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June 20, 1999

3 Min Read
Market focus: Medical products

Not every molder serving the medical market can be like the Nypros of this world-internationally located with hundreds of presses able to run millions of parts annually with a high degree of precision and accuracy for such big players as Baxter, Abbott, and Johnson & Johnson. In fact, most of the injection molders in the medical market are small- to medium-sized firms-fiscally healthy, technically strong, and quality oriented, but not yet selling $300 million in parts a year.

Such a modestly sized molder operates under a different set of rules when it comes to dealing with customers and generating business. Although a relatively small molder may mold a few parts for the bigger OEMs, more often than not his customers are smaller manufacturers of diagnostic equipment and other durable medical equipment. Program volume is low-in the thousands, not millions-and product life is long. Design and engineering are paramount.

Vince Mottola, marketing leader at Triple S Plastics in Vicksburg, MI, has been involved in the medical market for his entire professional life and says that small- and medium-sized OEMs should not be frowned upon by molders. With six manufacturing facilities, Triple S is a $70-million full-service molder that offers rapid prototyping services and Class 100,000 cleanroom capabilities to serve the healthcare market. Mottola notes that smaller OEMs are often more creative, nimble, fast-moving, and energetic than their larger counterparts. He points out that in the current economy of widespread consolidation and acquisition, the company that makes a small, molded medical diagnostic tool this week may be part of a bigger company next week-and a ticket to the next level of molding.

His example is a small company he once molded for that developed a harmonic scalpel. It proved to be such a popular product that the company was bought out by Ethicon. "Overnight this company went from six salespeople to 350 salespeople," he says. "That's a huge leap." As the molder of record for the product, Mottola's company was given a chance to bid for and keep the job. And it worked. "They [Ethicon] had to give us a look when it came to gearing up for high scale manufacturing and production," he says. "We were in the game where previously we wouldn't have been in the game."

The trick and goal is finding that one customer, or one potential customer, that has the next "big idea," the company on whose coattails a molder can ride to physical and financial expansion. "The thing is," says Mottola, "for every one you hit on, you might miss 10. And on the 10 you miss, two might go on to bigger things without you."

The strength of the medical injection molding market is tied pretty tightly to trends in the healthcare industry as a whole. Looking toward the next century, just how much is this industry expected to grow? This data comes from the National Medical Expenditure Survey, compiled by the Agency for Health Care Policy & Research. Shown here are actual and projected per capita healthcare expenditures for 1996 and 2005 respectively. What this chart does not show is the projected growth in home healthcare, which is expected to increase more than 12 percent annually through 2005. Make a note of it. For more information, go to www.meps.ahcpr.gov.

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