Extrusion Firms Adapt to Demands for New Procedures and More

Advancements in medical device technology are having the expected ripple effect on both manufacturing and business for extrusion suppliers. In one key development, suppliers are picking up more outsourcing work from device firms looking to focus on their core businesses. The increase in outsourcing joins shifts toward tighter tolerances, the use of non-DEHP plastic, and consolidations among the trends that have swept up suppliers in their wake.

“We find more and more companies are looking toward outsourcing their tubing and extrusion requirements because of the cost associated with running in-house extrusion departments and keeping up with technology,” says Mark Saab, president of Advanced Polymers in Salem, NH. 

The savings come in equipment, personnel, and training costs, Saab points out. He adds that Advanced Polymers is seeing more device firms “looking to go outside” for production of both low- and high-volume products, although more of the interest is “in the low-volume side of the business.”

In fact, medical device manufacturers are farming out more nonessential chores in general, says Karen Bufalino, the marketing and customer service manager of Fluortek in Easton, PA. The custom extrusion company opened contract manufacturing facilities in Ireland because several large U.S. device makers had begun manufacturing there. The Fluortek facility “came on-line 18 months ago to provide this industry with a local, responsive supply-chain partner,” says Bufalino. She notes that her company “is constantly rethinking its role in the supply chain as customers continue to shift the burden of supply-chain management to their vendors.”

Customers for Advanced Polymers' line of primary medical balloons and thin-film heat-shrink tubing confirm Bufalino's experience. As an approved supplier of heat-shrink tubing to at least 50 different medical companies, Advanced receives a steady stream of phone calls from clients looking to consolidate their tubing suppliers, Saab says. 

“They tell us, ‘We don't want 100 vendors. Let's try to narrow the list down to 10 vendors or so.' A lot of the time, they'll send us their whole package and ask, ‘Can you [give us a] quote on this?'” 

Suppliers are “pushing us to do more and more for them,” Saab notes. That to-do list includes “tighter tolerances, faster turnaround times, and lead times being cut. More and more companies want us to do dock-to-stock shipping. They don't want to inspect product, so they qualify our products and our systems. They also look for just-in-time (JIT) supply agreements, where you have a purchase order to deliver product on a weekly, biweekly, or monthly basis.”

Device customers still want the extruder to keep “one or two releases on the shelf,” Saab emphasizes. This backup plan enables manufacturers “to push the next delivery to tomorrow instead of the scheduled next-month shipment.”

“Our customers, both OEMs and contract manufacturers, are requiring shorter lead times for engineering and development projects,” agrees Jamie Mui, product manager, medical, for Saint-Gobain Performance Plastics (Charmy, France). “Many customers are trying to reduce their inventories of components and expect kanban or JIT delivery schedules from us.”

The device industry's health has been good for Zeus Industrial Products, says Eduardo Braga, director of marketing for the Orangeburg, SC–based firm. “The continued strength and resiliency of the medical device market” has encouraged the polymer extrusion company, which launched a new line of nylon tubing in April 2004. Braga notes that the device manufacturers' movement “to outsource nonproprietary technology as manufacturers look for ways to improve overall yields and reduce manufacturing costs for components” has allowed the OEMs “to focus more strategically on their core competencies.”

Zeus has benefited from opportunities the trend has provided, Braga says. “Our products and services mix is uniquely positioned to provide tremendous efficiencies to our channel partners, who develop devices utilizing minimally invasive technologies.”

As device manufacturers continue to farm out nonessential production chores, companies such as Zeus have seen demand grow for “value-added services,” Braga adds. “The type of value-added services range from flaring to skiving, drilling, tip-forming, and even packaging and inventory management.”

Bunzl Extrusion, a supplier of precision thermoplastic medical extrusions, also has seen medical OEMs significantly increase their use of contract manufacturers, says Richard Brooks, vice president of sales and marketing. As a result, both OEMs and the contract manufacturers are requiring the Northborough and Athol, MA–based company to shorten lead times for engineering and development projects, he points out. Brooks adds that custom medical-extrusion companies are facing a strong demand “to become more vertically integrated. This includes the addition of subassembly of components and packaging to add extra value to our core extruded tubing products.”

For example, custom extrusion companies are more likely today not only to make the base tube for a catheter, but also “to offer all the postfabrication operations necessary to complete the catheter, such as irrigation holes, tipping, and printing.”

Outsourcing has been a mixed blessing for some vendors, however. Mike Badera, president of Precision Extrusion in Glen Falls, NY, says that the outsourcing trend has increased business opportunities for the company just as the poor economy has decreased them. Lately, a slightly improved business climate has brought more inquiries from device manufacturers, while a weak dollar has attracted more international business.

MicroSpec, a New Hampshire–based extrusion company, discovered that outsourcing can have its drawbacks, particularly when coupled with industry's increase in globalization and mergers. “We are noticing that the outsourcing of medical manufacturing to other countries is having a huge logistical detrimental influence on the delivery of quality product,” says Tim Steele, the firm's managing director. 

