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How to become a lean machine

Can you Kanban? If you answered, "not without my dancing shoes," it may be time for you to brush up on the principles of lean manufacturing. First, you must learn to talk the talk.

At the recent Executive Leadership Conference of the Packaging Machinery Manufacturers Institute, several speakers and a member of the panel addressed this topic (Kanban is a Japanese term meaning "signal," one of the primary tools of just-in-time manufacturing, that signals a cycle of replenishment for proudction and materials), a theme carried through from last fall's meeting. According to Bill Donohue, vp of Virginia's A.L. Philpott Manufacturing Extension Partnership, "Lean is a systematic approach to identifying and eliminating waste (non-value-added activities) through continuous improvement by flowing the product at the pull of the customer in pursuit of perfection." He went on to say that 95 percent of all leadtime is non-value-added, such as overproduction, waiting, transportation, defects and inventory. Value-added, on the other hand, is any activity that increases the market form or function of the product or service. These are things the customer is willing to pay for.

Any manufacturing function that involves both workers and machinery can benefit from a lean approach. Donohue suggests starting with value-stream mapping. First, follow the product's packaging production path from beginning to end, making a visual representation of every process. Next, find the waste. Here, it's best to involve the employees; you may be surprised to find that they are already aware of the bottlenecks in the system—wasted steps, wasted materials, downtime. To eliminate waste, next standardize the workflow. Operations should be carried out with all tasks organized in the best known sequence, and using the most effective combination of people, materials, methods and machinery.

A Kaizen event is helpful (Kaizen is a Japanese term meaning continuous improvement). Kaizen is any action whose output is intended to be an improvement to an existing process. A Kaizen Event gathers operators, managers and owners to examine the packaging process, map production, improve it and then solicit buy-in from all parties. While much of the improvement focuses on the workers, machinery is vital to Kaizen, too. Donohue suggests Total Productive Maintenance. TPM maximizes the productivity of equipment for its entire life cycle and will extend the useful life of the machinery. By practicing continuous maintenance on the machines, the operation's safety, quality, cost and output will improve. Downtime is unacceptable, and this includes changeover time, which Donohue defines as the time between the last good packaged product off the current run and the first good piece off the next run. Shortening changeover times goes a long way toward maximizing output.

Donohue recommends implementing a 5S program: Sort, Set in order (relocating items as needed), Shine (yes, that means clean), Standardize and Sustain. The last two functions ensure that the first three are adhered to diligently. At the fall meeting, PMMI's members participated in a hands-on exercise that demonstrated how even simple improvements in workflow—organizing materials, eliminating wasted steps, keeping workspaces tidy—impacts productivity and profitability. And who can argue with that?

Machinery sales look solid for '05

The sales of packaging machinery in the U.S. are expected to rise by seven percent this year, following three consecutive years of growth since the economic downturn of 2001. Total sales should reach $5.91 billion, according to the U.S. Purchasing Plans Study from the Packaging Machinery Manufacturers Institute (

"End users are telling PMMI that they are confident and optimistic about their business," notes Charles D. Yuska, PMMI president. "This optimism is expressed through their capital expenditure budgets where we have seen increases in planned expenditures across all eight defined market segments that we study."

While much of the confidence and optimism fueling this remarkably higher rate of spending is tied directly to increased corporate sales and profits as well as to the sustained growth of the U.S. economy, this year's rise is also being propelled by a catalyst whose presence has just recently begun to emerge—a distinct improvement in rates of capacity utilization throughout much of the market.

The largest increase in spending is predicted to come from the pharmaceutical and medical segment (11 to 13 percent), followed by beverages (9 to 11 percent), personal care products (7 to 9 percent), food (6 to 8 percent) and converters, printers and all other (3 to 5 percent). The study also indicates that two-thirds of the respondents plan to increase their spending or keep expenditures at their 2004 level.

The assessment of prospects for the U.S. economy and capital spending in 2005 are based largely on an analysis of several groups of economic data in combination with the current consensus of economic forecasts. To that end, the projections reflect the following macroeconomic assumptions:

U.S. 2005 gross domestic product (GDP) will see real growth of +3.2 to +3.9 percent; capacity utilization by U.S. manufacturers should improve further in 2005; U.S. capital spending for industrial equipment in general will grow this year; interest rates will rise steadily from February/March 2005 levels; and corporate profits should continue higher, albeit at a slower pace, than in 2004.

In addition to the macroeconomic assumptions that are driving an increase in capital equipment spending in 2005, the end-users surveyed also indicated eight market-specific factors, trends and expected developments that will drive an increase in packaging machinery sales during the year. These include:

The need to replace older machines is still a key demand driver; more expansion of packaging capacity is underway; expectation of more product and stockkeping units in 2005; the evolution of new packaging is an ongoing catalyst for machinery demand; both direct and indirect influence of superstores and retail chains on packaging requirements—a continuing issue; the positive effect of more packaging runs per line; and end users addressing worker ergonomics, product security and safety issues PMMI's study represents the collective voice of 453 decision makers responsible for 7,005 packaging lines in 1,213 plants throughout all key segments of the U.S. market. The complete 2005 Purchasing Plans study is available for $1,500 by contacting Paula Feldman, director of statistics, at 1-888-ASK-PMMI or The study reports detailed findings for each of the eight segments and goes into depth on the market trends and factors affecting machinery purchases.


