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A Good Contract Manufacturer Is a Partner

Fri, 11/01/2013 - 2:44pm
Faina Zaslavsky, Director of Microelectronics Solutions, Crane Electronics

Faina Zaslavsky, director of microelectronics solutions at Crane Electronics, was a part of the staff written article, “Not All Contract Manufacturers Are Created Equal.” She took time to present a full array of responses that were not able to be included in the article, so they are presented here.

Q: What are the primary reasons an OEM will seek out a contract manufacturer?
Zaslavsky: The Crane Aerospace & Electronics Microelectronics Solutions business unit has been working with medical implantable device OEMs for the past two decades. Over this period of time, we observed a growing trend to outsource not the core competency components, sub-assemblies and electronic assemblies. Many start-up companies struggle to get to market as fast as possible. Instead of spending time to set up an expensive manufacturing facility, they look for a partnering relationship with a cost effective, qualified contract manufacturer. In addition to time-to-market, the next, not any less important, factor is time-to-volume to get to volume production, appropriate, validated equipment and trained personnel to operate the equipment are needed. Volume production always exposes variations in component behavior (mechanical, electrical and process tolerances) that the partnering contract manufacturer can resolve. This allows the OEM to focus its engineering teams internally to avoid the extra cost of component/assembly troubleshooting. This leads to yet another advantage point for outsourcing: cost effectiveness. The OEM does not have to set up expensive manufacturing facility, procure specialized equipment or hire direct and indirect labor to support the production line. Contract manufacturers can also help the OEM with validation and certification needed to meet regulatory requirements.

Q: How do medical device contract manufacturers stand out from their competition?
Zaslavsky: Medical device contract manufacturers must have a full component traceability system in place and must be certified to the ISO 9001 and ISO 13485 standards. These certifications and traceability systems, as well as a high degree of automation for assembly process repeatability, full electrical testing and screening, set medical contract manufacturers apart from other contract manufacturers. A medical device contract manufacturer stands out from its competition by offering superior program management, engineering support and a highly competent workforce to achieve consistent and timely production and to effectively handle challenges as they arise.

Q: Are there still concerns from the OEM regarding IP when working with a contract manufacturer?
Zaslavsky: OEMs occasionally voice concerns about IP, but this question does not come up often. Commonly, the product design belongs to the OEM, but the assembly/process “know how” belongs to the contract manufacturer. Both parties are bound by a non-disclosure agreement (NDA) and the contract outlining the responsibilities and boundaries of the parties. The contract manufacturer is a partner to the OEM, thus having an interest in protecting the OEM’s IP too.

Q: How has the OEM/CM relationship changed in the medical device manufacturing industry over the past five to ten years?
Zaslavsky: OEMs are more cognizant of the contract manufacturer’s certifications than they were in the past and rely more on them to provide turn-key services.

Q: What misconceptions do OEMs have in working with a contract manufacturer?
Zaslavsky: Some OEMs may avoid working with a contract manufacturer because they fear losing control over the design of their product or the quality of its construction. Conversely, some OEMs may see the contract manufacturer as a simple service-for-fee vendor. In reality, a good contract manufacturer is a partner who co-develops the assembly with the OEM and works closely with the OEM to create a qualification and validation protocol that ensures that the product meets the OEM’s needs. The good contract manufacturer then follows up with qualified processes, equipment and operators to ensure that the OEM gets the highest quality components/assemblies when they need them.

Q: How do you ensure clear lines of communication with a partner OEM?
Zaslavsky: We have found the best way to ensure clear communications is to assign a program manager (PM) to each program and align a dedicated team of engineers and operators to work on the product. The PM ensures that external and internal communications are clear and focuses the team on the development of the project implementation schedule, including all major development milestones, manpower and equipment requirements. The PM also coordinates all the tasks and ensures timely completion throughout the life cycle of the product/program.

Q: How do you earn the trust of an OEM who has been “burned” by another contract manufacturer?
Zaslavsky: OEMs get “burned” by contract manufacturers who aren’t reliable partners. A good medical device contract manufacturer can earn the trust of the OEM working with them as a true partner. A good contract manufacturer establishes open communication channels with the OEM, provides program management to ensure that development, qualification and production activities stay on track and provides its own engineering talent to enhance the capabilities of the OEM during the development, qualification and production phases of the program.

Q: How can a contract manufacturer be a valuable ally when it comes to the validation process for a medical device?
Zaslavsky: We approach medical micro-circuits the same as any hi-rel microcircuit and use the protocols specified in MIL-PRF-38534 as a baseline for the validation process. MIL-PRF-38534 establishes the general performance requirements for hybrid microcircuits, multi-chip modules and similar devices. The main body of this specification describes the performance requirements for hybrid microcircuits and the requirements for obtaining a Qualified Manufacturers List (QML) listing. The appendices of this specification are intended as guidance to aid manufacturers in developing their verification programs. The qualified manufacturer must have a quality management program and be certified and qualified in accordance with the requirements of this specification. The manufacturer may modify, substitute or delete the tests and inspections defined in MIL-PRF-38534. This is accomplished by developing a flow of tests and inspections that will assure that the devices are capable of meeting the generic verifications required by the specification. Medical OEMs might add or delete tests, as appropriate, for their product’s end use.

Q: Any thoughts/comments on contract manufacturing or another related area that you would like to share with medical device manufacturers to aid them?
Zaslavsky: Best practice requires OEMs to review the contract manufacturer’s capabilities, certifications, quality manual, technology portfolio and technology road map. Many start-up OEMs make the mistake of selecting any shop close to their own facility to build prototypes at low cost. At that point of the product development, the OEM is not very concerned with traceability, the contract manufacturer’s certifications, validated and controlled processes or equipment and trained assembly personnel. Unfortunately, by discounting those factors early in the product development, the OEM often ends up with unfavorable processes, materials or equipment choices. Because opinions are formed and inertia sets in, it can then be difficult to introduce better options later in the development process whens qualification and production near. By selecting a good contract manufacturer as a partner early in the product development, the OEM can take advantage of the CM’s experience and knowledge to produce a better, more manufacturable and more easily qualified/validated product.

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