MedTech Recycling: Johnson & Johnson’s Waste-to-Value Model

0:00
0:00

How can take-back programs move beyond compliance to become a primary sales driver and scaling mechanism?

In this episode, Daniel Unger, Environmental Sustainability Manager at Johnson & Johnson MedTech Germany, and Michael Leitl, Executive Director at Indeed Innovation, discuss how J&J’s collection system solves a core operational problem for its customers: the waste management costs for hospitals.

The conversation explores how their take-back program functions as a crucial sales and commercial lever.

What you’ll hear in this episode:

  • The function of the take-back program as a Unique Selling Proposition that secures sales and influences procurement.
  • The major regulatory barriers that block cross-border logistics and the strategic decisions that facilitate rapid market scaling and partner adoption.
  • The long-term business case and vision for industry-wide collaboration 

This episode covers the practical trade-offs and operational shifts required to build a financially and environmentally viable take-back business model, despite regulatory and cost constraints.

This is the second episode in the series Irresistible Circular Business, sponsored by Indeed Innovation, the global design and innovation firm pioneering the Circular Economy. The series showcases business practices that deliver irresistible commercial and circular results, with examples from different industries across different R-strategies.

People

Daniel Unger, Environmental Sustainability Manager at Johnson & Johnson MedTech
https://www.linkedin.com/in/daniel-unger-89220181/

Michael Leitl, Executive Director at Indeed Innovation
https://www.linkedin.com/in/mleitl/

Patrick Hypscher, Circular Business Strategist, PaaS Expert
https://www.linkedin.com/in/hypscher/

Chapters

00:00:00 Intro
00:04:40 The J&J Collection and Take Back System
00:07:35 Hospital Motivation: Data, Costs, and Waste Reduction
00:10:59 J&J Commercial Motivation and USP
00:12:43 Scaling and Regulatory Barriers
00:19:31 Vision 2030: A Star Alliance
00:25:52 Learning from Other Industries: Value Preservation
00:32:10 Outro

About

Johnson & Johnson MedTech is the medical devices and technologies business of Johnson & Johnson, working across areas such as surgery, orthopaedics, cardiovascular care, and vision to help improve outcomes for patients and healthcare systems worldwide. It develops medtech solutions that combine biological and engineering expertise to make care more precise, less invasive, and better connected for clinicians and patients.

On circularity and sustainability, Johnson & Johnson MedTech operates take-back and recycling programs for single-use devices and components that recover metals and plastics from items such as instruments, loaders, and other hardware so those materials can be reused in non-medical applications rather than going to landfill or incineration. These programs are active in multiple regions including Europe, the UK, the US, and markets such as New Zealand and Switzerland.

Further Links

2026 MedTech Circularity Index: Benchmarking global industry leaders: https://www.indeed-innovation.com/circularity-index-medtech-2026/

Refurbishment Guide: Scaling operations and circular revenue: https://www.indeed-innovation.com/refurbishment-the-ingredient-for-future-growth/
Circular Feasibility Study: Strategies to eliminate clinical waste: https://www.indeed-innovation.com/the-white-dot-2024-medtech-circular-economy-feasibility-study/
”The White Dot” Initiative, Practical hospital circularity via ZUKE Green, INDEED, and CIRCULARMED: https://zuke-green.de/initiative-weisser-punkt/

Transcript

[00:00:00] Intro

Daniel Unger: You need to answer who’s paying for what. And that is why you always need to find a solution. As we started as a pioneer by doing it we have a Unique Selling Proposition as we call it. And if a surgeon can work with each device from competitors or from Johnson & Johnson, there is a big game changer for him: okay your device is going to be recycled in the end then I decide for your product. And that was very helpful in the beginning. It was a big driver

Jingle: My name is Patrick Hypscher. And this is Circularity.fm, the podcast about understanding, building and managing circular business models.

Patrick Hypscher: Welcome back to Irresistible Circular Businesses, the series that showcases the business practices that deliver irresistible commercial and circular results. We look at the examples from different industries across different our strategies. Sponsoring partner of the series is Indeed Innovation. Indeed Innovation is the global design and innovation firm pioneering the circular economy and driving initiatives like in MedTech, the white dot.

Patrick Hypscher: A coalition that is transforming medical waste into valuable resources in each episode. A member of the Indeed Innovation team will join me as a co host. The last episode in the series explored the importance of circular product design, modularity, and the role of dealers for a circular business.

Patrick Hypscher: In this episode, we will take you to the medical sector, an industry that is shaped by high hygienic standards and intense regulation. We will look into Take back as an instrument to drive sales and get access to secondary materials. But before we start, I have an offer for you. If you want to get the actual one pager about this conversation, sign up for the Circularity.fm newsletter.