Back in the late 90s, when Dean Foods introduced its Chug bottle, with vibrant shrink sleeves and a funky, retro-style cap, the launch was so successful that it lifted sales of milk across the category, the first time the dairy industry had seen such growth in decades. The renewed sales activity seemed to awaken a sleepy industry, and soon dairies across the country were churning out Chug-wannabe bottles and new flavors. Previously relegated to retail stores' loss-leader status, milk suddenly acquired an air of panache.

So now, several years later, how has dairy's stature changed in the eyes of the consumer? Or hasn't it changed at all? To find out, Dairy Management, Inc.—the umbrella management organization for the American Dairy Association, National Dairy Council and U.S. Dairy Export Council—and Dairy Foods magazine undertook a survey of 1,000 consumers.

Although most of the questions centered on milk's health benefits and taste, several of the consumers addressed milk's packaging. One survey respondent said, "Maybe change the way it's sold rather than change the product itself. It would be great if you could buy it frozen." Another remarked, "Milk should be sold in individual sizes about the size of a yogurt container, and then pack it as a six-pack." Drinkable yogurt comes that way...why not milk?

Another consumer said, "I would only sell milk in glass bottles. It tastes better that way than in plastic." (Oberweis Dairy, in Aurora, IL, would fervently concur.) One respondent suggested that flavored milks should be made available in larger-size packages, and another said that dairies should add extra calcium and vitamins to milk to make it more nutritionally complete. Then there was this critic: "I don't know why most milk packages look the same. They're boring."

Other findings from the survey involved consumer preferences. For example, two-thirds of consumers drink milk (this could include on cereal) at least three times each week, with 42 percent claiming to drink milk at least once a day. The survey found that most people are either great fans of milk or are milk avoiders; very few consumers would fall into that middle ground of occasional drinkers. One-fourth of respondents say they have three or more different kinds of milk in their refrigerator at any given time. Half keep 2-percent milk on hand, and one-third buy whole milk. Only about 20 percent of consumers keep flavored milk, but of those that do, chocolate was by far the favorite, followed by vanilla. Two-thirds of the consumers say they become aware of new milk products while just browsing the store, and more than half attribute such awareness to television and magazine advertising.

Whether dressed in a dazzling, full-body shrink sleeve label, or packaged in the common, handled plastic jug, milk's got it!

The versatility and flexibility of flexibles

One of the fastest-growing materials segments for packaging has been flexibles, as in films, papers and foils. It is flexible's versatility that has helped to make it such a popular choice for packaging. Indeed, the 28 winning packages in the Flexible Packaging Association ( awards exemplify the wonderful things that can be achieved with a flexible substrate (see our coverage of the top winners, starting on page 24.

Converted flexible packaging demand in the U.S. is forecast to grow at 2.4 percent per year, reaching a value of $14 billion by 2008, according to The Freedonia Group ( The study attributes some of that growth to technological advances such as breathable films and resealable standup pouches, as well as manufacturers' needs for higher-performance packaging with enhanced graphics capabilities. Plastic films will continue to make inroads against paper and foil, with particularly good growth for polypropylene film. Further research and development for flexible films will focus on improving strength, sealing and barrier properties, as well as graphics capabilities.

Demand for flexible film, specifically, will increase 2.8 percent yearly through 2008. Polyethylene will keep its position as the film leader, but polypropylene continues to demonstrate its opportunities. Ethylene vinyl alcohol films will record the fastest advances because of their barrier capabilities, especially important for foods. According to Freedonia, paper packaging will exhibit only marginal growth but still remain an important player in the packaging market because of its low cost and environmental compatibility, and its use in laminations. Foils will find niche applications where light, moisture and other barrier properties are mandated, as well as where the aesthetics of high gloss and shine are desired.

A very fast-growing segment of flexible packaging is pouches, which are projected to grow 7 percent per year through 2008 to $5.2 billion. In fact, 16 of the FPA award winners this year are pouches. Standup pouches, in particular, continue to find new uses and new markets. Now, also, retort pouches have entered the scene. Says Freedonia, the incorporation of such value-added feaures as resealability, spouts, and retort and aseptic properties will stimulate advances for all pouch varieties. Faster line speeds have also led to increased interest in pouches as the package of choice.

Even though it seems as if all conceivable uses for standup pouches have already been introduced, the standup pouch category is growing at a robust, above-average rate of 15 percent. The fastest-growing markets for standups will be cheese, snack foods, processed foods and lawn and garden consumables. However, flat pouches remain dominant, projected to reach a value of $3.9 billion by 2008. Three- and four-side-seal pouches find new popularity with the addition of zippers. Flat pouches with retort properties are expected to rapidly replace cans in the mature petfood and processed food markets because of added consumer convenience and fresher taste. The best markets for flat pouches will be cheese, pudding and yogurt, and consumer products such as wipes.

