Knowledge puts the “smart” in smart-contract manufacturing
Web Industries’ VP of Corporate Development & Medical, Kevin Young, and Market Development and Strategy Manager, Ralph Tricomi, explain how experienced contractors can drive PPE and LFI tests rapidly.
Smart manufacturing means different things in different contexts. In the age of COVID-19, when US medical device manufacturers and makers of PPE are working under government mandates to reshore production of tests, gowns, masks and curtains from Asia, ‘smart’ means knowing how to earn Emergency Use Authorization (EUA) for the tests, ramp up production and bring a product to market in a hurry.
COVID-19 tests and PPE supplies are direly needed and in short order to support getting the United States back to work. According to the National Institute of Health (NIH), needs for COVID-19 tests, for example, exceed 100 million per week. As a matter of national security, government initiatives to reshore PPE supplies include mandates that they be manufactured, or at least assembled, in the US.
This immediate, critical and massive need for supplies and tests has prompted start-up companies to launch PPE manufacturing programs and for established medical device firms to pull back the overseas production they installed years ago. They must find ways to meet both government requirements and market demand quickly.
Needs for knowledge, materials and equipment stand in their way. A case in point: Most start-ups are in the batch-production stage of making lateral flow immunoassay (LFI) tests. Typically, they have a limited amount of materials and a small collection of manufacturing equipment – enough only to generate a sample number of tests. They need assistance to transfer from batch to commercial-scale production.
Established medical device businesses might or might not own the necessary manufacturing equipment. In many instances, equipment is in Asia, 10,000 miles away. Add to that needs to establish a supply chain for materials, reproduce low-variance manufacturing operations in the US, and manage the staggering amount of government regulations that oversee the manufacture of safe, FDA-certified medical-related product, and their mission is daunting, yet imperative. From start to finish, the product development to mass-market process can literally take years during the best of times.
Where to turn?
US-based contract manufacturing organizations (CMOs) are one potential source. CMOs can field orders from OEMs and brands for the production or assembly of component parts. This can mean manufacturing components as unremarkable as non-woven elastic bands used to hold facemasks in place to converting highly specialized chemical-based test strips and then precisely assembling them in OEMs’ LFI COVID-19 plastic test cartridges. For many CMOs, the technical transfer of moving reagent production from batch to commercial quantities is a core competency. Understanding and successfully completing the many undertakings necessary to acquire EUA are just one competency example. Another is the ability to store data in ways that meet FDA rules and ensure that COVID-19 tests can be traced back through the supply chain to every step in the development, manufacturing and delivery process.
Finding a CMO with an existing, mature PPE or medical device manufacturing process can eliminate the most complex challenges associated with rapid development, regulatory compliance, sourcing and delivery. Mature CMOs can usually adapt the roadmap they developed when creating their own mass-produced PPE products to bring a start-up’s or OEM’s PPE product to market in just a few months. Additionally, a CMO will likely have a supply chain that meets its customers’ needs or be in position to quickly assemble one with trusted vendors. Knowing that the CMO’s roadmap will be managed by professionals experienced in the administrative and physical jobs necessary to mass produce PPE and medical device products frees start-ups and OEMs to focus internal resources on their core competences. It leaves the jobs to the CMO experts.
What to look for
Choosing a CMO that meets your business’ requirements calls for due diligence from design, operations, supply chain, logistics and financial perspectives.
The one you pick should have a proven history of successfully working with its customers’ design engineering department during the product ideation stage. Such experience is crucial to rapid product development and design changes. Moreover, examine its competence in other relevant engineering disciplines. For example, in the COVID-19 test strip development and assembly example cited earlier, a CMO’s depth of chemical engineering expertise should at least complement that of its OEM or start-up client. To support cost-effective scaling, a CMO’s highly automated production manufacturing capability will often exceed a start-up’s production capacity.
To produce mask, gown and curtain components, a CMO’s plant should meet all ISO and safety standards and have a back-up contingency plan to bring capacity online in the event of a production disruption or unexpected demand for additional product.
Likewise, a CMO’s financial soundness speaks to its success as a business and the likelihood that it will be prepared to accommodate additional development and production needs. Ask about the CMO’s terms for receiving payment and for paying its own suppliers. Requirements for especially short payment terms or excessively long pay-out terms with their suppliers might indicate a cash flow issue. Review the company’s balance sheet for financial stability. Also ask your prospective CMO if it has a disaster recovery plan in place. Are quality procedures established? Are there firm plans for continuous process improvement?
PPE supply chain continuity is a particularly important issue both for today’s pandemic situation and for potential needs in a post-COVID-19 world. The deadly virus has issued a national and economic mandate for continuity of supply, and US PPE and medical device OEMs’ needs for supply predictability are greater than ever. So, evaluate your potential CMO’s supply chain, from materials source through to delivery methods. Ensure that it is sound. Ultimately, you are investing in not just a product, but in a virtual partner. The risk is significant but necessary for competing in the PPE and medical device markets in the age of COVID-19. Which brings us to a final criterion: Trust.
The question of trust should be at the heart of all due diligence. Do you and your management ‘click’ with that of the CMO you are evaluating? Are your cultures compatible? Are you satisfied that this CMO will invest the same sense of purpose and commitment to success that your company does?
Select the right CMO, and you will have a resource that helps slow the spread of COVID-19, supports putting the United States back to work and protects your business’ revenue stream.