Innovative Medical Devices

Disposable/Reusable instruments

Competition among vendors who manufacture reusable minimally-invasive surgical instruments and those who sell disposables is heating up as that market expands due to new laparoscopic and endoscopic procedures.

What type of instrument will dominate the market depends on which vendor is asked. Top manufacturers of reusables--and one manufacturer who sells both reusables and disposables--insist reusables will prevail because they cut medical waste and re-use of instruments costs less overall.

This is in spite of the dramatically higher cost of reusables when they are purchased. Reusable instruments typically cost about seven times more at the outset than their disposable counterparts. But the savings are evident--a mid-size hospital might use an instrument seven times in about a week.

Manufacturers of disposables argue there are a multitude of hidden costs associated with reusables, such as the price of cleaning solution and the staff time required to wash the devices. The intricate instruments are difficult to clean thoroughly, increasing the risk of contamination that can spread infectious disease, they say. The Denver, Colo.-based Assn. of Operating Room Nurses Inc. backs the use of disposables.

In a recent report, AORN detailed the hidden expenses associated with the upkeep of reusables, including an additional $9,000 per year to repair basic tools. An independent surgeon added that disposables do not significantly reduce expenses because instrument costs account for only 2% of all hospital overhead.

Opinion is "very mixed" regarding the disposable/reusable issue, agreed Pat Patterson, editor for OR Manager, a Boulder, Colo.-based monthly newsletter. "There is a renewed interest in reusables because of the environmental issues. But it really depends a lot on surgeon preference. Some like disposables because they are constantly sharp, and they don't have to worry about cleaning them, but there doesn't seem to be a clear-cut answer," Patterson said.

A subsidiary of Bristol-Myers Squibb Co., the $130-million-per-year Linvatec Corp, Largo, Fla., manufactures 75% reusables and 25% disposables. Disposable instrument sales have increased since their introduction by the company about two years ago. In 1991, disposables accounted for less than 1% of all sales, doubling to 2% in 1992, and expected to hit 10% to 15% this year. But so far, demand has focused on disposable scissors, trocars and clip appliers because it is more critical that these instruments remain sharp, said a Linvatec product manager. Although demand for disposables is on the rise, the spokesperson does not see it climbing in "leaps and bounds." Instead, waste concerns will fuel demand for reusables, he believes.

General outlook

Laparoscopic procedures, which involve surgery to the abdominal area, gained acceptance in the late 1980s with gallbladder operations. Today, 85% of all gallbladder procedures are laparoscopic. This pattern is expected to be mirrored by the new operations developed in the last two years for hernia repair and hysterectomies as well as lung, stomach, bowel, kidney and appendix surgery. By the year 2000, as much as 85% of all abdominal surgeries are expected to use less invasive techniques, states an extensive report by Find/SVP, New York, N.Y.

The older minimally-invasive procedure--endoscopic surgery--which began in the 1930s and was refined during the 1950s, involves procedures performed through the lower and upper gastrointestinal tract, as well as the hand, ear, nose and throat.

The number of these procedures performed each year could be affected by health care reform, because physicians and hospitals may become less willing and able under global budgeting to pay the high cost of instruments. A physician can easily spend about $60,000 to purchase a line of endoscopic instruments. Another downfall is that these instruments are becoming complicated and require more training to use.

Not all forecasters agree, however, that the future for endoscopic instruments is becoming clouded. The U.S. market for endoscopic instruments is forecast to jump to $630 million in 1996, an 86.9% increase over $337 million in 1991, according to Decision Resources Inc., Burlington, Mass. Meanwhile, the U.S. market for laparoscopic and related instruments for general surgery climbed to $219.9 million in 1992, up 132% over $94.9 million in 1989, according to Find/SVP.

Patient requests drive market

What's more, unlike some other areas of medicine, consumer preference is directly driving the shift toward endoscopic and laparoscopic surgery. Patients--rather than physicians--are responsible for the surge in laparoscopic procedures, said Michael Khalife, M.D., an independent general surgeon on staff at Winthrop University in New York. More patients are requesting laparoscopic and endoscopic procedures because they are safer and require less recovery time. Surgical incisions often are three to six inches long, compared to a few centimeters for laparoscopic procedures, he pointed out.

Many surgeons remain hesitant to adopt new laparoscopic procedures, Khalife said. They argue that the procedures require too much work and training. Khalife encourages vendors to spread the word to lay people about new laparoscopic applications. "It's a big advantage to patients. They should always request laparoscopic surgery whenever it's available, and they should know about those procedures," Khalife said.

