MERIT’S ORGANIZATION, PRODUCTS, AND SUPPLY CHAIN
Founded in 1987, Merit set out to build the world’s most customer-focused healthcare company by understanding customers’ needs, and innovating and delivering a diverse range of products that improve the lives of people, families, and communities throughout the world.
Merit’s primary products consist of inflation devices used in angioplasty and stent placement; diagnostic and therapeutic catheters used for various procedures in cardiology and radiology; diagnostic and hydrophilic products used to manage and monitor the administration of contrast media and other fluid solutions; thrombolytic catheters and fluid dispensing systems; embolotherapeutic products for the treatment of uterine fibroids, hypervascularised tumours, and arteriovenous malformations; and vertebral augmentation and related procedures; and procedural trays, packs, and kits.
Merit maintains a diverse, multi-campus manufacturing footprint in North America, South America, Europe and Asia, with a global distribution network focused on delivering our products and technologies to our customers.
We have customers in approximately 123 countries, employ approximately 7,100 people globally. Details of Merit’s organization and company can be found on https://www.merit.com/investors/reports-statements/.
MERIT’S POLICIES AND BUSINESS OPERATIONS
Merit has a comprehensive Code of Conduct for Suppliers, Code of Business Conduct and Ethics, and Global Compliance Policy, and is committed to ensuring that our global operations comply with our internal policies relating to human rights as well as with any legal requirements, such as the UK Modern Slavery Act 2015 and the California Transparency in Supply Chains Act. Merit has also more recently developed a Human Rights and Labor Standards Policy, revised its Supplier Code of Conduct, is modifying its supplier onboarding process, and has begun the process of conducting periodic assessments of its suppliers and business partners, in an effort to monitor and classify such suppliers and business partners according to their level of risk with regard to human rights, labor standards and business ethics.
Merit works to continually improve its processes of verification, audit, certification, internal accountability, and training to assess and ensure that Merit’s employees, suppliers and business partners comply with Merit’s policies and expectations to respect human rights.
As a leading medical device company, Merit provides products and technology that make healthcare safer while reducing costs. As a multi-national company, Merit’s sourcing and procurement organization delivers value by establishing global partnerships and developing new service solutions with our manufacturer suppliers focused on our patient-focused products. We work with global suppliers across different fields including businesses with operations in the US, Europe, South America and Asia.
SUPPLIER AND BUSINESS PARTNER APPROVAL
Prior to approving suppliers for use, Merit evaluates suppliers and business partners for suitability. Supplier and business partner approval activities are based on risk and may include surveys and on-site audits of facilities and business premises. On-site audits are conducted by Merit employees, for quality assurance purposes. The onboarding process for suppliers and business partners includes an assessment for human trafficking and slavery activity as a critical factor in the selection criteria.
CONTROLS AND AUDITS
Merit audits its suppliers and business partners periodically. Merit utilizes surveys and an audit schedule to promote compliance with Merit’s performance and quality expectations. Surveys and audits are performed by Merit employees and currently focus on quality and performance issues. The frequency of surveys and audits is based upon risk and performance. Depending on responses addressing human rights, labor standards and business ethics, and how suppliers and business partners are classified according to their risk rating, Merit may begin conducting audits from higher-risk suppliers on their labor standards.
Merit generally utilizes supply agreements, distribution agreements, quality agreements and/or purchase order terms and conditions for controlling relationships with suppliers and business partners. These agreements include commitments for suppliers and business partners to comply with laws and regulations applicable to the service or material provided. Additionally, through Merit’s annual supplier due diligence relative to conflict minerals regulations in the United States (as directed by the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010), Merit conducts country-of-origin inquiries regarding the origin of certain minerals. As recognized by the Organization for Economic Co-operation and Development (OECD), the objective of the law is to help companies respect human rights and avoid contributing to conflict through their mineral sourcing practices. See: https://www.merit.com/about/conflict-minerals-report/ This annual due diligence on conflict minerals will be expanded to satisfy analogous EU legislation on conflict minerals for EU importers, including any audit requirements.
COMMUNICATION AND INTERNAL ACCOUNTABILITY
All Merit employees, directors and agents are held accountable for adhering to Merit’s Code of Business Conduct and Ethics in all aspects of business, including dealings with suppliers and business partners. Employees involved in Purchasing, Supplier Management and Sales functions are trained on specific responsibilities regarding the corporate social responsibility and labor standards, including any requirements that may arise under customer relationships or the UK Modern Slavery Act and the California Transparency in Supply Chains Act.
Merit will promptly investigate any allegations of non-compliance. Violations of Merit’s Code of Business Conduct and Ethics may result in disciplinary action, including termination of employment or agreement. Merit will also consider the potential termination of business relationships, depending on the outcome of assessments, audits and the failure to take satisfactory correction action.
REPORTING
Our respective policies and codes of conduct provide important guidelines for our interactions with customers, suppliers and other business partners, and one another. Our colleagues are encouraged to raise concerns; this includes violations of our code(s) of conduct, our company policies, and the laws of the countries in which we operate. We have sophisticated reporting mechanisms in place to collect and relay information regarding potential violations to appropriate company resources for review and follow up action.
GOING FORWARD
Modern slavery and human trafficking has Merit’s attention and going forward it is Merit’s aim to eradicate modern slavery from its business and supply chain. Merit recognizes that eradication of modern slavery is an ongoing and evolving process. Merit commits to encouraging labor standards throughout its value chain and supply chain that are satisfactory and continually improving. Merit will share its progress through its annual statements.
Fred Lampropoulos,
Chairman of the Board of Directors and CEO
Date: 1 February 2025
*This statement has been approved by the Board of Directors.