Weathering the storm

According to a 2022 report by the World Health Organization, the coronavirus pandemic created more than 100,000 tons of medical waste internationally. This influx of excess waste created strains on the medical waste management system while also posing human and environmental safety risks, the report says.

MedXwaste, a Deer Park, New York-based provider of medical waste disposal services, is opening a new waste transfer station to help alleviate some of these pressures.

“Up until the pandemic, our options for disposal were one to two locations where we could bring our waste,” says Sean Fredricks, founder and CEO of MedXwaste. “Now, having a transfer station and increased tractor-trailer capacity, we can utilize up to about 10 to 12 facilities for processing.”

That means the company can transfer medical waste to a processing facility with extra capacity in an area that is not experiencing a surge in COVID-19 cases.

A strong investment

In addition to MedXwaste, Fredricks serves as a partner in New York-based Legal Shred Inc., which began operations in 2007. Legal Shred provides secure mobile shredding, hard-drive destruction and e-scrap recycling services. In 2012, Fredricks decided to launch MedXwaste.

“It seemed to be very similar to the shredding business in that there are trucks, drivers and the same kind of customer service and sales,” he says of the medical waste industry. Fredricks adds that the medical waste sector offers benefits that the shredding industry does not, including a consistent schedule of work and more reliable clients.

To grow MedXwaste, Fredricks started with a few acquisitions, including Pathacura Medical Waste in West Haven, Connecticut, and Code Red in New York. He says these acquisitions helped MedXwaste establish a presence in these markets with pre-existing routes.

Today, MedXwaste has 12 employees. The company operates three facilities, including its headquarters in Deer Park; a facility in Wappingers Falls, New York; and the facility it acquired in West Haven. It serves clients such as medical labs, dental offices, veterinarians, funeral homes and tattoo parlors in New York, New Jersey, Connecticut, Rhode Island, Pennsylvania and Massachusetts. Typically, MedXwaste handles approximately 882,000 pounds of medical waste annually, Fredricks says.

The company specializes in medical waste management, sharps container sales, narcotics disposal and government compliance and consulting. It also teaches organizations how to record incidents related to workplace safety for the Occupational Safety and Health Administration, including training for sharps and bloodborne pathogens.

Currently, MedXwaste is transforming its West Haven location, which it acquired in 2019, into a medical waste transfer station. The 11,000-square-foot transfer station is expected to be fully operational by March 2023.

Fredricks says the company purchased the facility from Pathacura for $450,000 and has invested an additional $600,000 to retrofit it with the necessary equipment, including a wash system for reusable sharps and medical waste containers. The transfer station will handle the medical waste that MedXwaste collects for disposal and also will process sharps containers for reuse.

Fredricks says the transfer station will employ four workers to operate the wash system: two for the day shift and two for the night shift, with each shift being eight to 10 hours. He adds that the company also will hire two employees to handle the transfer station’s administrative work.

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The facility will handle medical waste from New York, New Jersey, Rhode Island, Connecticut and Massachusetts.

“We chose this location because of our previous acquisition of Pathacura,” Fredricks says. “We also chose it because of its location near several highways that connect to Rhode Island, Massachusetts, New Jersey and New York.”

The new wash system is anticipated to maximize high-level disinfection rates while also having a positive impact on the environment. While the company can’t disclose which manufacturer will provide the wash system, Fredricks says he is working with about four companies that create washers for reusable sharps.

“It really comes down to what our estimated volume is going to be over the next five years,” Fredricks says. “That’s something we’re still trying to determine.”

By using a wash system in conjunction with its local transfer station, MedXwaste says it is reducing its carbon footprint by limiting use of cardboard and nonreusable plastic sharps containers, thus reducing the medical waste that needs to be processed prior to disposal. The company achieves this in part by using 28-, 38- and 96-gallon containers that can be reused.

Fredricks adds that the location of the transfer station allows MedXwaste to run one truck instead of multiple trucks and allows the company to maintain larger volumes of material, meaning it will be able to serve a larger client base.

Issues and consolidation

Fredricks says two major challenges are facing the medical waste industry. First, the medical waste market is consolidating as major companies acquire smaller businesses in the sector.

“The issue with the consolidation is that the vast majority of them are buying up processing facilities,” Fredricks says. “And because they’re buying processing facilities, it reduces the availability and opportunity for outside people to come into this industry because they don’t have anywhere to go with their disposal. So, the barrier to entry is very high.”

The industry also faces a lack of capacity as it attempts to deal with the high volumes of medical waste the pandemic created.

Fredricks says during the height of COVID-19, processing facilities that handle medical waste were full.

“I think we were less prepared during this pandemic for a lot of things,” he says. “So, I think it’s important for us to get ahead of it and get some honest information about where all the facilities were capacitywise during the pandemic.”

The issues originally spurred by the pandemic have worsened because no standard set of rules and regulations is available for the industry to follow nationwide, he adds. “I think that’s probably the hardest [factor] because there’s no federal law across the board; you have all these different rules and regulations by state,” Fredricks says.

Franchising the future

Photo courtesy of Sean Fredricks

In addition to investing in MedXwaste, Fredricks says he plans to continue to invest in his secure document destruction business, Legal Shred. However, he adds that he sees more opportunities to grow in the medical waste industry.

Recently, Fredrick says, MedXwaste began franchising its business. He adds that the company plans to continue to find new opportunities to expand through franchising.

“Franchising was always a goal for us in that we wanted to be able to kind of be the consultants,” Fredricks says. “We often get called for advice and information, and we thought, what better way to do it where we can help somebody grow and bring them business to start off with.”

He adds that the barrier to enter into the medical waste industry is high and that he hopes to lower that barrier by providing entrepreneurs with a client base, experience and resources through MedXwaste franchises. Fredricks says franchisees also receive assistance in negotiating contracts, access to locations where they can store waste and advice on regulatory compliance.

MedXwaste has two franchise locations in Illinois and New York as of July. However, Fredricks says the company has received more than 100 inquiries from businesses and individuals throughout the United States.

The author is digital editor for the Recycling Today Media Group. He can be reached at akamczyc@gie.net.