The Christchurch company has just learned it will be added to the list by the government agency.
Pharmac said an expanded list was expected to be released this week, which would include contracted and non-contracted items, after a supplier review.
Medsalv sells hundreds of thousands of recycled single-use medical devices — otherwise destined for the dump — to about 120 hospitals and facilities in New Zealand and Australia.
Mr Hunt, 31, founded the business in 2017 after developing an idea suggested by his surgeon uncle while he was studying for a master’s degree in engineering at the University of Canterbury.
Today, a range of about 60 devices includes patient transfer mattresses, deep vein thrombosis prevention sleeves, blood pressure cuffs and tourniquets.
They are sorted, cleaned, tested, inspected, packaged and relabelled before going back into hospitals for clinical use, saving them from going into landfills.
Mr Hunt said they had spent years trying to work with Pharmac to get Medsalv devices on the list and it remained to be seen how many of them would be accepted.
“This is something that’s been raised to Christopher Luxon, David Seymour, Andrew Little before him and Shane Reti when he was minister of health, and Jacinda Ardern. We have an execution gap between intent and delivery and that’s not shown more clearly than with Pharmac, which hasn’t saved any money over the last five annual reports but has been blocking out lower-priced, more effective and more sustainable alternatives.”
MedSalv supplied 69 surgical hospitals in New Zealand, but a few hospitals had been prevented from working with it because of the way Pharmac operated, he said.
“For the last several years, it’s been virtually impossible to get Health NZ hospitals to use products not already on Pharmac’s list.”
New Zealand needed more innovation and barriers to the market lowered if the health system was serious about reducing costs, he said.
He said Medsalv could deliver a product for $10 to $11 to a New Zealand hospital which would sell new for $17 to $18.
“So if you call it a $7 saving per product and that hospital is using 13,000, that’s $91,000 straight away and a really comprehensive saving. We are effectively 42% net off the brand-new price for a lower-price product, but for other products it might be 50%.”
Since Medsalv entered the market, competitors had dropped their prices in some cases from $100 an item to $17, he said.
Pharmac medical devices director Catherine Epps said the agency had recently consulted on expanding the list of hospital medical devices to include all the products under Pharmac contracts as well as uncontracted devices used by Health New Zealand hospitals.
“As part of this consultation, suppliers such as Medsalv were asked to check if their products that are currently used in hospitals were included on the list. The list will now reflect both contracted and non-contracted items. We expect to publish the comprehensive hospital medical devices list next week, which we will then continuously update over time.”
She said the priority was securing devices to provide good patient care.
Pharmac worked with a wide range of suppliers and had an established procurement process in line with government rules. The rules required it to support the procurement of low-emission and low-waste goods and consider how it could create opportunities for New Zealand businesses, she said.
Mr Hunt said Pharmac’s consultation was based on a narrow window, only allowing products that had already been used by Health NZ in the past two years to be added to the list.
He said Pharmac claimed it was creating opportunities for local businesses and low-emission products but after 13 years of managing devices, had delivered few material outcomes.
Fewer than 1800 New Zealand-made products were on the list. New Zealand imported nearly all its medical devices, some of them from countries with lower labour costs than China, he said.
Mr Hunt said Medsalv was the highest-scoring B Corp among for-profit companies in New Zealand creating environmental and social impact.
“Almost all of our labour comes from people who otherwise wouldn’t be employed by any organisation in New Zealand because they might have autism, a stroke or some other reason they might struggle to find employment and we deliberately designed our processes and our machines and everything we do to enable those people to be part of the workforce. They make up 50% of our overall staff and 100% of our NZ remanufacturing team.”
He said they were working to supply remanufactured medical products to more countries with good regulatory systems enabling innovation.
“We think there are great opportunities to take what we’ve built here to the world and that’s what we are doing. There’s obviously a fair bit of market development to make sure how it works and we are working on improving that as we go. I will keep mum on exactly where we are thinking next, but certainly Australia has a lot of wood to chop before we go to the next place and there’s a huge amount of opportunity in New Zealand.”
Medsalv’s remanufacturing facility in Christchurch’s Middleton was boosted by a site in Victoria, Australia a year ago.
The company supplies hospitals and facilities in the main states apart from New South Wales.
Mr Hunt said about 300,000 devices had been collected from Australian hospitals, and “significantly higher” numbers had been collected in New Zealand.