Patrick Hypscher: You can find it at www.circularity.fm.

Patrick Hypscher: Today’s guest studied economics and has an MBA in healthcare management. He worked for over 15 years for Johnson & Johnson, including leadership roles in commercial management since nearly three years. He is the environmental sustainability manager for Johnson & Johnson MedTech Germany. As a key expert in circularity within the medical field, he drives sustainable clinical pathways and MedTech environmental strategy.

Patrick Hypscher: Welcome, Daniel.

Daniel Unger: Hello Patrick. Nice to meet you.

Patrick Hypscher: I am not alone. We are not alone. Um, today’s Indeed co host is Michael. Michael has an academic background in chemical engineering. He worked for Manager Magazin, Harvard Business Manager and founded his own media startup for more than seven years. He is now with Indeed Innovation as an executive director. He helps companies to develop circular strategies and business models and the use of AI for circularity. Welcome Michael.

Michael Leitl: Thanks for having me. I am really looking forward to our conversation.

Patrick Hypscher: Michael, Daniel, we always start with a personal question. When was the last time that you’ve been in a surgery room

Daniel Unger: Should I start Michael Um, I, it is quite a long time ago. Of course, I started as a sales rep and in Johnson & Johnson, as you mentioned before, for 15 years approximately. And yeah, that was my daily business to be in the OR but in switching to the environmental sustainability manager role, that is oh quite a long time ago that I was in the OR. But I am really close to several customers and I know what is going on in the OR very well.

Patrick Hypscher: Okay. Michael, what about you Any experience

Michael Leitl: Yes. It was during my military service, so I was there in the medical division and there I had some duties in this area. This was the last time.

Patrick Hypscher: Okay.

Michael Leitl: It is quite quite a while ago.

Patrick Hypscher: I am happy that you came up with these kind of stories and not any personal surprises here. We wanna stick to this ecosystem but look at it more from a circular perspective and also look at the products that are used there and also are discarded there.

[00:04:40] The J&J Collection and Take Back System

Patrick Hypscher: Johnson & Johnson does run a collection system. How does this look like Daniel

Daniel Unger: Oh, it is actually quite simple. As you always do at home, I hope so, separating waste between paper and plastic and household. And it is not different when you are talking about the medical products take back system. Your staff needs to separate our instruments from the rest of the devices which are used in the OR and then they put it into the bin. And once these bins are full, they can arrange a pickup service by our partner Reclay. And then these bins are going to the not to the recycling part yet that is forbidden. And before we recycle these instruments, we need to decontaminate them, and that we are doing with a German partner here as well. And then they were sterilized and after that, once sterilized, all these clean devices go to the recycling partner and then they were recycled on site.

Patrick Hypscher: And what kind of regions are we talking about

Daniel Unger: We started in Germany in 2020 and we were the first country. We are next to New Zealand. New Zealand started in 2019 and as we started here in Germany, we scaled very fast in the other European based countries. And meanwhile, we have recycling programs in 13 countries within the EU. And very proud to say that we also have the first pilot now running in California.

Patrick Hypscher: Nice. And just to be sure, are you taking only products from Johnson & Johnson or are you also covering other manufacturers

Daniel Unger: Unfortunately not yet. But that is the plan and the vision for the future. Currently we are only able to take back our own products that have several reasons. The first one is costs. When as we started in 2020, I was surprised about the price you need to pay for recycle something. You can say it is more expensive to recycle a MedTech product than to incinerate that. And that is a strategy in total that we are talking about later maybe. And that is the first reason about cost because someone needs to pay the bill in the end for the service. The second one is of course we are currently working with a very small decontamination service which is not able to scale it automatically. You need to separate all the devices by hand. But we have engineered a new process for three years ago I think it was, and we are ready to scale it, but unfortunately we are not allowed because we have some strict regulations here in place which are hindering us to scale it here in Germany at least.

[00:07:35] Hospital Motivation: Data, Costs, and Waste Reduction

Michael Leitl: Cool. Yeah. Interesting. So what are the main reasons why hospitals sign up to these programs

Daniel Unger: As I started as a sales rep, actually I can say I was myself aware of all the volume of waste which is generally during the OR days. And I think that is the same for hospitals. Everybody who is working in the OR can see all the waste which is generated during the day. It was my first aha moment as we say in German. It was my waking up moment and to say, okay guys, unfortunately of course we have great products and we have a lot of patients and all the surgeons we are serving for, but in the end we are part of the problem. I started to think about okay guys let’s look we need to find a solution. We need to arrange or set up a take back system for these products and recycle in the end that we can decrease the environmental footprint of this product.