Tropicana trots out a trove of shapely bottles, labels

From orange juice to juice/yogurt smoothies, Tropicana has made great strides recently in chilled juice and juice-related product developments, with captivating packaging that combines structural ergonomics and exciting label graphic designs. Integrating film sleeve labels and many clear bottle designs, new flavors and some marketing changes, the Bradenton, FL, company hopes to peak consumer interest and build sales momentum after somewhat of a decline in the last few quarters. Tropicana also has an alliance with Gatorade, which will help boost C-store sales. Parent PepsiCo acquired Gatorade from Quaker Oats last summer.

Among the basketful of new products in "shapely, shrink-labeled" packaging, Pure Premium pasteurized, 100-percent orange juice now comes in a handy 14-oz, single-serve bottle. First distributed in January, the single-serve bottle signals changes for both the brand and its distribution channels. Believed to be the first and only nationally distributed, single-serve not-from-concentrate orange juice, the single-serve bottle, which fits nicely in car cupholders, was dubbed "GoJ," by Tropicana insiders because it's aimed at consumers on-the-go.

"We're excited, because this is going to change the way people drink orange juice," says Andrew McFall, senior marketing manager at Tropicana.

Molded by Plastipak of clear polyethylene terephthalate, the single-serve container has a round shoulder and a cinched-in waist, perhaps to resemble the shape of an orange. The shape is patented. It's topped with a twist-off, color-matched 38-mm polypropylene closure from Owens-Illinois (O-I) and snugly labeled with a glossy shrink sleeve from American Fuji Seal. Printed with a white background amid tree-ripened orange grove graphics, the sleeve displays Tropicana's signature orange-poked-with-a-straw graphic below the brand logo and descriptor of the four product varieties. Four-bottle multipacks, along with the single, 14-oz bottles, are sold in supermarkets and C-stores.

New packages and graphics for Season's Best fruit juices, once in glass, now feature brighter wraparound labels from American Fuji Seal and a contoured, 10-oz easy-grip PET container (molded by O-I, which also provides the color-matched plastic cap) available at most Sam's Clubs. Smoothies are packed in rectangular, 11.5-oz multilayer PP bottles from Graham Packaging that fit in car cupholders. Available since early March in Northern California, Arizona and Iowa test markets, Smoothies wear film sleeve labels from Lawson Mardon, printed with dazzling fruit-filled graphics.

A new chilled from-concentrate orange juice just launched by the company's Dole subsidiary is available in five skus (two plastic jug and three gabletop carton skus) in what Tropicana bills as the first bilingual packaging unveiled by a major food company.

Though it's difficult to shrink a film sleeve label onto a cold, wet bottle, because of condensation, most of this new packaging makes use of full-body clear film sleeve labels that in many cases replace paper bottle labels, notes director, packaging engineer for Tropicana Products Robert Weick.

In fact, new contours are everywhere in Tropicana's drink bottles. Revised label graphics for Tropicana Twister products and a 20-oz PET bottle of Tropicana Twister, now available with Fruit-Forcee energy-releasing B vitamins, features zingy, "twisted" new flavors including Wild Strawberry Dragonfruit and Mango Tangerine Mambo. Capped with O-I's 43-mm closure, the 20-oz ribbed-shoulder bottle wears a film wraparound label from Mail Well. Soon, Tropicana says, Twister and other brands will be produced in-house by Gatorade plants. And this is only a taste of Tropicana's new offerings.

More information is available:

PET containers: Plastipak Packaging, 313/455-3600. Circle No. 267.

Closures: Owens-Illinois, 419/247-5000. Circle No. 268.

Sleeve label: American Fuji Seal, 973/882-5600. Circle No. 269.

PP bottles: Graham Packaging, 717/849-8547. Circle No. 270.

Film labels: Lawson Mardon, 516/355-2507. Circle No. 271.

Wraparound label: Mail-Well Label, 630/369-6397. Circle No. 272.

Increasing security in the supply chain with RFID tags

There's a new twist on using radio frequency identification (RFID): Smart electronic security markers, based on RFID technology. These markers are making an impact with item-level security and are laying the groundwork for this kind of protection in future applications. RFID tags embedded at the product-item level make it easier to guarantee authenticity and represent an increasingly important value proposition for RFID by protecting product and brand integrity.

This paper will take a look at the size and most common means of counterfeiting today in the pharmaceutical and consumer products industry as well as with peripheral or replacement market products. It will also propose a range of increasingly secure methods of using RFID to prevent some of the different types of counterfeiting.

Figure 1. The chart above shows counterfeit products that were seized in 2005 by U.S. Customs and Border Patrol. The products are segmented according to type.

Counterfeiting continues to grow and has become a worldwide problem that has reached “epidemic proportions,” according to DNA Technologies ( [a security company employing DNA-based tracking technology to combat counterfeiting, piracy and product diversion] in its report entitled, “The 21st Century Solution to Counterfeiting, Forgery & Diversion”(1). DNA Technologies estimates that while eliminating more than 750,000 jobs, counterfeiting costs American businesses more than $200 billion in revenues every year. This doesn't take into account activity in other areas of the world that can reach 5 to 8 percent of the total world trade. One of the problems in addressing counterfeiting is that it can take different forms in the supply chain at the item level or through diversion. The most prolific abuse is the counterfeited product at the item level, for example, brand-name apparel, electronics and pharmaceutical products (See Figure 1).

