An increasing number of medical industry investments — some large, some small — are yet another sign that firms serving the segment see strong opportunities ahead despite economic uncertainty.
Among investments that were unveiled at the Medical Design & Manufacturing West show in Anaheim, Calif., held Feb. 9-11:
* Helix Medical LLC is expanding into Europe with a 55,000-square-foot plan in Germany.
* MedTech Group Inc. is opening a second plant in Heredia, Costa Rica, and adding toolmaking capacity in the country.
* GW Plastics Inc. has created a dedicated product development division — GW/PD — to capitalize on original equipment makers demanding more help from contract manufacturers in designing and developing products.
* Custom molder and contract manufacturer Mack Molding Co. has ordered three 110-ton, all-electric injection molding machines for its Arlington, Vt., headquarters plant to serve the rapidly growing orthopedic sector of its medical business. Also, Mack has bought two Stratasys fused deposition modeling system machines to enhance its engineering capabilities for medical OEMs. One FDM machine is slated for Mack's Arlington plant and will be used mainly for design verification and quality processes for orthopedic parts; the other will be installed at a prototype facility, in Gardner, Mass.
* PolyOne Corp. of Avon Lake, Ohio, has acquired specialty health-care engineering materials provider New England Urethane Inc. in North Haven, Conn. PolyOne also has restructured its five specialty businesses to fit a global approach.
“All of our business units will be organized globally, but we will have regional presidents in Europe and Asia to coordinate and direct activities within those geographies,” said PolyOne Chairman, President and CEO Stephen Newlin. “These improvements will allow us to deliver global solutions with a local touch.”
PolyOne's health-care resins business will be strengthened by the restructuring, said health-care marketing director Larry Johnson.
“We will be able to globalize product lines more easily and we will be able to leverage European technology into North America and Asia more easily. It will make it easier for customers to do global product development and make it easier for us to communicate internally because we won't be going across business lines,” Johnson said.
The end result, a more efficient global health-care and engineering materials businesses, said Rick Noller, global marketing director for thermoplastic elastomers at GLS Corp., a PolyOne company.
“It doesn't change what we do, but it increases the speed at which we can do things,” Noller said.
Johnson said PolyOne's health-care resins business will gain significantly from the acquisition of custom compounder NEU, completed in late December.
In addition, he said, PolyOne became the primary North American distributor for DuPont resins last fall. And, the firm announced Feb. 9 that it will carry a portfolio of BASF Corp.'s Ultrason health-care-grade resins, which are designed for high-temperature medical applica- tions like respiratory devices, fluid-collection containers and other applications requiring optimum strength.
“One of our objectives was to beef up our advanced and engineered materials offerings and we have achieved that with the distribution agreements and the acquisition of NEU,” Johnson said. “It shows customers that we are totally committed to the health-care markets, and to developing and finding technologies that provide solutions.”
He called NEU — now PolyOne's NEU Specialty Engineered Materials LLC subsidiary — “a strategic acquisition that gets us into the minimally invasive market where we were not strong,” and into providing resins to make catheter-type products. NEU produces compounds for health-care applications, including polyamides, olefins, urethanes and high-performance engineering thermoplastics.
“It was a strong market that we had to be in,” Johnson said. “It gives us access to companies we had not done business with. It filled a technology void we had and it fits our strategy of specialization.
“We have the potential to be a global player and have a stronger global footprint with Europe and Asia. We expect our new partnerships and the acquisition to push business up. We are always open to more acquisitions and partnership opportunities and we are continuing to look at those possibilities.”
The creation of a product development group at GW Plastics reflects another growing medical trend — the need for molders to offer design and development services.
Larry Bell, GW vice president of business development and marketing, stressed that working in tandem with OEMs on product development isn't new for the Bethel, Vt., firm. But, he said it became clear that GW needed to create a division exclusively focused on that task.
“Our customers kept telling us that they don't have the capacity or the resources to do as many projects and kept asking us whether we could get involved earlier. It is the right step for us,” Bell said.
“Molders are no longer just an extension of the development work. OEMs are relying and leaning on us to do more.”
He said GW/PD's development activities will involve everything from concepts to prototypes to designing products for manufacturability or moldability.
“We will take the lead instead of being the ones looking over their shoulder,” Bell said. Getting involved earlier also allows GW “to take costs out of assembly and to simplify design,” he said.
“We can help them get to market faster with better-quality products. We can help them get cycle times lower and make sure quality is designed in. It also gives us an early opportunity to show customers what GW can offer them and to help them see the total cost of the project — not just the per-part price, Bell said.
Jeff Kane, who heads GW/PD, agreed: “We can save these customers money by helping them see where designs need to be changed. We can help them combine components or eliminate assembly steps.”
At Mack, adding three Toshiba electric presses expands the firm's total number of injection presses to 123.
“This new equipment represents another investment in our medical manufacturing strategy,” said Jeff Somple, president of the firm's Northern Division. The presses will be installed during the next six to nine months. “They will be used to support a manufacturing cell in the medical business' orthopedic market,” he said. Capacity of those machines is “already close to being sold out,” he added.
The new FDM machines give Mack's design engineers another tool for design verification, to predict how a part will work, ensure the function of snap-fit parts and set up quality processes like part measurement. The FDMs' flow simulation software can help predict part warpage and prove or disprove a planned design.
“It gives our tooling engineers another tool to build a more cost-effective product or part and a greater opportunity to come out of the chute with product-ready components,” Somple said.
“A lot of customers are pushing tasks down to contract manufacturers because of their own budget restraints, so they are asking us to do more,” said Somple. “We will continue to make intelligent investments to fulfill the needs of our customers.”
Two companies that announced expansions at MD&M West both said the timing was right to increase their opportunities and continue to grow.
Helix Medical LLC has opened a 55,000-square-foot manufacturing facility in Kaiserslautern, Germany, its first medical manufacturing plant in Europe. The plant will be the cornerstone of the newly formed Helix Medical Europe KG, the firm said.
“It gets us closer to our European customers and expands our global footprint,” said Thomas Vassallo, Helix executive vice president of global business development. “We have manufacturing in the U.S. and in China. It made sense to have manufacturing in Europe.”
Among other the things, the plant will double Helix's silicone manufacturing capacity. The plant began limited operations in January, doing silicone injection molding for customized projects involving products for dialysis and blood separation. It will start silicone extrusion and thermoplastic molding operations by midyear and thermoplastic extrusion by year's end.
Meanwhile, MedTech Group is boosting capacity for medical devices in Costa Rica with a second, adjacent plant that opened in January.
“This expansion in Costa Rica provides us with tremendous growth potential,” said MedTech President and CEO George Blank. “Our capacities now in place for manufacturing, tooling and design help us in speed to market and in growing our business.”
The new facility, which doubles MedTech's total space at the Heredia site to about 60,000 square feet, can house two clean rooms and assembly operations. Currently, MedTech operates just one 6,000-square-foot clean room at the site.
The firm also plans to add injection mold toolmaking in the country in July.
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