Local Business

Covidien continues its sharp focus

CRYSTAL LAKE – Despite a dip in sales, Covidien's Crystal Lake manufacturing plant continues to churn out more than 200 different products used for the safe and secure disposal of syringes and other medical supplies.

The Dublin-based company's medical supplies segment had sales of $439 million in the fourth quarter of 2012, down 9 percent from $481 million in the fourth quarter of 2011.

In fiscal 2012 the segment's sales fell 2 percent to $1.74 billion from $1.78 billion in fiscal 2011, a result of lower sales of SharpSafety and OEM products, some of which are made at the company's plant at 815 Tek Drive in Crystal Lake, according to corporate earning reports released in November.

Medical supplies are just a part of Covidien. It also makes medical devices and pharmaceuticals. In 2012, the company had revenue of $11.9 billion.

The 472,000-square-foot Crystal Lake plant makes products that are used for the disposal of “sharps” – such as intravenous needles, syringes and absorbent pads that come in contact with blood. The majority of the products are sold in the United States, though some are exported.

The facility and its product line have been a staple in Crystal Lake for decades. Sage Products established the plant in 1991. Covidien acquired the sharps disposal business from Sage in 1999, said plant manager Rui Dos Santos, who took over operations here in January 2012.

Production at the facility has remained flat, Dos Santos said in an recent interview with the Northwest Herald.

"Volume continues to be very stable for the plant," he said.

Like other manufacturing companies, Covidien has struggled to fill some highly-skilled positions and is working to develop a pipeline for such sought-after employees.

"Recruitment for certain technical, skilled positions continues to be a challenge," Dos Santos said. "We do find them eventually, but it takes a little longer."

The challenges have prompted the company to look at developing skilled workers from within its own ranks through partnerships with community colleges and other apprenticeship-type programs. Such efforts could pay off in the future.

"I see great opportunities in the plant for that," Dos Santos said.

Globally, Covidien invests more than 5 percent of sales into research and development.

"[Research and development] spending for Covidien has more than doubled in the last four years to more than $623 million in 2012," Dos Santos said. "Covidien has launched more than 100 new products in the last five years and sales of new products have tripled since 2007."

However, there are no research and development positions in the Crystal Lake plant, which has about 400 employees. Worldwide the company has 43,000 employees in 70 countries.

Covidien continues to invest in the Crystal Lake plant.

"Over the last few months we have made several infrastructural improvements to our facility," Dos Santos said. "These improvements have focused on enhancing our manufacturing capabilities as well as supporting our asset replacement program."

The emphasis, he said, is on "continuous improvement," a key characteristic of the entire company.

"It's all about making those small improvements day after day," Dos Santos said, "to drive greater efficiencies, to be a more sustainable operation, and to have the necessary gains that we are seeking in terms of safety and environmental performance."

The latter includes collecting scrap materials to be reground and reused, among a host of other environmental efforts.

Though Covidien maintains a lower profile than some of the county's other large manufacturing companies, it remains an important part of the business community, said Gary Reece, president of the Crystal Lake Chamber of Commerce.

"Covidien has been a good corporate citizen," he said.

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