Currently, the healthcare industry is facing unprecedented challenges, and the entire industry is under constant cost pressure. Internally, launching a new type of medical device product often takes three to seven years, sometimes even longer; A new drug takes an average of 12 years from development to final approval. Therefore, while ensuring reliability and quality standards, it is crucial to be able to advance faster and more efficiently.

In my many years of experience leading healthcare companies, I have always been committed to exploring effective ways to reduce risks and redirect resources towards product innovation. One important way is to outsource cooperation with trusted partners. In my opinion, outsourcing cooperation in the field of healthcare is not just a strategy; It is also the key to changing the rules of the game. Outsourcing can help achieve a wide range of strategic goals, including leveraging the advantages of external manufacturing partners to improve operational efficiency and drive significant transformation of enterprises – often referred to as’ network optimization ‘.

Network optimization is gradually becoming an emerging trend in the field of healthcare, representing enterprises refocusing resources on core businesses through strategic outsourcing.

When properly executed, network optimization can drive enterprises to completely reform their network structure, effectively reduce risks and focus on core business areas by optimizing resource allocation, while significantly reducing capital expenditures during this transformation process.

Recently, Technavio released a report predicting that from 2024 to 2028, the medical device manufacturing outsourcing market will grow at a compound annual growth rate of 10.9% to $50.44 billion. This indicates that numerous healthcare and pharmaceutical companies see an opportunity to reshape their existing manufacturing models. A well executed outsourcing model can bring multiple benefits, including improved operational efficiency, reduced supply chain risks, and the ability of internal teams to focus on core competencies and innovation. By working together with suitable partners, companies can more effectively utilize funds and resources to manage production line investments, ensure strict compliance with regulatory and quality standards, and address various complex challenges during the transfer of production lines and factories, thereby effectively alleviating the company’s related concerns.

Concentrate resources and strengthen expertise

In 2023, the US Food and Drug Administration (FDA) approved more new medical technologies than any previous year, creating a more competitive environment for healthcare and pharmaceutical companies to bring innovative solutions to market. At the same time, rising cost pressures, increased profit demands, and global supply chain uncertainty collectively require companies to seek a way to release resources in order to focus on their areas of expertise.

By partnering with professional manufacturing outsourcing partners, healthcare and pharmaceutical companies can fully leverage their vertical integration capabilities and expertise in complex production process management and supply chain configuration. In this way, companies can concentrate their internal resources on core competencies such as product innovation and research and development.

At Weichuangli, we are committed to helping customers optimize the entire product lifecycle and achieve sustainable development goals. From ensuring the manufacturability of product design, to effectively expanding production scale, to providing reverse logistics and circular economy services – while sharing advanced manufacturing expertise and best practices from other industries.

For example, we used advanced analog technology to create a digital twin for the production line of a type II diabetes product, helping to reduce production risks and ensure the continuity of production. We also assist our clients in addressing complex supply chain management challenges, effectively reducing operational risks while allowing them to focus more on the development of other core areas. With a vast network of over 16000 suppliers, we work closely with leading companies in the diagnostic industry, ensuring the stable operation of our supply chain even in the face of semiconductor supply shortages during the COVID-19 pandemic. During this difficult period, our customers have demonstrated extraordinary resilience by continuously providing sensors to millions of patients who rely on their products.

Quality first

Although companies fully recognize the wisdom of concentrating internal resources on product innovation, they may still be skeptical about outsourcing due to the healthcare industry’s requirements for high quality standards and strict regulation. The same Technavio report emphasizes that although outsourcing medical device production can bring opportunities for companies to access the latest technology and advanced equipment, it also comes with a series of challenges. For example, medical professionals have extremely strict requirements for product quality and must strictly comply with relevant regulatory requirements

Evaluating manufacturing partners to ensure they meet regulatory and quality requirements is crucial.

At Weichuangli, we provide an excellent quality management system based on decades of deep cooperation experience with healthcare and pharmaceutical companies, ensuring that customers can smoothly meet the strict compliance requirements of Class I, II, and III medical products. As regulatory expectations continue to evolve, we are committed to closely collaborating with customers throughout the entire product lifecycle, from early conceptual design to human factors engineering (HFE), to providing highly automated production and end-of-life solutions.

Working with manufacturing partners like Weichuangli and leveraging our 14 FDA certified and 21 ISO 13485:2016 certified factories will help healthcare and pharmaceutical companies easily achieve the highest quality and compliance standards for regulated medical products.

Reshaping the internal production model

Even though end-to-end value chains can bring significant benefits, transferring production from internal to outsourcing partners can still be daunting or risky. However, medical and pharmaceutical companies should first consider the desired outcomes before formulating their strategies.

Whether seeking to be close to the end market, integrating multiple production bases, or aiming to reduce overall operational risks, enterprises have diverse choices. With strong vertical integration capabilities and global layout, Weichuangli provides professional skills, rich experience, and complete infrastructure for clients in the healthcare industry. As a partner, it can help them achieve their outsourcing strategic goals.

For example, we worked closely with a client focused on diagnostic monitoring to reduce the overall risk of their supply chain. By integrating five manufacturing bases scattered across multiple regions into one Weichuangli manufacturing center in North America, we have helped our customers reduce redundant processes, improve operational efficiency, thereby saving costs and reducing risks.

The Weichuangli production base we have chosen, with its professional knowledge and experience in the medical manufacturing field, as well as a high-quality team, has successfully achieved a fast and smooth transition, ensuring the normal operation of customer business.

Strategic cooperation for long-term development

The landscape of the healthcare industry will become increasingly complex, driven by rapid technological advancements, a growing population of chronic disease patients, and an estimated 1.5 billion people aged 65 and above worldwide by 2050, creating new market opportunities. In order to stay ahead of future challenges and seize unprecedented opportunities, healthcare and pharmaceutical companies must establish strategic partnerships with outsourcing partners. These outsourcing partners can not only help them optimize their own networks, but also provide cross industry expertise, knowledge, and experience in medical product design, development, and manufacturing.

With decades of experience in the healthcare industry, I have personally experienced the importance of strategic outsourcing in maintaining a competitive advantage for businesses. By cleverly utilizing the capital advantages, technological investments, and various resources of outsourcing partners, enterprises can concentrate on core innovation activities, while achieving more flexible operations and effectively avoiding risks. In this rapidly changing industry, it is particularly important to continuously examine and innovate existing models in order to better meet the ever-changing needs of healthcare providers and patients.