Should we doubt the future of 3D Printing?

Cost is a major concern regarding  3D printing ,with skepticism revolving around 3D printers being too expensive for mainstream audience. We think it is not.

With annual spend of pharmaceutical companies being close to USD 50 billion , spend that is channelized without awareness of what could be the potential return; 3D printing offers a assured ROI. This is mainly because of personalized offering angle that 3D printing brings on table.

Close to 2 million tons of medical waste is generated every year, primary part of this waste is unused medical devices and supplies, this wastage can be directly avoided by 3D printing, as this manufacturing process produces products on demand, thereby shrinking inventory levels.

While the inventory management and spend reduction remains as operational advantage points backing  3D Printing, reduction in error rates in surgeries, bio printing of organs are some technical advantage the process brings forward.

To summarize 3D Printing is an amazing form of personalized medicine , where the providers are tailoring plans for individuals rather than one size fits all approach.

Logistics service provider like UPS are putting their best foot forward to help this  manufacturing process reach levels that it deserves.

Content Outline Picked from MPO.

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Watch out for this CMO’s work in EU

We are referring to Flexan’s recent expansion strategy in Europe. Company had previously acquired Medron to bolster it’s foot print in European market for medtech industry.

Currently it does lot of contract manufacturing of hearing aid devices in EU geography along with manufacturing of rubber and silicone based products. It also has recently appointed Werner Karau as new European commercial leader.

With a move of new office in Germany and other aforementioned activities, company seems to be leaving no stone unturned  to make it’s end customer’s life simpler.

Insights on Orthopedic Medical Device OEMs financials

Medical device companies generally enjoy gross margins anywhere in the range of 40% to 75%. Which means their spend (COGS) lies in the range of 25% to 60%. Though this range seems a little too much we were able to research figures for Orthopedic sector.

Analysis by Avicenne highlights that Orthopedic behemoths operate at best gross margins of 70-75%. Further their spend which is 25% of revenue is divided equally between in-house and outsourced activities.

While the entire medtech OEM fraternity plays at a outsourcing range of 25% as per recent analysis from PMCF, orthopedic has surpassed the outsourcing percentage to 49%. Old data from 2012 indicates for a combined revenue of 34.5 billion USD from orthopedic focused OEMs outsourcing to third party contract manufacturers was close to USD 3.7 billion.

Thanks to below mentioned contract manufacturers who scaled their capabilities to a level, which provided OEMs with confidence to board on outsourcing wagon which is out speeding all its other counter parts.

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Further another graph below indicates why outsourcing for overall medical device industry still has good potential in coming days. There are still OEMs who are thinking about utilizing medtech CMOs capabilities for their manufacturing need, and if the CMOs are able to convince the decision makers the change in current 25% number is highly likely.

 

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Source 1:http://www.excelta.com/article/4147-how-medical-device-companies-are-outsourcing-and-making-it-work

Source 2: http://www.odtmag.com/issues/2014-05/view_features/a-strategic-analysis-of-contract-manufacturing-in-

6 tooling machines, 1/2 a million dollar of investment

FREU_MEDICAL_Logo_Sinus_CMYK

Freudenberg is one name that strikes our mind when it comes to strategic medical device contract manufacturer. Company has been on rampant growth rate and has been channelizing quiet a spend on growth activities ranging from expansion to new technologies.

Company recently acquired 6 new machines to increase its offerings in medical device contract manufacturing space. These CNC machines have been acquired with a goal to reduce the repair lead times and increase usage of customer molds to optimal levels.

Medical device outsourcing needs are on rise and according research reports it is poised to touch USD 90.5 billion by 2020. Company competes with likes of

– Flextronics
– Jabil Circuit
– Benchmark Electronics
– Greatbatch
– The Tech Group (West Pharmaceutical Services)
– Tecomet (Symmetry Medical)
– Nortech Systems
– TE Connectivity (Creganna Medical)
– Forefront Medical Technology
– Vention Medical in medical device contract manufacturing segment.

Strength & Opportunity Analysis : Freundenberg

  • Company has been making significant investments on technologies and capacity additions.
  • It has expanded its operations in APAC geographies such as China giving at an edge for competitive price offerings to medical device OEMs.
  • Its unique offerings of rapid tooling and prototyping gives it good push on highly competitive contract manufacturing sector.

Technical and Operational Strengths: Company Score:∗∗∗∗∗ <4.75>

Technical (Absolute) : 5/5

  • Design : Yes
  • Prototyping or Development : Yes
  • Manufacturing : Yes
  • Niche { Premium or Niche Segments (Invasive, connected and robotics) : Yes
  • End to End  or Consolidated Service Offerings :Yes

Number of yes determines rating of technical parameter

Operational (Relative) : 4.5

  • Years of experience – 5 (Bench-marked with peers)
  • Number of employees – 5 (Bench-marked with peers)
  • Geographical foot print- 5 (Considered global presence i.e.Developed and Emerging Country Penetration)
  • Investments on new technologies – 3 ( Evaluated investment on novel industry themes such as 3D Printing, Connected Healthcare, Robotics or Others)

Note: Technical positioning is done based on absolute Key performance indicators while Operational positioning is done based on peer analysis.

Main Competitors

  • Vention Medical

  • Tegra Medical

  • MedPlast Inc.

  • Confluent Medical Technologies

  • Posey Company

  • SMC Ltd

Medical device industry’s outsourcing opportunities scale up tremendously

Medtech sector has been subjected to various pressures ranging from complex regulatory norms to cost pressures from reimbursement agencies. Under these circumstances the only option for maintaining healthy bottom line is to outsource.