Counterfeit and compromised drugs have been increasingly making their way into the public healthcare system and have been identified as a threat to the public health by the U.S. Food and Drug Administration. In 2004, the FDA reported 58 counterfeit drug case—a tenfold increase since 2000 (3). In China, it's estimated that in one year, 192,000 Chinese patients died from “fake” drugs. In Nigeria, nearly 2,500 people were killed through injecting a supposed anti-meningitis drug during an international vaccination campaign.

Another example of item-level counterfeiting is with peripheral electronics equipment, such as replaceable ink-printer cartridges. Since a manufacturer usually earns the highest margin for a system from the peripherals or replacement goods, counterfeit peripherals impact the manufacturer's profitability. They can also cause problems with the quality and operational performance of the system.

Diversion is the use of an unauthorized channel in the supply chain and is another form of counterfeiting. Branded cosmetics sold at flea markets by unauthorized vendors or pharmaceutical products purchased at a senior citizen discount to unqualified individuals are examples of diversion. Diversion typically occurs because of differentiated price structures within an intended channel or between market segments with different qualifications. Channel corruption in the supply chain can distort profits and revenue distribution, which can lead to additional black-market activities as well as diminished brand value.

The current anticounterfeiting methods are usually classified as either overt or covert packaging technologies. Overt technologies on packages are visible to the eye and include methods such as optical, variable inks in which colors shift as the user moves the package between various viewing angles. There are tamper-evident techniques that indicate package manipulation such as plastic [shrink film or a shrink band] covering the cap on medicine bottles.

Covert technologies are integrated into packaging and are invisible to the naked eye. They include such methods as ultraviolet/infrared light elements that can only be detected with special equipment or microscopic/nanotextimages and complex printing that's difficult to replicate.

Whether overt or covert methods are utilized, the need for human involvement remains an overriding requirement for their use. In many supply-chain scenarios, everyone in the supply chain—from receiving clerks to stockers to checkout clerks—is required to be aware of the overt method used. Due to the complexity and the number of touchpoints in the system, this often leads to anticounterfeit tactics that are ignored, compromised or not utilized in a way that makes them fully effective. Therefore, covert and overt approaches are often used after there is already a suspicion that a problem exists.

RFID technology provides ways to prevent illegitimate products, peripherals and channels from [continuing to move through the supply chain].

A typical RFID system comprises three main elements, which include an RFID tag, a reader and a host processor. The system uses a microchip in the transponder (tag) to store and transmit data via radio signals. Through the transponder's antenna, the tag receives an electromagnetic signal at the appropriate frequency from an RFID reader. The passive tag (meaning it has no battery) is charged with enough energy to communicate with the RFID reader and provide the reader with data stored on the tag.

RFID protects products by removing the propensity for counterfeiting through human involvement by providing an embedded, electronic security marker that's automatically read as it passes through the supply chain either individually or as a group inside a shipping case. An electronic security marker is a unique data code that, by itself or in conjunction with a network, can distinguish the product as genuine. This marker is unique to the individual product and cannot be easily altered, providing an enhanced level of security. Combined, the attributes of being both automated and highly secure give an electronic security marker many advantages over traditional covert and overt marking techniques.

In peripherals, if the security marker on a tag is deemed legitimate by the host processor, then the product is accepted in the application. As the product travels through the supply chain, the electronic marker is picked up by RFID readers that authenticate the products as genuine. The authentication happens either directly between the reader and tag, or by retransmitting the data to a network and validating the information.

Figure 2. The micro-chip and antenna, above, are significant elemnts of an RFID transponder (tag).

Authentication of the tag data can be either on- or off-network. As an example of an on-network solution, EPCglobal Inc. ( is creating an Electronic Product Code (EPC) item-level serialization scheme for item-level tags. They will serve as electronic security markers unique to each product. The vision is for products to have automated track-and-trace capabilities, as well as real-time visibility of the product through the EPCglobal Object Name Service (ONS) Network. The EPCglobal ONS will act as a traffic cop and direct authorized network inquiries to the proper database hosting the desired data.

The off-network method enables RFID readers to authenticate the tag through a shared-data encryption algorithm. An electronic security marker can be a digital signature generated via a public-key infrastructure (PKI) and programmed into the tag's memory.

A reader may validate the tagged product because the reader is supplied with the appropriate manufacturer public key to authenticate the digital signature. PKI relies on public-key cryptography, which uses a pair of mathematically related cryptographic keys—a public key and a corresponding, unique private key.

While the keys are mathematically related to each other, given proper key length, it's computationally infeasible to calculate one key's encryption from the other. When using an RSA encryption, [a method of dual key (public key) encryption, based on the public key system, meaning that every user has two digital keys—one to encrypt information; the other to decrypt] a 1,024-bit-size digital signature will prohibit a brute force attack to gain knowledge of the cryptographic private key (4).

By using a digital signature, a manufacturer's unique, “electronic fingerprint” is created and is programmed into the tag, which can then be authenticated by a reader without a network.

Already, examples of RFID item-level tagging today are designed to protect product integrity. These cross various industries and address the problems of illegitimate products and channels.

RFID electronic security markers are also used in many medical-equipment systems, such as ventilators, to ensure that authentic peripheral products are used with the host system. Typically, RFID reader chip sets are built into medical equipment and are used to read tagged peripheral products as they're connected. The benefit is first and foremost patient safety. Having the correct peripheral with the appropriate medical equipment ensures the parts will operate together as they were designed, which can be a matter of life or death. Additional benefits include product authentication, automated calibration and setup information in various medical equipment that's RFID-enabled.

