The Need to Know Drives Pharma Labeling Market

As a supplier of inserts, outserts, and labels, PCI Services rides the pharmaceutical boom in Puerto Rico.

With more than 50 pharmaceutical firms operating in Puerto Rico (pop. 3.7 million), domestic package component supply is booming. Enjoying that boom is PCI Services, a Cardinal Health co.

PCI has operations at four sites in Puerto Rico: two folding carton plants, one contract packaging operation, and a dedicated facility devoted to the manufacture of pharma printed inserts/outserts and labels.

In an exclusive Paper, Film & Foil CONVERTER visit to the PCI Services operations in Manati, Puerto Rico, labels operations manager Luis Silva explained that "in our highly competitive environment, we feel that our `one-source' approach at the global level is the best way to do business."

He was pointing out that PCI Services is involved in all aspects of pharma packaging, from thermoformed containers to clinical packaging.

Taking Advantage of Opportunity
With manufacturing operations in the US, U.K., and Germany, PCI Services has grown dramatically since it was founded in 1971. In Puerto Rico, it is located about 42 miles along the superhighway from Old San Juan. Previously called PCI-Tri-Line, the operation began in 1979 in Arecibo, P.R., and moved to its present Manati location in 1986--just meters from Schering--Plough's huge Puerto Rican facility.

Presently operating out of two buildings, the Manati site has a third building under construction, and plans are to devote even more production effort to pharma label production. This operation is part of PCI Services Printed Components Div., which includes plants in Moorestown, NJ; Fremont, CA; Pennsauken, PA; Guaynabo, PR; and Gurabo, PR.

The Manati facility meets about 80% of Puerto Rico's insert/outsert requirements. Estimated at about $30 million, the total market is ripe for expansion in the printed label area, where the lion's share comes in from stateside label converters. There is also a fairly large food industry in Puerto Rico, which is an excellent potential market for narrow web label producers.

Silva says, "About 80 percent of our production is dedicated to printing inserts and outserts, with the major portion being inserts." The remainder is pharma labels.

Approximately 15 companies in Puerto Rico presently manufacture a wide variety of printed outserts, inserts, and package labels in growing quantities. Products range from narrow web printed labels (8 in. wide) to medium web printed inserts/outserts (27 in. wide). (There is not yet any wide web flexible packaging converter supplying the pharmaceutical industry on the island, but excellent opportunities do exist for an off-shore converter to build a manufacturing facility.)

Package inserts/outserts have become a legal requirement with the move toward dispensing patient packs of medication. They are not always inserted into the package but can be attached as a label-cum-leaflet to the outer pack or to the container. The total market exceeds $40 million. In Europe leaflets are estimated to have accounted for 33% of combined sales of labels and leaflets during 1998.

Either inserted into the carton or applied as a label, it is critical that the leaflet should be kept to a manageable size. It should not have too many folds because this makes it seem bulky and reduces the changes that it will be read.

Too small also is not desirable, because the printing will be reduced in size and not legible to elderly patients.

Customers Are Neighbors
Located in Puerto Rico's "pharmaceutical alley," PCI's Manati plant is near most of the island's pharma plants including Merck, Johnson & Johnson, Pharmacia, Wyeth, Pfizer, as well as Schering-Plough. A tour of the facility presents a well-planned, clean operation with a wide variety of production equipment. There are about 200 employees with 25 professionals involved in all aspects of quality assurance and control.

Production of pharma inserts/outserts follows three basic operations: printing, guillotining, and folding.

An estimated 90% of Manati's products are prefolded prior to shipment to the customer, while 10% is supplied on rollstock or flat to be folded in the pharma producers' plants either in- or off-line.

Special pharmaceutical-grade 24#-30# paper from Fraser Paper Co. is used as base-stock. Most is printed one color (black), although there are requirements for other colors for special products.

Printing of inserts/outserts is done on 27-in.-wide paper stock with six offset presses: four Didde, one Sanden, and one Stevens. These presses feature capabilities up to four colors.

