When Medical Manufacturers Cross Over

January 04, 2010

By: Jennifer Madison, DOTmed News Reporter

This report originally appeared in the December 2009 issue of DOTmed Business News

Manufacturers moonlighting outside of their initial field of expertise have long done so to extend the reach of their brands and add to the bottom line with products that naturally branch from their core offerings. From the globally dominating conglomerates whose products are household names, to lesser-known domestically marketed developers, diversifying products is a widely practiced marketing strategy for companies aiming to penetrate new industries and increase profitability. In the medical field, this can be particularly rewarding as innovators work together toward technological advancements in health care. However, it can also lead to bizarre pairings in the minds of clients and consumers – who may fail to realize, for example, the same company manufacturing beds for a local hospital also has, among other head-turning products, a patent on barbecue grill covers and beanbags.

The health care industry has provided a home for some of the world’s best-known multinational technology and service providers. Branding machines such as American conglomerate General Electric, Dutch electronics company Phillips, German engineering conglomerate Siemens, and Japanese electronics specialists at Toshiba and Hitachi serve as prime models of successful cross-market penetration. Their contributions to medicine are matched in fields including aviation, entertainment and locomotive construction, among numerous other industries.

These companies and their wide-ranging innovations in medicine and divergent markets do not stand alone: upholsterers and hospital bed makers at Casco Manufacturing Solutions, medical equipment engineers at Saturn Engineering, software developers at Sopheon, and orthopedic and prosthetic developers at Hanger Inc. are also part of a growing group of companies discovering the benefits of manufacturing outside of the medical marketplace.

Beds of Foam and Beds of Charcoal

Domestically, Casco Manufacturing Solutions, Inc, specializes in upholstered products. The company has made a name for itself in the medical field as an original equipment manufacturer, and is known throughout the medical community as a supplier of hospital beds, mattresses, mattress covers, cushions, ergonomic seat and back pads and examination table pads.

The Ohio-based business prides itself on operating with a small staff of 55, boasting on its web site of its tightly controlled operation, “(We are) a small business, woman-owned, contract manufacturer specializing in the custom design and production of high-quality, sewn, sealed and upholstered products.” However, the modest business model doesn’t stop the U.S. team from innovating designs in health care to rival larger competitors. Casco in fact, holds patents on health care solutions that developers hope will one day flourish in the marketplace. These include fluid resistant removable mattress covers with a zipper flap design, which can also be used on stretchers, and the tools and process used to make the flap. “We have several new mattress covers and mattresses,” said Gary Hill, sales manager in the health care division. “We’re moving into air products for the first time and we’re also introducing a mattress that is divided into three parts – head, body, and a foot and leg section. Each of the sections can be upgraded dependent upon a patient’s needs. We wanted to create a nice entry-level foam mattress that could be used by a facility without adding items they didn’t need. We have inserts where memory foam with a little gel can be added to it depending on the situation, meaning a hospital can save money by using exactly what they need.”

For Casco, it’s an even split between their product health line – C-matt products generate about half their revenue and the rest will come from other products outside of health care.

The company, founded in 1959, is an FDA registered Medical Device Manufacturer. However, its 56,000 square foot manufacturing facility has become a center where engineers develop, manufacture and distribute products largely outside of the medical field – and many of which could keep its customers out of their hospital beds. Horse riding enthusiasts may be surprised to learn equestrian body protectors can be purchased through a call to the company hotline. And barbeque lovers may salivate at the thought the stretcher-maker also manufactures grill covers. In fact, the grill covers are so popular, the product landed the company first place in the Zestfest 2004 People’s Preference Award. And when the summer barbeque season has cooled down, the company has another solution for fire-lovers. It also hawks log carriers and rack covers to ease the transport of wood and keep logs dry year-round. These innovations bring in revenue along with some other diverging offers, from task chairs to outdoor furniture covers, computer bags to pool table covers, to beanbag chairs and even exercise equipment upholstery.

Hearing Aids and Bluetooth

Operating from Sofia, Bulgaria, Saturn Engineering, Ltd. boasts medical innovations in laboratory and dental products. Other medical innovations include drug nebulizers, dose counters, respiratory ventilators, medication warmers and hearing aid devices. Founded in 1998 as a full-service engineering design, product development and contract manufacturing company, Saturn has fast become a leading provider of industrial medical products in consumer and commercial markets. The company, FDA-registered in 2004, earned accolades and global recognition with the development of the Induction Cap Sealing System – an airtight method of sealing plastic and glass containers. The system won the Bulgarian Innovative Enterprise Award in 2006. And just last February, the company was awarded the same prize for its Warming Cradle, developed for Pennsylvania-based biotechnology experts at Discovery Labs.

