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Med tech demand boosts manufacturers - 2003-04-07 - The Business Journal (Minneapoli... Page 1 of 3 The Business Journal(Minneapolis/St. Paul) -April 7, 2003 • http //twiucities.b..izjournals coni/twincities/stories/2003/04/ 7/focus2ht .l THE kST.PAUL J t:74 Printable Version I El Email Story i qa Want a Reprint? i -> More Print Edition Stories From the April 4,2003 print edition Med tech demand boosts manufacturers Sam Black Staff reporter After resisting the trend to outsource manufacturing jobs, which became the rule in the telecom and computer industries in the 1990s, the medical device sector is following suit. Increased business from med tech companies is giving a boost to small plastic and machining shops. Other manufacturers who once were tied to the ailing technology industry are changing strategy to get in on the act. For example, last month Rochester-based Pemstar Inc. created a new medical device business unit. • The fire is being stoked by companies such as Fridley-based Medtronic Inc.,which announced at a plastics industry trade show last month that it is aggressively moving to outsource more of its manufacturing. Medtronic's Cardiac Surgery division has sold off a number of its company-owned manufacturing plants to contract manufacturers, said Christopher Oleksy, director of strategic sourcing and business development for the Spring Lake Park-based unit. The division has gone from 16 plants in 1998 to just eight today. In the future, the number of plants could drop to just three or four, Oleksy said. Industry sources expect Medtronic this week to announce the sale of a manufacturing plant in Michigan to A-Tek Manufacturing,based in Brainerd. Since Oleksy joined Medtronic about five years ago, he has been pushing his division to take a step back to ask if its manufacturing has been distracting the company from its goals. If the answer was "yes," he turned to outsourcing. Other local medical technology companies that outsource work to different degrees are St. Jude Medical Inc.,based in Little Canada.; the Scimed division of Boston Scientific Corp.,based in Maple Grove; St. Paul-based Urologix Inc. and CNS Inc., Eden Prairie. Growing together • A long line of smaller companies are eager to take on outsourcing contracts from Medtronic and other medical device companies. One such company is S&W Plastics Inc., a 100-employee custom molding plastics firm in Eden Prairie. http://twincities.bizjournals.com/twincities/stories/2003/04/07/focus2.html?t=printable 4/9/2003