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Pharmaceutical Makers Show Preference for Dedicated Suppliers

Pace Foods, the San Antonio-based salsa producer, has gotten a lot of mileage out of a series of television commercials emphasizing its Tex-Mex heritage and deriding the competition's product for being made "in New York City?!!" In the same vein, Chi-Chi's, Inc., the Mexican restaurant chain headquartered in Louisville, KY, has an amusing TV commercial for its retail-packed salsa in which the ceo of some unnamed competitor asks his managers whether the company should make salsa or oven mitts.
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The point the commercials are trying to get across to consumers is that specialization whether borne our of geographic location or market concentration makes their salsas better than any of those that might be produced by diversified product manufacturers some distance from the Mexican border. Never mind that Pace following its recent acquisition will be run by a company headquartered in Camden NJ (Campbell Soup Co.) or that Chi-Chi's is one arm of Foodmakers Inc. of San Diego CA whose other arm is the Jack-in-the-Box hamburger chain. Salsa makers aren't the first to equate specialization with superiority. Among processors cheese makers from Switzerland consider Swiss cheese from any place else inferior and French Italian German and California wine makers are particularly insistent that their domestically produced varieties are superior to those made elsewhere. Drug maker's parochial view Whether you agree or disagree that specialization is what breeds superiority it's an operating philosophy U.S. pharmaceutical producers follow devotedly. Pharmaceutical packagers consider themselves a breed apart and above the rest of the packaging community. Perhaps that's because their products and packages are held to higher standards and stricter regulatory review than those of their non-pharmaceutical peers. When it comes to selecting packaging suppliers they'll often walk past the most skilled mixed market suppliers to do business with a "pharmaceutical packaging vendor" usually one whose production facilities are dedicated exclusively to the pharmaceutical market. In qualifying packaging suppliers pharmaceutical manufacturers demand focus and commitment notes Joseph I. Rivas president and general manager of Engraph's Patton Label division (Moorestown NJ). Addressing a group of pharmaceutical packagers at the recent opening of Patton's Delmar NJ pharmaceutical label converting center Rivas made the point directly. "Those of you who have visited our operation in Moorestown have seen the broad range of capabilities we have. Our varied and unique capabilities get us involved in many different types of applications. This was something many of you picked up during your audits and quite frankly was something that you did not always view as a positive." That same reaction obviously influenced Lawson Mardon Flexible Inc. (Arlington Heights IL) to build a narrow web converting center in Shelbyville KY dedicated to the healthcare market. LM's existing Shelbyville plant took pride in producing quality flexible structures for a diverse customer roster. But to meet the preferences of its pharmaceutical customers the new center built next door to the existing plant is set up as "a clean working environment." The new center is isolated from its mixed market neighbor and equipped with two state-of-the art presses engineered specifically for the "high-end" flexible packaging needs of the healthcare business. A month after it opened the center was serving pharmaceutical customers on a three-shift seven-day-a-week production schedule. When pharmaceutical packagers do business with packaging suppliers who aren't dedicated exclusively to the market it's usually because the suppliers have some unique capabilities. The Gold Circle Coin condom packages from Safetex Div. Aladan Corp. Colonial Heights VA are a case in point (see photo on p. 72). After considering and rejecting a number of domestic foil converters Safetex went to Teich AG (Obergrafendorf Mhlhofen Austria) a diversified converter for the proprietary laminated lacquered aluminum foil it uses to stamp out the condom packs. Safetex's search apparently paid off. Here in the States the new line is selling well and in Europe the stamped and flanged coin packs were one of only four packages to win a 1994 European Aluminum Foil Packaging Trophy for technical and esthetic design.

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