Patient safety is the key force behind pharmaceutical item-level tagging. RFID enables track-and-trace through the EPCglobal ONS networks and/or direct authentication with off-network RFID readers. As more products are tagged, supply-chain efficiencies will occur at the manufacturer, wholesaler and pharmacy. Markers protect and manage clothing at retail stores such as British retailer Marks & Spencer, which plans to tag clothing at the item level in six departments at 53 stores this year (5).

Tagging high-end clothing also helps to prevent diversion in the supply chain. With item-level tagging, if a legitimate item is diverted, it can be verified with a security marker and traced back to the point of diversion.

Electronic products can be enabled with RFID security markers to protect peripheral authenticity. Many electronic systems rely on peripheral products to perform as intended. And too often, electronic retailers are stuck with counterfeit or damaged goods when they are returned to stores by dishonest patrons. Electronic security markers can tie the relationship of a particular product to a given sale and to the return.

Manufacturers could benefit from the elimination of fraudulent products being returned to retailers by placing item-level RFID tags on their high-end products and components.

RFID tags on beauty product containers can protect that sales channel, which is an integral element to the success of the business model. For example, it's important that high-profile cosmetic brands sold through direct sales are not undermined by some of the product being diverted and offered by street vendors.

RFID tags embedded into packaging can be used to identify diverted product being offered through street vendors. Also, electronic security markers indicate the product pedigree, pointing to where the improper channel diversion occurred.

Protecting product and brand integrity is a challenge, and counterfeiting continues to grow. But it's already becoming a new value proposition for RFID. Controlling product legitimacy in the supply chain may become a nonissue for manufacturers some day, as the use of electronic security markers will curb counterfeiting at item/product levels.

  1. /counterfeit.htm


  3. “Combating Counterfeit Drugs: A Report of the Food and Drug Administration Annual Update,” 5/18/05, p. 1. Available at

  4. “Securing the Pharmaceutical Supply Chain with RFID and Public-key infrastructure (PKI) Technologies,” by Joseph Pearson, Texas Instruments RFid Systems


Joseph Pearson, the author of this and other white papers, is a business development manager at Texas Instruments' Radio Frequency Identification (TI-RFid™) Systems. For more information, visit TI's website at

RFID stays well in healthcare, pharma markets

The excitement over radio frequency identification (RFID) technology has gained momentum in the last five years, with a diversification in the range of applications. The market is experiencing tremendous growth predictions with the increasing use of passive RFID technology in volume-driven vertical markets such as pharmaceutical and retail.

The healthcare and pharmaceutical market is slated to become one of the most promising verticals for the future of RFID technology. Patient safety and process efficiency can be improved by RFID in the development of drugs and the running of clinical trials of drugs. It may also increase patient safety, manage critical-care assets and hospital equipment and reduce counterfeiting and diversion of pharmaceutical products. The commercial feasibility of the technology makes for a stronger business case in this market, due to the presence of high-value products and the resultant margins. But RFID is still relatively new in the healthcare market, where end users rely most on bar coding, and many have traditionally been slow to adopt technological advancements.

The following analysis from "World RFID in Healthcare and Pharmaceutical Applications Markets," reveals that RFID in healthcare and pharmaceutical applications markets earned revenues of $370 million in 2004, and estimates indicate that it will reach $2,318.8 million in 2011. During 2004, the market grew at a modest rate of 11.8 percent over the previous year. During the forecast period, this market is expected to grow at a very healthy compound annual growth rate (CAGR) of 29.9 percent.

However, increased investments in RFID are taking place in pharmaceutical and patient-tracking applications with the advent of regulatory recommendations. Initial interest was triggered by retail mandates in North America and Europe that require pharmacy chains supported by such stores to adopt RFID tagging. Pharmaceutical companies are now focused on pilot activities to integrate the technology in their supply chains. The deployment rates, however, are expected to see regional disparities, with most deployments likely to be centered in the North American region. The European region is still grappling with issues related to standards, frequencies and the lack of government-driven initiatives. The Asia Pacific region holds huge promise for growth in light of their existing initiatives in patient-tracking applications and anti-counterfeiting measures.

RFID technology has been traditionally used in asset-management and equipment-tracking applications. The technology is expected to have huge potential in drug-tracking applications following regulatory and legislative developments, while the security of pharmaceutical supply chains is driving a number of large deployments. Benefits of the technology remain focused on safety concerns across the applications.

The full report indicates that the American market is the biggest for RFID applications in healthcare and pharmaceutical markets in terms of revenues as well as growth rate, and is expected to grow the fastest, at a CAGR of 31.3 percent. Growth rates across geographic regions are marginally different. The U.S market is the driver within the American region, followed by Canada, which is followed by Asia Pacific, Europe, the Middle East and Asia.

Of the three applications analyzed, the drug-tracking applications market is expected to have the strongest CAGR of nearly 32.8 percent during the forecast period.

It's expected to be closely followed by the medical-equipment tracking applications market, with a CAGR of 28.9 percent compared with the forecast period.

