If the only things to be absolutely sure of in life are death and taxes, perhaps it's no surprise that plastics processors making things to care for the sick and injured continue to have a good prognosis.
Processors with strong stakes in the medical business say they generally are seeing growth. Not that medical is an easy market. It remains a tough business to penetrate, because of government regulations, liability and manufacturing requirements; it faces the same price pressures other segments do; and it's seeing more manufacturing move offshore.
But most processors would love markets with steady growth like medical devices-9 percent a year for the next three years, with a market size of $69.4 billion in 2004, according to consulting firm Frost & Sullivan of Mountain View, Calif.
``We saw double-digit growth in 2003 for the medical segments,'' said Chuck Hoar, vice president of accounts with injection molder United Plastics Group Inc. in Westmont, Ill. ``We're anticipating more of that. Our focus is going to be tailored toward servicing the medical market.''
Publicly traded medical plastics processors reported either growth or steady profit in 2003.
Merit Medical Systems Inc. in South Jordan, Utah, saw net profit rise 53 percent to $12.6 million, on $100 million in sales in the first nine months of 2003. Utah Medical Products Inc. in Midvale, Utah, said its net profit of $5.5 million and sales of $20.5 million held steady in the same period.
Several privately held custom processors said they generally are seeing growth in the range of 10-15 percent, although there is no way to verify those figures. A September survey by financial adviser PennTar Consulting Inc. of Port Washington, N.Y., found medical the most profitable sector for plastics processors.
Injection molder Nypro Inc. said its medical sales were up 13 percent in its fiscal year ended in June, and have accelerated since then. Medical grew 25 percent in the most recent quarter, said Stephen Glorioso, corporate vice president of marketing and business development.
The Clinton, Mass.-based company does about $180 million in medical sales a year, a little more than 22 percent of its $800 million in total business. Nypro officials attributed some of the firm's recent medical growth to work shifting from smaller competitors.
The medical market is luring both global contract manufacturers and smaller, more U.S.-focused molders, Nypro said.
``You have a lot of contract manufacturers who are desperate for diversity because they've been hurt,'' Glorioso said. ``You've got a lot of molders who aren't global looking at what is staying in North America.''
Commodity-type medical work, or manufacturing of simpler devices, however, is starting to head for lower-cost locations. UPG said it now is doing about $1 million a year in medical molding in its Chinese plants, for example.
``I see it in a lot of the border towns in Mexico, doing molding and assembly,'' Hoar said. ``The next step is China.''
Several molders said adding skills, getting deeper into the supply chain and expanding beyond molding are vital. Midwest Plastic Components in Minneapolis, for example, is working more with implantable biomaterials, said Mark Schaefer, vice president of business development.
George Blank, president of the MedTech Group Inc. in South Plainfield, N.J., said: ``We are doing a great deal of our work in full device manufacturing [and] we have more projects now where we are designing.''