Michael Leitl: Are there some cost or profit positions that are improved then by that so that the hospitals have another advantage beside the topic that waste is reduced or incineration costs are prevented.

Daniel Unger: Of course. I think they have two good arguments to participate on this program. The first one as you mentioned of course the more they collect and take back to the supplier, the less they have the volume or they can decrease their volume of waste that needs in the end. That is the first. The second one is that they are also when they are participating on our program, it is not only about recycling itself, it is also about that they are getting reports how many devices they collect. What kind of material is getting back into the loop How many devices we could avoid from incinerating in the end. That is another one. They can use all these data for their own sustainability reports. And last but not least, it is about costs. And yes of course the more they can avoid waste the more they can save money in the end for their own reports.

Michael Leitl: Is it also about making processes a little bit leaner internally Or is that not

Daniel Unger: No. Leaner I would not say that that is the topic. No. But it is also not more work for them to do. That is the first thing. When we present our programs to the hospitals, the first question is, okay, have we more work with that But doing that and we say no guys you are doing the same like you have to do every day. And there are the only thing you need to keep in mind is okay there is another bin and you need to separate and keep in mind which kind of products are going into this green bin and which one not. And that is the only thing they need to keep in mind. I think that is very easy. That was very important for us as well because we know the workload within the OR and it was very important for us that we do not make so much pressure and too much more work for the OR staff.

Patrick Hypscher: Just to make clear here, sorry. You mentioned OR, everyone might be familiar with that. What do you mean by that

[00:10:59] J&J Commercial Motivation and USP

Daniel Unger: The Operation Room.

Patrick Hypscher: Okay. Okay. Yeah, just to make it right. Brilliant. I am sorry. It is the Operation Room where all the surgeries take place every day.

Patrick Hypscher: Yeah. Cool.

Michael Leitl: So what drives Johnson & Johnson to run this collection system What are your benefits

Daniel Unger: Yeah. It was a personal ambition to start with this program to feel to have a meaningful job to say okay guys we did something for good. And I think it is the same thing for Johnson & Johnson using our size for good. And I make aware of this problem and I think everybody is aware of it in the end. And that is why I reached out with open arms as I presented in 2020 the idea okay let’s talk about recycling. Is it feasible Let’s check it out. Let’s try to find the right partners. In the first beginning, we are also benefit from it because we are still the only company who is doing recycling for MedTech device and their packaging at least. We reached milestones also in the hospital as we presented this program in the first beginning. And it was not a big deal to convince these guys in the or to participate on this program.

Michael Leitl: Mm. And I think one of the most pressing topics is to scale up all those processes. So since hospitals are very distributed in a huge area, how do you make it possible to reach scale

Daniel Unger: The first step It is key to get the most possible hospitals you can reach in Germany at least. Of course, the question is always okay how can we improve the processes How can we streamline the processes But it is a second task. In the first beginning it is very important to get all the at least university hospitals so that this is not only a small program or even the pilot.

[00:12:43] Scaling and Regulatory Barriers

Daniel Unger: It must be the new normal. And of course the more hospitals participate the more we can streamline the process in the end. One challenge is if it works in Germany why does it work in the Netherlands Can we also collect all the devices in the Netherlands and bring them cross border to Germany And that is a big deal to do that. That is why it is a challenge always. If another country would like to participate on this program they need to find their own recycling partner locally. That is always a big challenge to find the right partners in each country. Scaling is easy in the dashboards in the reporting, but in the end it is always a challenge to find the right partner in each country.

Michael Leitl: So you need really to separate country wise

Daniel Unger: Unfortunately, yes. The operators in each country. Okay. Interesting. And are these resources returned then into the loop, or is it separated into other industries

Daniel Unger: Yes, of course. We put it back into the loop locally. That is very important. We do not ship them to any other countries or abroad. It stays here locally in Germany. Unfortunately we are not allowed to reuse our own recycled material to make new MedTech products of it yet. But with our recycling program, we avoid in the first step the incineration and the carbon emissions which are generated by it. And the second one, we can reuse the material when you are talking about MedTech devices and many reasons you have. Precious material inside, we can take it back into the loop and maybe it is sold on the commodity market here locally and then these kind of recycled material can be used to make new products like bottles of shampoo or steel products.

Michael Leitl: The question of how profitable the topic is relates to the purity of materials. But first are the differences between the different countries When you look at Germany with strict regulation and other countries maybe have other rules.

