Traceability and its Benefits to the Healthcare Industry

The ability to track and trace products is crucial for comprehensive supply chain management. Traceability solutions have long been recognized for their ability to protect against counterfeits and ensure more effective recalls. According to the U.S. Food and Drug Administration (FDA), the tracking provision dates back to 1993. Over the years, healthcare traceability has evolved and in November 2013, the Drug Supply Chain Security Act (DSCSA) became law. The law requires pharmaceutical drug and device manufacturers to facilitate product traceability by 2023. Manufacturers, licensers, dispensers, and distributors must track, collect and share product data at every stage of the supply chain.

Product integrity is a constant facet of importance for supply chain professionals. Many of these issues occur because the current supply chain lacks transparency and visibility in every single stage of the journey. Fortunately, traceability solutions can eliminate such risks by keeping track of the entire supply chain. Some Class II and Class III devices are subject to the Medical Device Tracking Regulations. Similarly, GS1 standards support the traceability of medical devices across the supply chain.

This article explores the three main benefits of traceability to the healthcare industry.

But first, what is Traceability?

Track and Trace technology or simply traceability refers to product tracking. Traceability is the ability to follow the movement of products at particular points of the supply chain as well as the ability to trace the location, history and storage parameters of the products.

According to GS1, traceability in healthcare enables a person to see the backward and forward movement of medical devices across the supply chain. Backward tracing shows the history of transfers and locations of a product from the point of manufacture. On the other hand, forward tracing shows the route followed by the product up to the point of care.

Benefits of Traceability to the Healthcare Industry

There are numerous benefits that any business in the medical sector can derive from traceability systems.  Traceability isn’t just about compliance but it’s about taking the opportunity to improve business operations, quality and consumer trust to gain a competitive advantage.  

Here are some of the benefits of traceability:

Integrity of Products

Electronic Product Code Information Services (EPCIS) is one of the GS1 standards that require trading partners to share data about a product’s movements through the supply chain. Trading partners must share information on the what, when, where and why of the products. The goal is to increase supply chain integrity. The traceability technology can autonomously record and transmit data about the condition of the product, including any evidence of product tampering to ensure product integrity.  Traceability, therefore, ensures that only authorized medical products circulate in the supply chain.

Traceability also helps to deliver customer value. Manufacturers are able to deliver the promised product offerings to consumers. A manufacturer records virtually every movement of a product and consumers can access full information of the cradle-to-the-grave journey of specific brands. Allowing customers to verify the products can aid in confirming that the device originates from legitimate manufacturers and have been handled correctly throughout the supply chain. Traceability hence increases the integrity of products by reassuring the end user that the items are genuine and sterile.

Minimization of Product Loss

There are risks for losing products at any point of the supply chain. Inventory can go missing due to accounting errors or dishonest workers which negatively impacts profits, efficiency, and compliance. Traceability systems are reliable in tracking shipments, administering recalls and ensuring reliability at every step of the supply chain. The technology eliminates the loss of products by providing real-time visibility as items make their way to distributors and retailers. Traceability systems as a consequence assist organizations to minimize inefficiencies and mistakes that bring unbudgeted costs.

Quality Control over Products

The aim of the DSCSA is to transform the supply chain. Traceability of medical products has potential advantages such as ensuring fewer counterfeit products. It also ensures correct shipping and storage conditions especially for temperature-controlled products thereby reducing damages. According to Berlinger, Beyond the Cold Chain, traceability to a greater extent permits manufacturers to exercise quality control over their products by ensuring correct handling.

Traceability further allows manufacturers to exercise control of the products by reducing the chance of expired products being sold and preventing the distribution of recalled products. Traceability technology enables manufacturers to expeditiously remove defective products from the market. Traceability systems are also able to notify distributors when the products are nearing the expiration dates. Product scanners and barcodes ensure that expired products are removed from the warehouses and shelves. As a result, traceability plays a great role in helping devices maintain their efficacy throughout the supply chain.


In the past few years, traceability has been the new watchword in the medical industry.  Despite tracking being a law in the industry, traceability is going to have potential benefits for manufacturers, suppliers (such as Surgishop), buyers and healthcare consumers.  Utilizing traceability offers a wealth of capabilities that support any business in the medical device industry by improving product integrity, minimizing loss of products and having comprehensive quality control over the products.


