Medline Signs Prime Vendor Agreement With Prime Healthcare Services

Prime Healthcare Services, an acute care hospital management company based in Southern California, and Medline Industries, Inc. have signed a major cost management agreement in which Medline will serve as the group's prime vendor.

Prime Healthcare owns and operates 13 acute care hospitals in Southern California located in San Bernardino, San Diego, Los Angeles, Orange County and Shasta County.

The five-year agreement will focus on driving savings for Prime Healthcare's hospitals on a multitude of medical and surgical products and services, including distribution of Medline and other national brand products. Some of the main products in the agreement include surgical procedure trays (disposable medical components for a single surgical procedure contained in one convenient kit), surgical gowns and gloves, exam gloves, and briefs and underpads, to name a few.

Additional highlights of the agreement include:

--  Savings on distribution of non-Medline brand products through lower
    fees and more efficient processes.
--  Savings and efficiencies through product standardization and
    utilization efforts in collaboration with Medline's product specialists and
    on-staff clinical team.
--  Savings by converting to Medline manufactured products delivered
    direct to the facilities.
--  Enhanced reporting capabilities
--  Medline will also offer comprehensive product utilization and
    education programs to help the facility control costs and achieve maximum
    efficiency. Medline has an extensive clinical team and educational programs
    in conjunction with its prime vendor programs.

"As our prime vendor, Medline provides everything we are looking for in a distribution partner," said Lisa Ottem, Director of Supply Chain Management for Prime Healthcare Services. "They have the capabilities to distribute quality products to all of our facilities when they need them and because of their efficiencies and logistical expertise, they are able to deliver significant savings to our bottom line."

About Medline Industries, Inc.

Over the past five years, Medline has been the fastest growing distributor of medical and surgical supplies in the U.S., serving as the primary distributor to over 250 major hospitals and health care systems. As a leading distributor, Medline offers a comprehensive array of consulting and management services encompassing the supply chain and logistics, utilization and standardization, business tools and enhanced reporting capabilities, and on-staff clinicians.

With a growing network of 34 distribution centers around the country, Medline is able to deliver products to customers where and when they need them. To help deliver its 100,000-plus products, Medline has an expanding, dedicated transportation fleet with over 160 vehicles in a variety of sizes to fit customers' specific delivery needs. The fleet is equipped with the latest navigation devices for enhanced order tracking and communication.

Medline, the nation's largest privately held manufacturer and distributor of healthcare products, manufactures and distributes more than 100,000 products to hospitals, extended care facilities, surgery centers, home care dealers and agencies and other markets. Headquartered in Mundelein, IL, Medline has more than 800 dedicated sales representatives nationwide to support its broad product line and cost management services.

Meeting the highest level of national and international quality standards, Medline is FDA QSR compliant and ISO 13485 registered. Medline serves on major industry quality committees to develop guidelines and standards for medical product use, including the FDA Midwest Steering Committee, AAMI Sterilization and Packaging Committee and various ASTM committees. For more information on Medline, visit our Web site, www.medline.com .

Media Contact: John Marks (847) 643-3309 Jerreau Beaudoin (847) 643-3011