Qure Medical looks to grow pharmaceutical unit

ROCK HILL, S.C.—It has taken the better part of a year, but the pharmaceutical unit of Qure Medical has begun to gain some traction.

And that's good news for the Rock Hill plant, the epicenter of Qure Medical's North American pharmaceutical operation after last year's purchase of Tompkins Pharmaceutical Rubber.

According to Plant Manager Keith Blockinger, Qure Medical has received approval from a majority of Tomkins' key customers and is selling products made at the Rock Hill plant—primarily stoppers for drug vials—on a weekly basis.

“The pharma business itself is one of the key focuses going forward as far as adding to our portfolio of what we do,” Blockinger said. “Everything we do here is flashless, wasteless. The advantage: We produce a very high precision part while keeping very, very tight tolerances.”

Qure Medical, a unit of Twinsburg, Ohio-based Q Holding Co., closed the deal in January 2014 to purchase Plainfield-N.J.-based Tomkins, a manufacturer of rubber components for the pharmaceutical industry. Tomkins had been in operation since 1908. Itran Precision Rubber purchased it in late 1998.

As soon as the transaction closed, Qure Medical began the process of closing Tomkins' New Jersey facility, supplying current orders with inventory on hand and transferring production to Rock Hill. Blockinger said during the first six months after the acquisition, a program was developed to build the required inventory for the transfer.

Then the process began of creating the infrastructure to handle the new machinery at the Rock Hill facility, while at the same time working on some of the qualifications and approvals needed to satisfy customers' needs for components listed in Drug Master Files with the Food and Drug Administration.

“We have a very strong system, so putting those systems into the pharmaceutical business was not a simple task, but it went very well,” Blockinger said. “From that aspect, (the pharmaceutical transition) was not hard.

“The qualification is somewhat difficult because it's a pharmaceutical customer, and that has taken time. But we have the majority of the customers now quality certified, and we're now shipping product.”

Thus far, the pharmaceutical business represents just 5 to 7 percent of the manufacturing done at the 65,000-sq.-ft. Rock Hill manufacturing facility, which was privately owned when it opened in 1984. Four years later, Lexington Precision Corp. purchased the plant, then producing both automotive and medical components.

With Tier 1 automotive supplier Delphi becoming a large customer, the decision was made to split the automotive business into its separate entity, moving automotive production to a plant in Vienna, Ohio. In 2009, however, with the economic downturn bringing auto sales to a halt, the Ohio facility was closed for good.

Meanwhile, Lexington Precision emerged from bankruptcy protection with less debt and a new majority owner, Aurora Resurgence, in July 2010. Another private equity firm, Industrial Growth Partners, purchased Lexington in August 2011. The following year, Lexington Precision purchased Twinsburg-Ohio based Quality Synthetic Rubber Inc., renamed the new company Q Holding Co., and replaced the Lexington moniker at Rock Hill with Qure Medical.

Another change in ownership occurred late last year, as private equity firm 3i Group P.L.C. announced plans to purchase Q Holding Co. and its three operating businesses—Qure Medical, QSR, and Quadra Tooling and Automation—from Industrial Growth Partners for an estimated $160 million.

Today, the Rock Hill plant, with 150 employees, has sales of about $25 million annually, with key customers such as Johnson & Johnson subsidiary Ethicon Inc., Baxter International Inc., Merit Medical Systems Inc. and Smith Medical. The facility runs 24 hours per day, five days a week, supplying about 100 different medical products, including a number of duckbill components, trocar seals, drug delivery stoppers, syringes, diaphragms and bellows.

The factory produces, inspects and slits duckbill seals, a critical medical component. A duckbill seal, shaped like the beak of a duck, commonly is utilized in medical applications to prevent contamination due to backflow.

It works this way: The seal typically is stretched over a supply line, usually round, while the other end retains its natural flattened state. When fluid is pumped through the supply line and through the duckbill, the flattened end opens, allowing pressurized fluid through. As the pressure stops, the duckbill end returns to its flattened shape, preventing backflow.

Blockinger said the best improvement at the Rock Hill facility has been the transition from the human factor to a vision inspection system, “an automated system with very high technical type cameras and robust systems to look at the parts, to give the customer a 100 percent quality product, which is the expectation in the medical industry with zero defects.” The facility houses 20 of these, with two on order, and each represents an investment of between $50,000 and $300,000.

“Our path going forward and our focus going forward will continue to keep that investment in vision system as new projects are launched,” Blockinger said.

Another plus for the facility is the full-circle, launch-to-delivery nature of the Q Holding operation. All of the tooling for the plant is done at one of two Quadra Tooling plants, in North Canton, Ohio, and another in Sturtevant, Wis., site of another Qure Medical manufacturing plant. All of the chlorination is done in the building as well.

In addition, about 75 percent of the polyisoprene used in Rock Hill each year is supplied by the firm's facility in Jasper, Ga.

Automotive remains the largest business in the Q Holding portfolio, which includes six manufacturing facilities in the U.S. and China, selling products in more than 50 countries. Early this year, Q Holding broadened its reach globally, acquiring England-based Silicone Altimex Ltd., a manufacturer of silicone tubing components and assemblies for the pharmaceutical industry.

That acquisition fits with the firm's intention to become a player in the pharmaceutical industry. While competition is stiff—West Pharmaceutical Services Inc. is one of the largest in the industry—officials believe it offers plenty of growth potential, both organically and from the current customer base.

“I think the opportunities are endless for us,” Blockinger said. “It's a massive market, and again we have a very, very small piece of the pie. So we're very excited digging deeper into that business and working with quite a few key customers right now with new products in that arena.”