Feb 07, 2020

The Strategic Potential of Rapid Operational Improvement

The Strategic Potential of Rapid Operational Improvement

A REV.1 Engineering White Paper

Several years ago, a startup company developed an innovative, reduced profile, coronary stent-on-a-wire device. The design promised to streamline Percutaneous Coronary Interventions (PCI), improve Cath Lab turn times, lower costs and improve patient outcomes, safety and their overall experience (less discomfort). The design incorporated new ways of bonding the balloon to the guidewire and introduced novel joint designs within the stent that resulted in unanticipated challenges to the manufacturing process.

The startup was seeking IRB approval in order to conduct a live procedure for the upcoming Paris PCR event. As an investor-driven startup, this pre-commercial, clinical demonstration was mission critical to the startup’s pending market launch and follow-on funding. At the time, the startup was working with a contract manufacturer (CM). The CM had established a pilot line for the delivery of devices necessary for conducting the statistically significant testing required in support of their IRB approval.

As is often the case, the time pressure to market launch resulted in what could be described as an unsubstantiated jump from early feasibility testing to pilot line production. The net result was very low yield rates of 35% from the pilot manufacturing runs. Unfortunately, this led to cherry picking devices from differing manufacturing runs. This decision is emblematic of processes that are neither robust, stable or reproducible. This endemic variability threatened the approval of the IRB and the startup’s ability to meet the deadline for the Paris PCR clinical demonstration.

In an attempt to address the low yield rates, a lean manufacturing consultancy, JVC Consulting, was engaged by the contract manufacturer to solve the challenges they were experiencing on the pilot line. Upon assessment, JVC determined there were systemic engineering and project management issues that needed to be addressed in order to deliver enough devices to support the IRB approval.

With only four months lead time to the Paris PCR event, JVC engaged REV.1 Engineering to solve these systemic problems. REV.1 deployed immediately, embedding the necessary engineering resources onsite for the duration of the project. The REV.1 team dove in to deliver the rapid, operational improvements necessary to ensure safe human use, secure IRB approval and meet the deadline for the clinical demonstration.

REV.1 initiated the engagement with a deep dive assessment resulting in a project plan that identified the developmental processes, and interdependencies throughout the critical chain, that needed to be addressed in order to deliver a robust, reproducible, compliant device. The plan identified tweaks to the original design that would contribute to the manufacturability of the device. The changes addressed balloon bonding and crimping as well as several mechanisms of action that supported stent deployment and anchoring.

The resulting design changes required guidance and coordination with the vendors providing balloon extrusion and the components and materials used to manufacture the device. REV.1 led the charge, driving the necessary changes and ensuring the Design History File was updated and accurate.

With the new design freeze in place, REV.1 rapidly moved through Verification & Validation and transferred the updated Design for Manufacture to the contract manufacturer’s pilot line. This included installing new processes, new tooling and fixtures (designed by REV.1), as well as executing the IQ/OQ/PQ for the redesigned line. The line’s capacity was also increased four-fold in anticipation of post-launch demand surge.

With the updated pilot line validated and operational, yield rates went from 35% to 95%, delivering the necessary number of units required for statistically significant testing and validation. Integral to implementing these improvements was the introduction of four additional sizes of the stent, enabling the startup to address approximately 50% of the patient market, right out of the gate. The dramatic improvement in yield rates also ensured the company would deliver the profit margins their investors were anticipating.

With the clock running, REV.1 engaged a private plane in order to ferry packaged goods from the pilot line to the sterilization facility - for 24 hour turnaround. The line would run, the packaged devices delivered via private plane to the contract sterilizer, and the sterile goods ferried back on the return flight to the contract manufacturer for destructive testing.

REV.1 successfully met the deadline, enabling the startup to secure IRB approval, conduct their clinical demonstration for the Paris PCR event, and go on to successfully launch the new product line for human use.

A lead consultant for JVC at the time, who is now President of Lucerno Dynamics, Ron Lattanze, commented, “The project was delivered far faster than could be achieved in-house, and the product now represents significant growth for our client. REV.1 was more than two times faster to develop a marketable product than our client projected they could achieve.”

Three years after the launch, the startup directly engaged REV.1 Engineering to transfer their manufacturing line from the original contract manufacturer to a larger, global CM. As a result of REV.1’s consistent performance, the founders of this particular startup have gone on to engage REV.1 as the sole design & development firm for two subsequent medical device startups they have founded. One of these companies, Ablative Solutions, has raised more than $120 million in equity financing and is well underway with large scale clinical trials. The other startup is simultaneously moving efficiently through Verification & Validation.

This is an example of what REV.1 calls ROI2; the combination of Rapid Operational Improvements and exceptional Return on Investment. While this is an “In Case of Emergency, Break Glass” example of performance under pressure, ROI2 has been deployed for clients to quickly and efficiently improve gross margins on existing product lines (while hitting breakeven in months, not years). For many medical device companies, a dollar saved in COGS is often the financial equivalent of five dollars in incremental sales. Due to the relatively long lead times in new medical device development, ROI2 is one of the few strategic tools available to device companies that can contribute significant improvements in financial performance, within the current fiscal year.

For more information, please contact Terry Murray, Vice President of Strategic Development at terry@rev1engineering.com.

Copyright 2020, REV.1 Engineering®.

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