On a May 6 earnings call, Medline named Mohawk Medbury as the first customer for its Prime vendor supply program in Canada. Now, the supply chain solutions company is looking ahead to fall. At that point, it said, it will take over warehouse and supply chain logistics for its client’s Ontario-based hospitals in the province’s southwestern region.
Use of Medline’s Prime vendor model will mean that participating hospitals use Medline’s vertically integrated supply chain infrastructure and products. Medline will assume responsibility for product, inventory management, distribution and delivery for their supply chain.
What Medline’s Prime vendor model will offer in Canada
As Mohawk Medbury becomes Medline Canada’s first Prime vendor customer, the deal presents Medline with an opportunity. It will be able to apply what it has learned from working with health-care providers in the U.S.
“This is a major milestone for Medline in Canada and supports the evolution in how healthcare supply chains are managed in this market,” said Ernie Philip, president of Medline Canada and Medline Latin America, in a public statement. “This first Prime vendor agreement in Canada with Mohawk Medbuy is expected to help their hospitals move beyond traditional distribution and toward a more connected, responsive and efficient model that’s designed to make healthcare run better.”
Philip noted that the Prime vendor agreement would support Mohawk’s capabilities. Specifically, he anticipated that it would be better positioned to “build capacity in hospitals” and “deliver more frontline care.”
What Medline’s Mohawk Medbury deal covers
Medline Canada offices | Image credit: Medline press release
Medline’s announcement mentioned that it would handle “almost daily distribution deliveries from its Guelph, Ontario, location.” In addition, Medline Canada will provide supply chain services. Those include “delivery and storage optimization, automatic product substitutions for pre-approved items” and “backorder management with national brands.”
“Dependable supply chain services are a critical component of our members’ ability to deliver sustainable, quality care to their patients,” said Tony DiEmanuele, president and CEO at Mohawk Medbury. “This collaboration with Medline aligns well with our multi warehouse expansion plan for Ontario to provide that surety of supply.”
Medline will also offer data solutions, tools and other technologies related to bolstering resiliency.
Medline’s Prime vendor goals
James Boyle, Medline CEO, said May 6 that his team expected “to achieve our goal of the $1 billion in new Prime vendor signings” in the U.S. In the meantime, it is also looking ahead to expansion in Canada for the current fiscal year. Mohawk Medbury’s deal for its nine-hospital system will count separately from the U.S. target.
“We will leverage the playbook we have in the U.S. to drive significant value to the Canadian customers who are in this partnership,” Boyle stated. “And I can tell you, we already have customers asking, ‘Could we be next?’ But we want to actually build — really — the playbook and really the design with Mohawk Medbuy with this group of customers to make sure we deliver the right value and really the right supply chain mechanisms to create the right product at the right place at the right time for the best value.”
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