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    Industry News

    Phillips-Medisize Expands; CEO Provides Market Trend Insight

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    03.19.13
    Phillips-Medisize Expands; CEO Provides Market Trend Insight

    Phillips-Medisize Corporation recently announced further expansion of its manufacturing footprint, building on significant growth from last year. In 2012, the company grew its facilities in the Czech Republic; opened a design center in Mountain View, Calif.; added cold chain storage capabilities; and, of course, re-branded itself following the merger of Phillips Plastics Corp. and Medisize Inc.
    Now, the company has expanded its Kontiolahti, Finland, operations. The site focuses on the production of complex drug delivery devices such as inhalers, injection pens and safety syringes. The 60,000-square-foot addition should be completed by August, and will increase molding and assembly capabilities. According to the company, the growth will include a 15 percent increase in staff over the next two years. 

    “The wind is behind our back,” said company President and CEO Matt Jennings. The company’s global growth strategy has its sights set on growing marketplaces outside the United States, especially Asia—which, as Jennings pointed out, often is code for China. Jennings suggested that though the opportunity in China is known throughout the industry, many may not realize just how big the marketplace has the potential to become. “The middle class in China is 350 million [people]—the size of the U.S.—that’s their definition of middle class. It’s got a boom to it too and is aging. It’s the largest growth market in the world today.”

    Indeed, as Jennings noted, industry leaders such as Medtronic Inc. and Stryker Corp. have acquired device manufacturers in China recently. These big-ticket purchases are setting the stage for others to follow. As soon as the Medtronic/Kanghui acquisition closed, Stryker CEO Kevin Lobo began hinting about its own purchase—and now Phillips-Medisize is doing the same. 

    “The North American and European markets are slowing,” Jennings said during a February news conference. “We would go to China to take advantage of its growth.”

    A key in Asia, too, is the notion of manufacturing in Asia for Asia—or in China for China, as the case may be. This, Jennings noted, would accelerate top-line growth by keeping costs down while at the same time accessing vast market space. 

    One of the reasons it’s more difficult to gain rapid top-line growth now, explained Jennings, is the diversification of the market place. “In the [19]80s and 90s, there were plenty of areas that were very large, that drove top-line revenue,” said Jennings. “Big therapy areas are getting smaller. As a blockbuster comes off patent, they may extend it by putting it in a different delivery mechanism, a different platform. Epipen is a good example. Epinephrine hasn’t been on patent for years, but the device has lot of patents in and around it.”

    According to Phillips-Medisize, some of the key factors affecting the medical device market landscape now (besides the ever-present issue of aging populations) are the need for a one-stop vendor base; increasing challenges to develop global “blockbuster” drugs; developing emerging markets (including the BRIC bloc of Brazil, Russia, India and China); tighter regulatory oversight; and the management of a global manufacturing scale with intermittent blockbuster wins. 

    A key trend lately has been the increased focus on exploiting attractive high-growth market segments including diabetes, personalized diagnostics consumables and improved single-use devices. Unfortunately, this trend is leaving niche devices and technologies in the dust. Treatments for “orphan” conditions (those that affect a very small minority of the general population, or conditions traditionally largely ignored by research and medicine, including Fabry’s disease, alveolar echinococcosis, variant renal cancer and high myopia) increasingly are neglected in such an environment. 

    The U.S. Food and Drug Administration (FDA) also has been placing an increasing emphasis on supplier controls and human factors engineering. As a result, stretched internal OEM resources have increased the propensity to outsource all stages of design through production to fewer global contract manufacturing organizations (CMOs) with broader capabilities. This is a major driver for CMOs to expand in every way they can and for OEMs to gain CMO capabilities as well. “It’s difficult to get into CMOs because of the high level of expertise and regulation,” explained Jennings. “The way to do it is get in via an acquisition.”

    So, applying the knowledge of these market trends, will Phillips-Medisize be expanding into China in the near future? “We see 2013 as being robust growth year,” said Jennings noncommittally. “We have visibility into 2014 and ‘15 too—but facilities usually come last, people and expertise first.”

    Phillips-Medisize is headquartered in Hudson, Wis. The company provides design and manufacturing services to the medical device and diagnostics, drug delivery, and commercial markets.

    BMS Tees Up Key Partnership, Inks MPC Merger Deal
    TissueGen Inc. and Biomedical Structures LLC (BMS) have partnered to develop a finished textile platform for drug-eluting medical device applications—such as small diameter vascular grafts and stents, tissue and nerve regeneration, orthopedics and sutures—using TissueGen’s drug delivery technology. The extrusion technology from TissueGen reportedly enables absorbable fibers to be loaded with a wider variety of drugs and biologics. BMS’s expertise is in biomedical textiles.