Not unlike Casco, Saturn provides a diverse array of products, many of which directly target consumers. In the wireless communications industry, the company has developed Bluetooth technology and made advancements in wireless data transmission. Electronic engineers have also designed and developed digital and microprocessor circuits, DC and AC amplifiers and micro-processors, high-frequency power inverters, battery chargers and current sources, among other products. In addition, the company specializes in firmware and software development.

Organizing Organizations

Sometimes, the crossovers are less obvious. It has only been 16 years since software executives at Sopheon launched their company. However, in that time, the company has become a successful software developer for doctors, nurses and health care providers, food and beverage executives, communications providers and manufacturers of consumer goods.

Supporting hospitals and clinics in the management of medical processes, its Accolade software has centralized updates of the latest treatment guidelines and protocols, allowing practitioners real-time access and enabling care givers to make informed decisions about patient treatment. The company has also earned notoriety for its Evidence Monitor solution, designed to help practitioners save valuable time with the “reading robot” system that monitors journals and databases and provides news alerts helping to improve efficiency.

The company was founded in 1993 and operated for six years as Netherlands-based PolyDoc. Executives built on the company’s developments in linguistics and language management to create software applications that enabled users to capture and organize knowledge. The technology initially focused on specific processes, including hospital protocol management. By 2001, the software system’s capabilities had expanded in Europe and the U.S.

Today, the company software serves a wide-range of other industries, including aerospace and defense clients including BAE systems, the U.S. Army, Honeywell and NAVAIR. The company claims its product roadmapping and program management software has improved technology reuse within the industry.

In addition, Sopheon serves manufacturers in food and beverage, consumer goods, chemical and specialty paper, and high-tech and electronics industries with technology solutions. The company has assisted some of the world’s biggest brand names to secure their place in the market by saving millions in research and development costs. In one case study published by Sopheon, developers helped executives at communications leader Motorola to save $32 million with the use of their Vision Strategist software in the late 1990s.

Tony Piecz, manager of Planning Solutions for Motorola, champions the company’s software system: “Prior to implementing Vision Strategist, our product and technology roadmaps were spread throughout the organization. Because there was no central database for our strategic and product planning information, we were missing opportunities to get everyone on the same page and improve the efficacy of our innovation processes.”

Footwear and Feet

Similarly, researchers at Hanger Inc. have cast a wide net within their own niche, as providers of orthotic and prosthetic (O&P) care. The company partners with suppliers to create clinical processes, tools and products available solely to physicians. However, many of its other products are available to consumers, whether they are looking for a long-term solution to increase mobility, or a comfortable pair of shoes.

The Bethesda, Maryland-based company has established itself as a lasting O&P manufacturer over the last 150 years. Initially, the company was well-known for its clinical innovations and as a major manufacturer of artificial limbs to amputees and patients with musculoskeletal disabilities. Now, the company provides postoperative, preparatory, temporary and permanent prosthesis for upper and lower extremities; in addition, Hanger provides a series of customized medical devices provided by physicians to disabled patients, including their ComforFlex Socket System, Insignia and the WalkAide, they also provide- in addition to post-mastectomy care supplies.

With 640 care centers nationwide, the company utilizes its global partnerships to provide a tailor-made service to patients, relying on practitioners trained under the company’s programs to operate its systems. Hanger is comprised of four subsidiaries, each servicing its own segment of the O&P industry. Hanger Prosthetics and Orthotics serves as the company’s core, servicing more than 650,000 patients by helping to design, develop and fit supports to the disabled. Hanger subsidiary Linkia provides network management within the O&P industry. Meanwhile, Southern Prosthetic Supply (SPS) remains the largest O&P distributor worldwide, providing physicians throughout the U.S. alone with over 270,000 products.

To commercialize devices developed at research centers, executives established Hanger’s Innovative Neurotronics, extending the company’s offerings into the consumer market. A specialty footwear program for diabetics and other products including bracing systems, spinal and neck orthotics, diabetic shoes and cranial bands can all be customized to patients’ needs, and can be particularly helpful to prevent conditions from worsening. However, these and other products have also proven to be widely successful among consumers without medical needs, who are simply looking for added comfort. Extra-depth shoes, insoles, and healing shoes are among these products. The company has even gone a step further to reach out to consumers in today’s media-saturated market, with pages on social networking web sites Facebook and Twitter, and YouTube.

Developing the Future

With ever-expanding product diversification, it seems manufacturers – global and domestic, commercial and consumer-driven – are working toward similar goals beyond expanding the bottom line, helping to ensure competitive and innovative solutions aimed to improve quality of life.

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Josh Sandberg

Josh Sandberg is the President and CEO of Ortho Spine Partners and sits on several company and industry related Boards. He also is the Creator and Editor of OrthoSpineNews.

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