Penang’s Medical Device Industry: A boom in the offing?

Medical Device Industry


By Charanya Lakshmanan – A Lifesciences consultant and pop science enthusiast, who has an active interest in emerging healthcare trends and business development.

October 26, 2016

The latest seminar organized by Invest Penang, a non-profit initiative of the Penang State Government, on “Preparing SMEs for Medical Devices Supply Chain”, caused quite a buzz in the Penang industrial circles. It enabled a life sciences consulting firm like ours to gain a first-hand perspective on the evolving medical device manufacturing landscape in Penang.

Delineated as a high potential growth sub-sector under the 11th Malaysia plan (2016-2020), the medical device industry has been receiving a lot of attention from the government agencies like MIDA, MITI and SME Corp and private players alike. The fact that a strong manufacturing ethos and electronics ecosystem already exist in Penang makes it an attractive destination for new investments in this area.

Two big players in the Penang medical device scene, B Braun and Plexus Manufacturing along with the latest entrant in the big league, Boston Scientific, participated in the seminar to showcase how SMEs in Penang could integrate themselves into the MNCs’ medical device supply chain. As western players who were moving into the Malaysian market, they reported a relative ease of transition owing to the superior infrastructure, support from the local government and professional yet friendly atmosphere. They added that the availability of skilled workforce and pervasiveness of the English language are additional advantages.

The operative question is: what are the opportunities for small businesses to provide value and make a genuine play in the medical device industry? Some of the example focus areas are the manufacture of precision instruments for medical device testing, testing, and standards compliance for medical devices and supply of individual components for the final assembly of a medical device. Companies providing scientific expertise to deliver industry relevant trainings on topics such as regulatory requirements, lab safety, and management skills would also be key cogs in the medical device industry growth engine. These trainings would also enable companies, both big and small, to upskill their workforce and attain higher levels of operational efficiency.

How can aspiring businesses in Penang/ Malaysia rise to the occasion? It is evident that there is plenty of scope for large companies to outsource parts of their operations to independent players. Representatives from the aforementioned big medical device companies listed the following characteristics as key focus areas to foster better supplier-client relationships:

• Operational efficiency with a commitment to drive down costs in the long term
• Adherence to the highest quality standards with zero tolerance to defects
• High levels of personal accountability among higher management vis-à-vis timely delivery of services/ solutions to the client.

It was emphasized that excellent support and cooperation from the vendors would be valued very highly. Demonstrable proof of strong internal processes and industry awareness are also highly coveted.

The medical device industry in Penang is poised to grow in the near term. There are opportunities galore for local businesses to establish a foothold in the industry. The government is providing its support in promoting Penang as a destination for attracting more medical device investments. An SME village in Batu Kawan, Penang is being developed with a focus to house new SMEs. It is expected to be ready by 2019. Additionally, companies from the US and Europe are purportedly in talks with the government to set up their manufacturing operations in Penang. All the above factors could very well create the perfect storm to facilitate sustained growth in this industry, in the years to come.

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