Medtech distributors' just-in-time era is 'dead' as 2026 chip crunch looms

Medical device makers face a new semiconductor squeeze in 2026, and Zoll Medical chairman Jon Rennert says the industry's tolerance for lean inventory is gone for good. "Just-in-time inventory was never really a big deal in healthcare. I would say to the degree that it ever was, it's dead now," Rennert told an audience Monday at AdvaMed's The MedTech Conference in Boston.

The AI infrastructure buildout is the trigger. Data centers are bidding up chip supply, and device makers — a fraction of the demand stream — are competing for the same components. Rennert, whose company makes automated external defibrillators and other emergency and critical care devices, put the disruption in perspective: "There's been more supply chain disruption to the medtech industry in the last five years than at any point that I've seen in my career, and I imagine many of you feel the same way."

What is Zoll doing about chip access?

Zoll has made strategic investments in inventory, Rennert said. It's expensive, but it buys lead time and the ability to respond when conditions shift. The company has also gone upstream: historically Zoll bought its electronic boards from contract manufacturers and had no direct relationships with leading chip suppliers. Now it works to make those suppliers understand what's at stake for patients.

"I don't think that the big players have visibility on how important our products are, how impactful they are to patients if they're not available," Rennert said. "We're a small demand stream, and while all the AI companies may be bidding up supply components, if they could allocate just a little bit for us, it would make a big difference to patients."

Tariffs have already bitten. Rennert said Zoll has seen suppliers close plants after other customers stopped buying because of tariff pressure, forcing Zoll to develop relationships with parallel suppliers that have excess capability to front-load projects. The result: working two or three times as hard to stay ahead as was necessary five years ago.

How does a 30,000-SKU portfolio build resilience?

It doesn't — not everywhere. Heather Knight, chief commercial officer at Solventum (the 3M healthcare spinoff spanning wound care, infection prevention, dental products and health information systems), said constant scenario planning is the only way to meet customer requirements that keep getting deeper and more precise. Disruptions arrive as weather events, cybersecurity incidents, geopolitical tension or a supplier abruptly discontinuing a needed component.

With 30,000 SKUs, full redundancy is impossible. Knight's answer: prioritize life-saving products that customers depend on, "and then building resiliency backward from there." She also urged companies to simplify — "look at where you can buy where you make and then make where you sell. So you're not shipping product all over the globe" — and to proactively cross-register products with regulators in different geographies before a disruption strikes, saving time when one does.

Who owns the inventory decision?

Vantive CEO Christopher Toth argued accountability should sit with regional leaders, not a central function. His checklist: a disaster recovery plan with a named point person and defined steps, an integrated business planning process matching field events to what the supply chain is signaling, and regional leaders accountable for the inventory they hold.

"Now they have skin in the game, and so when a decision is taken, if we want to increase inventory, it costs something relative to their [profit and loss], but it's also a calculated decision where they have shared responsibility," Toth said.

Vantive was formed in 2025 when Baxter sold its kidney care business to the Carlyle Group. Home dialysis is a core focus, and in many markets patients depend on dialysis solutions being shipped to their homes. Vantive runs 20 global manufacturing facilities, and Toth was blunt about the stakes: if those products suddenly couldn't reach a home, "it would be catastrophic." He encouraged executives to treat manufacturing and supply chain footprints not as a cost but as a competitive advantage — the billions invested in infrastructure create a barrier to entry for competitors.

Toth closed on the framing that drives the sector's inventory math: "From a company perspective, our philosophy is we need to do our jobs as if each patient is our mother, father, brother, sister, child because it is someone's mother, father, brother, sister, child." As the 2026 semiconductor crunch approaches, expect medtech supply chains to keep carrying more buffer stock — and more of the cost that comes with it.