8.2.11 | Brandon Glenn

STERIS: System 1E transition ‘moving along as expected’

The top executive with sterilization products maker STERIS (NYSE:STE) said the transition to a replacement version of its flagship sterilization device is “moving along as expected.”

The Mentor, Ohio-based company during the most recent quarter shipped 700 units of its new System 1E device, which is a liquid chemical sterilizing system used by hospitals, surgical centers and other healthcare facilities to sterilize heat-sensitive medical instruments.

The company also received 2,000 orders beyond what it shipped during the quarter, CEO Walt Rosebrough said in a conference call with investors and analysts after STERIS released its first-quarter earnings information. STERIS projects selling between 5,000 and 8,000 units of the System 1E during the year.

STERIS has been battling issues related to its System 1 device since December 2009, when the U.S. Food and Drug Administration issued a safety alert warning that the device could be harmful to patients. The System 1 has been recalled and STERIS is hoping to transition customers to its replacement, the System 1E.

The FDA has yet to clear an accessory part for the device, which Rosebrough acknowledged could be slightly holding down sales. That part, called a biological indicator, isn’t necessary to operate the System 1E, though many customers prefer to use it. The part indicates the presence of biological materials on equipment.

Rather than proceed through the FDA’s 510(k) process for medical devices, the biological indicator will be reviewed as part of the agency’s “de novo” process, which is intended for devices for which there is no existing “substantial equivalent” on the market. STERIS officials wouldn’t offer a prediction on the timing of when the FDA might clear the indicator for sales. “I believe that we’re in a process to have this device cleared,” Rosebrough said.

STERIS turned in a first-quarter financial performance that slightly exceeded analysts’ expectations. Earnings per share stood at 48 cents, 1 cent better than analysts’s projections. Revenue was up 9 percent on the quarter to $319 million. Analysts had expected about $311 million.

Sales were helped by increased demand and added capacity for STERIS’s contract sterilization business unit, Isomedix Services.

The company maintained its full-year outlook of earnings between $2.25 and $2.45 per share, and year-over-year revenue growth between 8 percent and 10 percent.

Brandon Glenn MedCity News

Brandon Glenn is the Ohio bureau chief for MedCity News.

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Tags: earnings, medical devices, Northeast Ohio, Ohio, publics, STE, STERIS

Comments Post a comment

Were not getting the System 1E. It is not a sterilizer. After reading this, I think it would be risky to get the new system. http://www.fda.gov/MedicalDevices/ProductsandMedicalProcedures/GeneralHospitalDevicesandSupplies/ucm208018.htm

Comment by Bill — August 2, 2011 @ 6:15 pm

Nice link. I looks like you can’t use the SS1E for anything accoring to the FDA website. I guess we will be getting a Sterrad. They have a better system anyway.

Comment by Jason — August 2, 2011 @ 6:20 pm

As a nurse I can say I never thought the SS1 was a sterilizer and I don’t think the SS1E is either. This system is too limited when there are a lot better options. Terminal sterilization is the only way to go. We use the Sterrad NX. I would’nt have surgery at a facility that uses the 1E

Comment by Jane — August 12, 2011 @ 10:25 am

@Jane-You didn’t think SS1 was a sterilizer?!? How do you explain the fact that it STERILIZED the spores that are done with spore testing? As a MSN prepared OR nurse with over 20 years experience, I think I can speak on this: The problem with sterilization and nursing is that sterilization is not part of the nursing teaching cirriculum at any level. At several of the facilities that I have visited the nursing staff is responsible for spore testing and truly has no idea how to do it. Jane, you’re worried about a facility using a SS1 or SS1E but you’re not concerned about the fact that nursing is clueless about spore testing in a facility? What about the sterile processing department and the people they hire? I actually had a sterile processing tech ask me if a set was ok or not because the wrapper “only has a little hole in it”. There are several facets to the problem of sterilization quality in the OR.
1. Nursing schools don’t teach about sterilization in schools. The OR is a pretty specific field, so why waste ADN/BSN time teaching this material when only a few will end up in the OR.
2. Surgical tech programs don’t teach sterilization techniques the way they used to.
3. Sterile processing techs don’t have any special training. It is all on the job training. With no prerequisites for these jobs, you get the lowest quality of worker for these low paying jobs.

Education makes all the difference. In the military, the surgical techs are taught both to work in the OR AND they are instructed on proper sterilizer maintenance and sterilization techniques. If I compared the quality of sterilization in military (active duty, not VA) vs. civilian hospitals, generally the military facilities had much cleaner instruments and were more compliant with the regulations.

Comment by Bill — August 14, 2011 @ 2:22 am

Comment to 2nd Bill that posted- I say why chance a debatable sterilizer. I have now worked at few surgery centers and see that each facility pushes the just in time sterilization. Because facilities cannot afford to buy extra SS1s, they process their cameras in the morning and use them in afternoon cases so they don’t have delays in the cases. Do you want to get a knee scope with a camera and scope that has been sitting in a wet environment for 8 hours. If you use steam or hydrogen peroxide, you have a better assurance. It’s wrapped and dry. The other problem with filtered water is that if you don’t change the filters regularly (again ASCs stretch the limits on this to), how do you know your water is getting sterilized? I would rather eliminate extra potential human error.

Comment by unonomous — August 19, 2011 @ 4:02 pm

sorry, “Anonymous” is spelled incorrectly.

I do agree with what you have to say about education and surgical tech programs. This is another reason not to use the SS1 or SS1e because they don’t follow the manufactures instructions

Comment by Anonymous — August 19, 2011 @ 4:10 pm