Health Care

Air Capital could grow into medical device hub

Wichita, the "Crutch Capital" — hmm, not quite the ring of the "Air Capital."

But it might not be so far-fetched in five or 10 years if an effort to encourage local aircraft subcontractors to produce medical devices bears fruit.

At a Friday workshop, called "From FAA to FDA" — for the change in federal overseers — several speakers said that getting into the contract manufacturing of medical devices isn't that hard and the benefits could be large.

Wichita can become a major center for medical device manufacturing, said Paul Wooley, chief scientist for the Centers for Innovation for Biomaterials in Orthopaedic Research.

"I think it's highly doable," he said. "I've been saying it for three years now."

And the new industry is a natural for Wichita's aircraft manufacturers, said Harvey Sorensen, an attorney with Foulston Siefkin with a long record in community economic development.

"The buzzwords in medical devices are product safety, sterility in manufacturing and engineering, technological advancement, and alternative materials and coatings," Sorensen said. "If those words sound familiar to you, they ought to, because you already do those things."

But there remains enough of a difference to push these companies out of their comfort zone. They must master a new set of federal regulations, spend thousands of dollars up front, adjust to higher volumes and smaller profit margins, and learn an entirely new industry.

"It's different than what they're used to," acknowledged David Bossemeyer, of the Greater Wichita Economic Development Coalition. "But going from FAA to FDA isn't that big a jump."

But on the benefit side, the market for medical devices is huge and growing.

Manufacturers sold $95 billion in the U.S. and $300 billion globally in just the first four months of 2011, said Cydney Boler, an attorney with Foulston Siefkin who specializes in biotechnology law.

And the number of people over age 65 in the U.S. will rise from 40 million now to 72 million by 2030, she said.

The range of medical devices is very broad, with 12,000 manufacturers. It's not just complicated devices such as pacemakers or artificial hips. It can be products such as stainless valves, components for magnetic resonance imaging machines, or, yes, crutches.

Boler said she expects Wichita's aircraft subcontractors would be more attracted to durable medical equipment and home health supplies that require limited or no clinical trials and less liability risk.

Regulation

The workshop was called "From FAA to FDA" for a reason. Getting approval for the manufacturing process and for the product from the U.S. Food and Drug Administration is essential to even start.

But the message from Boler, Wooley and Bossemeyer is that getting that approval isn't that difficult for the aircraft companies.

Many of the local aircraft subcontractors are already ISO 9001 certified, Boler said, which is about 85 percent of the way to becoming FDA certified.

And companies that have gone through ISO certification are already used to collecting voluminous documentation — the key to becoming FDA certified, she said.

The FDA, Boler said, tends to be pretty helpful in working with companies getting into the business. She estimated it would take about a month and $25,000 in legal and regulatory advice for such companies to get certified.

The average profit margin in the device industry is 13.1 percent, she said. That may be narrower than aircraft makers are used to, she said, but can be compensated for by the large volumes.

Already there

A few local companies, spurred by tough times in the general aircraft industry, are already inching their way in that direction. Executives for J.R. Custom Metal and PWI spoke at the conference.

Several of the workshop attendees were non-committal about taking the plunge.

"We're always looking to see what's out there," said Jeff Pauli, director of business development at Exacta Aerospace.

Building a cluster of biomedical device manufacturing is one of the community's long-term economic development goals. It's a big industry based in the U.S., it's growing and it pays well.

There are several important supporting institutions already in place.

CIBOR, a joint project of Wichita State University and Via Christi Health, was created to jumpstart a medical device industry in Wichita. It can design, research, test and make prototypes of medical devices. All it needs is companies with good ideas and willingness to get into the business.

The GWEDC can provide services, connections to legal and regulatory experts and, potentially, access to incentives.

"We need to see how much interest there is," said Bossemeyer, the GWEDC official. "If there isn't enough interest, we need to be spending our time on something else,"

So far, he said, he's encouraged. If half of the 30 or 40 businesses that came Friday get into the industry, it would not only generate crucial sales during a long dry spell, but it would give the city a push toward an important new industry.

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