Medline Inc. (MDLN)

Medline Inc. is the largest provider of medical-surgical (med-surg) products and supply chain solutions serving all points of care, based on total net sales of med-surg products. Founded in 1966, the company states its mission as making healthcare run better by delivering improved clinical, financial and operational outcomes. It combines manufacturing, sourcing and distribution of med-surg products with supply chain services, supported by a Prime Vendor model, a distribution network and a commercial platform.

Medline has two reportable segments. The Medline Brand segment offers about 190,000 products under the Medline brand in three categories: Front Line Care (wound care, exam gloves, skin care and incontinence products, environment cleaning supplies, textiles, durable medical equipment and infection control products), Surgical Solutions (procedure trays, drapes and gowns, personal protective equipment, sterile wraps, surgical instruments, gloves and orthopedic implants) and Laboratory and Diagnostics (point of care testing, analyzers, consumables, vital signs monitors, and pathology and phlebotomy products). The Supply Chain Solutions segment offers about 145,000 products from more than 1,300 third-party suppliers, including nearly all leading national brands. It also provides consulting, outsourced warehouse and technology management, put-away-ready packaging, third-party logistics, inventory rationalization and route planning. Across both segments the company offers about 335,000 products. It holds more than 2,300 granted patents and more than 450 FDA 510(k) clearances, and has launched more than 250 new products in the last three years.

Customers range from hospitals and surgery centers to physician offices and post-acute facilities. Many are served through Prime Vendor relationships, which are multi-year agreements, typically five years, under which the customer buys the vast majority of its med-surg products from Medline. The company reports an average Prime Vendor retention rate above 98% over the past five years. A U.S. commercial team of about 4,000 people supports customers, with teams dedicated to each channel and each international region. No international market represents more than 3% of net sales.

Medline manufactures about one-third of its Medline Brand products, primarily Class I and II medical devices, in 30 manufacturing facilities, 24 of them in North America. It sources most of the rest from more than 600 partners in about 40 countries, with no single partner above 5% of spend. Its network has 70 distribution centers, warehouses, cross-docks and transship facilities, 45 in the United States, which provide next-day delivery to 95% of U.S. customers. It also runs more than 2,100 owned MedTrans trucks. Competitors include other med-surg manufacturers and distributors such as McKesson, Cardinal Health, Owens & Minor and Henry Schein. The company has over 45,000 employees, more than 26,000 in the United States, and is subject to extensive regulation, notably by the FDA.