WESTLAKE, OHIO (July 3, 1:35 p.m. ET) — Officials at health-care services giant Cardinal Health Inc. haven't lost sight of the reason the company is in the health-care market in the first place.
“The main reason to get into health care is the people side,” said Nick Fotis, research and development director of pre-source and scientific products at Cardinal, which ranks as one of the 25 largest corporations in the U.S. The Dublin, Ohio-based firm has annual sales of $103 billion.
The keynote speaker at Plastics in Medical Devices 2012 in Westlake, Fotis outlined reasons why so many companies want to enter the lucrative medical market — but he also pointed out some of the many challenges that new entrants can face.
The attraction of the market can be seen in government programs that could allow 40 million to 50 million uninsured Americans to gain access to health coverage in the next few years. On a broader scale, more than a billion Chinese people have limited health coverage or none at all. The U.S. and other developed countries also have aging and more active populations, which creates a greater need for health care.
“Health care has consistent growth and stable demand,” Fotis said. “There's a high barrier to entry, but once you're in, you're in, and there's a high hurdle to change.”
He advised new market entrants to have patience with the process and to learn the industry's standards and regulatory pathways, particularly those that involve the Food and Drug Administration. This educational period involves asking about evaluation and accreditation processes, safety testing and sterilization types.
Fotis also pointed out several trends affecting the current health-care market. Included on that list are hospitals now having more impact on product selection, while individual doctors have less. The reason, he said, is because medical school debt, malpractice costs and other factors have led hospitals to own as many medical practices as doctors do.
“Physicians' preference still retains value, but less so,” Fotis explained. “The world is changing as far as who controls buying and decisions.”
Health-care officials also are looking at sustainability and reusability as means to reduce the massive amounts of waste that hospitals generate. Even so, Fotis said sustainability “is a tie-breaker if costs are equivalent, but hospitals aren't willing to pay more for green products.”
The reprocessing and resterilizing of single-use devices also is having a big impact on medical devices. The industry first opposed this practice, but Fotis said that the two biggest reprocessors now are owned by medical-device firms.
“For plastics, [reprocessing and resterilizing] decreases sales and creates physical challenges of heat, handling and cleaning agents,” he said.
Future material development could include “smart materials” that are affected by stress, temperature, moisture and electricity. These materials could change color or release antimicrobials or other materials to respond to a patient's condition.
Cardinal Health products that use cutting-edge plastics-related materials include Tiburon surgical drapes, which consist of three-layer, multifiber composites designed to protect patients and physicians during surgery. The firm's SmartGown surgical gowns also allow for water transmission to protect against bacteria.
“We need more smart materials because of hospital-acquired infections,” he said.
In the broader market, Fotis said researchers have developed an acrylic resin for use in bone cement that can repair fractures as they occur.
Overall, the health-care market still offers a lot of opportunities.
“Even with all of the challenges and pressures, it's still great to be in health care,” Fotis said. “We get to affect the lives of people every day.”
The June 12-13 conference was hosted by Plastics News.