Drug injector device maker SHL Group is investing $40 million this year at its injection molding facilities in Taiwan in response to new product launches by customers in the pharmaceutical sector.
SHL was set up in 1989 by two European entrepreneurs — Roger Samuelsson and Martin Jelf of Sweden — with its manufacturing wholly based in Asia.
"Five years ago I signed a letter of intent with the Taiwan government promising to invest $100 million here," said Samuelsson, CEO at SHL. "We kept our promise and even completed that investment early. Now we will spend another $40m for 2013."
SHL operates five pharma manufacturing facilities in Taoyuan and Nankan in Taiwan, and a healthcare manufacturing facility in Guangdong, China. It also has a final assembly plant in Florida, and design centers in Florida and Stockholm, Sweden. Its global staff level passed the 2,000 mark in 2012 and now stands at over 2,400 following this year's expansion in Taiwan.
The group's high volume products are auto injectors, pen injectors and inhalers, which it delivers in millions of units to European and North American pharma groups. It also makes beds, slings and other products for healthcare providers.
"The majority of our growth is being driven by disposable auto injectors," said Steven Kaufman, marketing director at SHL. He told European Plastics News that pharma groups are releasing a lot of their new drugs in an injector format.
The Molly auto injector, launched in 2010, is an example of SHL's innovation in drug delivery devices. It was designed as an intuitive and compact device, with a simplified two-step operation and a permanently hidden needle.
Lower operating costs make Asia an attractive manufacturing location for entrepreneurial companies, but SHL entrusts technology suppliers from Europe when it comes to the production platform critical to its success in the demanding pharma market.
SHL has purchased 10 KraussMaffei CX injection molding machines for its Taoyuan One plant as part of the $40 million investment this year. KraussMaffei has been SHL's preferred machinery partner for a number of years.
Samuelsson said: "With the CX series of machines, we have further enhanced reliability and continue to consistently produce high-quality components for the medical and healthcare industry worldwide. Our goal is zero error tolerance, a goal that our partners must share with us."
A key component of SHL's strategy is scaleability of its production. Kaufman said: "When we do an audit, we find we are always keen to have additional capacity."
This is particularly critical as customers launch new drugs and need the assurance that suppliers can ramp up production if demand takes off. This desire for risk mitigation is the rationale behind the investment in equipment and staff.
As well as new injection molding machines, SHL has expanded its materials handling capability to cope with this year's expansion and with future production growth too. Motan is SHL's main partner in materials handling.
Frank Isaksson, SHL's general manager, said: "We have worked closely with our suppliers to design each of our facilities for maximum scalability."
He said SHL's experience shows it needs to be prepared to expand further in its capacity for injection molding, materials handling, tooling, metrology and automation.
Kaufman said that while SHL does use some suppliers for robots (primarily Fanuc), the group has its own automation department that builds its own robots and end-of-arm tooling, such as grippers. The automation team also plays an important role with customers, as it has developed assembly equipment used at the facilities of its pharma customers or their fillers.
Growth in SHL's manufacturing operations looks likely to remain focused in Taiwan. The group's operations are located close to logistical hubs, an important factor in supplying its pharma customers' facilities around the world.
"Taiwan has one of the best infrastructures in the world for logistics," said Kaufman.
A clear indicator of SHL's commitment to Taiwan is the increasing number of skilled staff it has hired there. "We have so many experts here [in Taiwan], it would be really hard to change," he said.