The company's present label output is printed on two six-color ultraviolet letterpress Gallus presses. There is now 100% inspection for all labels using Rotoflex and Arpeco equipment. All the operation's inks are supplied by Flint Ink and Akzo Nobel.

Supporting the printing production is a complete up-to-date, computerized prepress facility located in a separate secure area near the printing facility. All plates are produced from computer-generated images.

More than 40 machines fold products up to 32 times (4, 8, 12, 16, and 32). This demanding procedure is accomplished on machines from Vijuk and MBO.

Folded inserts/outserts are then boxed for eventual shipment to local pharma plants. No product is shipped stateside, although this is a distinct possibility for future expansion.

Patient Info a Global Concern
The regulation for patient pack information varies among countries, although there is regulatory agreement for companies in the European Union (EU). In Europe leaflets now are compulsory for all new medicines receiving a license and for products that are applying to have their licenses renewed. Exceptions to this rule are products for which information can be included on the label.

EU directive 92/27 (2) is concerned with patient information. It aims to empower patients with more information presented in a simple and comprehensive form. Failure to supply a patient leaflet would be a criminal offense under EC directive 92/27. Pharmacists must ensure that any drugs dispensed include a patient information leaflet.

The US Food and Drug Administration (USDA) is aiming to make patient pack leaflets mandatory, but it is implementing its proposals over a longer time period than in the EU. Japan is encouraging companies to provide more information to patients, and pharmacists have been given the responsibility for this.

Healthcare issues loom large all over the world, and the need for packaging, labels, and components follows in their wake. For PCI Services, this portends continued success.

Puerto Rico
Proudly independent in spirit but entirely reliant on Uncle Sam, Puerto Rico is the place where four centuries of Spanish Caribbean culture comes face to face with the American convenience store. This leads to some strange juxtapositions--parking lots and plazas, freeways and fountains, skyscrapers and shanties--but they're not hard to reconcile in the context of the Caribbean's hybrid history.

Rectangular-shaped Puerto Rico is sandwiched between the bulk of Hispaniola and the tiny archipelagoes of the Leeward Islands. It measures roughly 175 x 50 km (100 x 33 miles), and much of its interior is taken up by the peaks and foothills of the rugged Cordillera Central.

With superb tax abatements, the international pharma industry has made Puerto Rico an important manufacturing base. Most of the world's larger pharma firms maintain plants in Puerto Rico, feasting on a workforce that is both highly educated and motivated.

Although tourists have been visiting San Juan for decades, few ever felt the need to get out of the casinos, let alone the city limits. Today, travelers who venture into the island's mountainous interior or explore its underdeveloped southern and western coasts are discovering an island of rugged scenery and gracious Latin mores.

There are stately colonial hill towns where the locals in the plaza seem to have been feeding the same pigeons for 30 years, and reefs where divers can see 30 species of fish swim by in less than a minute.

Add to this a perplexing culture that is part of its past yet unable to claim its own destiny, and you have the ingredients for an intriguing adventure, even if you only talk politics in the local bar.

Converter Info
PCI Services

Box 311100
Manati, Puerto Rico; 787/854-2155; pciservices.com

Supplier Info
Akzo Nobel Inks, Langhorne, PA; 215/750-9191; akzonoble.com

Arpeco Engineering Ltd., Mississauga, Ont., Canada; 905/564-5150; arpeco.com

Didde Corp., Overland Park, KS; 913/339-9191; didde.com

Flint Ink Corp., Detroit, MI; 313/538-6800; flintink.com

Fraser Papers Ltd., Stamford, CT; 203/705-2800; fraserpapers.com

Gallus Inc., Philadelphia, PA; 215/677-9600; gallus.org

MBO America, Westhampton, NJ; 609/267-2900; mboamerica.com

Rotoflex International, Mississauga, Ont., Canada; 905/670-8700; rotoflex.com

Sanden, Cambridge, Ont., Canada; 519/623-8510; sandenmachine.com

Stevens, distributed by Cerutti-Zerand Group, New Berlin, WI; 262/786-2500; cerutti.it/zerand/index.htm

Vijuk Equipment Inc., Elmhurst, IL; 630/530-2245; vijukequip.com


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