By Dave Busch
On July 1, 2006, a quiet but dramatically disruptive law went into effect that has wide-reaching business and environmental implications. While it formally impacts only products sold in Europe, its effects are global. It isn’t a plague but some might call it a pandemic.
A Solectron employee inspects a printed circuit board. RoHS and other similar environmental regulations are changing the supply base, which could force medtech firms to revalidate products with government agencies, such as the FDA.
Why? Many of the materials and components found in medical devices are going green.
As the supply base shifts, medical manufacturers must take the proper precautions and steps to ensure product protection and enhance competitive position.
RoHS and BeyondGovernment bodies are adopting environmental regulation with rapid speed while cracking down on OEMs. In 2001, Sony spent more than $80 million to replace peripheral cables in over one million PlayStation game consoles because they contained more cadmium than permitted under the Netherlands environmental law, which closely mirrors the EU’s RoHS initiative.
Europe is just the beginning. Major global economies are implementing their own versions of RoHS, and the impact on medical devices is unclear. For example, China passed its own version of RoHS in February 2006the Management Methods for Controlling Pollution by Electronic Information Products. The scope of China RoHS extends not only to the final product (as the EU RoHS does), but to the design and assembly process, as well as parts and packaging material and labeling and testing requirements for catalog products.
Additionally, more than 20 U.S. states and numerous countries have or are in the process of considering electronic environmental legislation. Given such global context and broad scope, medical device OEMs can no longer ignore these trends, hoping that exemptions will forever shield them from the effects of these regulations.
What Does This Mean?RoHS is driving the “greening” of the supply base, and it has huge implications for medical devices, not the least of which could require complete product redesigns.
Indeed, the supply chain is inexorably moving toward compliant materials. This means that current components and materials are being phased out (end of life) and are being replaced with new green materials. Therefore, medical device OEMs will be faced with changes in their products, will have the challenge of determining the effect of these changes, and will have to demonstrate that they have no negative impact on safety and efficacy.
There are also unknown factorsreliability being most critical among them. For example, for lead-free solder, questions remain about long term reliability. Some research indicates that it could take five years to fully understand the long term reliability impact.
Cost of RoHSAt the risk of stating the obvious, there are substantial resources requirements medical OEMs need to consider as they migrate to environmentally safe materials.
In September 2005, Technology Forecasters estimated the one-time cost to comply with RoHS requirement as roughly 2% to 3% of the cost of goods sold. While there aren’t any firm cost estimates for the impact of the greening of the medical supply base, the financial impact will be greater due to re-validation and associated regulatory process costs.
|Restricted Elements in RoHS |
In 2003, the EU established legislation to limit the amount of some hazardous substances in electronic devices. The directive requires companies selling to EU countries to remove six hazardous substances: Lead (Pb), Mercury (Hg), Cadmium (Cd), Hexavalent Chromium (Cr-VI), Polybrominated Biphenyls (PBB) and Polybrominated Diphenyl Ethers (PBDE). This went into effect July 1, 2006.
Coordinating supply chain activities, associated planning, and inventory are further complicated by minimum order quantities, stretched lead times, price variances, non-cancelable and non-returnable ordering constraints, and material availability. The influx of new “green” material together with existing supplies will require incremental storage space and controls in the warehouse.
Finally, and most significant, is verification and validation (V&V) of the newly “greened” product. This usually involves a full regimen of V&V protocols to demonstrate continued safety and reliability.
Where to StartIt would be nice to have a magic wand we could wave to instantly comply with all current and pending RoHS regulations. But there is no such quick fix, no Merlin the Wizard who can help. However, in working with major medical device firms grappling with environmental issues, the biggest and most costly challenge is the revalidation process for medical devices where RoHS approved components have been integrated.
There are essentially two classifications to this challenge:
- Removal of lead in printed circuit boards: While this involves data collection and parts management, the substitution itself is reasonably straightforward. However, revalidation issues can become significant (e.g., reliability), making the whole process highly complex, time consuming, and costly.
- Removal of “5 of 6” substances: Here data collection is tricky because most OEMs and their suppliers do not really know if or where, for example, polybrominated biphenyls are used. However, revalidation tends to be a much easier task, because these components rarely have a significant functional role.
Based on the early HALT/HASS test results on the pilot units, decide whether to:
Partnering for SuccessThe journey you take on your road to compliance is one you won’t have to do alone. This is where partnerships come into play. For example, leading contract manufacturers should help in this effort to transition to a lead-free supply chain. The key to this process is to determine core competencies. Medical device firms are driving life-saving innovation, while contract manufacturers are in the business of managing the supply chain.
A true contract manufacturing partner should be able to highlight performed testing to assure customers that long-term reliability issues have been satisfactorily resolved. The partner also should have mechanisms in place to monitor the long-term reliability of RoHS compliant printed circuit assembly, while also ensuring uniformity on lead-free processes.
|The Road to RoHS Readiness |
In 2004, Solectron created a RoHS readiness program for its 50 sites worldwide, which comprised of many processes and tests to ensure the site met compliance guidelines before it was certified by Solectron.
First, Solectron established an internal Environmental Compliance Team as well as RoHS Regional and Site teams. The global, cross-functional teams provided direction and support in the development of many corporate specifications for lead free and RoHS policies, procedures, and specifications. Solectron then hired an outside training company and held several sessions of training.
Next Solectron developed a 200-question RoHS self-assessment checklist to examine training, materials and warehouse management, engineering and test capabilities, manufacturing process and control, and quality management system for each site. Solectron then performed this detailed corporate on-site audit.
The Solectron Process & Technology Engineering team developed the equipment, process, and technology solution for RoHS. In addition, Solectron created new site part numbers for all RoHS-compliant assemblies and all of their BOM components, regardless of the actions of component manufacturers or customers, while ensuring there was a clear physical and financial separation of the supply chain, as well as fully utilize the MRP (Material Requirement Planning) System.
To ensure uniformity among OEM, suppliers, and contract manufacturer, Solectron takes a three-prong approach:
ConclusionAs environmental laws dictate rapid change in the development of medical devices and the supply chain evolves with legislation, medical device firms need to evaluate what makes sense to manage internally, and what should be managed externally through an outsourcing partner. A unified, proactive approach, coupled with a strategy that leverages outsourcing partnerships, is the best and safest path to take in order to be prepared. A collaborative effort will reduce the risk of converting products to environmental standards and will help ensure regulatory guidelines are met with increased efficiency at lower costs while meeting quality requirements.
ONLINEFor additional information on the technologies and products discussed in this article, visit Solectron Corp. at www.solectron.com .
Dave Busch is the Vice President of the Medical Segment for Solectron Corp. He is responsible for sales and business development for this division of the company. Busch can be reached at 408-956-7561 or firstname.lastname@example.org .