Investing to support pharmaceutical companies in Puerto Rico

Daphne Allen in Cartons on December 17, 2014

Victor Dixon has been involved with the pharmaceutical and biotech packaging industry in Puerto Rico for a number of years, so he’s seen the island industry during its up and down cycles. He’s supplied these businesses in PR from companies such as Alcoa Packaging, Kimble/Gerresheimer Glass, and later Cortegra as well as operated the printed packaging production facilities of Catalent on the island. And now as President/COO of Rondo-Pak, he’s excited about the company’s year-old facility in San Juan.

Rondo-Pak is so confident about the new plant, the company is offering a “zero-cost switching” program to PR-based customers. “Customers typically have to consider the costs of new plates, dies, etc.,” says Dixon. “To make a switch to our plant seamless, we assure customers we’ll bear the burden of the costs to switch.”

Rondo-Pak had already been shipping a significant amount of cartons and other materials to PR from its Norristown, PA, facility. 
“Our customers came to me and said they needed an alternative in their Puerto Rico supply base,” Dixon says. “At one time, there was a clear tax advantage in the market, and then that changed as the market matured. In the rollercoaster market, some packaging businesses pulled back from the island. There was also heavy consolidation within the packaging supply chain.”

After hearing of the industry needs, “we saw the opportunity to serve as a supply alternative in Puerto Rico and also to use this location as a launching board for the Caribbean and other markets,” Dixon says.

Establishing Rondo-Pak’s presence and manufacturing processes in Puerto Rico allows us to become qualified as a “critical industry supplier,” Dixon explains, so he anticipates there will be some significant tax advantages to island-based businesses purchasing materials from the printed packaging supplier’s San Juan location. “In addition, the company is supporting the local economy by purchasing supplies locally and creating jobs as we grow.”

Rondo-Pak currently runs a continuous manufacturing process beginning at its Pennsylvania plant. Materials are printed in PA and then shipped to Puerto Rico where they are electronically verified and then proceed to final manufacturing. “Our business plan includes continued investments in additional equipment and resources as market growth dictates,” says Dixon.

Rondo-Pak’s PR plant is equipped with brand-new versions of the same carton production equipment the firm uses in PA. New equipment includes a Bobst folder/gluer with vision systems for glue inspection as well as defect detection. “Anything we produce in the United States we will be able to provide in Puerto Rico,” says Dixon. “We’ve planned for the cartons we need to do today and then in the future for possible additional products such as inserts and labels.”

The facility has “ample space” for production growth, with plans to eventually include printing, he adds. It currently does have temperature- and humidity-controlled storage.

In addition, “both locations operate on the same cGMP-compliant quality management system,” Dixon says. “We’ve duplicated the system and translated it into Spanish. We also use the same ERP system and the same file-sharing and prepress system. We’ve got provisions for innovative supply chain solutions such as Vendor Managed Inventory and Kanban set-ups.”

Dixon believes that the significant number of installed packaging lines, inspection equipment, and manufacturing execution systems (MES) solutions by Körber Medipak Systems on the island from its sister companies Dividella, Mediseal, Seidenader, and Werum increase the appeal of working with Rondo-Pak. “We work closely with our sister companies so we can provide a seamless experience for the customer,” Dixon says. “The interaction of materials with equipment is critical to maximizing uptime and OEE. We’ve built in special features that make our cartons run well on our machines. Our design teams work hand in hand, and we all work together during line trials and validations. We also retain the most experienced technicians and a dedicated technical services manager to help our clients ensure optimum line performance when utilizing our packaging materials.”

Such collaboration adds to Rondo-Pak’s value proposition, Dixon says. “Customers need to consider the total cost of ownership. We’ve saved companies money because they’ve been able to not only reduce costs, but get cartons to market faster.” He points to the top-load cartons Rondo-Pak provided to Sanofi for its flu vaccines. The combination of Rondo-Pak’s specially designed cartons and inserts running on Dividella’s NeoTop 804 packaging equipment resulted in increased output and higher equipment efficiency, as well as lower package material costs and distribution costs, he says. “OEE went from 35 to 70%, and they were also able to cut cold-chain storage costs by 50%.”

The PR location also adds redundancy to Rondo-Pak’s North American plant network. “We’ve built in contingency planning with reciprocating back up and business continuity plans between this site and the Norristown, PA location,” he says. The plant in San Juan adds a fourth location to Rondo’s global footprint, which currently includes the Norristown location, a plant in the Czech Republic, and corporate headquarters location in Switzerland, he adds.

Körber Medipak Systems, parent company of Rondo, continues to expand. Recent projects include the acquisition of Werum IT Solutions, a provider of MES serving areas in pharmaceutical and biopharmaceutical manufacturing from ranging from process development to commercial production and packaging.

Rondo-Pak also recently launched its Multimedia Carton, which consists of an externally printed digital watermark to allow the package to interact with a consumer’s smart phone and an on-board high-definition video screen for displaying product information for patients such as branding messages, instructions for use and compliance-promoting videos, the firm reports.

“We are trying to bring innovation to packaging, in both the products and supply chain,” says Dixon. “We’ve got growth plans for both locations, and our range of solutions just keeps getting bigger and bigger.”

Rondo-Pak’s PR business is managed by industry veterans Pablo Vega, who serves as Director of Business Development, Caribbean; and Plant Manager Liza Diaz, a lean six-sigma black belt. Both worked previously with Dixon at Catalent’s former printed components businesses in Puerto Rico.

For more details, visit www.rondo-pak.com.

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