The old-school model of a medical device manufacturing supply chain just doesn’t cut it anymore.

Todd Martensen ought to know. He’s been in the medical and life sciences business for 35 years, the first 30 of which were spent on the original equipment manufacturing side. There, a new device would be developed over a span of perhaps two to four years, inching its way from research and development to final regulatory approval.

At the product-development stage, Martensen recalls, it was all done with manual processes, resulting in the creation of one or two prototypes. Having finally obtained verification, undergone clinical trials and secured a green light from regulators, the manufacturer would then seek out the lowest-cost location to scale up production for the market. Often, that was far from the end customer.

Then things started to change. Manufacturing margins got squeezed as once-innovative devices aged and competition ramped up. COVID-19 disrupted the flow of product from distant offshore plants to the U.S. Raw materials became pricier and more difficult to obtain. And a rash of tariffs on imports from China, previously favored as the lowest-cost source of production, erased the benefits of relying on cheap Chinese labor (which, in any case, was getting more expensive).

“Medical-device companies woke up,” says Martensen, who is now chief commercial officer with Ascential Medical & Life Sciences. Many of them moved to reshore manufacturing of at least some product back to North America. At the same time, they turned to automation to streamline and speed up the various stages of device development, as well as to inform the U.S. Food and Drug Administration of all sourcing changes.

There were opportunities for automating processes at every step of the supply chain, beginning with R&D and extending all the way to building the final product. That last stage was especially critical, given the chronic shortage of labor that has afflicted American manufacturing in recent years (as well as the high cost of the labor that producers have been able to secure).

Automation, particularly in the form of robots, can be applied to discrete processes such as placing an active ingredient within a catheter. “It allows for more precision and lower cost,” Martensen says. In addition, the technology can be built into the various inspection steps that are essential for product design, verification and development.

As they move to automate their supply chains, manufacturers should expect to experience some pushback from their current labor force, Martensen acknowledges. Over the years, a typical medical device producer is likely to have assembled an extensive team of designers and operations experts. As systems are automated, at least some of them will no longer be needed. “But because all of these people have their jobs, they’ll say ‘This is the way we’ve done it,’” he says. Never mind the prospect of dramatically shortening time to market by dispensing of a range of manual tasks.

Where a medical device manufacturer isn’t likely to encounter opposition to automation is at the regulatory approval stage. The elimination of manual processes can speed up the certification process, keeping FDA better informed every step of the way. Assuming that manufacturers can demonstrate that their new systems deliver an equivalent level of quality assurance, “the agency wants to help you do that.”

Along with process automation comes the need to upskill workers to manage it. “Most of the people bundling products overseas are not high-skilled labor,” Martensen notes. “But when you bring that back to North America, it provides an opportunity for the remaining people to be sophisticated in monitoring equipment, rather than putting screws on a box.”

In fact, Martensen says, the North American labor pool of higher-skilled individuals, such as software and automation engineers, is actually deeper than that of traditional production line workers who are carrying out numbingly repetitive tasks.

Martensen says there’s plenty of opportunity for simultaneously automating and nearshoring more of the medical device supply chain. The growth of disposable surgical instruments offers one area of particular promise. And relatively little progress has been made to date in sophisticated equipment such as EKG machines and infusion pumps — “the last frontier” of automation, as he sees it.

The use of automation to streamline processes and eliminate waste, as well as support nearshoring, “is absolutely where we need to be,” Martensen says. “Everybody understands that.”