The Needs of Medical Device Manufacturers

Manufacturing inventory control…scheduling and capacity planning…material requirements planning (MRP)…supply chain control…all manufacturers share these needs. And cloud ERP helps them oversee these operations. But, that’s just a start for medical device manufacturers. They must contend with a mix of standards and regulations which add an extra layer of complexity to their enterprise systems.

The Food and Drug Administration (FDA) has created very specific standards for medical device manufacturers. ISO 13485 contains specific requirements for manufacturing, installation and servicing, including:

  • Implementing a quality management system
  • Risk management
  • Statutory and regulatory compliance
  • Process validation
  • Effective product traceability and recall systems

Compliance can include planning, inspections, document tracking, product specifications, deviation tracking, parts approval tracking and testing. Traceability is also an important factor. Inventory management consists of not only tracking each SKU but also tracking serial numbers and lot tracking so that the manufacturer can identify where and when each item was manufactured.

Read more: 6 requirements for medical device manufacturers in 2021


5 Benefits of ERP for Medical Device Manufacturers

1. Improved Order Fulfillment

Old legacy, on-premise ERP solutions can no longer meet medical device manufacturing requirements. Their inability to quickly optimize order planning and fulfillment operations which meet this industry’s diverse, often unpredictable market requirements, leads to inaccurate planning. They are simply incapable of handling the consequences of underutilized inventory, sales shortfalls and stock-outs. Their closed system hinders access to real time data emanating from the supply chain.

Conversely, in-depth cloud ERP solutions connect data from throughout the system to provide enhanced visibility into manufacturing operations, inventory, supply chain and external market demand with real-time information updates and integration with advanced analytics solutions. Such cloud ERP systems for medical device manufacturing, integrated with sensor-based asset tracking systems, provide current information regarding the available assets by incorporating manufacturing speed, market distribution and demand to prompt optimum resources and raw material for production. As a result, medical device manufacturing companies can deliver on-time performance and meet customer expectations with improved order fulfillment.

2. Manufacturing Automation

Medical device manufacturing doesn’t follow a single production process, even for a single company, so supporting business systems have to offer both flexible capabilities and deep feature sets. Advanced cloud ERP solutions offer built-in automation capabilities in areas of billing, costing, specifications, Manufacturing Execution Systems, work plans, production, vendor management and partner performance.

This also includes automating areas such as contract manufacturing that links customer contracts with billing, production and costing as well as vendor rating/management which measures business partner conformance and impact (in time and dollar terms). It also automates partner performance and product costing to the ingredient level and with the ability to get accurate overall equipment effectiveness (OEE) and per-unit cost information.

This also includes automating areas such as contract manufacturing, linking customer contracts with billing, production and costing, and vendor rating/management, which measures business partner conformance and impact (in time and dollar terms). Vendor rating/management also improves partner performance and tracks product costing to the ingredient level, enabling accurate overall equipment effectiveness (OEE) and per unit cost information.

Medical device manufacturers that plan for this level of detail during their ERP software deployments are most certainly going to see significantly higher payback on their software investment, as they avoid manual intervention prone to costly delays and inaccuracies.

3. Serial and Lot Tracking

For medical devices manufacturers, traceability requirements go beyond linear searches from procurement to QA to production to sales. They must also include Usage to Origin or Origin to Usage tracking, backward traceability for finished goods, forward traceability for parts or ingredients, and finding a supplier lot number, SKU, shelf life or country of origin. Not only that,. there should also be support for problem inquiries, problem diagnosis and corrective actions – all of which are part of a comprehensive audit trail.

However, recording the receiving, production, inspection, shipping and related transactions can become complex when dealing with indirect distribution channels, multiple SKUs for the same items, shared customer relationships and changing units of measure with parent/child steps (i.e. from pallets, to boxes to items) during the distribution process. This is where software such as Rootstock Lot & Serial Control comes into play. This module in the cloud ERP provides for an item’s lot or serial number to be registered through Purchasing Receipts, Inventory, Shop Floor Control and Sales Order Fulfillment functions.

The Purchasing Receipt function will note the Item Number classification and if ‘lot controlled’, the lot number must be assigned to the entire Purchase Receipt for the items being received prior to their ‘acceptance’ into stock. There is an option that allows the user to assign the ‘receiver number’ as the lot number, which provides for an easy, yet practical, application for the lot identification.

If the Vendor assigned a lot number, then this can be assigned by the user instead. If the Item Number is ‘Serial Controlled’, then prior to the receipt into stock, the serial numbers can be assigned in a ‘free form’ text field. The software will parse that text box to ensure that serial number records are created on the Purchase Receiver and on Item Location Records as well as an ‘item serial record’, assuring that only one serial can be assigned an item.The lot or serial number, as required, is registered on all inventory additions, adjustments and scrap transactions. While Lot and Serial controlled items are not appropriate for ‘backflush’ considerations, all other inventory, work order and subcontract order issues record the lot or serial as required on the issue transaction.

On work order supplies, the user must record the lot number for ‘lot controlled items’, and this recording must be done before the assembly is received into stock or scrapped. Likewise, serial numbers must be assigned before the work order assembly is received or scrapped.Pick lists are printed with serial number detail and lot information as appropriate. When the sales order is fulfilled, the serial number of the final assembly is noted on the shipment.

4. Medical Device Compliance

Leading cloud ERP systems help medical device manufacturing organizations in establishing measures throughout the medical device manufacturing lifecycle, from procurement to sales and distribution, within strict, evolving and unpredictable local and global regulations. They provide support for FDA record-keeping and compliance requirements, such as the 21 CFR part 11 (secure electronic signature and document controls) and FDA 21 CFR 820 (manufacturing requirements for product safety and efficacy) among others. As a result, the cloud ERP system can save time, mitigate compliance risk and improve overall efficiency.

5. Enterprise-Wide Automation

Today, every manufacturing enterprise needs ERP to unify a central and enterprise-wide information system that encompasses cross-departmental process automation and closed loop reporting. That is the goal of cloud ERP software – to achieve a single, central, enterprise-wide information system. Organizations pursuing cloud-based ERP solutions to replace existing legacy ERP deployments are well positioned to maximize the returns on their ERP system investments.

Rootstock Designated the Top Cloud ERP for Medical Device Manufacturers

Leading medical devices manufacturers, such Mevion Medical Systems (a leading global provider of proton therapy systems for cancer treatment), RS Medical, and Summit Imaging are already leveraging the benefits of such a cloud ERP, Rootstock. That’s not surprising as analysis by the independent research firm Frost & Sullivan recently confirmed that “Rootstock’s cloud ERP properly addresses the complexities challenging the growth of the North American medical device industry. Other companies have not been able to build a functional product similar to that of Rootstock’s cloud ERP. As the largest product footprint among ISV products on the platform, Rootstock’s cloud ERP solution possesses the functionality required to replace more than 25 legacy ERP products.”