Invacare - a world leader in home healthcare, rehabilitation and mobility products - has just released their earnings for Q2 2006. The pressure of Medicare reimbursement on the earnings is no big surprise - especially to readers of this blog.

Perhaps learning from recent experience in the homecare mobility (and oxygen) business the Sleep Manufacturers Alliance has been formed. More details at RTmagazine

When arch rivals such as Embla, Fisher & Paykel, Invacare, Pro-Tech, Puritan Bennett, ResMed, Respironics, Sunrise Medical, and VIASYS get together you have to believe that there are huge industry challenges on the way.

Perhaps a group like this can help provide the balance in providing great affordable healthcare in an environment where politicians are perhaps more interested in their next election results than in the health of their constituents.

In the last few days two (at least) interesting things have happened in the home healthcare industry. People even remotely close to the industry know that by watching the activities of Sunrise Medical and Invacare Corporation - aggressive competitors and both leaders in their own right, you can understand a lot about what is going on.

This is why when I heard that Sunrise Medical was acquiring Lomax Mobility in the United Kingdom and read the latest quarterly press release from Invacare - well, I had to stop and think.

Please understand that I am not making a judgment its just that in so doing Sunrise is adding manufacturing capacity by acquiring a company with 200 employees in the UK while Invacare has announced that it is reviewing its global manufacturing and distribution strategy and hopes to save $21 million pre tax annualized. Maybe the UK is not part of the plan.

Of course in addition to the manufacturing operations Sunrise is getting a much bigger share of the UK NHS market. Sunrise has a very bright global management team so this decision would not have been taken lightly.

It seems that while cost is a huge industry driver today some of the additional thoughts in a previous post concerning adding value and channel management are still right there.

Invacare had bought its way into the NHS in the mid 1990’s through its Bencraft acquisition. In April of this year Invacare made their own acquisition in the UK of a value added seating company.

Which ever way you look at this Sunrise Medical has made a bold step in the UK and has picked up a large share of the biggest customer.

As with most acquisitions today - the challenge is going to be in the execution, especially as Lomax will be run separately according to sources.

This is not the last we have heard of this.