Daniel Unger: Yes. That is always the first one as I mentioned to find the right recycling partner because not every recycling company is willing to participate because when you reach out to these kind of companies they the first question is how much volume. And if you are presenting these small volumes in comparison to what they are managing each day, some maybe laugh. That is why it is the first challenge. And the second one is to find the right partners with the authorities in each country because of course we are all in the EU but in the end each country is responsible for its own waste regulations and there are a lot of differences between these countries. Italy, for example, is very strict. Spain is also very strict. That depends on which country and which kind of people are working in which kind of authority and departments. And yeah that makes it not easy to scale.

Michael Leitl: Would it be a big leap forward for all those circularity ambitions if regulation would be harmonized across all Europe

Daniel Unger: Yeah, of course. Thinking about the cross border shipment of waste would be helpful. Maybe we have partners in the Netherlands or the UK and the distance is not too long. Maybe it makes sense to streamline this process to work with one recycling company in the UK or the Netherlands where all the connected devices from UK and Germany and Switzerland go. Going to one partner, that would be very helpful because as our partner mentions it is very hard very hard to get approval to do this. I remember one approval we asked for in Sweden and Denmark; it took more than one year to get this approval. Second, it could be very helpful to start our new process in Germany because when we are talking about the Netherlands, the recycling companies who are localized in the Netherlands are allowed to decontaminate themselves on site. That is forbidden in Germany, unfortunately. Yet that would be very helpful to invite other suppliers, other competitors into this program because we need to run the new tube 2.0 process as I call it to invite other companies to join this program.

Michael Leitl: So you see regulation really as a limitation of circular transformation of business

Daniel Unger: Unfortunately, yes. I think we have good regulation in place when we are talking about the supranational framework like the EU Green Deal taxonomy. That is great top down. But in the end you are faced with the local regulations and sometimes they are not working together. You would like to do what is the aim of the EU Green Deal but you are faced with limitations locally when you want to execute it. That is what we are faced with unfortunately in Germany at least.

Daniel Unger: The other countries I think the great ambitions are ongoing. I think in the Netherlands when I look what is going on there, in Switzerland I think also, Denmark. To Germany we have a lot of good partners like Indeed Innovation or our ZU KA Green Networks. All the ambitions in the several hospitals are ongoing. We all try to make this problem visible by doing it. But unfortunately I have not the feeling yet at least that there is a change going on. Let’s cross fingers that will maybe happen in 2026. Let’s see.

[00:19:31] Vision 2030: A Star Alliance

Patrick Hypscher: 2026 Let’s also talk about the future and Daniel what’s your vision for the program in 2030

Daniel Unger: Oh that is good. It is very simple to answer. That recycling in each hospital is a new normal not only for Johnson & Johnson also for all the Star Alliance of MedTech companies as I call it. It is a new normal that we also recycling and increase the recycling rates in the hospital.

Patrick Hypscher: And Star Alliance then means what What do you envision there

Daniel Unger: That we have all the big companies into place and we are already in touch with them. And I know that most of these companies are willing to participate. But as I mentioned there are some regulations and some problems in place yet but I am very confident that we will solve this problem. I think the feeling and the ambition to participate is existing already. And I hope that we can do our job in this year and next and that it is in 2030 the new normal that we are doing recycling in each hospital place.

Patrick Hypscher: So the incentive to run such a program is basically what from a Johnson & Johnson side from a commercial side

Daniel Unger: Okay. The first motivation was to doing something for good. But then for a company you need to answer who’s paying for what. And that is why you always need to find a solution. As we started as a pioneer by doing it we have a Unique Selling Proposition as we call it. And if a surgeon can work with each device from competitors or from Johnson & Johnson, there is a big game changer for him okay your device is going to be recycled in the end then I decide for your product. And that was very helpful in the beginning. It was a big driver but of course if something you need to pay for something that is not an obvious basement to scale rapidly. And that is why we changed and said okay for all the long partners, good partners we are working very long time with, the hospitals we offering the service for free. That is a game changer for us and it is a good requirement for scaling with other companies.

[00:25:52] Learning from Other Industries: Value Preservation

Michael Leitl: When you think back when we first met while doing this feasibility study together to identify with other companies what are the biggest main problems in reducing medical waste in hospitals

Daniel Unger: I think ambition is there because when we are talking with our own suppliers and when we are talking about our customers I think there’s a big motivation in the market to change something. It is not always hard to convince our customers when we present it. And I think the competitors are also looking because we are the first and once you are as a big player get one step further the others need to follow and that is why they’re also keen and eager getting to participate on this program very fast. And that is why we need this escalation shift, a change that we can run at least at the first a pilot with several competitors to demonstrate the value of this program. And then I hope that we can scale very fast.

