Flexan adds service firm to portfolio

CHICAGO—Flexan Medical Holdings L.L.C., like many other suppliers to the medical device industry, is taking steps to ensure it has a wide range of offerings.

The firm, through its medical subsidiary FMI, has acquired Medron Inc., a medical device contract manufacturing services company based in Salt Lake City. Medron offers a range of outsourcing services, including high volume manufacturing, customer private label capability, design engineering, product development and prototyping. It works with a variety of materials, primarily urethanes, silicones and thermoplastics.

Flexan did not disclose financial details or Medron's employment, but did say that adding Medron brings its total headcount to 750. Medron operates two facilities in the Salt Lake City area.

"We are excited to add Medron's vast array of capabilities to our custom medical molding services," Jim Fitzgerald, president and CEO of Flexan Medical Holdings, said in a statement. "Medron's reputation for providing high quality products from design to product launch and ongoing manufacturing support aligns well with our platform of providing long-term and short-term implantable silicone components. We are excited about the combination of our great brands, and our great people."

Flexan said the acquisition supports the current trend of the medical device industry's strategic efforts to outsource with total solution providers who can consolidate critical offerings to address the needs of the global device market.

Mike Huiras, vice president of sales and marketing for Flexan, said that while FMI had some minor assembly operations, Medron offers a whole range of services: tip forming, whole forming, prefab molding, catheters, some injection molding in plastics, laser marking, product testing, assembly and packaging including X-ray inspection.

He added that the firm is well balanced between silicone, urethanes and thermoplastics with about a 50-50 split between assembly and manufacturing, which focuses on catheters, drug delivery systems and septum valves among others.

All of which will complement FMI's large molding footprint.

"We're looking at an end-to-end solution from contract manufacturing in the medical space to design and development all the way through to finished product and assembly," Huiras said.

"Now we have an opportunity to offer a full suite of options. Especially when you look at a lot of our components we're really manufacturing for inside the device. Now we're expanding into a whole host of clinical markets. It really expands not only our capability, but our market penetration. Our opportunity to cross-market our capabilities to many OEMs will now expand dramatically."

Another attractive element of the acquisition is the opportunity to cross-market products as the two firms do not have many significant overlaps, Huiras said. There might be opportunities in the industrial space to offer customers some assembly opportunities, but the acquisition is primarily focused on medical.

The recent trend of consolidation in the medical device industry is one of the main drivers as cost of development increases, medical device OEMs are looking for suppliers that bring a range of services to the table.

"The other driver is a stronger focus on supplier quality," Huiras said. "The FDA is putting a lot of pressure on OEMs to ensure that they're managing their supplier base more stringently. It's much easier to do that if you have less suppliers."

Flexan is a global manufacturer of high-precision elastomer parts for a wide range of industry applications. It operates out of three manufacturing facilities with 500 employees and consists of two business units. Its Flexan unit focuses on custom molding while its FMI business delivers clean room manufactured silicone rubber components for use in Class II disposable and Class III implantable medical devices.

The firm is owned by Linden Capital Partners, a Chicago-based private equity firm focused exclusively on leveraged buyouts in the health care and life sciences industries.