Originally Published MPMN March 2009

REGIONAL FOCUS: new jersey

Garden State Boasts Fertile Ground for Medtech Industry

A concentration of pharmaceutical manufacturers has created a life sciences–friendly environment in New Jersey for medical device companies

Shana Leonard

Considered to be the epicenter of the pharmaceutical industry in North America, New Jersey is known as “the nation’s medicine chest.” And, as home to facilities for 15 of the 20 largest pharmaceutical companies in the world, this medicine chest is well stocked. But while the pharmaceutical manufacturers revel in the state’s spotlight, the medtech industry has quietly taken root in the Garden State and blossomed into a thriving component of New Jersey’s economic landscape.

Location Is Everything
Situated in the Northeast corridor near such high-tech hubs as Massachusetts, New Jersey benefits from extensive rail and highway networks, as well as from its proximity to major metropolitan centers, such as New York City and Philadelphia. Its prime position also provides easy access to New York’s bustling LaGuardia and JFK airports, in addition to New Jersey’s own in Newark and Atlantic City. And it doesn’t hurt that the Port of New York/New Jersey is the largest seaport complex on the East Coast—the third-largest in the United States.

Because of these geographical advantages, the region has evolved into a substantial manufacturing hub. “New Jersey has a long tradition in manufacturing,” notes Mark Bannayan, marketing manager for manufacturing equipment maker Glebar Company, Inc. (Franklin Lakes, NJ; www.glebar.com). “It was the biggest manufacturing hub in the country a hundred years ago. Also, as far as machine tools and machinists, it was the primary place in the whole country as far as qualified people to run high-precision equipment to make high-precision parts.” The state continues to build on its foundation of fabrication as home to a plethora of drug and device manufacturers.

A Symbiotic Relationship
Although pharmaceuticals are the state’s primary prescription for economic stability, the medical device industry plays a significant role in keeping New Jersey healthy. In conjunction with the biopharmaceutical industry, the medical technology sector is credited with having a $27-billion impact on the state. Together, the two industries pay close to $1 billion in taxes and rebates to the State of New Jersey and employ 61,300 workers, according to the 2008 Annual Report conducted by the HealthCare Institute of New Jersey in collaboration with Deloitte Consulting. In fact, New Jersey is even ranked among the top 10 states for concentration of employment in the medical device and equipment sector, according to a report released by Battelle and the Biotechnology Industry Organization.
Driving expansion and innovation of the life sciences sector in New Jersey is a workforce composed of highly skilled scientists, engineers, and technicians that flock to the region to take advantage of its quality of living and competitive jobs. Lucrative salaries are likely a factor in the quality of talent: The average life sciences salary is almost $90,000 a year, according to the division of labor market and demographic research of the New Jersey department of labor and workforce development.
Helping to educate the future life sciences workforce are 57 colleges and technology schools, including well-known Princeton University (Princeton, NJ; www.princeton.edu) and the three campuses of Rutgers, the State University of New Jersey (Camden, Newark, and New Brunswick, NJ; www.rutgers.edu). However, smaller schools are integral in supporting the drug and device industries as well. “One of the things we have benefited from is the close proximity to the County College of Morris (Randolph, NJ; www.ccm.edu), which is right across the road from us, and whose students Glenbrook has hired,” says Gil Zweig, president of Glenbrook Technologies Inc. (Randolph, NJ; www.glenbrooktech.com), a company specializing in magnification fluoroscopy technology. “In fact, a majority of our technical staff had at one time attended the County College of Morris. Glenbrook hires co-op students and offers scholarships there. They tend to be very talented, very resourceful, and very innovative.”

J&J and NJ
Among the greatest contributing factors to the growth of the medical device industry in New Jersey is perhaps the presence of a global powerhouse within the life sciences sector. Established in 1886, Johnson & Johnson (New Brunswick, NJ; www.jnj.com) is recognized as a global leader in both the pharmaceutical industry and the medical device and diagnostics markets. But the company’s humble beginnings can be traced back to a small medical products company founded by three brothers in New Jersey whose initial success was the manufacture of the first-ever commercial sterile surgical dressings. Adding to the budding life sciences community near the turn of the century, Becton, Dickinson and Co. (BD; Franklin Lakes, NJ; www.bd.com) was launched in the region roughly a decade later in 1897 as a medical device import company.
More than a century later, both companies continue to be leaders in the medical device industry, among others, with headquarters still operating in and giving back to the communities that supported them in their early years. Further fueling the medical device industry in present-day New Jersey are a facility for Abbott Point of Care Inc. (East Windsor, NJ; www.abbottpointofcare.com) and the divisional headquarters of Stryker Orthopaedics (Mahwah, NJ; www.stryker.com).
“It’s not like Minnesota or California, but [the device industry] definitely does have a presence. And not only that, but it does also have a lot of suppliers to the medical device industry,” observes Janet Burpee, CEO of Burpee Materials Technology (Eatontown, NJ; www.burpeetech.com), a company specializing in the design and fabrication of stents and stentlike devices.

As Burpee notes, the medical device sector is supported by a diverse network of supplier companies that has sprouted up in the Garden State. Burpee Materials is one of many vendors whose businesses have been shaped by one of the region’s major OEMs. After the company for which she and her husband had worked was acquired by Johnson & Johnson, Burpee decided to launch her own company. Since the establishment of Burpee Materials in 2001, the company has expanded from a two-person to a 40-person operation.

Burpee Materials’ history is not uncommon in regions with industry clusters, such as the life sciences sector in New Jersey. “You have a major manufacturer training people who then develop experience. These people then get funded and go on to start similar companies in the area,” says Zweig. He also adds that in New Jersey, there is some crossover between the pharmaceutical and device industries. “People working at large pharmaceutical companies who are involved, for example, in the packaging and the testing, then start their own companies in New Jersey as suppliers to the medical device industry,” he says.

A State of Innovation
Innovation is the key to success, especially in the medical device industry. And there doesn’t seem to be a shortage of it in New Jersey. The region’s pharmaceutical and medical device manufacturers are constantly developing breakthrough products to improve patient care; however, innovative technologies at the supplier level are key components in enabling new medical product development
Glenbrook Technologies, for example, was the recipient of a life sciences award in 2007 from the New Jersey Technology Council in recognition of its MicroFluor system based on the company’s magnification fluoroscopy technology. “It provides the ability for the first time for these companies to look inside the devices they are developing and to record magnified x-ray movies of the actual internal operation of their device,” explains Zweig.
A provider of manufacturing equipment for the high-precision forming of such medical devices as biopsy needles, catheters, and guidewires, Glebar Co. is also a New Jersey–based trailblazer enhancing medical device manufacturing. It was the first company to develop fine wires for use in angioplasty procedures using an abrasive technology, according to Bannayan. “They used to chemically etch these parts and it used to take forever. And the precision wasn’t there. The owner here in his basement worked out the process of grinding these parts and getting really high-precision parts, and this added flexibility to designing these parts,” he says. Bannayan credits New Jersey’s attitude toward the life sciences and manufacturing sectors with helping to yield such a development. “I guess New Jersey sort of nurtured that setting,” he reflects.

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