The RFID application market for healthcare has progressed from the initial iteration stages of experimentation toward early adoption. The potential of RFID in the healthcare vertical is quite promising, since it would have a direct impact on the service offering. The success of RFID implementation would depend on its compatibility with systems that are already in place. The U.S. Food and Drug Administration and the Health Insurance Portability and Accountability Act of 1996 (HIPAA) security mandates could further the adoption of the technology in the healthcare vertical.

RFID has a wide variety of applications within the healthcare market and the pharmaceutical supply chain. These applications can be broadly classified, in terms of application areas, into healthcare and pharmaceutical applications. Within the healthcare vertical market, there are categories including personnel and patient tracking, equipment tracking, patient admission and registration, patient self services like bill payment, dosage and disposal of medicines and updating medical records. On the other hand, for the pharmaceutical supply chain, typical application areas are drug development laboratories and drug tracking along the supply chain from development to retail sale.

A tough road ahead

In the present market, there are a number of issues that are restraining the growth of RFID technology. One such issue is compatibility. RFID solutions call for integration with existing technologies. A complete overhaul of the system wouldn't be a sensible ROI decision in the short term. This would prove critical to manufacturers integrating the RFID tagging process further up the supply chain at the point of manufacturing itself. Existing RFID systems would also require a certain level of compatibility to upgrade to newer protocols and advancements.

The cost of adopting RFID is also another cause of concern for the industry. Whereas bar-code labels are available for $0.001 per unit, RFID tags cost around 20 to 25 cents per unit. The challenge of the cost factor is particularly relevant since the healthcare vertical has not traditionally been a market for tagging. Pharmaceutical companies have only recently begun tracking their supply chains. However, the high price of items to be tagged, particularly in the medical equipment and devices segment, would justify the implementation of RFID systems.

Privacy infringement in RFID systems constitutes security concerns among end-user segments. The issue seems to be more acute after the FDA's approval of human implant chips. Manufacturers would have to address issues here, since the same could hinder early adoption of the technology.

Reasons to smile

Along with the above restraining factors, there are factors that can help the market grow. One such factor is the possibility of improving operational efficiency. The use of RFID calls for an in-depth understanding of business processes. This provides good opportunities for companies to improve processes resulting in a competitive advantage. It would also enable a real-time location of key personnel and critical equipment, thereby improving operational efficiency. Real-time tracking of mobile medical equipment would enable cost containment in terms of rent and labor. Healthcare facilities, especially hospitals, would gain a competitive advantage in their service delivery.

The same tracking ability is also expected to result in avoidance of lawsuits filed by patients who have been administered the wrong tests or faulty medication. Though errors are still prone to happen, RFID systems are expected to reduce the frequency and magnitude of such errors, if they are used properly.

Another factor that can also be considered a driver is the possibility of curbing down losses that happen from the counterfeiting of drugs. An estimated $15 billion is lost globally every year due to counterfeits. (The first chart presents the increasing number of drug counterfeit cases in the world.)

There's also the issue of parallel trading and online pharmacies. RFID technology provides a means to authenticate drug products from development to dispensing from pharmacies. But compared with bar codes, the higher tag costs are a concern.

The FDA report, "Combating Counterfeit Drugs," published on Feb. 18, 2004, envisages RFID technology being critical in drug supply safety. Close on the heels of the above-mentioned report, a compliance policy guide was issued in November 2004 to facilitate the implementation of feasibility studies and pilot tests related to RFID. The FDA recommendations have resulted in several states, including California and Florida, requiring tracking of drug shipments through the supply chain. There are a number of other initiatives that have been taken by authorities like the CIMIT Operation Room of the Future (ORF) project. This project was initiated to explore the impact of the new technology platforms and systems on the safety and efficiency of patient care in a high-tech and minimally invasive environment. Another such example is the HIPAA of 1996 and Joint Commission on Accreditation of Healthcare Organizations (JCAHO) security mandates expected to enable hospitals to meet security and privacy regulations.

Pilot studies: A possible indication of future potential?

A three-month pilot study involving eight manufacturers, including Merck, Novartis and Solvay, ended in January 2005 after tagging approximately 180,000 medicines to counter illegal drug trafficking. The system, called Authentication at the Point of Dispensing (APOD), would verify prescribed name and dosage, expiry dates and recalls. Other companies implementing pilot projects include GlaxoSmithKline and Purdue Pharma (for the painkiller Oxycontin). Both companies have already begun pallet tagging in compliance with the Wal-Mart mandate.

The article was written by Soumilya Banerjee and Priyanka Gouthaman, analysts at Frost & Sullivan, a Palo Alto, CA, research firm that provides growth consulting and corporate training services to clients in more than 50 countries. The full report, "World RFID in Healthcare and Pharmaceutical Applications Markets," is available from Frost & Sullivan as part of the firm's 9201 subscription.

Is that toothpaste tube clean before it's filled?

Instead of a conventional handling arrangment the tube-packaging system above has a conveyor circuit with a diagonal layout and specially designed tube holders. Below, the systems's display reveals tubes from above. A ring-shaped LED light illuminates tube interiors.

