The manufacturing industry in America has seen a revival over the past two years. As the economy has heated up, communities like Volusia County are benefiting from the boom, and those seeking long-term careers have found opportunity.
Those opportunities include the multi-trillion dollar medical services industry, of which Daytona Beach manufacturer B. Braun is a part.
The German-based medical device provider is a fairly recent addition to the Volusia County business community, but the history of the manufacturing facility dates back much further, according to Pete von Lersner, Vice President and General Manager of Daytona Beach operations for B. Braun Medical, Inc.
When Pete von Lersner talks about the early days, it’s with a sense of appreciation for where he is today.
Before German-based B. Braun acquired the plant in Daytona Beach, it was owned by several different companies, including Gambro Healthcare.
The Swedish company’s dialysis manufacturing and distribution facilities were in locations around the world, and included a plant in DeLand, Florida, which supplied a portion of the company’s dialysis clinics in the United States.
Coming on board in 1997 as the director of operations for Gambro’s DeLand plant, Pete von Lersner is generous in his recall, admitting there were a few challenges with the aging DeLand site.
He recalls his excitement when talks began for the building of a new facility on Mason Avenue in Daytona Beach. His excitement grew when, in 1999, Gambro made the move official, reaping the benefits almost immediately with streamlined operations and state-of-the-art equipment.
“We made a significant step up in what was produced,” said von Lersner, as productions levels went from eight to nine million gallons of hemodialysis concentrate annually in DeLand on three shifts, to over 10 million gallons annually on a single production shift at the Daytona plant.
“We used to have about 240 employees on three shifts in DeLand and because of the efficiencies we designed into the building and into the process, we were able to whittle that down to a staff of about 90 people, making the same amount of product – actually over time it grew to more than that. It was a significant step forward and also a world class building,” he said.
Foresight and proper planning with the initial purchase ensured the ability to expand the facility in 2004 before the FDA approval of their new drug application (NDA) for pharmaceuticals. The launch of a product line of sterile replacement fluids in 2006, proving to be profitable for the plant, helped provide a solid argument for keeping the plant open when production of the hemodialysis concentrate was discontinued, and half of the plant sat idle.
Gambro’s consolidation efforts and changes in ownership brought a sense of foreboding over the next few years, as a private equity firm took the helm, with plans to sell off the Daytona Beach plant in 2010. Baxter International’s 2012-13 purchase of Gambro Healthcare once again put the plant in the crosshairs for sale. This time, B. Braun, who had been excluded from consideration during 2010’s initial sale listing, acquired the Daytona Beach facility in 2014.
“We were ideal for B. Braun because they had something on the west coast and really wanted something on the east coast,” said von Lersner, who worked closely with the transition team to retain some of the skilled talent on the workforce.
From his perspective, it was about the right place at the right time.
Speed to market, a welcoming community, location and a skilled workforce were all incentives for B. Braun Medical, Inc. Senior Vice President and Chief Financial Officer Bruce Huegel, who led the site selection starting in 2013, to choose the Daytona Beach facility for their east coast operations.
“We’re in a highly regulated industry, FDA compliant,” said Huegel. “We make medical devices and as a result it may take eight years or so before we have a property and actually start making product on that property,” he said.
A call from then Florida Governor Rick Scott, indications of Gambro-Baxter looking to exit the property and a positive reception by local officials and business leaders in the community helped seal the deal.
“Being an international company we want to make sure we are going to places we are wanted,” said Huegel.
“We are competing globally, so we have to make sure that our manufacturing costs are competitive, and the labor pool will be sufficient. We already went from zero to 120 high skilled laborers, so we have to make sure there’s a good labor pool. The fact that we had a site here that already had the infrastructure, that saved us two years, possibly three, so that’s speed to market. It’s been so successful that we started out with one project and now we’re up to six,” he said.
Efficiency in operations … Getting a Hand from Technology
The manufacturing industry has continued to grow, and according to the Bureau of Economic Analysis, “manufacturers contributed $2.38 trillion to the U.S. economy in the fourth quarter of 2018.”
Factoring in technology’s rapidly evolving changes, consumer demand and the cost of doing business, companies today, especially in the manufacturing industry, keep a close eye on the bottom line.
With this being said, B. Braun is working on the cutting edge to maximize their $100 million investment in Volusia County, while providing the highest quality work environment for its employees according to von Lersner.
“The new manufacturing line which B. Braun is installing makes heavy use of robotics for material movement. Not only does this eliminate the need for operators to perform menial tasks involving repetitive motion risks, the robotics also can accomplish many tasks with greater speed and precision than an operator,” said von Lersner.
“There are literally dozens of robots from multiple equipment manufacturers used in our new high speed production line. This is a big shift from the manufacturing methods which were used while the site was operated by Gambro. The Gambro production line only made use of a single robot.”
Statistics show there are more than 12 million people employed by the manufacturing industry in the United States alone, with the majority of the manufacturing businesses deemed “small” or having less than 500 employees.
In addition to their substantial financial investment in Volusia County with upgrades to the manufacturing facility and off-site 400,000 square foot distribution center, B. Braun has pledged to create 175 jobs with an average annual salary of $41,000, at the plant. Von Lersner anticipates hiring line operators beginning in the fourth quarter of 2019.
“Once fully staffed and operational, the new B. Braun production line will have an annual payroll in excess of $10 million dollars,” said von Lersner.
1997 Pete von Lersner hired as Director of Operations for Gambro Healthcare – DeLand facility
1999 Gambro Healthcare exits DeLand facility, moving operations to new Mason Avenue facility in Daytona Beach
2004 Daytona Beach plant and warehouse expanded
2006 FDA approves NDA and Daytona Beach plant manufactures products classified as pharmaceuticals, expands product line
2010 Consolidation efforts begin for Gambro via private equity, Daytona Beach plant for sale
2012-13 Baxter International acquires Gambro, including Daytona Beach plant
2014 B. Braun Medical, Inc. acquires Daytona Beach plant from Baxter International, leasing back a portion of the facility to Baxter-Gambro to complete Gambro orders while building facility elsewhere
2017 Lease-back contract ends, Baxter-Gambro transitions out. B. Braun begins redesign and repurpose of Daytona Beach facility
2019 B. Braun begins to hire additional staff
2020 B. Braun slated to begin production at Daytona Beach facility