Hitting half a century as a business is a significant achievement. A key player in the medical device industry, Philips-Medisize is celebrating 50 years in the sector. Lu Rahman spoke to Matt Jennings, CEO, to find out what’s behind the company’s success and what he sees in store for the next fifty years.
LR: Phillips-Medisize is celebrating 50 years success in the sector. What has contributed to this success and what sets you apart as a company?
MJ: This is a big year and a significant milestone for the company as we celebrate our 50th year of continuous operation. Our success has been driven by the execution of a classic principle...building partnerships with our customers based on quality, service and innovation as well as, a focused investment centred around people, processes and facilities which we think sets us apart from our competitors
LR: In your opinion, what has made you a perfect outsourcing partner?
MJ: The ability to understand the nexus of part design, manufacturing requirements and automation capabilities. We have developed a demonstrated ability to integrate advanced moulding, automated assembly, and quality control systems into the product design and the manufacturing process, which often delivers innovative, high-quality, cost-effective solutions for our customers.
We partner closely with our customers to make their innovative designs come to market with the highest regard for safety, scalability and protecting their intellectual property and designs. We believe that the integrity of our people and processes help bring our clients’ innovation, ideas, and products to market while adding our expertise in the areas I’ve mentioned.
LR: Is there one single factor has contributed to the company’s longstanding success?
MJ: Our people. The heart and soul of Phillips-Medisize is our people. It is their expertise and knowledge that allow us to solve our customers’ challenges. We are willing to invest and grow with our customers and with the industry. We continue to expand our to quality and technical expertise within the drug delivery space to stay current changing requirements and properly staffed with the growing demand. We are actively seeking to add to our organization people who are committed to quality and have a passion for excellence and want to be part of building the best products and a better company. It is truly our peoples commitment that has allowed us to have the long-standing success over the past 50 years.
LR: Can you share some of the highlights of those 50 years with the readers?
MJ: 50 years ago the company began as the vision of its founders in northern Wisconsin. Through the years, the company expanded into the medical device space.
With the expansion into medical device, we’ve become the true leader in drug delivery, working with the top biopharmaceutical companies in the world, manufacturing auto injectors, pen devices and diagnostics across a variety of indications for global markets.
In 2010 the founder of the company sold his controlling interest to Kohlberg & Company, a New York based equity capital firm, which was able to provide very needed growth capital. Shortly thereafter the company acquired Medisize which expanded its global reach. This past June, the company was sold to a much larger equity capital firm, Golden Gate Capital, again to support its ability to continue to grow. Since the founder sold Phillips Plastics, the company has more than doubled in size from about $270 million in annual revenue to just shy of $600 million. Today, Phillips-Medisize is truly global company with manufacturing and design centres in Europe, the Americas and on the European continents. The company has 14 locations and employs over 3400 people. So, rather than just reflect on the past, we honour it by celebrating where we were and by looking forward to a bright future.
LR: Describe 2014 for the company – have you achieved everything you set to do at the start of the year?
MJ: To-date, 2014 has been our best year ever and we expect that trend to continue. We are meeting or exceeding all of our goals and are excited about what the future has in store for Phillips-Medisize.
LR: Which achievements are you particularly proud of this year?
MJ: In April, we commenced full-scale production of the first drug-delivery injector pen from our new Suzhou, China facility and we will be opening a
Design Development Centre there later this year.
We have also completed a significant plant expansions at our facilities in Finland, as well as, our Metal Injection Moulding (MIM) facility and plan another expansion to the MIM facility next year. This is in addition to expanding our New Richmond facility. These opportunities have all been made possible by significant new business awards from our customer base
In May we achieved the president’s “E” Award for exports which is the highest recognition any US entity may receive for making a significant contribution to the expansion of US exports.
LR: Tell us about the work Phillips-Medisize is currently carrying out
MJ: Phillips-Medisize currently focuses on three business segments in the medical space; diagnostic devices, drug delivery systems and single-use medical devices. We leverage our expertise in these segments to help our customers design and manufacture products that will improve the standard of care in the respective markets they serve in a more cost effective manner. We do this through innovative design and manufacturing for a variety of products that include insulin pumps, pens and autoinjectors for both branded and generic products. With the advent of new therapeutics and biosimilars we are excited about new customers and opportunities to expand our business, and our customers success, into greater number of patients who are in need.
LR: With the experience you have in the medical device sector, where do you see the innovation currently coming from?
We think innovation is a collaborative process and a requirement of all those who work in the design, development and manufacturing disciplines. We work together with our customers to help them design products that meet their customers’ needs in a more cost effective manner. We work hard in defining the supply chain for our customers’ products employing creative sourcing strategies for critical componentry and raw materials in a time sensitive environment. We use our engineering skills and manufacturing know-how to design the most effective manufacturing processes with quality and cost as top of our priorities. Innovation is in our view, 10% inspiration and 90% perspiration.
LR: What are the current challenges for the medical device market at the moment? What would you like to see done about them?
MJ: The dual challenges of expanding access for patients while health care payers seek to define value and lower overall costs will continue to be a challenge. These dual goals will drive health care companies around the world to be more efficient. Critical to this is process innovation in product design and manufacturing to assure lifesaving products get to market at cost structures that will work for our customers and their customers and payers. I think this will be an iterative process and all parties will need to cooperate to make sure that the quality of care is not inhibited by these economic pressures and that we find a way to drive toward a continuous improvement culture. It will be interesting to see how Point of Care diagnostics and self-treatment reshapes the delivery of care. We are working with our customers to make this happen.
LR: Where do you see the opportunities in the industry?
MJ: We believe that the greatest opportunity is in the pre-production process. Outsourced design engineering resources become critical in an environment where cost is a paramount concern for our customers as, our customers just will not be able to staff for all their needs. Therefore they will need competent outsourced design engineering to complement their need for outsourced manufacturing, while doing so quickly and with full regulatory compliance.
We believe our approach of working with customers during the early design phases of projects affords that opportunity by planning the integration of sophisticated moulding, automated assembly and appropriate quality systems into the product and manufacturing process. By having our design engineers engage right from the start of that process, we can make the process much more efficient which will lead to better outcomes and often increased speed to market. From there, our program managers work closely with our customers to ensure a fully transparent process and partnership that speeds product to market.
LR: What does the next 50 years have in store for the company? Any predictions?
MJ: Looking ahead the next 50 years is hard, but one thing is for certain, Phillips-Medisize will continue to grow.
We will continue to focus on expanding the capabilities of our people, process and facilities to meet the changing needs of our customers. In addition, we will do additional acquisitions that are consistent with our strategy to expand our design and manufacturing capabilities to support our customers’ growth. Targeting companies with a common vision and culture is critical to enabling smooth integration of our proprietary approaches. Done successfully, we create both a unique and differentiated product development and outsource manufacturing service solution to our customers. As opportunities present themselves we will evaluate them based on the value they create for our customers, investors and our people.