Steele says that quality, “which is oftentimes a subjective thing in the custom extrusion field, becomes more subjective” when the outsourcing firm is foreign. The language barrier presents problems when specifications that are “developed subjectively” at the U.S. headquarters of a device firm “become black and white, when they weren't necessarily developed as black-and-white specifications,” he explains. 

The result, says Steele, is that “the issue of quality, which wasn't an issue before, suddenly becomes a barrier to smooth operations. For instance, we have a product that we have been manufacturing for three years now that hadn't had a rejection from our American customers for the last two years. Suddenly everything is being rejected, and the product hasn't changed.” The product is a component of an extruded part that is put into a finished medical device such as a catheter, a guidewire, or a laparoscopic device. 

MicroSpec manufactures tubing with ID tolerances of ±0.0001–0.0002 in. and OD tolerances of 0.004–0.625 in. 

“We haven't changed a thing, and the product is the same, and yet it becomes an issue at the other end,” Steele says. The foreign team's unfamiliarity with the process is the primary problem. “They don't understand the product, even with the best transition team that might come through the door.” The company head says the confusion “is a problem for us, but it's more of a problem for our customer. We have to, in a sense, almost reinvent the wheel. They're not familiar with [the product], and they have to learn it. Because of the language barrier, [the learning curve] sometimes takes a year, a year and a half.”

Steele sometimes has to travel to the foreign site “to head one of those issues off at the pass,” which he notes also “adds travel costs, costs at our own end, and ISO costs.”

Steele has a fairly straightforward opinion of the reasons for outsourcing's growing popularity. “When products get outsourced, they get outsourced for one reason and one reason alone,” he insists. “Not because of quality, but because it's cheaper.”

Custom extrusion companies may have no choice but to shift some production across borders, Brooks of Bunzl notes. Suppliers focusing solely on extrusion “will eventually lose market share. Subassemblies and other extra-value operations need to be provided to service the growing requirements of today's medical OEM. To remain competitive, however, the assembly operations need to be based in a low-labor and low-cost environment such as Mexico or Latin America.”

Saab asserts that most outsourced extrusion work falls in a specific category. “We haven't seen a lot of extrusion work go outside the country, with the exception of commodity extrusion work. Usually, that commodity work is being done by the same company in their own facility. Like a Baxter, for example. They open a plant in Mexico or in Puerto Rico and set up manufacturing lines for extrusion vinyl tubing. And all of a sudden they're having problems when they've never had problems before.”

Pushing Technological Limits

Outside of outsourcing, several extruders say OEM requests for more-sophisticated extruded products have increased. Jim Dandeneau, president of Putnam Plastics in Dayville, CT, notes that an increasing number of devices such as catheters “are becoming smaller and increasingly sophisticated [and] therefore pushing the limits of polymer and extrusion technologies.”

The company, which is being acquired by Memry Corp., manufactures multilumen, multilayer extruded products for guidewires, catheter shafts, and other medical devices. Putnam specializes in precision extrusions with coatings in fluoropolymer, polyimide, and thermoplastic resin. Dimensions range from 0.002 to 0.750 in. and wall thicknesses from 0.0003 to 0.100 in.

“We are being requested to extrude thinner walls, as well as more-complicated configurations,” says Dandeneau. “Coextrusion is more popular than ever, with multiple materials extruded together to offer the unique property of each to the catheter.

“The tolerances are becoming tighter on simple monolayer extrusions,” he adds. “We are also getting many requests for extrusion over discrete lengths of wire or coils.” Dandeneau also says that the supplier's intermittent extrusion process has become more popular among device manufacturers trying “to avoid bonding soft tips on individual catheters.” 

Bunzl's Brooks says a demand for more-sophisticated devices is requiring companies such as his to develop more “high-tech extruded products.” In particular, manufacturers are looking for “minimally invasive” devices. He cites two examples of new OEM devices used in advanced medical procedures for women. Both use PEXbond paratubing from Bunzl's Pexco Medical Products unit. An outpatient procedure medical device uses paired PEXbond tubing and paired electrical conductors that are thermobonded together, Brooks says. “This product is a component of an impedance-controlled endometrial ablation system. The procedure is designed as an alternative to hysterectomy, conventional endometrial ablation, and hormone therapy.”

PEXbond paratubing is also used in an assisted breast-biopsy device for a nonsurgical procedure that significantly reduces the time of standard medical devices, according to Brooks. Irrigation and anesthesia are sent to the biopsy site through the tubing, which also uses air and suction to capture tissue culture, he says. “This device is the only one commercially available that operates under MRI guidance and gives women in the high-risk category for breast disease a fast and easy biopsy option over surgery.”

Because of the continuing device advances, companies such as Bunzl and Fluortek are facing more-stringent specifications than before. Brooks says custom extrusion “is moving toward six-sigma and lean-manufacturing philosophies to improve efficiencies and ultimately reduce costs.” 

