I have a friend who owns a company that used to specialize in making machines that make disposable diapers. Did great for a while until his machines started getting copied overseas and then sold into the US market at half his cost. Then he started building specialty machines like us and we collaborated on a few aerospace projects. Big carbon fiber layup machines. Fun projects with 100+ axes of motion on machines that make parts for the Dreamliner in South Carolina.
Despite being fun, these projects rarely made money as you always underestimated the engineering and typically lost money on the first machine or two and hoped to be profitable on machine 3 or 4 . . . which sometimes never materialized.
A few years ago he calls me up and says he is going to focus on ultra sterile medical drug processing, compounding, and packaging equipment. Working more as an integrator of sterile robots, pumps, controllers, etc. Less inventing and more narrow focus on higher value products.
All I could think of was how many people would he have to hire to take care of all the red tape put up by the FDA, and how many different quality programs and hoops would he need to jump through to get the first product to market. No. Thank. You.
Well . . . today, I am the one wondering if we will survive COVID-19 + the 737 Max debacle that have collectively cratered our business 40% in the last 18 mos. And my buddy’s business is seeing double digit growth for the last several years and he is doing fantastic.
Aseptic Filling Equipment & Packaging Machines | AST
Also, we have done some work more on the bleeding edge of vaccine development with a company called Dice Molecules. We designed and built a number of “Routers” which are not like anything we have done before. These were 384 chamber pumps (not a typo) that pumped a protein-enzyme-saline mixture through each of the 384 chambers (serially, I.e. one after the other) . . . each of which had a porous feature which was seeded with a specific strain of DNA that defined a particular biological molecular structure. Each chamber would be held at a specific temperature and grow billions of molecules per the DNA instructions. After a routing cycle was complete, then each strain of molecule would be tested for efficacy in whatever goal they had (preventing a virus from docking with a cell was typically what they were attempting to do).
Fun facts with that project (all 384 chambers machined into a plate that was 75mm by 150mm) including plumbing ports. And these plates were plated with gold after machining. Total fluid volume pumped through the system was less than 50ml and cost roughly $2k/ml by the time that fluid made it to our machine. We designed a lot of leak detection systems to ensure that our chambers did not leak.
Like other projects like this, we lost money on the first few and in the end probably made less than 15% margin on the fleet of routers that we made for them.
I am glad we are in business to have fun and that we have managed to be profitable enough to stay in business for 25 years now.