    TissueGen’s technology is purpose-built for advanced drug delivery and sustained therapeutic release. Its core technology includes fiber extrusion at room temperature, which is aimed at preserving the biological activity of incorporated drugs and therapeutic agents. This enables drug delivery through biodegradable fiber, a format that expands the types of agents that directly can be incorporated into implantable medical devices. 

    The hope is that this platform will allow medical device developers to incorporate high levels of manufacturing tolerance to provide tailored release kinetics for in-vivo support and regeneration applications. The biomaterial format also has tunable release profiles. TissueGen claims it can be used across various therapeutics and can be engineered for any biologic therapeutic, from small pharmaceuticals to protein class drugs such as enzymes. Drugs are incorporated into the fiber according to device performance requirements using a combination of commercially available polymer components, including polylactic acid and polydioxanone.

    Warwick, R.I.-based BMS intends to use the TissueGen polymer extrusion platform to develop biomedical textile structures designed for drug delivery within the body. Because the TissueGen technology allows for the engineering of both chemical composition and mechanical properties such as size, shape, and porosity to each specific application, a single structure can satisfy both physical and pharmaceutical performance requirements without requiring additional material support for implantation. The polymer platform is bioabsorbable and can control therapeutic release over time in accordance with its designed degradation profile as device performance requires—and this feature lends itself to tissue engineering and regenerative medicine applications.

    “TissueGen’s polymer technology is the drug delivery solution that can help overcome many of the constraints of current polymer-based systems,” said BMS CEO Dean Tulumaris. “As BMS works to provide our customers with a suite of solutions for every device design challenge, we believe the TissueGen absorbable delivery platform will provide a tremendous addition to our biomedical textile development capabilities for cardiovascular, tissue engineering, and other applications.”

    Dallas, Texas-based TissueGen focuses in extruding biodegradable polymer fibers with broad drug delivery capabilities. The company has a portfolio of drug delivery technologies with the capability to incorporate and elute therapeutics and standard pharmaceuticals in hydrophobic polymeric fibers or tubes for sustained therapeutic release.

    BMS’s experience in medical textiles includes knitting, braiding, weaving and non-woven technology. The company uses implantable-grade absorbable and non-absorbable biomaterials in orthopedic, general surgery, tissue engineering, cardiovascular, bariatric, cosmetic surgery and veterinary applications, including implantable devices and drug-delivery technologies. The company also provides advanced medical device applications such as bifurcated stent grafts, tapered tendon and ligament repair structures, and heart valve solutions.

    BMS and Modified Polymer Components Merge
    BMS and Sunnyvale, Calif.-based Modified Polymer Components (MPC) will go coast-to-coast with a merger. MPC specializes in the design, rapid prototyping and manufacturing of polymer components for medical device OEMs. Together, the companies hope to provide medical device customers with a full spectrum of value-added services across a wider range of applications. Ampersand Capital Partners, a Boston, Mass.-based private equity firm that focuses on middle-market growth equity investments in the healthcare sector, will be the majority shareholder of the combined company.

    MPC uses its proprietary heating system for molding and modifying plastics to manufacture medical device components. The company’s capabilities include tipping, flaring, hole drilling, marker band placement, reinforced tubing, printing, electrode assembly, and component level assemblies.
    According to the newly combined company, MPC’s production specialists can perform modifications of any complexity to custom and off-the-shelf plastic components including flaring, flanging, joining, tipping, coating, cutting, drilling, skiving and gluing.

    “With our joint capabilities, we will be a more robust organization that will bring greater value to customers with a wider variety of needs, both related to custom plastics components and medical textiles,” said Mike Taylor, CEO of MPC. 

    “MPC’s unique bonding technologies are enabling exciting developments with custom plastic components for medical devices and other related industries,” 

    Tulumaris said in a news release. “By merging BMS and MPC, both companies will benefit from a bicoastal presence and extensive combined resources.”

    Tulumaris will lead the combined company and Taylor will transition into his new role of chief technical officer, where he will focus on working with the company’s engineers to develop new technologies and solutions for customers.

    Jabil Enters Plastics Segment with Nypro Deal
    St. Petersburg, Fla.-based electronic manufacturing services company Jabil Circuit Inc. has inked a deal to acquire Clinton, Mass.-based contract plastics manufacturer Nypro Inc. The announcement came less than a week after the Jabil made several key executive appointments.

    The transaction is subject to shareholder vote and antitrust clearances in the United States, China, and other jurisdictions where Jabil has operations. The expected total purchase price is $665 million, and Jabil is funding the deal from its existing cash and credit facilities.

    “The combination with Nypro will extend Jabil’s materials manufacturing capabilities into the healthcare and consumer packaging markets as well as add depth to our consumer electronics business,” said Timothy L. Main, chairman and CEO of Jabil. “We think this is an important strategic step in Jabil’s development of engineering and capability intensive businesses. Combining Nypro’s capabilities and market presence with Jabil’s global scale and expertise should result in great things for customers, employees and investors.”

