St. Luke’s Part of New Coalition to Expand Domestic PPE Production

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Premier Inc. (NASDAQ: PINC), a leading healthcare improvement company, and 15 leading health systems acquired a minority stake in Prestige Ameritech, the largest domestic manufacturer of face masks, including N95 respirators and surgical masks, it was announced Wednesday.

Under the agreement, Premier members including Bethlehem-based St. Luke’s University Health Network commit to purchase a portion of all face masks they use annually from Prestige Ameritech for up to six years, inclusive of a three-year renewal option.

The arrangement with Prestige Ameritech is part of Premier’s newly-announced strategy to work with members to invest in domestic and geographically diverse suppliers of PPE and other medical equipment currently in shortage due to the COVID-19 pandemic.

PPE products critical for the daily operations of health systems are overwhelmingly sourced overseas, with approximately 80 percent coming from China and Southeast Asia. The risks of this overreliance on Asia came into sharp focus as COVID-19 swept across the globe and nations closed borders, preventing U.S. access to supplies and triggering widespread shortages of PPE needed to protect healthcare workers and patients. In contrast, Prestige Ameritech represents a domestic supply chain, with production completed in the U.S. Prestige also sells 100 percent of its products to U.S. customers.

“With past outbreaks such as SARS, H1N1 and Ebola, the nation talked about domestic manufacturing and expanding supply sources as the keys to preventing shortages, only to return to the same overleveraged overseas markets once the crisis was over,” said Premier president Michael J. Alkire. “This move is the latest step in our long-term commitment to changing the way we source critical products so that we never again experience shortages as a result of overreliance. Our economic prosperity can no longer be tied to things we buy–it must also come from things we make.”

“As COVID-19 proves, the United States is almost completely at the mercy of foreign nations for vital supplies,” said Dan Reese, Prestige Ameritech co-founder and CEO. “Diverse and on-shore manufacturing of critical healthcare products is clearly a national security issue. With this agreement, we have long-term, multi-year commitments that give us certainty and allow us to dedicate our resources to increase production. Not only does that help us today with COVID-19, but long-term commitments also create economies of scale for when we return to business as usual.”

In addition to St. Luke’s, Premier members participating in the initial investment include AdventHealth (Altamonte Springs, Fla.), Adventist Health (Roseville, Calif.), Advocate Aurora Health (Downers Grove, Ill., and Milwaukee, Wisc.), Ballad Health (Johnson City, Tenn.), Banner Health (Phoenix, Ariz.), Baptist Health South Florida (Miami, Fla.), CommonSpirit Health (Chicago, Ill.), Genesis Health System (Davenport, Iowa), Henry Ford Health System (Detroit, Mich.), McLaren Health Care (Grand Blanc, Mich.), Riverside Health System (Newport News, Va.), Texas Health Resources (Arlington, Texas), Universal Health Services, Inc. (King of Prussia, Pa.) and University Hospitals (Cleveland, Ohio).

“These members are true innovators, as they are the first to step up and fund the long-term domestic manufacturing of healthcare products,” said Alkire. “This agreement and the added domestic supply it enables would not be possible without their commitments. Each one deserves recognition for its leadership and for its work to bring supplies back home to America.”

Financial terms of the agreement were not disclosed.

Note: This local health news was brought to you in partnership with St. Luke’s University Health Network.

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