Subsequently, question that needs to be asked is: Are there outsourcing partners that can accommodate the in-house contained volume of OEMs?

Answer is yes, and the recent uptick in outsourcing partners activity clearly indicates they are more than prepared to handle this surging demand.

One of these recent activities which go about acknowledging the claim is, SFS acquisition of Tegra Medical. Tegra Medical, leading medical device CMO with sales of close to 80 million USD was acquired by fastening solution provider SFS group.

While Tegra is medtech focussed CMO, SFS has various industries under its purview. One thing in common for both the companies is their relevance in OEM’s operation. Both Tegra and SFS are preferred partners in new product development process and carry outstanding client testimonials for their services so far.

The acquisition definitely bolsters SFS positioning in medtech CMO fraternity, while Tegra enjoys the global presence of SFS to sell its capabilities to new clients and geography.

Medtech CMO activity meter is on run, thanks to strategic acquisitions like Tegra-SFS that are keeping the engine running. OEMs can definitely relax as their trusted CMO partner count moves to new heights.

 

Looking to consolidate tooling, prototyping & volume production requirements, here is med CMO partner to go for

Our claim stands on recent strategic move of Carclo plastics acquisition of Precision Tool & Die.

Carclo’s acquisition was strictly aligned towards objective of moving closer to their key customers in north east part of US. This move also provides medtech OEMs based out of north east US geography an opportunity to tap into consolidated offering of the conglomerate.

While lot of medtech CMOs are bringing in the tooling expertise in-house, considerable chunk of tooling requirements is still met by stand-alone tool manufacturers. And hence Carclo’s acquisition of PT&D surfaces as strategic activity, which positions the company on one stop shop radar.

Deal transaction was valued $ 6 million plus.

 

 

Electronics and plastics purchase could now be consolidated to single supplier, thanks to this acquisition

As healthcare industry moves towards connected healthcare, which means companies would now have to procure plastics, electronics as a combo, making  supply chain of buyers more complex than ever.

In times like these, Molex, a connected healthcare pioneer surfaces as an ideal strategic partner. Thanks to its recent acquisition of Phillips Medisize that makes it a go to guy for all healthcare sourcing requirements.

Phillips Medisize has been one of best medtech focused CMO , taking a lead position in many segments like drug delivery, connected healthcare and diagnostics solutions.

Molex-Phillips Medisize deal closed recently and has become a major milestone for medtech contract manufacturing operations.

Medtech OEMs could now breathe a sigh of relief as lot of their strategic operations could be outsourced to Molex.

Medical device outsourcing is basically divided into two major categories:

  • Medical device EMS
  • Medical device plastics

 

Molex-Phillips Medisize acquisition just goes about highlighting a key trend in the industry, which is, cross services acquisition. Services consolidation has begun and there will be a likely increase in  deal counts of similar kind.

A deal that shares a similar resemblance as that of Molex-Phillips is Jabil-Nypro.

 

Phillips Medisize had previously acquired Injectronics and Medicom, both acquisitions were done in very short duration gap. Finally Phillips acquisition spree was paused, that was because Molex acquired Phillips.

 

Medical device assembly service sees a major addition

We are referring to EmbedTek LLC’s recent entry into finished goods supply of medtech devices.

EmbedTek LLC has been for long delivering its services to medical device industry; however those service were limited to component level. Post getting FDA badge of contract manufacturer, it can now cater to finished good supply, which means, EmbedTek can now ship ready to use medical devices to OEMs doorstep.

EmbedTEK has shed its previous image of outsourcing partner working on client specs, and has become strategic CMO ready to take joint responsibility of product quality and delivery.

About Company:

EmbedTek designs and manufactures embedded computers and integrated display solutions for original equipment manufacturers and ISVs. We leverage our expertise in computing, displays, software, wireless, I/O and controls to provide solutions optimized for our customers. We collaborate with our customers early in the process to create solutions that make their end product better. We leverage open standards and augment with engineered hardware and software solutions that enhance the performance of our customers’ end product. We also provide ongoing supply chain management services; delivering the product to our customer throughout the lifecycle proactively managing component obsolescence and product quality. The team at EmbedTek is experienced, professional, agile and customer focused.

Drug delivery and diagnostic disposables sees a global capacity addition, also witnesses a beginning of strategic alliance between medical device behemoth BD and CTP

Global capacity of drug delivery and diagnostic disposables sees a recent expansion by addition of CTP’s manufacturing facility.

While innovation in drug delivery has been on steady pace, joint alliances between medtech OEMs and contract manufacturers has been pretty much stagnant.

CTP, along with expanding its annual production volume also struck a deal with BD for commercial launch of BD Vystra, a disposable pen for delivering insulin and other injectable drugs. CTP had previously supported Becton Dickinson with pilot phase of Vystra.

HAI on rise, not to worry, some players are actively pursuing the quest of minimizing the issues

HAI on rise, not to worry, some players are actively pursuing the quest of minimizing the issues.

We are referring to combined efforts of PDI and Sabic to find out the solution involving the results, that eventually minimizes the count of healthcare associated issues.

As per Cheryl Moran of PDI, in order to understand the compatibility issues between healthcare devices and disinfectants it is mandatory for Healthcare equipment, disinfectants manufacturers and healthcare providers to work together.

The duo intends to protect the patients from damaged or improperly disinfected devices, and are leaving no stone unturned to accomplish the same.

HAI was talk of the medtech world sometime back, with activities involving alliances such as PDI-Sabic, it is really a relief to see the some players are working to fix the broken healthcare ecosystem.