Volume 8 | Issue 3 | Year 2005

When your customers are eye surgeons, you better be good. Quality and precision are the watchwords for Advanced Medical Optics, Inc., which develops innovative technologies and devices to address a wide range of eye disorders. AMO runs a tight ship in its three Puerto Rico plants, which produce acrylic and silicone lenses that replace the clouded lenses of cataract patients. The tiny artificial lenses are implanted through a miniscule 3mm incision in the eye. AMO’s foldable lens unfurls inside the eye to correct the problem. The small-incision/foldable lens process, approved by the Food and Drug Administration in 1989, means a far shorter recovery time for patients than conventional surgery.

“The small incision required for these lenses causes less trauma to the eye, and promotes a faster recovery time from cataract surgery, which used to be months and now is only days,” says a member of the AMO management team. (Individual members of the organization, all fans of the New England Patriots, prefer to be identified according to their position on the team, rather than by name.)

It turns out that cataract surgery is one of the most widely performed procedures in the world. Covered by Medicare, it’s necessitated by the aging of the eye. As the population ages overall, the surgery will grow in its use, creating an even larger market for AMO’s specialized lenses. “As you age, your eye’s natural lens can begin to become opaque, signaling the formation of a cataract and reducing vision. After the age of somewhere between 65 and 80, a cataract operation can improve your quality of life by clearing vision,” observes the AMO team’s head coach, vice president and managing director.

“We have an assured market because people do get older,” the head coach adds. Although he wouldn’t confirm the financials, the coach calls the company’s growth exciting.

The Eye Land
The quality and unparalleled cost benefits of production on the island have made Puerto Rico an epicenter of world-class medical and surgical product manufacturing. Eight out of 10 of the top selling drugs worldwide are manufactured on the island, according to the AMO team statistician. The island’s pharmaceutical business, employs about 30,000 and exports nearly $9 billion in products; the medical device industry employs about 15,000 and exports more than $2 billion in instrumentation, equipment, and supplies.

AMO started operations in Puerto Rico in 1983 and today has three production facilities: an 18,000-square-foot acrylic intraocular lens production facility, a 20,000-square-foot silicone lens production facility (it’s up to the surgeon’s preference whether to use acrylic or silicone lenses), and another large facility for manufacturing components used with the surgical instruments and equipment during cataract procedures.

The company’s quality level is measured in defects per million and production specifications in thousandths of an inch. Over the last decade, the company has vastly improved its already high-precision operations through an initiative combining lean manufacturing techniques and demand-flow technology. As a result, AMO has substantially reduced costs and lead times, while reaching ever-higher quality standards. “We continue to develop our talent and build more and better technological capabilities while also simplifying the operations and becoming more agile,” says the team’s manufacturing director.

The results speak for themselves. Although production processes and techniques are proprietary (nobody but the team sees the play book), in general the company has achieved multi-million dollar annualized savings, a 34 percent productivity improvement, leaner production on all three lines (for the two types of lenses plus instrument components), vastly simplified paperwork, and better inventory control.

A look at the product lineup suggests why quality is such a vital focus. AMO’s Array(r) silicone lens was the first small-incision foldable multi-focal intraocular lens approved by the FDA. Traditional monofocal lenses generally provide good distance vision only, but Array can potentially restore a full range of vision for cataract patients. It provides the focus on faraway objects, on objects that are two to five feet away, and on near objects, revolutionizing the benefits of the procedure to patients.

“The three main issues for our products are innovative technologies to address the illness, ease of use by the surgeon, and finding ways to beat the competition,” says the vice president.

Other products include the PhacoFlex(r) II and ClariFlex(r) foldable silicone intraocular lenses. These allow for the minimal incisions that ophthalmologists have mastered and patients appreciate because of speedier recovery from cataract surgery. ClarifFlex(r) features AMO’s exclusive OptiEdge(r) technology, a unique, rounded-edge design to reduce reflections and glare.

Another pro bowl selection in the product line is AMO’s Sensar(r) acrylic intraocular lenses, designed to ensure outstanding optical performance and long-term refractive stability. Sensar is the company’s foldable acrylic lens implant, which also features OptiEdge(r). In addition, Puerto Rico operations produce some components of the Unfolder(r) insertion system used to implant those lenses.

Worldwide, AMO also markets and offers in its surgical portfolio instruments and equipment used in ophthalmic surgery including the Sovereign(r) advanced cataract extraction system, a digital ultrasound device using a technology called WhiteStar(tm) that dramatically reduces the amount of heat directed into the eye.

The Puerto Rico operations support that product innovation with the production of specialized tubing used in the surgery.

The Company also makes refractive surgical devices used in LASIK surgery, which reshapes the cornea to correct vision problems. AMO is famous for its over-the-counter eyecare products for contact lens wearers, including the COMPLETE(r) line of lens disinfecting solutions, cleaners and drops found at major pharmacies.

AMO Distribution
Intraocular lenses are available by prescription only, so the market is heavily regulated and distribution and supply chains tightly controlled. The company ships worldwide from Puerto Rico and so must be in compliance with regulatory demands worldwide. AMO satisfies regulators including the FDA for the U.S. market, ISO international certification standards for European and other exports, and separate standards and requirements for Canada and Asia.

“In addition to external audits, we have our own internal program to make sure we are in compliance with all these standards and are aware of and ready for any changes in regulatory standards,” says the team’s quality director.

The channels of distribution for surgical devices also differ by country since health care provision is organized differently around the world. For example, U.S. customers include surgeons, HMOs, and distributors. The company uses its own portfolio matrix to forecast market needs for its products, which are produced in a range of sizes and optical specifications.

“We are always looking at the market sales tendencies and marketing projections so we can adjust ourselves and be flexible based on the product matrix to support the market,” says the logistics director.

Of course all this technology is great but it’s the people that make it work, according to the scouting director and human resources manager. “We have a very talented and dedicated workforce, who make a difference and set us apart,” she said of the 650 employees on the island.

“Our people are service oriented, effective, visionary, agile and work as a team,” the head coach stresses. “Our vision is focused on providing our manufacturing talents to enable AMO as a corporation to maintain a leadership position in the ophthalmic surgical business by implementing our superior and technologically advanced products.”

If the New England Patriots’ team approach is any indication, AMO can look forward to many championship seasons to come.

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