5 Advantages of Medical Device Contract Manufacturing

Entrepreneurs in the healthcare industry are known for the effort they put into research and development. This intense Research and Development (R&D) effort is also driven by the need to pass strict regulatory requirements when taking a product to market. It is important to note that R&D is a labor and capital-intensive process, and when performed inefficiently, can become the major reason why 75% of Medical Technology (MedTech) start-ups fail. Medical device contract manufacturing, or choosing to outsource the manufacturing of medical equipment, provides key advantages for avoiding failure.

Listed below are the biggest advantages that both large and small medical technology enterprises can benefit from when they contract out their device manufacturing to industry experts:

1.   Contract manufacturers help in the development of high-performance products. 

Start-ups and small enterprises with exceptionally innovative ideas sometimes struggle with acquiring the equipment and experienced personnel required to bring their ideas to fruition. The cost of purchasing heavy manufacturing equipment for in-house use and the labor to operate them become stumbling blocks to producing quality medical devices. Contract manufacturers provide the tools and the user experience needed to develop and produce innovative medical devices.

For larger enterprises, while product research may not be a problem, having the core competencies to produce new high-performing devices is always a challenge and may drive up additional costs. Here, the technical expertise of an experienced medical device contract manufacturer can be leveraged to develop, create, and test diverse configurations to produce high-performing devices at a lower cost compared to manufacturing them in-house.

2.   Outsourcing results in considerable cost reduction. 

Purchasing the heavy equipment, setting up clean rooms, and hiring the labor required to handle the manufacturing of medical devices can be akin to starting up a whole new company. For the average start-up, these operational costs are likely to draw extensively on available resources and hinder growth. On the other hand, large enterprises that are able to make such investments will need to make a calculated risk and forecast an acceptable time when the company can finally profit from this new venture.

Medical device contract manufacturing provides MedTech enterprises with access to cutting-edge equipment, experienced staff, product testing, quality checking, and maintenance activities at dramatically reduced costs. Strategically outsourcing manufacturing devices outside a company's core competency conserves capital dollars and gives the enterprise the flexibility to exit a product quickly and easily if it does not perform as expected.

3.   Contract manufacturing help keep up with the competition. 

The medical device manufacturing market is known for its competitiveness. Major players spend approximately 10% of their revenues on R&D. Start-ups spend even more. Industry players must remain innovative to maintain their profitability. Medical device contract manufacturers provide custom facilities that can support innovative operations and projects that are required to keep market share or beat the competition. These custom operational facilities needed for new products are provided at greatly reduced costs because the operations and maintenance activities are outsourced to professional service providers.

4.   Outsourcing results in faster time to market. 

Expert medical device contract manufacturers make use of cutting-edge manufacturing tools and the newest technologies to manage and execute the manufacturing process. Skilled technicians within these facilities come with the industry-specific working experience needed to use these tools and produce devices with simple to complex configurations depending on the device requirements. The medical device contract manufacturers can also provide a budget and an exact development timeline that MedTech enterprises can rely on.

The reliability of contract manufacturing empowers MedTech enterprises with the certainty required to develop functional go-to-market timelines and follow through. Speeding up the time to market may also give enterprises the first-mover advantage needed to dominate niche markets.

5.   Contract manufacturers help with product scalability. 

Enterprises that choose to test the market with innovative products before going “all-in” can contract short production runs with a view to scaling up at need. Here, “short production runs” refers to the production of approximately 500 to 1000 medical devices for public consumers. For large MedTech enterprises, it can be difficult to find unscheduled time to run a new job on existing equipment without impacting other customers. Medical device manufacturers provide the expertise to manage short production runs at an affordable cost for the period of the marketing campaign. A successful market run may then pave the way for producing larger volumes at reasonable prices.

Start-ups can leverage the scalability that contract manufacturing provides to reduce the cost of executing both short production runs and large-volume manufacturing projects at need.

Contract Medical Device Manufacturing for an Innovative MedTech Solution

Deciding to outsource and hire a medical device contract manufacturer provides a MedTech enterprise with an expert technical team that can produce a functional product at a reduced cost compared to manufacturing the medical device in-house. The contract manufacturer can supply the MedTech enterprise’s equipment and technical expertise shortage and ultimately execute the product idea.

Speak to the experts to learn more about how ACHB can help with your medical device manufacturing project.