Berlinger. (n.d.). Beyond the Cold Chain. Retrieved from

FDA. (2018). Medical Device Tracking. Retrieved from

GS1.Org. (2019). Healthcare traceability and GS1 standards. Retrieved from GS1:

WHO. (n.d.). WHO to work on a policy position on the introduction of track and trace technologies and standards. Retrieved from World Health Organization:

Analyzing the Supply Chain Effects of Stericycle’s Closure

Rundown of the Story

At the beginning of 2019, quality regulators ordered Stericycle to stop sterilizing medical products due to quality issues. The gas used to sterilize the products, ethylene oxide, has been found to have adverse environmental effects and has also been identified as a cancer-causing gas (Paavola, 2018). 

Another company that has closed its facilities as a result of using hazardous gas is Sterigenics.  Its contract sterilizers in Viant, Grand Rapid, and Michigan have been closed due to quality issues identified by the environmental quality regulators.

The Stericycle issue began in 2014 when whistleblowers accused the organization of dumping deadly medical waste into the environment.  A study conducted on residents who live near Stericycle Company revealed that despite access to quality healthcare, Utah population experienced high rates of bone, colon and joint cancer (Engkilterra, 2014). Women experienced higher rates of breast and anal cancer while men suffered from prostate cancer.  The health department, however, refuted the claims that the high rates of cancer among the people living in the Utah area were as a result of environmental pollution. After a long wait, the company will be leaving Utah and it is a high relief to eco-activists and the residents (Means, 2019).    

Unfortunately, many manufacturers of medical devices and healthcare facilities rely on the company’s stylization services.  

Effects on Surgical Disposable Market

Supply chain disruption can have adverse impacts on inventory supply. The closure of giant medical equipment sterilizers such as Stericycle has detrimental effects on the supply chain. Hospitals and medical centers relying on their services can be vastly affected. 

Lack of Inventory in the Market

Stericycle operates in 12 countries including the United States serving over 540,000 customers. The company provides medical waste disposal services, manages reusable surgical devices, pharmaceuticals, and hazardous waste disposal. Healthcare organizations use a large number of specialized devices, medications, and materials to serve patients. Closures of giant contract sterilizers can, therefore, affect the availability of inventory in the market.

Higher Prices

Higher demand than supply makes product prices to climb. Stericycle’s closure can lead to a shortage of medical equipment and other services compared to the level of demand. Prices of the surgical instruments are therefore expected to rise. 

Additional Pressure on Purchasers

The Stericycle closure can influence the flow of disposable surgical devices and medical waste services within the supply chain. Many frontline clinicians confess that inventory management is already a complicated process. Additional pressure on the inventory management processes in healthcare facilities and scarcity can only worsen the situation.

Patient Care 

Supply problems can be directly linked to negative impacts on patient care.  Robust supply chain management is critical to cost reductions and patient support in the operating room.  Medical device shortages lead to case cancellations, higher costs of surgical procedures and delayed surgical cases. 

Alternatives to Stericycle

Supply chain impact may entail the inability of suppliers to complete an order. Companies that depended on Stericycle must look somewhere else.  To prepare for such risks in the future, the buyers must consider strategies to diversify the supply disruption risk by sourcing from multiple suppliers. 

Other Sterilizers

Hospitals and other healthcare organizations could turn to other sterilizers to prevent the impact of a potential shortage of medical devices.  The closure of Stericycle can interrupt the distribution of devices to end-users including patients. 

Third-Party Distributors

Operating rooms ought to consider third-party distributors of medical devices to reduce stress and delays caused by the unavailability of surgical supplies.  Third-party distributors such as Surgishop are transforming medical device distribution in healthcare. These distributors feature an array of surgical supplies from leading manufacturers (Ethicon, Covidien, Medtronic, etc.) at discounted prices. Other third-party providers have also joined to tackle the turbulence in the medical equipment supply industry.  The goal of the distributors is to ease the supply chain disruptions in the expanding disposable medical supplies market.