Manufacturers are also demanding tighter specifications for catheters in particular, according to Brooks. Thinner walls “reduce the impact of trauma associated with the introduction of a catheter into the vascular system.” Bunzl's Pexco business has introduced tubing with a wall thickness of 0.008 in. for use as a catheter in veterinary applications.

Fluortek's Bufalino says extrusion companies will continue to face demand for “downsized” products, reduced wall thicknesses, and tighter tolerances. Fluortek is committed to developing technologies in-house to meet changing customer needs, she emphasizes. “The reality of device life cycles dictates the need to meet requirements early in the development stages of a particular device. Mature products require suppliers like Fluortek to cut costs with consistent, lean processes.”

The entire industry “is going toward tighter tolerances,” insists Saab of Advanced Polymers. “Companies are much more interested in statistical process controls. They are also more interested in companies that can run very tight tolerances and prove it with both statistical data and also through quality control inspection techniques using very aggressive sampling plans that don't allow for any rejects in the system.”

Saab says device customers are now less tolerant, if you will, of any rejected product. “Companies expect product at virtually 100% yield, whereas in the past, companies were typically willing to accept some number of product that was out of spec.” He emphasizes that the industry's shift toward thinner walls, smaller diameters, and much tighter tolerances means that new devices “require extremely tight tolerances in order to function properly. In some cases, people ask for tighter tolerances when they don't really need it. But they expect it.” 

Dethroning DEHP

Regarding the 50-year domination of PVC in the industry, several extrusion companies are seeing increases in demand for tubing without the plasticizer diethylhexyl phthalate (DEHP). Bunzl's customers are exploring the differences in materials costs and processing techniques for PVC materials without DEHP, Brooks says. He notes that non-DEHP tubing is more difficult than standard materials to process. It also has more potential for cosmetic defects.

“The costs for extruded medical tubing produced with non-DEHP materials can be 5–10% higher than traditional DEHP grades,” Brooks emphasizes. “The major costs for the OEM, however, lie in the revalidation of the new material, which can range from $5000 to $50,000 and utilize their internal resources for 3 to 12 months or more.”

After receiving quotes, most customers analyze the costs and decide to stick with “traditional, plasticized PVC-grade materials, especially since there is no real proof of harmful effects in humans to date.”

At Fluortek, demands for products that contain DEHP, such as PVC tubing, “have declined substantially,” Bufalino says. “Fluortek has experienced little PVC replacement business because it leans toward custom specialty products as opposed to commodity-type tubes that have traditionally been extruded from PVC.”

PVC has never been a part of Zeus's product mix, notes Braga. He says the extrusion company has been working with several device manufacturers searching for alternative materials that have “similar performance characteristics and comparable price points” to PVC with DEHP plasticizer. The company has developed “a range of [polyamide] blends that are demonstrating positive results in field trials,” Braga says. He adds that one of Zeus's “raw-material-enhancement processes” could attract the attention of device makers if regulators take further steps to limit DEHP use in the industry.

Before 2004 ends, Saint-Gobain expects to introduce two new non-DEHP PVC product lines, says Mui of Saint-Gobain Performance Plastics. One of the new lines slated for introduction will be a nonphthalate. The company, known for its wide range of products such as Tygon and Bio-Sil silicone extrusions, offers non-DEHP PVCs known as S-74-HL and S-75-HL. Alternate non-PVC products offered by Saint-Gobain include thermoplastic elastomers and polyurethanes, Mui says.

“Our studies indicate that non-DEHP PVC will be in the United States in the near term,” and certainly within the next five years, the product manager notes. “Europe and Asia have embraced non-DEHP PVC and are requesting nonphthalates.” He adds that California “has pretty much caught on to the non-DEHP PVC market and taken the lead on this.” The industry is putting strong pressure on extrusion suppliers to hold down prices on alternatives to DEHP PVC products, Mui emphasizes.

“For extrusion, we have serious pricing pressures,” the product manager says. “We enjoy working with large companies that we can service worldwide. However, smaller companies in local markets drive prices down.”

Precision Extrusion “will use whatever material the customer asks for,” says Badera on the DEHP issue. “We have had some customers ask about it, but when they discover that the alternatives are more costly, they revert to the usual PVCs. It has become a big enough issue that our insurance company was questioning us on our use of DEHP materials.”

One aspect of the extrusion business remains constant through all of the industry segment's ups and downs, Advanced Polymer's Saab points out. “One of the issues with extrusion, to be quite honest, is that there's a significant part of the extrusion process that is still an art. It's not as much of a science, though there is a lot of science involved. It's not as cut and dried as, say, doing business where you can duplicate five molding machines and five molds. With extrusion lines, there's still an operator interaction and still adjustments that need to be made manually for guiding the product.” 

Copyright ©2004 Medical Device & Diagnostic Industry