Flextronics Medical President Discusses Industry Challenges

Flextronics Medical President Bill Flaherty was one of the hundreds of device company executives that attended AdvaMed 2011 – The MedTech Conference in Washington, D.C. The Marlborough, Mass.-based unit of Flextronics International provides design, manufacturing and logistics services to pharmaceutical, medical device and equipment companies worldwide. The unit, which has more than 300 design engineers dedicated to the medical sector, serves five markets: drug delivery (insulin pumps, human grown hormone delivery devices); consumer health (such as blood glucose meters, laser skin treatment and laser hair removal devices); disposable products (single-use sterile devices, heart catheters, guide catheters, wound care products); imaging and monitoring (magnetic resonance imaging and computed tomography scan equipment); and lifesciences (laboratory equipment). Before he headed to the board meetings and panel sessions that would consume most of his day on Sept. 28, Flaherty discussed with Medical Product Outsourcing the trends, challenges and growth factors that are impacting both his company and the overall device industry.

Medical Product Outsourcing: What is the most pressing challenge currently facing the medical device industry in the United States?
Bill Flaherty: This should be no surprise because it’s gotten a lot of discussion and attention here at the AdvaMed conference. It’s the medical device tax. That puts cost pressure on companies but it also creates an opportunity for Flextronics Medical. We can help our customers become more competitive by engaging with us to conduct manufacturing on a lower cost platform or by improving their speed to market with the help of our design engineers. We have good solutions to offer.

MPO: How has healthcare reform impacted the device industry?
Flaherty: It’s putting pressure on the industry. But on the other hand, there are elements to it that are important and impactful for both patient care and well being.

MPO: Flextronics Medical has achieved significant growth and expanded its scope of capabilities in the last four years. How was this achieved?
Flaherty: In our medical segment, specifically, it goes back to our portfolio. It’s extremely broad and diverse. Where we may be experiencing some pressure in one market, another [market] might offset that. In addition, our customers in this economic downturn are looking for lower-cost solutions and we have the ability to deliver that to them. We are very advanced in Lean manufacturing. We have global manufacturing operations and because of that, we can provide them the solutions that allow them to be more competitive.

MPO: Your company works with a lot of small firms and startups. What advice would you give a startup that is just getting its feet wet in the medical device industry?
Flaherty: I would tell those companies that we can provide them bandwidth and expertise in resources to help them with their product development needs. Secondly, we have the ability to engage with them as their manufacturing services partner, which would enable them to forgo the capital requirements needed to build a manufacturing operation.

MPO: What trends are you seeing in the industry?
Flaherty: From a technology standpoint, there are two. One is the miniaturization of products, which has two benefits. One benefit is patient lifestyle; the more affordable products—those that are wearable—allow the patient to have a more active lifestyle and that’s a terrific advantage. The second benefit is portability, which means bringing the device to the patient instead of requiring the patient to go to the doctor’s office. Remote patient care is a big benefit because it provides a quicker diagnosis and quicker treatment for the patient.
The second area of the technology trend that I see revolves around compliance and improving the ability of medical devices to ensure that a patient is taking his or her medication and also taking the proper amount of medication. There is a lot of technology being developed in this area.