If you’re looking to know the benefits you can reap from using a third-party distributor/vendor check out our previous article Benefits of Using Third-Party Vendors in Healthcare.

Wrap up

Many contract sterilizers have long relied on ethylene gas to sterilize medical equipment. Recent discoveries linking the gas to negative health effects has led to the closure of sterilization facilities causing disruption to the healthcare supply chain. Healthcare organizations should take steps to combat the shortages by turning to third-party distributors of sterilized medical devices.


Engkilterra, S. (2014, February 14). Physicians Group Rips Apart “Offensive” Stericycle Cancer Study at the State Capitol. Retrieved from EnviroNews Utah:

Means, S. P. (2019). Medical waste company Stericycle is leaving Utah; ‘Hallelujah,’ says eco-activist. The Salt Lake Tribune.

Paavola, A. (2018, March 27). FDA braces for medical device shortages: 9 things to know. Retrieved from Becker’s Hospital Review:

Surgical Setting

Benefits of Using Third-Party Vendors in Healthcare

Using a third-party vendor can be a great way to improve your cost-savings goals on surgical disposables. The primary benefit of the relationship is the potential cost savings on the 3-4% of purchases that many facilities must make off-contract for physician preference.

Besides the direct decrease in costs, third-party vendors enable you to provide your customers with an overall seamless experience. As healthcare facilities are continuously looking to cut on expenses and improve sustainability, it is increasingly important to rely on third-party vendors to contribute to the successful accomplishment of such goals. Let’s look at the benefits of sourcing your OR supplies from a third-party vendor.

1.     Potential Cost Savings on Surgical Disposables

Hospitals can rely on third-party Vendors to help them in achieving cost reduction goals. Although a facilities main aim is always to stay as contract compliant as possible, there are situations where they are forced to buy an item off-contract. Scenarios that come up often are physician preference items (PPIs), and an OEM backorder that forces purchasers to look at comparable products from a competing manufacturer that are not on-contract. Situations like the above are where third-party vendors make significant impacts on bottom lines and help facilities maintain optimal levels of patient care.

Third-party vendors can help your healthcare organizations to procure surgical disposables from reputable brands including Ethicon and Covidien at a fraction of the cost.

2.   Sustainability

The obligation to offer quality care and control environmental footprints lies on everyone. Third-party suppliers act like allies to bring solutions to healthcare organizations to achieve true benefits in both areas.  In healthcare, sustainability entails meeting both fiscal and environmental goals.  While working together with third-party vendors, it is possible to reach those goals and ultimately keep patients and the environment healthy.

Third-party vendors deliver holistic value by supplying a wide array of long-dated high-end surgical disposables. In addition, they help to reduce waste in the environment by purchasing excess inventory from facilities. Most companies, including SurgiShop, focus on supplying current and next-generation devices that will allow hospitals to usher in a new era of sustainability.

Luckily, a third-party salesperson can help facilities analyze how they can eliminate waste without sacrificing quality.  For example, SurgiShop operates in a specific niche; -prescription medical devices (PMDs), to offer OEM devices that boost efficiency in healthcare organizations and translates to not only lower costs but waste and excess elimination.

3. Smaller Business, Better Customer Service

Original Equipment Manufacturers (OEMs) have strict company policies and corporate cultures that make them less flexible. However, third-party vendors offer a flexible and individualized service.  Moreover, business executives of third-party distributors personally interact with the facility-buyers and can easily make instant decisions and changes to meet customer requests.

Third-party medical suppliers concentrate on the fulfillment process. Whether it is their products, customer care, or post-sale service, these can translate to an exceptional purchasing and customer experience. Being brand-neutral provides buyers with a great deal of convenience and access to a wide array of high-quality products covering a variety of specialties.

Summing Up

Optimization of the supply chain through third-party vendors should be a core element in every healthcare facility’s business strategy, especially with the industry continuing to transition towards value-based care. Third-party vendors present unprecedented opportunities for organizations to meet the demands of the healthcare reform. It is a means to decrease operational costs and increase environmental sustainability; a direction that both vendors and facilities are obliged to follow.

If you are looking to save 30-60% on surgical medical equipment for your organization, visit to receive a quote on the most reputable medical devices brands.


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