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ChristianaCare to invest $25M in new supply warehousing

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ChristianaCare, the state’s largest hospital system, is looking into a new warehouse for medical supplies. | PHOTO COURTESY CHRISTIANACARE

NEWARK — Looking to expand and streamline distribution of pharmacy and other medical supplies, ChristianaCare aims to move out of its current warehouse and settle in a larger one in the Pencader Corporate Center industrial park.

The state’s largest health care provider will reportedly invest around $25.6 million to renovate a 187,000-square-foot distribution and warehouse center at 300 Executive Drive by April 2022, according to documents that Delaware Business Times reviewed through a Freedom of Information Act request.

Once renovated and complete, the Newark site would more than quadruple ChristianaCare’s existing warehouse space in New Castle. The lease on the New Castle warehouse at Boulden Circle will be up in May 2022 and ChristianaCare has no plans to renew, according to the documents.

In a letter to the Delaware Health Resources Board (DHRB), which regulates investments by the state’s health care systems, ChristianaCare President and CEO Dr. Janice Nevin said that the new warehouse “would play a more critical role in pharmacy supply chain and materials” amid the COVID-19 pandemic and beyond.

“The new warehouse would allow ChristianaCare to have a more streamlined and centralized supply chain operation to prompt an efficient delivery of personal protective equipment (PPE) and supplies to our patient care locations,” Nevin wrote. “[It] will enable us to maintain higher inventory levels of needed supplies, equipment and PPE, which will ultimately help us lower costs and mitigate supply chain issues that can put our caregivers and patients at risk during the global pandemic.”

The DHRB granted ChristianaCare’s request to exempt the warehouse from the Certificate of Public Review process on Oct. 22. ChristianaCare spokesman William Schmitt said that the building will not be a clinical site and that the purchase had not been finalized. He declined to comment further on the project.

ChristianaCare first opened its Logistics Center on Boulden Circle in November 2010, to consolidate reception and distribution of all medical and other supplies into one location. Before the 43,000-square-foot warehouse opened, the health care system stored supplies at various facilities, including in both hospitals in northern Delaware.

ChristianaCare Wilmington’s expansion triggered the need for the Logistics Center, as it got to the point that nearly 100 items were sent from ChristianaCare to the Wilmington hospital every day because there was no room to store them.

But not only does the future Newark warehouse stand to potentially answer any issues with storage, but it also leaves room for expansion into specialty and procedural items, according to DHRB documents. Examples include pharmaceuticals, endomechanical devices, rehab supplies and additional respiratory supplies that ChristianaCare does not carry, and more.

In a letter to the DHRB, ChristianaCare Vice President of Strategy and Planning Sarah Nagle noted that while hospitals across the country are reckoning with storage and access to materials during the pandemic, this warehouse is part of a long-term strategy for its supply chain.

“Supply chain maximization is consistently recognized in industry publications as one of the greatest opportunities for addressing growing costs in the U.S. healthcare system, “Nagle wrote. “Hospitals and health systems nationwide are dedicating additional resources to upgrade our supply chain warehouse and distribution mechanisms to align with our strategic aims for the next decade.”

ChristianaCare has a purchase agreement signed with the property owner, Del Monte Fresh Produce of Florida, and is scheduled to close on Dec. 4, according to the documents. Existing employees at the New Castle site will be transferred to the Pencader Corporate Center in 2022 and there is a possibility of adding more jobs down the line.

By Katie Tabeling

[email protected]

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