Pittsburgh has witnessed the successfully convergence of its strengths in manufacturing, advanced materials and IT contribute to the development and commercialization of medical devices. Specialties in material sciences led to the development of lightweight and miniaturized materials for devices. These advances segued into the development of nanomaterials and the use of robotic types of apparatus for medical and life sciences.

In Ohio, a sizeable medical device industry, 649 companies in all, was a result of the state's historic legacy of manufacturing, such as auto manufacturing. In fact, one company, Lies Medical, Inc. quit supplying auto parts 10 years ago and is completely involved in the manufacture of orthopedic devices.

The Pittsburgh region and the state of Ohio have uniquely positioned their business climates to support medical device manufacturing related activities. This bodes well as the medical device industry continues to be one of the U.S. economy's strongest and growing sectors.

A traditional stronghold for the industry is the state of Indiana, which continues to be a leading destination for medical device investments. Zimmer Holdings, Inc. has begun hiring engineers, supervisors and machine operations to staff its expanded metal-making facility in Warsaw. The company, a designer, manufacturer and global distributor of orthopaedic devices, is investing $19 million to add nearly 50,000 square feet to its foundry operations, boosting automation of the facility and increasing annual output by nearly 1.3 million castings. The company, which employs 2,800 people at its Warsaw operations, expects to add another 100 jobs by 2011 with this expansion.

Zimmer's expansion announcement was the fourth in four years. In 2007, the company announced a $66 million project to add 120,000 square feet to its manufacturing and distribution facility. These project activities further strengthens Warsaw's status as the, “Orthopaedic Capitol of the World,” hosting the headquarters for three of the world's five-largest makers of artificial joints and related surgical instruments.

Ohio is also seen as a global medical device player, says John F. Lewis Jr., vice president, BioOhio, which is a state Edison Biotechnology Center, working to accelerate the biosciences industry in the state. “Over time we have evolved into a sizeable medical device supply chain group of companies, and we see that growing,” Lewis notes. Companies can conduct product design, prototyping, clinical and regulatory activities, manufacturing of products and distribution of products.

Ohio has a history in the development of imaging technologies, and is a worldwide player in the sector, home to companies such as Philips, Hitachi, GE, Toshiba and Siemens. The state's strengths in working with polymers transition nicely into the development of biopolymers. And, relevant to today's economy, Lewis notes, is the fact that the state is part of the auto supply corridor running down Interstate 75 from Detroit to Lexington and Louisville, Ky. “A number of auto suppliers have diversified over the years into medical device suppliers,” Lewis says.

Auto workers are used to working with regulations, and these skills can be transferred into medical device activities, with a few extra protocols, such as following FDA-regulated processes.

While the medical device cluster strengths in Ohio are situated in Cleveland and northeast Ohio, the Columbus area has an emerging cluster. The region is home to some of the most progressive medical technology being used to train surgeons and medical students. Surgeons at Columbus' Riverside Methodist Hospital use a GPS-like navigation system during orthopaedic surgery. What's more, Riverside's CME+I center uses lifelike patient simulators that allow users to practice complex medical procedures. The simulators are programmed with more than 72,000 responses that allow users to learn and perfect their techniques.

Lewis notes that Riverside is part of the Ohio Health System, which has modeled an innovation assessment system within the network after a program at the Cleveland Clinic. The system allows hospital employees to present ideas that could meet a market need in health care. “It is an avenue to get these ideas commercialized, licensed, and create new companies,” Lewis says.

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The ideas that come out of such activities require funding support and incubation spaces to ensure the ideas become thriving commercial ventures. Ann Arbor, Mich., is home to Michigan's leading concentration of venture capital firms, with a presence of 14 venture capital organizations. Ann Arbor SPARK, which markets the area as a business locale, operates the Michigan Pre-Seed Capital Fund, which is capitalized at $9.5 million. The direct investments into companies, either through convertible debt or equity arrangements, fill the funding gap for startup operations.

Michigan's state level economic development officials have been aggressive in creating additional venture capital resources to fund startups. The Venture Michigan Fund and 21st Century Investment Fund are each capitalized in the $100 million range, says Mike Finney, president and CEO, Ann Arbor SPARK. These funds are investing in other venture funds that are making investments in the companies in the state, and the Ann Arbor region.

