Manufacturing a Device

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Eric Sugalski
Manufacturing a Device

If you have successfully designed, engineered, prototyped, and successfully verified your medical device, then you may be ready for entering the manufacturing phase.  Most medical devices are produced through contract manufacturing organizations (CMOs).  The CMO business model is generally based on selling a high number of units at a low cost per unit.  The challenge that you will likely encounter in the manufacturing stage is that your volumes are not very high.  As a result, many CMOs will not be interested in your business, as it simply will not meet their financial thresholds for new engagements.  For CMOs that are interested in your business, they may need to charge a high per unit cost and/or they may charge substantial non-recurring engineering (NRE) fees that account for time related to procurement, line setup, employee training, quality management, project management and other tasks.

 

Typically, the best strategy for an early-stage medical device is to source all components and subassembly operations through a distributed supply chain.  This means all plastics will be sourced directly with molders, all machined parts will be sourced through machinists, all printed circuit boards (PCBs) will be sourced through electronics assembly houses, etc.  This process of building a supply chain from the ground-up is time and labor intensive.  If you get through it, then it is less time, cost and risk that a CMO will need to assume in working with you.  This will increase the number of CMOs that are willing to work with you, and it will improve the terms of your manufacturing engagement.

 

Often, early stage companies will leverage medical device development firms for supply chain development.  Additionally, some medical device developers offer pilot production services to complete low volume builds.  Smithwise (www.smithwise.com) is a medical device development firm with offices in Philadelphia and Boston that can assist with supply chain development and pilot production for new medical devices.  Following are two articles published by the Smithwise team through Medical Device Online that offer strategies and tips on medical device manufacturing:  Develop your Bill of Materials (BOM) and Prototypes to Production: 5 Steps to a Smooth Manufacturing Transfer.