Toothpaste is supposed to help maintain and clean healthy teeth. But is the toothpaste you're using to clean your teeth safe? It's only in recent years that vision systems have been used to check toothpaste packaging for cleanliness and safety before the toothpaste is filled into the tubes. Previously, filling systems that weren't equipped with a visual checking system couldn't actually guarantee that no particles or contaminants from the preliminary tube production stage would be present in the tube after filling and sealing.

For its latest tube-packaging machine, the TFS 80-6 from Germany's IWK Verpackungstechnik GmbH (, part of the Oystar group of companies, relies on vision systems from Cognex ( Designed for tubes from 19 to 40 mm wide, the system incorporates two In-Sight® cameras that check during the course of the filling process that the tubes are round, clean and firmly sealed.

Speed takes a new angle

With a capacity of 500 tubes/min, the TFS 80-6 production line inspects, fills and seals toothpaste tubes using an atypical handling arrangement. Instead of the conventional operation using a turntable, the TFS 80-6 has a conveyor circuit with a diagonal layout. The lines are positioned at a 90-deg angle to each other, and the tubes are picked horizontally on a conveyor belt that takes them to a cartoner for final packing. Though top-quality packaging materials are required, contamination can still make its way into the equipment; tubes may possibly be deformed when loaded into the outer carton or the base of the tube may have a faulty seal. To ensure the production processes are fault-free, Oystar IWK collaborated with Octum Electronic GmbH (, a member of the Cognex specialist partner/integrator network, to install two In-Sight 5100 and two 5400 cameras on each of three inspection stations. Each camera monitors a set of parallel conveyor rows with offset tube holders.

The first stage of production on the line begins with a six-axis robot and its expanding gripper arm removing 30 empty toothpaste tubes at a time from shipping cases and placing them neck-down, with screw-caps already affixed, into tube holders on a conveyor. The robot arm's tooling has special pins that precisely fit into the case partitions and grip the tubes to lift them out of the cases. The base of each tube is left open and ready to be filled.

Next, the tubes convey clockwise toward a cleaning station and are scanned to ensure that they are aligned correctly so that the printing on each tube is in the correct position when the base is sealed. The two successive Cognex inspection stations also check to ensure that the tubes are round-shaped and clean before they enter the cleaning and filling stations.


Beyond a shadow of a doubt

Cameras installed above a toothpaste tube conveyor evaluate a number of parameters such as roundness and check the tubes for proper seals. They also scan each tube for contaminants.

Two In-Sight 5100 cameras installed above the conveyor evaluate the tube coating, its shoulder area and the interior of the cap during a particle check. The cameras can detect foreign bodies based on a contrast to their surroundings. A red, ring-shaped LED light illuminates the inside of each tube from above. Undesired particles cast a shadow detected by the cameras, making it possible to detect objects that are the same color as the tube's contents.

During the subsequent tube-shape check, the other two In-Sight 5100 cameras scan the tubes to see if they are of the required shape. If tubes don't have the specified roundness, the fill nozzles can stay at the edge during the cleaning and filling process and ram the packages into the tube holders.

The In-Sight technology prevents this by ensuring that the fill nozzles enter round tubes to within tolerances of 3 mm. This check takes place without the need for an additional operation or step. The cameras each receive a trigger for every tube that passes and record images of the tubes as they move past. If a tube is out-of-round or outside of the tolerance range, it's identified as “faulty” and is not filled. After cleaning and filling, the laminated plastic tubes are hot-air-sealed downstream. Then the TRS 80-6 ejects the sealed tube from the production line.

Sealing the deal

The ends are heated with hot air at a temperature of 380- to 450-deg C and are pressed together by cooled stamping jaws. The seal is either stamped smooth or stamped in a corrugated pattern and may feature a serial number or a code. According to Cognex, defects can occur at this stage of the process. For example, if a sealing knife becomes blunt and can no longer cut off the ends of the tubes correctly, the seal will be left with rough edges. In the trimming station, the two In-Sight 5400 cameras make sure that all packages like this are detected and also check the seal itself. If the seal isn't completed or if the printing isn't properly aligned with specified parameters, the tube is ejected from the line.

Proper print positioning

Saving time and reducing overall costs, the In-Sight cameras are networked to a center PC panel that records all images of faulty tubes. This makes it easier for the tubemaking system to detect faults quickly without having to recheck the actual unit of packaging that has already been ejected from the line. Another advantage of the vision systems is their integrated structures, which Octum customized for IWK. While conventional tube lines may only offer tube inspection as a separate station, which could mean time delays, the Cognex technology is integrated right into the production process, thus saving time and keeping costs to a minimum.

Production lines with free-standing or separate inspection modules would require one inspection camera for each of the six tubes filled by the TFS-80-6 machine at a time in each step.

In addition, six vision-inspection camera systems would be required for each inspection station, or a total of 18 for three stations. IWK's TFS-80-6 tubemaking equipment meets the inspection requirements with six cameras mounted over three stations, which maximizes production reliability.

Today, having brushed up its toothpaste tube-production equipment with camera-based inspection, IWK is all smiles.

More information is available:
Cognex, 508/650-3000.
IWK Verpackungstechnik GmbH, an Oystar co., 49/7244 9680.
Octum Electronic GmbH, 49/7134 9119180.