    Main will be leaving the post of CEO on March 1, when current Chief Operating Officer Mark T. Mondello assumes the role. Mondello recently was elected to the board of directors at the company’s annual meeting of shareholders on Jan. 24. 

    On that day, Jabil’s board of directors named William E. Peters to the position of president and William D. Muir, Jr. to chief operating officer, effective March 1. Both are current officers of Jabil, and have been with the company for more than 20 years. Human resources veteran Scott D. Slipy joined Jabil as executive vice president of human resources and human development. He most recently was vice president of compensation, benefits and M&A with Cisco Systems.

    Courtney Ryan, senior vice president of Jabil’s global business unit, called Nypro’s precision plastic consumables and disposables for the healthcare market “a welcome complement to Jabil’s engineering and supply chain solutions for healthcare hardware and advances our ambition to become a leading provider to the global healthcare marketplace.” 

    Jabil’s newly appointed president noted that the rigid plastic packaging market potentially is as big as $140 billion globally. 

    “Jabil is an excellent strategic partner for Nypro,” said Ted Lapres, president and CEO of Nypro. “Our complementary capabilities will allow us to offer our customers a more integrated manufacturing solution, while our employees will appreciate Jabil’s similar culture and commitment to ongoing growth and innovation.”

    Nypro has approximately 12,000 employees and manufacturing operations in 10 countries. The company provides product design, tooling, injection molding, surface decoration and complete product manufacturing. Jabil provides electronics design, manufacturing, and aftermarket product management services to global electronics and technology companies.

    ISO Certifications
    • Trumpf Medical Systems Inc. has gained the ISO 13485 certification for its quality management systems for manufacturing medical devices. Headquartered in Charleston, S.C., the company specializes in LED (light emitting diode) surgical and procedure lights; equipment management systems, commonly known as “booms” and used to improved safety and efficiency in the operating room, intensive care unit, gastrointestinal and trauma/emergency departments; surgical tables, including mobile and system versions that feature exchangeable tabletops; and patient and equipment transport solutions. Trumpf’s global headquarters are in Germany.

    • Camarillo, Calif.-based ZPower LLC, specialist in silver-zinc battery technology, has received the ISO 9001:2008 certification for quality management customer satisfaction. “Our silver-zinc chemistry possesses significantly more energy than either nickel metal-hydride or lithium-ion technologies, and is the key enabler for new hearing aid designs to continue moving from disposable, zinc-air batteries to rechargeable batteries,” said Herb Weigel, ZPower’s vice president of manufacturing. “ISO 9001:2008 certification further assures our customers that we are highly capable of delivering a quality product that will bring the convenience and environmental benefits of rechargeable battery technology to this market.”

    • Company officials said that Connecticut Spring & Stamping is on track to earn its ISO 13485 certification this year. The Farmingham, Conn.-based manufacturer of precision parts has achieved standard certification for the aerospace industry, and the company now aims to demonstrate its commitment to its medical device customers. CSS contracted with Connstep, a non-profit business consulting organization that specializes in assisting manufacturing firms implementing ISO quality management systems. A gap analysis was performed and changes are currently being implemented to prepare for the 2013 certification.

    • Electronic manufacturing services company Cirtronics Corporation earned its ISO 13485:2003 certification quality management standard this year. “ISO 13485 certificationrepresents a major milestone for Cirtronics and our customers,” said company President and CEO Gerardine Ferlins. The Milford, N.H.-based company already holds an ISO 9001:2008 certification.

    • Three of UFP Technologies Inc.’s facilities have been awarded the ISO 13485:2003certification. The Denver, Colo., El Paso, Texas, and Grand Rapids, Mich., manufacturing facilities focus on custom-engineered components, products, and specialty packaging made from foams, plastics, composites, and natural fiber materials. “We are committed to investing in our operations to become a valuable partner with our customers,” said Richard LeSavoy, vice president of manufacturing for UFP Technologies. “Now with seven ISO 13485:2003 certified facilities we are able to grow with and continue to meet the needs of our customers in the medical industry.” The company is headquartered in Georgetown, Mass.

    • Germantown, Md.-based Senseonics Inc., a medical device company focused on the development and commercialization of the first fully implantable, long-term continuous glucose monitoring system, has been granted ISO 13485:2003 certification of its quality management system. The scope of certification includes the design, development, manufacturing, servicing and distribution of active implantable glucose sensors and accessories for continuous glucose monitoring. The certification “comes at a crucial time as we approach the European pivotal clinical trial of our first generation continuous glucose monitoring system,” said Tim Goodnow, Ph.D., Senseonics President and CEO.
     

     

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