RDI shuts doors; 700 respiratory med customers up for grabs
FOLEY, Ala, -- RDI Global Solutions closed its doors at the end of July, leaving some 700 providers without a respiratory medications supplier, according to industry sources. Those close to the company expect it to file for Chapter 13 bankruptcy in the near future.
"We weren't informed of the closing. They haven't informed us of anything that's going on," said Eileen Payne of Hometown Home Health in Jasper, Ga., a former RDI customer. "Our sales rep was let go in March and that was a shock because she had been there for several years."
Officials at Sun Capital Partners, a private investment firm that acquired RDI in 2004, did not reply to interview requests by press time. Industry insiders estimate the company has 700 to 800 customers, including Lincare, which bought its vials from RDI.
The closing came as no surprise to some customers, including Payne.
"We started ordering directly through the distributor that RDI was shipping out of," she said. "They were honoring the same prices that we were receiving from RDI, which was a good thing because we had really good prices with RDI."
Another customer said his company also switched to an RDI competitor. That customer, who asked to not be identified, said he had to switch when orders stopped arriving and his phone calls were not being returned.
"There was a core group of employees who had been working there for a long time who are good people, and when they said they were going to do something, they did," he said. "But, obviously when something on the corporate level happens like this, their hands are tied. So, my loyalties will go back to them if the company gets its act together."
A source close to RDI also blamed corporate decisions for the company's recent downfall. He said Sun Capital was not familiar with the business when it acquired the company less than two years ago. Prior to the MMA, RDI was seeing great profits by selling compounding vials. After the MMA, however, it took on a role as drug manufacturer, which yielded much smaller profits, he said.
"Sun Capital is in the business of buying companies, infusing them with cash, building them up a bit, and then selling them. Under this scenario, there is not really a market to sell," he said. "The easiest things for Sun to do was just say adios, shut the door and file Chapter, and I think they chose the path of least resistance."
"That doesn't mean the company wasn't profitable, it doesn't mean there wasn't a need for it. It just didn't fit with Sun Capital's business model and what they wanted to achieve," he added.
In July, company President and CEO Keith Trowbridge resigned to pursue other opportunities. Trowbridge joined RDI shortly after it was acquired by Sun Capital.