Moving to Ohio, Lewis says the state of Ohio has been aggressive in funding business development. He notes the Third Frontier stimulus, which is a $1.6 billion economic development set of tools. “The state has expended little more than half of that money, half of which has been in the biosciences industry, and much of that has gone into medical devices,” Lewis says.

Last year, the state Legislature passed another $1 billion job stimulus package, which included $100 million for biomedical-related activities. A package of $50 million was allocated to agriculture biotech activities; and $250 million was allocated specifically to workforce development.

In Pittsburgh, the growth of venture capital funding in the region during the past five years has led to the region's ranking in the top five in the country in terms of growth, says Mike Langley, CEO, Allegheny Conference on Community Development, which promotes the region as a business destination.

Pittsburgh offers many funding and institutional supports to further the medical devices industry. Innovation Works, which is the area's Ben Franklin partnership project, which is a state-level initiative. “Innovation Works is a successful start up, incubation and financial support network,” Langley says. A number of the startups have been in the life sciences sector, with a number in the medical devices arena.

Successful projects include Clear Count Medical Solutions, an RFID surgical sponge company, which has moved into series B financing. Another firm, Alung Technologies Inc. is focused on the development of artificial lung devices.

Startup companies can also tap into the Pittsburgh Life Sciences Greenhouse initiative, which connects executive talent, venture capital and innovation capital resources to take advantages of the R&D that is occurring at the region's universities and corporate research centers. “It has both incubation space and executives in resident to provide emerging businesses with early stage activities to get them funded, commercialized and get products to market,” Langley says. “In addition to the literally billions of dollars at Carnegie Mellon University and the University of Pittsburgh each year in R&D, we have 80 or more corporate research centers in this region that conduct R&D in robotics, coatings, nanotech and more.”

Pittsburgh is also recognized as the global leader in regenerative medicine and tissue engineering with the presence of the McGowan Institute. A new entry into leveraging robotics, IT and life sciences assets is the Quality of Life Technology Center, which is a partnership between Carnegie Mellon University and the University of Pittsburgh to create technologies to improve and sustain quality of life for the disabled and elderly. Another institutional asset is UPMC, which is a global $7 billion health care provider, which is headquartered in Pittsburgh.

Langley points out that Pittsburgh is a growing area for companies already on the ground, in addition the R&D activities. Regionally based Respironics, involved with developing sleep apnea devices, was purchased by Philips last year for more than $5 billion. “Philips has a couple of headquarters here for its medical health care companies under the Respironics corporate umbrella,” Langley says.

Pittsburgh's assets were also attractive to German company Medical Sensors Technologies, Inc. (Mesotec), which last year selected Greentree as its location for the development of a new ophthalmic device for improved glaucoma management. The company's officials were attracted to the area's thriving life science cluster, which includes world-class hospitals, research universities and medical device companies, which “make this an ideal place to headquarter our company and this emerging technology,” says Max Ostermeier, CEO, Mesotec, about the decision.

Langley says company officials learned of Pittsburgh's advantages through conversations with community leaders who traveled with the Pittsburgh Regional Alliance and the Pittsburgh Symphony Orchestra to Europe, in 2006 and 2008. “By our active outreach and exposure to them about the assets they were able to come here and compare our assets to other regions and make a business decision to locate here,” Langley notes.

Medical device firms are looking for places that offer low costs of conducting business, higher education assets and quality of life assets. In the Ann Arbor region, Terumo Cardiovascular Systems expanded and consolidated a facility from California to its Scio Township operations. The company manufactures and markets products for cardiac and vascular surgery to hospitals worldwide. Finney says that in addition to lower costs of conducting business, the region's quality of life assets allows the firm to attract and retain the best and brightest employees.

And holding on to the best and brightest employees is vital in the medical device sector, which continues to fare well in the turbulent economy. Through the convergence of technologies from “old” manufacturing industries to support the industry's advances, as well as institutional and venture capital funding, medical devices companies will find regions and states are prepared to support their breakthrough ideas.

For complete details about the organizations featured in this article, visit:

Allegheny (Pittsburgh) Conference on Community Development, www.alleghenyconference.org

Ann Arbor (Mich.) SPARK, www.annarborusa.org

BioOhio, www.bioohio.org

Indiana Economic Development Corp., www.iedc.in.gov