Three-sided bottles heat up haircare sales

Thermafuse Healthier Hair With Heat of Kannapolis, NC, is not only putting the heat on its products, it's putting some heat on its packaging with hot, new bottle shapes created with help from Joni Rae and Associates (

Available in salons across the country, the products work with the heat of blow dryers and hot irons to heal and repair hair using what Thermafuse calls the HeatSmart Complex®, which combines a silicone molecule and a wheat protein molecule that, together, stay on and in the hair, penetrating to smooth frazzled hair cuticles while adding shine. The HeatSmart Complex is accentuated by and activated with heat.

The high-density polyethylene bottles, produced in dazzling pearlescent pastels and citrusy-pearl-finish colors using molds from Matrix Packaging ( are part of a large line of custom and stock packages for shampoos, sprays, stylers, volumizers, colored hair treatments and more. The products comprise some 50 stockkeeping units. The impactful collection of containers include tottles and jars provided by Dieter Bakic Enterprises (

The glamourous, sophisticated look of the three-sided bottles didn't come easy, as Thermafuse faced several design challenges that would have stopped many packagers and designers in their tracks.

The efforts of Thermafuse and its design and packaging teams paid off, with a series of practical advancements, especially as the three-sided bottles feature a way to incorporate a lengthy ingredients listing and product details. In order to effectively communicate the new product formula technology to consumers, the company wanted significant space on the bottles devoted to product copy. But once the ingredient listing took its required legal spot on the bottle design, there was no room left to tell the unsual heat-sensitive product's story.

As the formula team and design groups negotiated, a suggestion to simplify the product formula emerged, to which the formula department replied with a resounding “no.” So the teams worked against a backdrop of multiple disciplines, time zones and various strategic positions to resolve the challenges, until finally the suggestion of a three-sided, custom-molded bottle was proposed.

Fresh color palette

The fresh color scheme is based on hair type. “Blue, orange and yellow containers—both warm and cool colors—provide a visual representation of the fact that the products work best with heat and then cool to a healthy shine,” points out Joni Rae Russell, president of Joni Rae and Associates.

Depending on the SKU, the containers are topped with spray foamers from Airspray Intl. (, pushbutton sprayers from MeadWestvacoCalmar ( and Seaquist Perfect ( ) and overcaps from Berry Plastics ( in a dazzling copper. A blue and a metallic copper icon label graphic are centered on the main label panel. Grayson O (704/932-6195) fills the containers and screen-decorates them in two and four colors and adds the metallic icon label graphic.

Special multi-panel labels from WS Packaging ( are incorporated on the two-sided containers to accommodate the extra ingredients listing and explanatory product information.

More information is available:
JoniRae and Associates, 818/783-8080.
Airspray Intl., 954/972-7750.
Berry Plastics Corp., 812/424-2904.
DieterBakic Enterprises, Inc., 973/473-2995.
Grayson O Co., Inc., 704/932-6195.
Matrix Packaging, 905/624-2337.
MeadWestvacoCalmar, 800/599-2124.
Seaquist Perfect Dispensing LLC, 847/639-2124.
WS Packaging Group, Inc., 800/236-3424.

DuPont Packaging call for entries to 22nd DuPont Awards competition

DuPont Packaging announced a call for entries in the 22nd DuPont Awards for Packaging Innovation, what it says is the longest running, independently judged competition. DuPont syas its brand owners and value chain partners work to develop cost-effective packaging structures that help reduce waste and have improved environmental performance. Innovation is key to these new packaging approaches. "In this year's program, we will be broadening the focus of the DuPont Awards from solely sustainability achievements to include packaging innovation and waste/cost reduction as well as sustainability achievements," sys Carolann Haznedar, global business director.


"DuPont sponsors this program to recognize achievements that provide learnings to the industry and to highlight the importance of collaboration. To foster knowledge-sharing on the winners of the 22nd Awards, we will conduct a global online event that will be open to the industry. In addition, winners will be honored in a celebration event with senior DuPont executives."

Entries for the 22nd DuPont Awards will be evaluated for excellence in packaging innovation, sustainability and cost /waste reduction. Entry forms and guidelines are available at deadline for entries is Feb. 12, 2010. Packaging designers, converters, consumer good producers, retailers and equipment manufacturers from around the world are encouraged to enter their new product packaging developments. There is no fee for entry and DuPont materials do not need to be in the packaging structure. In evaluating entries, jurors will consider excellence in one or more of these areas: innovation, sustainability and cost/waste reduction. Winners will be announced in the spring of 2010. Information on the program and past winners is available posted on DuPont's website at


This year's international jury panel for the 22nd DuPont Awards includes:
John Bernardo, president, Sustainable Innovations LLC
Peter Clarke, founder and CEO, Product Ventures
Sara Hartwell, Environmental Specialist, U.S. EPA Office of Resource Conservation and Recovery
Stuart Lendrum, head of Packaging, Sainsbury's Supermarket Ltd., UK
Mike Maggio, vice president of Global Strategic Design Operations, Johnson and Johnson
Greg Pockat, vice president of Research and Development Curwood Inc, a Bemis co.
Fred Renk, vice president External Technology, Mead Westvaco
Gail Tavill, vice president of Sustainable Development, ConAgra Foods
Patricia Villalobos, PhD, director of research & development, Bimbo, Mexico