Less invasive means less cost

Because less hospital time is required for minimally-invasive procedures, laparoscopic surgeries cost less for the client, he noted. The cost of minimally-invasive surgery for a hysterectomy (a uterine resectoscope procedure) is $3,500 compared to $8,400 for the open surgery, according to Santa Barbara, Calif.-based Circon ACMI's annual report. The minimally-invasive procedure requires no cost for patient stay, an assistant surgeon or post-operation therapy. With open surgical hysterectomy, the patient room costs $3,000, assistant surgeon $500, and post-operation therapy $1,200.

Minimally invasive procedures also reduce risks. Complications with conventional gallbladder surgery occur in 9.4% of all cases, with death resulting in 0.2% to 0.6% of all cases. In contrast, the overall complication rate following the laparoscopic procedure is 5.1%, with a death rate of 0.1% for all cases, according to Find/SVP.

After undergoing a laparoscopic procedure, patients can return to work within a few days, Khalife added. Recovery from conventional surgery can involve four or more weeks. A firm believer in the future of laparoscopic surgery, Khalife says these less invasive procedures account for 80% of his work.

Disposable versus reusable

In response to the burgeoning market and looming health care reforms, vendors are emphasizing the cost-effectiveness of either disposable or reusable instruments, depending on which type they manufacture.

"Hospitals want the disposables. They're safer for the patient and for the staff," said Steve Rose, spokesperson for the $581.9 million U.S. Surgical Corp., Norwalk, Conn., a top vendor of disposable instruments. Laparoscopic and endoscopic instruments contain many moveable and intricate parts, Rose said. This makes reusables arduous to clean. Because they are used frequently, it also is difficult to keep reusables sharpened.

Another plus is that with disposables, an operating department is never left with an obsolete device. "Technology is changing so rapidly that many of our instruments have already undergone several modifications since they were introduced. We have reached the third generation in three years. If these were not disposable instruments, they could have been out of date after six months," Rose said.

Disputing Rose's assessment is a spokesperson from the $74 million Richard Wolf Medical Instruments Corp., Vernon Hills, Ill., a top manufacturer of reusables. Concern about medical waste will heighten demand for reusable instruments, he asserted. Reusables also cut expenses. Less waste lowers disposal costs, and also can lower such additional expenses as taxes. In California, for example, hospitals are taxed based on pounds of waste generated to pay for waste disposal, a move that could spread to other states as well. While this flies in the face of demands for tougher cost-containment measures and the goals of health care reform, it certainly places the spotlight squarely on the need to switch to reusables, he said.

"As convenient as disposables are, in the long run, demand is going to be for reusables. But they are going to have to be taken care of and maintained differently than they are today--with more maintenance and education," the spokesperson said.

To address concerns about dirty instruments that are difficult to sterilize for reuse, Wolf Medical Instruments recently added cleaning ports to its devices. The ports fasten to a hose that emits a high-pressure burst of disinfectant solution. In response to concern over dull reusables, the company provides extra instruments to hospitals for use while their instruments are being resharpened. Wolf's 78 national sales reps also provide continuous training to hospital personnel.

"All the service reps conduct in-service for local hospitals. They'll go to the hospital every six months to make sure they are caring for the equipment. We like to remind them of the proper procedures. You don't just put a $3,000 endoscope in the bottom of a drawer. New designs of all instruments also take into account how people clean them," he said, noting that new devices are becoming seamless and void of crevasses.

Reusables demand up

"Disposables may get a boost but I don't think it is best for the environment or the health care community because of the cost and the waste," the spokesperson said.

The Linvatec product manager agreed. "People would prefer to get away from disposables because of the true cost," he said. To reduce overhead, a hospital has two choices: reduce staff or cut inventory. Shifting to reusables is one way to save money without having to impose layoffs, he said.

Ethicon Endo-Surgery, Cincinnati, Ohio, a leading manufacturer of disposable instruments, asserts that reusable instruments bring with them many hidden costs. Armed with a report from AORN, Ethicon Endo-Surgery's marketing vice president Kay Clanton outlined the shortcomings of reusables. The instruments may appear less expensive than their disposable counterparts, but that pales when compared to the time used to clean instruments and the cost of solution as stated in the AORN report, Clanton noted. Repair and sharpening costs for basic instruments (scissors, dissectors, grasping forceps) can cost $9,000 per year, according to the report.

