen and healthcare providers need alternatives.

"The result is that the value of the pumps already in the marketplace skyrockets even though they are under an urgent device alert. Nobody can buy any new pumps from the OEM, so everybody is scrambling to get the ones [on the recall/alert
lists] that are held by rental companies," observes Tom Creal, President, First Biomedical Inc., Olathe, KS.

Medical megatrends affect the pump world

In addition to the ironic recall alert impact, several other big trends point to favorable market conditions for new and used pumps. To begin with, more patients are hooked up to IVs.




"Nowadays if people are on oral medications, they are home. They don't stay in the hospital any longer," says Joni Poole, RN, formerly a clinical executive at a large northern California hospital group. "Most of our patients in the hospitals now are getting IV therapies."

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