Michael Leitl: That is interesting. When you look in other industries then there are examples where meanwhile in industries that are not that regulated they already start using parts from competitors to combine the refurbished products again. It reminds me it is a kind of Frankenstein product at the end but it looks like a very good design new product and it is all about standardization. And I think this is a really game changer because then you can create the scale up in a much better more efficient processed way and I think this is a quite optimistic scenario for the future.

Daniel Unger: Yeah. I think we need to do a lot of homework within the industry, but I think it is already happened. For instance we are talking in our organizations about how to standardize the method we are calculating our own carbon footprint for medical devices. Before you can present these data to customers we need to synthesize the method we are calculating. That is already happened with the DIN industry norm here in Germany. And I hope it will end in the ISO in the end. Let’s see. Of course you need to work you need to collaborate with your competitors on the market. You cannot do it on your own that will not work in the end. You need to reach out your arms to other companies. Of course we are in competition but I think in the end sustainability is not a factor for competition. I think now we need to work very close to find a good solution for our customers and the environment.

Patrick Hypscher: Wonderful. Daniel let’s wrap it up. So as a short answer what makes this program irresistible for Johnson & Johnson

Daniel Unger: Unfortunately we are still unique as the first one and it makes still unique that you get the report in the end what is inside the bin so that you have a big motivation to see what is the difference why separating MedTech devices and why you’re doing that.

Michael Leitl: I think in general and also from what we heard from Daniel we have mainly two parameters. The first one is the amount of material we can get. I heard in many different industries it is always the same story. So as soon as you have a certain amount of material the process after take back can be established in an industrial way not manufactured. This is very important the scale up possibility that makes a business profitable. The second part is the type of material you can get. For example when you can get hands on aluminum or steel this is very easy to reprocess and reintegrate into the production processes. When you think of plastics with those many different variants it becomes even more complicated. And therefore more and more companies look into complete components because then you do not need to go to a particular level which is the case in recycling but you can use the whole component, safe value of manufacturing it and remanufacture that.

Daniel Unger: MRI.

Michael Leitl: MRI machine. This is a very established process since years. And when you can transfer that to even smaller devices this would be a huge step forward.

Michael Leitl: As we discussed in MedTech it is regulation. Because it is in Germany not allowed to disinfect these materials outside of the hospital to make it in a more scalable process you need to do it on site. Even that is sometimes difficult to achieve because the law at the moment requires as soon as materials have been in contact with the patient it needs to be incinerated. What we did in the White Dot initiative where we which we created together with Johnson & Johnson and Philips and other companies is that we now see that there is some weakening in the regulation. That this particular part will be now discussed during this and next year that we can hopefully see that this part of regulation will change. That will open the door to create loops of materials components and establish new ways to reduce waste streams.

Michael Leitl: I think it is mainly about preserving value. So if you are able to establish a take back system and can not only recycle which helps you to hopefully sell the recycled material for other industries. But if you think more into the future and you are able to rebuild devices then you maybe need just 50 percent of the effort to remanufacture the device in comparison to create the new device. Even you, even if you resell this with a discount, you will also have a chance to end with a better margin than with creating the new device. This is the case in other industries that are not that regulated and the numbers of the refurbishment market are really telling. So it, since years they grow with a double digit rate, about 14 percent depending on which industry you look at. And this was one surprising finding when we did some research about what are the main success factors of refurbishment in terms of circular economy which we launched in February. And if we could establish that in the MedTech industry as well then we could prevent much of the clinical waste that is produced at the moment.

[00:32:10] Outro

Patrick Hypscher: Wonderful. Um, Daniel, Michael, thanks for sharing your experience and providing your perspective.

Patrick Hypscher: And all the best with reaching the vision Daniel you sketched. Thank you.

Daniel Unger: Thank you. Thanks for having me. Thank you.

Patrick Hypscher: Our second episode in this series about irresistible circular businesses in sponsoring partnership with Indeed Innovation. Indeed Innovation is the global design and innovation firm pioneering the circular economy and driving initiatives in MedTech like the White Dot which is about transforming medical waste into valuable resources.

Patrick Hypscher: If you want to get the actionable one pager about this conversation here sign up for the Circularity.fm newsletter which you can find at www.circularity.fm. Do you wonder how 20 MedTech leaders rank on circularity and what’s actually driving circular revenue Get Indeed Innovation Index Report which I will link from the show notes in the next episode of Whirlpool will tell us how they operate their certified refurbishment program in North America.

Patrick Hypscher: Until then let’s drive a profitable circular economy. And please don’t forget the most abundant renewable resource is your imagination.

Jingle: My name is Patrick Hypscher. And this is Circularity.fm, the podcast about understanding, building and managing circular business models.