The supplies required to clean instruments total $425, AORN adds. These include: $100 for four vertical plastic soaking containers, $125 for a lighted magnifying lens and $200 for a wire mesh basket with clips.

But more important, reusable instruments may never be as clean as disposables, according to the AORN report. "Many of the cleaning procedures being employed with reusable instruments in both the operating room and central processing, in an attempt to meet surgical turnabout times, are placing both employees and patients at risk of injury from inadequate cleaning," the AORN report warns.

To avoid the misconception that disposable instruments are discarded after one use, Ethicon Endo-Surgery uses the term "single patient use" to describe its products. This drives home the fact that instruments are utilized during an entire surgical operation.

Reusables, disposables merge

Medical professionals seem to learn toward disposables. "If you look at hospital expenses, instrumentation is only 2% of the cost. The rest of the costs are for labor," said one general surgeon. Because of this, he believes disposables will continue to be the products of choice.

One concern hospitals have is that no guidelines have been developed governing use, care or cleaning of reusable instruments, said Mary O'Neale, a paraoperative nursing specialist with AORN. Instead, the Occupational Safety & Health Administration safety guidelines are general, rather than specific. "We're finding that nurses and facilities want someone to develop guidelines for the types of solutions used and specifying when instruments should be taken apart," she said.

The new automatic washer/decontaminators are unable to effectively clean laparoscopic instruments, posing another major concern, O'Neale said.

Thus, reusable endoscopic and laparoscopic devices must be cleaned manually, increasing the chance that bloodborne pathogens will remain on instruments. The need to clean the devices manually also makes the process labor-intensive, requiring clinicians to clean the instruments, she noted.

Cleaning, OSHA issues

But manufacturers of reusables argue that high-level staff are not the ones who end up cleaning the instruments, so the contention that clinicians spend a lot of time cleaning equipment isn't accurate.

The disposable/reusable debate could resolve itself in the shape of a new breed of instrument. Rather than an entirely disposable or reusable device, one surgeon predicts that more hand-held minimally-invasive instruments will be partially reusable and partially disposable.

"I think that is what we will have in the future," said Khalife, who uses primarily disposable instruments.

Recognizing the need for a mix of reusables and disposables, Linvatec devised VARITEC, an endoscopic instrument with a reusable handle and shaft coupled with a disposable tip. The product is currently awaiting 510(k) clearance by the FDA.

Marketing strategies

Leading vendors agree that the most effective means of selling minimally-invasive surgical instruments is through personal contact with operating department personnel--especially surgeons. All sales reps must undergo extensive product training and be re-certified annually. To generate new leads, companies display their products at key trade shows such as AORN, American College of Surgeons and American Assn. of Orthopedic Medicine, as well as smaller events that attract medical specialists. For example, Linvatec exhibits at about 60 national and regional medical meetings and conventions each year, sending about 50 of its 175 sales people to each of the events.

Companies also advance their products by working closely with surgeons to develop new instruments. They sponsor extensive training seminars in hospitals and universities. Ethicon Endo-Surgery last year opened its own surgeon training facility in Cincinnati, Ohio. More than 5,000 surgeons and other clinicians received training there during the facility's first year, Ethicon's Clanton said.

In addition to putting on regular training sessions, Linvatec sponsors a video library for surgeons that contains taped demonstrations of products and procedures.

Beyond training surgeons and attending trade shows, some companies employ other strategies to set their products apart. U.S. Surgical pre-packages its devices in procedure-specific kits. "Basically, it makes the operating room nurse's job easier. She or he doesn't have to order 10 different things. If they order a gallbladder kit, they receive the precise number of trocars and other instruments. They can then dispose of them in the package," U.S. Surgical's Rose said.

Selling the "feel" of surgery

As part of its advertisements, Linvatec calls attention to the special "feel" of its instruments. The devices are designed to provide surgeons with the hands-on sense of a conventional instrument. Most minimally-invasive instruments lack this quality since the surgeon must manipulate them at a distance, via a tube through a small incision.

A recent Linvatec advertisement shows a picture of a hand at the end of an endoscopic instrument. The logo reads: "Our instruments bring the feel of open surgery to endoscopy."

Linvatec also emphasizes that its products are made entirely in the United States. Other vendors' products are manufactured elsewhere and then imported, Linvatec's spokesperson said.

"What is exciting about our company is we can take a design from a group of surgeons and go directly to the engineers to develop the product. We can then manufacture it in an unbelievably short time," he said. Competitors manufacturing their products in another country delay the process, he said.