Patrick McCarthy, VP & GM, Supplier SolutionsWaveMark, Inc.

John Nolan, VP, Global Supply Chainev3 Inc.

Healthcare Supply Chain Environment

Healthcare Challenge

RFID as a Solution

WaveMark RFID Inventory Management

Ev3 Case Study

Conclusions

High cost medical devices represent a growing percent of supply expenditures for hospitals

Tighter regulations and shorter shelf lives for products are a growing concern for suppliers

Increased fuel costs impact margin and delivery practices of physician preference items

Hospitals and suppliers alike need visibility to optimize inventory levels, reduce costs and maintain regulatory compliance.

Qu

ali

ty

Cost(Labor, Waste, Price)

High Low

Low

High

BarCode

RFID

RFID solutions enable

higher quality at lower

costs

Invento

ry A

ccura

cy,

& I

mpro

ved

Patient

Safe

tyThe Challenge: Choosing the Right

Technology for the Job

Automated Data Collection Continuous inventory tracking with RFID enabled cabinets Accurate and automated audits, field transfers, transactions &

returns with mobile device Streamlines clinical and administrative workflow

Highly Accurate Inventory Certainty of product availability Self correcting system—built-in audit mechanism Identifies and manages by exception

Efficient Regulatory Compliance Visibility to recalled products: FDA Visibility to field inventory: Sarbanes Oxley Visibility to expired products: JCAHO

Company Overview

Privately held corporation, founded in 2003, and headquartered in Massachusetts

Leverage RFID and network technologies to solve industry specific field inventory challenges to improve cost containment, patient safety and regulatory compliance

Business Model and Solutions

Operates an ASP based data network serving the medical device industry (suppliers and their customers)

Employ modular and mobile solutions

Self correcting system with 99.994% accuracy

Subscription model- no capital expense for providers; comprehensive, module based solution for suppliers

Focus on Healthcare

Supplier Solutions[Field Transactions & Inventory Mgmt]

Provider Solutions[Clinical Inventory Management]

WaveMark’s focus and experience is rooted in providing solutions for managing high-value medical supplies

How WaveMark Utilizes RFID

Back of tag Unique ID

on tag

Antenna

Front of tag

RFID tag

“License Plate” Concept

Lot, Expiration and product ID info is stored in a database and associated to a tag ID

RFID tag is put on all ev3 packaging before shipping to the field

• HF Passive RFID

• 13.56 MHz: Worldwide ISO 15693 Standard

• Low cost disposable tags

•Product tagged at manufacturer or hospital

•Automatic and continuous inventory and usage updates

•Product level info: lot#, model, serial#, expirations

•View stock outs, room replenishments, usage, more

2. Collect data1. Tag product 3. View information

Hospital Inventory and Usage Tracking

Total Field Intelligence

Manufacturing

RFID tags are placed on individual items

Tag It

Mfgr places tags on packaging at time of manufacture

Sold

Used in a procedure

Use It

Distribution Center

All product is shipped with RFID tags

Product can now be tracked to customer/rep

Ship It Sales Transactions

Common sales functions are now automated for field reps

Field Inventory

Manage trunk and consigned stock

Receive It

WaveMark’s use of RFID provides tracking from the point of manufacture to the point of consumption

Field Inventory Tracking

Strategic

Value

Customer

Value

Operational Value

(Supply Chain)

Tier 2•Better managed SKU proliferation

•Increased sales & reduced time to invoice

•Real -Time demand intelligence

Sup

ply

ch

ain

so

ph

isti

cati

on

an

d v

isib

ilit

y

High

Low

Tier 1•Total field visibility•Increased customer intimacy/partnership•Increased sales & reduced time to invoice

•Improved demand planning/market

intelligence

•Improved patient safety

Tier 3•Automated field audits, transfers, transactions & returns• More sales time and less administrative tasks for reps•Improve Consignment practices•Address SKU proliferation•Address Short- Dated Product•Address Counterfeiting/Gray marketing

Medical Device Manufacturer

Mission is to be the Global Leader in Peripheral Vascular and Neurovascular Solutions

Large, Diverse Customer Base

Large Field Sales Force in US & Globally

Large Field Inventory• Trunk Stock

• Consignment Stock

Prior State: Manual Audits, Reconciliation, & Field Sales Transactions

To Support Current & Future Technology Direction of:

• Customers

• Industry

• Company

To Improve Supply Chain Productivity for:

• Customers

• Company

To Increase Accuracy

To Automate Sales & Field Inventory Management

To Develop Foundation for Continuous Improvement

Aware-Total RFID is long-term, comprehensive journey

On Surface –RFID is product ID & data collection

However-RFID leads to many short-term, long-term, functional and cross-functional benefits

Our Approach–Select a problem, develop a simple solution, and get started

We Chose-Focused partner with bolt-on software, hardware support, and common objectives

Corporate Accountability: Product Visibility• Improved field inventory management policies• Significant reduction in field write-offs• Complementary to our ERP system • Ability to leverage RFID upstream in manufacturing,

as well as downstream (returns processing)• Platform for migration OUS

Sales/Customer Service: Increased Sales, Less Admin Work• Increased sales productivity –reduced work for field transactions• More accurate field audits- (SOX remediation)• More efficient management of expirations• Platform for better Sales training• Improved field inventory accuracy• Reduced time to reconciliation due to serialization of products and electronic pedigree

Manufacturing/Distribution: Improved Planning• Better demand planning-reduction in field inventory, better inventory turns• Better history of each item-improved product search capability• More frequent cycle counts• Foundation for DC automation; Improved shipment accuracy

RFID is compatible with emerging healthcare solutions

Supports direction of customers to better serve them

Positions ev3 as industry leader in field inventory management

RFID is strongly considered to be the technology of choice for UDI (Unique Device Identification)

Partner with WaveMark-a leader in multiple integrated RFID solutions for healthcare providers and manufacturers

Establish clear goals and measurements for implementation

Gain cross functional buy in

Solutions must bring value and improved workflow for Sales and Customers

Review and revise policies to fit the new “RFID enabled” paradigm

Use data to drive results and improve solution

RFID for inventory management streamlines workflow and improves care

Cost Containment-Strong ROI Improves clinical workflow Optimizes inventory levels Reduces waste

Improved Patient Care/Safety Better serve the needs of customers

right products at right time

Efficient expiration and recall tracking

Efficient Regulatory Compliance Accurate inventory counts satisfy Sarbanes Oxley requirements Proper management of short-dated products