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Cardinal Health Aims to Bring Visibility to All Medical Products

Since acquiring WaveMark in 2013, the drug and medical device distributor has expanded its RFID inventory-management platform to both low- and high-cost items.
Posted By Mark Roberti, 12.09.2014

In August 2013, Cardinal Health, a $91 billion drug and medical device distributor, acquired WaveMark, a Concord, Mass.-based company that offered a solution for tracking implantable medical devices and other high-value items using passive high-frequency (HF) radio frequency identification technology. I had a chance to sit down with Jean-Claude Saghbini, Cardinal Health's GM of inventory-management solutions, during our RFID in Health Care event, held last month in Chicago, Ill.

Since the acquisition, Saghbini said, Cardinal Health has been expanding the WaveMark platform to be able to track more than just high-end implantables. It has created a cloud-based, enterprise platform that helps track bandages, gauze and other low-cost items, in addition to high-value implantable devices.

"With the smart two-bin kanban mechanism, you can track inventory levels for two-cent bandages, and it runs on the same platform you are using to track medical devices that cost $2,000," Saghbini told me. "We've done all the integration work to make that possible."

According to Saghbini, it is a mistake for hospitals to over-invest in a solution for tracking low-value products, and to under-invest in one for tracking high-value products. The Cardinal Health platform, therefore, was designed to allow for different workflows for different types of products. The kanban system makes it easy to track inventory levels of low-value products. The demand signal in the two-bin process can leverage either RFID or bar-code technology to trigger replenishment and par-level optimization. The choice of the right technology is based on how well it fits a customer's unique workflows.

Cardinal Health is currently exploring ways in which to integrate the RFID solution with existing platforms, in order to help medical facilities become more efficient. "Hospitals were looking at point solutions to solve specific inventory problems," Saghbini explained, "but now, they are looking for partners that can solve multiple problems. We are adding functionality to the platform to help them with supply-chain, inventory-management and point-of-use issues."

RFID is the foundation of the Cardinal Health inventory-management solution, and the company has made sure the solution fits hospital processes. It is constantly adding new workflows and capabilities as customers seek to expand the technology's use to new areas.

"We are adding new solutions as we see problems in hospitals," Saghbini said. "The beauty of software-as-a-service is that the upgrades you make for one customer can benefit all your other customers. It's almost crowdsourcing ideas and enhancements."

Cardinal Health has also been expanding the solution to medical device manufacturers. "We're helping them to use RFID where it makes sense to manage their own inventories," Saghbini told me. "In many emerging markets, you have multi-echelon distribution systems, so by RFID-enabling dealers or subdistributors, you can manage inventories throughout the distribution network and aggregate data nationally—and even globally."

The Cardinal Health solution has data analytics capabilities, and most hospitals and medical device makers are just beginning to take full advantage of them, Saghbini said, adding that the problems they are trying to solve require better data, not big data. "The tools are there to solve the problem, and eventually, there will be a big data play," he noted. "They'll be better able to understand product-utilization rates, what the true cost of a product is and much more. There will be additional value added by analyzing all the data the system captures."

Mark Roberti is the founder and editor of RFID Journal. If you would like to comment on this article, click on the link below. To read more of Mark's opinions, visit the RFID Journal Blog, the Editor's Note archive or RFID Connect.

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