By Sean Fenske, Editor-in-Chief

While a medical device manufacturer’s supply chain has always been a critical aspect of its success, it has not gotten the attention that’s emerged from shortcomings realized during the COVID-19 pandemic. As a result of challenges experienced during and following that time, medical device companies have reevaluated many aspects of their supply networks and continue to make adjustments. They want to be certain they will be better equipped to address supply needs during future events, whether pandemic, natural disaster, or another significant event.

One finding that many organizations are attempting to resolve is the distance components, materials, or finished devices have to travel to get to where they need to be. The resulting strategies have led to an increased interest in more regionally based supplier networks. As such, companies with an established worldwide presence may have precisely what medtech OEMs are seeking.

Fortunately, MPO was able to speak with Walter Tarca, president of Forefront Medical Technology (FMT), a medical device contract manufacturer with the aforementioned worldwide manufacturing network. He shared the value this framework can provide to medical device companies. He also highlights the capabilities of what several of the company’s locations can offer to their clients in the following Q&A.

Sean Fenske: What are the major challenges your medtech customer base wants you to solve?

Walter Tarca: Our customers want to take cost and time out of their supply chain. Geographically, that means more focus on regional manufacturing solutions that enable them to nearshore at as low a cost as possible because reduction in transit time from the manufacturer to distribution translates to less logistics and inventory cost. It also enables faster response to changes in demand.

In addition, I feel the pressure to reduce costs is higher than I’ve ever seen. Real costs have risen, so achieving a reduction in cost requires improvement in operational efficiency. Our teams utilize Lean Six Sigma in our continuous improvement process. We are now seeing that customers want to integrate their teams with our teams for larger focus in this area. As an example, we have a customer sending in representatives for a joint Gemba workshop at our China facility in Q1 2025.

Fenske: Your newest facility is in Mexico. What are some of the key benefits you see in that choice?

Tarca: Our customers see our Juarez, Mexico, facility as a strong and secure nearshore solution because of its proximity to the U.S. border. They can warehouse their finished goods in El Paso, TX, for fast shipments to other distribution points. Juarez has been a medical manufacturing hub for over three decades so there is strong infrastructure there to support our workforce experience needs and critical suppliers.

Fenske: How does your Singapore headquarters fit into the equation?

Tarca: Singapore is important to us because it provides an Asia manufacturing option outside of China. Its intellectual property protection laws are some of the most comprehensive in the world. The bulk of our management team, engineers, and toolmakers reside in Singapore. While labor costs are higher than those of China, our ability to automate production helps us lower that cost. Additionally, Singapore’s free trade agreements can be beneficial. For example, the Singapore Free Trade Agreement with the U.S. (SGFTA) also qualifies it as a “designated country” under the Trade Agreements Act of 1979 (TAA). As a result, products qualifying as Singapore origin under SGFTA can be sold as TAA-compliant, which can be important for products sold to U.S. government entities such as the Veteran’s Administration.

Fenske: What benefits are offered by your U.K. operation?

Tarca: Our U.K. operation does specialty manufacturing and has unique capabilities not present in all facilities, such as silicone injection molding and medical textile manufacturing designed to serve niche markets. We also support a variety of products from E.U. medtech companies in our cleanroom assembly areas.

Fenske: What benefits do you see in manufacturing in China?

Tarca: China is still the lowest-cost medical manufacturing solution. It offers a skilled workforce with significant medtech assembly and toolmaking experience and they have a strong work ethic. There is also excellent medtech supply chain infrastructure. There are 1.3 billion people in China, which translates to a very large domestic market for medtech devices. For many of our customers, the cost advantages of being able to build in China to serve their domestic market make this a critical part of their strategy. It also provides a low-cost and logistically simple option for serving other markets in Asia.

Fenske: How are you optimizing FMT’s global footprint to deliver the best value?

Tarca: While we offer fewer options in terms of global footprint than our largest competitors, we are also leaner and more focused on providing very tailored solutions through our six facilities. That provides a cost advantage in itself. We’ve also developed a culture focused on quality and speed to market. Our customers want quality products in as short a manufacturing cycle time as possible and we ensure our teams are aligned to their expectations. One example is our FIT (Forefront in Transformation) program, which encourages our employees to bring forward ideas that enhance efficiency and drive innovation. We award cash prizes to the best suggestions.

Fenske: What else is important to consider in selecting a contract manufacturer?

Tarca: Customers want a one-stop shop that can provide a complete and effective solution from development through fulfillment to their distribution channels. They also need to be able to trust their contract manufacturing partners. They aren’t just outsourcing manufacturing, they are outsourcing their brand. They also want responsiveness and speed. Time is money. Inventory is money. They want a partner that understands the need for urgency and continuously works to take cost out of the process.

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