Outsourcing for Small Medical Device Companies

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Outsourcing for Small Medical Device Companies

• MassMEDIC
• 16 April 2004
• Jeffrey Cerier
• V.P. Product Development
• NDO Surgical, Inc.

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Outsourcing for Small Medical Device Companies

• What?
• Why?
• How?

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What to Outsource?

• Concept generation
• Product development
• Testing
• Component fabrication
• Assembly
• Packaging
• Sterilization
• Clinical study management
• Regulatory affairs
• Patent work
• etc. etc. etc

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Why Outsource?

• Better
• Faster
• Cheaper
• Strategic fit

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Better

• Proprietary or unique processes?
• Team knowledge and experience
• What are you good at?
• Can get whatever expertise you need,for whatever
  time period its needed

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Faster

• Speed
• No recruiting lag time
• Speed
• Consider your time horizon
• Speed

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Cheaper

• Economies of scale
• Utilization of resources Elastic Capacity
• No capital investment required
• No underutilized capital equipmentor facilities
• Lower costs due to location

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Strategic Fit

• What do you want to be when you grow up?
• Fit with exit strategy
• Little value attached to capital assets in
  liquidity event

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How

• Selecting
• Managing the process

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Selecting

• If
• Establishing in-house getting married
• Then
• Outsourcing living together
• Get competitive quotes
• Check references
• Interview key personnel

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Managing the Process

• Get to know each other as people
• Establish clear goals and expectations
• Insist on regular, detailed reporting
• Communicate
• Communicate
• Communicate

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When Not to Outsource

• You have the capability and capacity
  availablein-house
• Establishing in-house capability and capacity
  fits with your exit strategy
• Proprietary processes - you dont want to let go
• Finicky processes - you want to control
• You feel that your work will not get thepriority
  it needs

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Summary

• Small medical device companies need to
• 1. Move fast
• 2. Conserve cash
• 3. Do great work
• 4. Position for liquidity event

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Summary

• Ask yourself
• 1. Can I get the same results faster by
  outsourcing?
• 2. Can I save money by outsourcing?
• 3. Can I get better results by outsourcing?
• 4. How does outsourcing fit with my exit
  strategy?

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Thank You