April 16, 2019

Resilic Spotlight on Sterigenics Part 2

Jon Bovit and Shahzaib Khan

Download the full EventWatch Spotlight Report here

Sterigenics and Sterilization Challenges Ripple Across the Industry

Early Warnings Enabled Resilinc Customers to Manage Sterilization Challenges



Then another sterilization contractor using EtO was identified as a possible source of toxic pollution. On January 17, 2019, Resilinc’s customers were alerted to local media reports that the Michigan Department of Environmental Quality was blaming Viant Medical in Grand Rapids for EtO releases associated with high cancer risks in surrounding neighborhoods. By early March 2019, Viant announced it would cease sterilization activities at the Grand Rapids plant, noting that sterilization was not a core business there.

Viant’s decision to shed a non-core business that was becoming a liability underscores another theme in the still-evolving EtO story. “Changes in ownership or management that occurred in 2018 could affect the EtO supply chain, especially if safety concerns about the chemical are not resolved soon,” said Graeme Dykes, Managing Director of the Healthcare Transparency Initiative formed recently by Resilinc and a coalition of medical manufacturers and healthcare providers. “Two EtO suppliers—Medco Plast of Egypt and the Czech Republic’s Kodarma Plus—were acquired by Thailand’s Indorama Ventures.”

“Unless you were an investor in one of these firms, you probably wouldn’t pay attention to such M&A events in far-flung parts of the world,” said Dykes. “But as we’ve seen with other M&As and acquisitions, they can lead eventually to serious disruptions in supplies as acquirers make strategic decisions such as exiting non-core business lines.”

In the case of EtO sterilization, the loss of even a few additional suppliers could have dramatic impacts on medical product supply chains. Contract sterilization providers like Sterigenics and Viant are little known but critical elements in the medical product supply chain—as well as in supply chains for pharmaceuticals, food and other industries.

In the medical product industry, ethylene oxide (or EtO) is used to sterilize about 50% of all medical devices used in the United States, according to the FDA. And for many types of devices, such as those made with certain polymers or with hard-to-reach surfaces (such as catheters), sterilization with EtO “may be the only method that properly sterilizes,” according to the FDA.

As part of its response to the loss of the sterilization capacity at Sterigenics’ Willowbrook facility and Viant’s Grand Rapids plant—and to the mounting environmental and health concerns about EtO generally—FDA said in its March 26, 2019 announcement that it is working with sterilization experts and other stakeholders to identify methods to use lower levels of EtO in sterilization to reduce environmental exposure risks. The agency and stakeholders will also explore “new sterilization agents or processes that don’t come with the same environmental risks [as EtO] but still enable … safe and effective sterilization.”

In the short term, FDA urged medical product manufacturers using the Sterigenics or Viant facilities “to begin assessing any potential downstream impacts of the closures on device distribution through their supply chain to end users (such as health care facilities), and ultimately on patient care.” To support manufacturers who need to find alternate sources of sterilization, FDA promised to expedite its review of site change submissions.

Resilinc customers had a full six months advance warning—and five months warning in advance of the Illinois EPA’s action against Sterigenics—to being such assessments. “Today, many healthcare providers are scrambling to deal with impending shortages of medical devices due to the constraints in sterilization capacity,” said Resilinc CEO Bindiya Vakil. “My team and I are especially gratified that we were able to alert our customers many months in advance of these public announcements by the Illinois EPA and U.S. FDA.”

It’s important to note that Sterigenics is vigorously contesting the legal basis of Illinois EPA’s enforcement action against its Willowbrook facility. The firm is seeking an injunction against the Illinois EPA with a hearing scheduled for April 9, 2019. Resilinc will keep its customers appraised of the results of this hearing and other events that impact the sterilization contractors so vital to medical product supply chains.

To hear more about Resilinc solutions for healthcare and life sciences, go to healthcare.resilinc.com or read the Biogen case study at https://info.resilinc.com/proactive-risk-mitigation-in-hurricane-season

Topics: supply chain risk management, SCRM Best Practices, supply chain risk, crisis management, action plan, business continuity, resiliency