On day three of Interphex, Todd and Todd interviewed John Hunt, the CEO of TEG. Hunt discusses the company’s process for packaging tablets, highlighting in particular the benefits and challenges of blister packing. In the interview, Hunt also discusses the ways TEG and clients approach tablet and packaging design in an effort to prevent counterfeiting.
Todd S: Good afternoon. This is Todd and Todd live from New York Life Science Connect Radio live on location, direct from Interphex day three. Todd we have an exciting guest up next who I am really looking forward to that conversation.
Sadly, we are in the home stretch of Interphex 2014 and I cannot believe it.
Todd Y: I always hate this part of the show. You always feel like you are just getting warmed up. I’m getting into all of the technology and the applications and conversations.
Todd S: Good thing we have this gentleman with us. Say hello to John Hunt, the CEO of TEG. John, welcome to the show.
John: Thank you Todd. I am glad to be here.
Todd S: We are glad to have you. Thank you for stopping by and joining us. John, before we get into a conversation around TEG and your specialty, tell us a little about you and your background.
John: My background is that I am a chemical engineer. I am originally from Ireland, as you can tell from my accent.
Todd Y: Is that what that is?
Todd S: I thought it was Birmingham, Alabama.
John: My background is chemical engineering and I have been in the industry for over 30 years working in manufacturing for the first 15 years for an American multi-national based over in Ireland in the European market, Middle Eastern, and African markets. I then started my own business specializing in engineering support for the pharmaceutical industry.
We specialize in supplying tubing for packaging tablets. That is my background.
Todd S: Go deeper on TEG and exactly how are you serving your market?
John: TEG is based in Ireland. We have offices in the U.K., France, Germany, Holland and Romania. We serve all of the major pharmaceutical companies located in the European region with generic drugs and often with patented drugs.
Our specialty is designing tubing for packaging tablets and blister packs and feeding them in at very high speeds. That is core technology for TEG. We are based in Mullingar, Ireland. We employ 85 people in a privately owned company. I am shareholder— a 50 percent shareholder of the business. I work with my colleague Tommy Kelly.
I am over here in the U.S. to scout around and see what is going on here. We don’t do business around here, but hopefully we can add these customers. That is why I am here.
Todd S: Just to give us some context talk about the sorts of issues that you help your customers address and their problems that you help them solve.
John: The problems that customers have are ultimately they want to get the tablets to the customers in pharmacy in the store. In order to do that we use mainly blister packing over in Europe. It is less common here in the United States, but there is a very big challenge in getting the tablets into the blister pack.
That is our specialty; achieving that and economically improving the products of our customers.
Todd S: Why is it less common in the U.S.?
John: Generally, Todd, it is a culture thing. I think that people get them in bottles, and they are comfortable with that. Over in Europe, regulatory issues, those things have to come out in blister packs for security.
Todd S: As one American, I would much rather have a blister pack than fighting with those child-proof caps.
John: They can be awkward.
Todd S: It is a regulatory issue in Europe — is there a reason why it is not a regulatory issue here? Is it coming?
John: I am not sure. I think that there are some target areas here in the U.S... We believe that the consumer expects this in blister packing.
Todd S: You have mentioned several times now this process of getting the tablets into the blister packing at high speed. Why does that matter?
John: Productivity. The consumer expects to pay a stricter price. It has to be done and manufactured at that price to make profit. Making something really slow that is a high-value product at a high-cost location in a clean room adds cost very rapidly. That is where we come in.
Todd Y: How big of an impact does it have in terms of cost?
John: In terms of costs it depends on the drug. Let’s say for a paracetamol packaging costs can account for as much as forty percent of cost.
Todd S: A few percent off of that has a big impact on the total cost?
John: A huge, huge impact. For instance, for GlaxoSmithKline, we have done two main seeding systems that have allowed us to pass 40,000 packs of paracetamol every hour.
Todd S: Let’s just think about that; every hour.
John: It is going so fast that you can’t see it.
Todd S: Okay I thought about it, and that is impressive.
John: That is impressive. To get an unbroken tablet into each pocket 99.999 percent of the time, that is why our customers come back.
Todd S: Talk to us about the role that you play and your product plays in counterfeit production. I have to assume — I was just thinking on it for a second — that it seems more secure than a bottle.
John: It is far more secure. It is much more difficult to replicate. When it is in a blister pack, it is a challenge. It is a technical challenge. That is the first challenge to counterfeiting is to put it into a blister pack.
It is easier to count, easier to reconcile, easier to trace, and all of that is easier. The second thing that not many people think about is that marketing departments of the pharmaceutical companies require a particular shape of a product.
There are good reasons for that. One is that elderly people, when they are taking tablets, they want to be able to distinguish one tablet from another drug. The other is to make the shape difficult to pack and give it an awkward shape like an oval or a slight convex shape, and I have even seen heart shaped tablets.
Heart-shaped tablets are very challenging to put into a blister pack without breaking off a section.
Todd S: I just want to make sure that I am following you. Your customers are saying I want the oddball shaped tablet?
John: Yes if the marketing department…
Todd S: Is that anti-counterfeiting or…
John: Anti-counterfeiting is making a product a very challenging product to pack.
Todd S: Okay, so the ability to deal with, I don’t want to say difficult customer, but a customer that is really challenging you. I just wanted to make sure that I was following you.
John: That is where we come in. Our specialty Todd is being able to seed difficult tablets into blister packs at high speed without any breakage. If something is broken, then the patient is getting a smaller dosage then required.
Todd S: Or they get nervous because it is broken. I am scared about taking this…
John: Of course blister packs can be cleaner than a bottle for sure. You have an individual tablet in the pocket.
Todd S: John, as you have said, you have been in the industry for years, and I am sure that you have been a keen observer of the industry and beginning to dive into the U.S. a little bit. What are some of the big changes that you have seen over that time span, and then the obvious next question is, where does it go from here?
John: I think that big changes that I have seen over the years are that the drugs are changing. Patenting is easier. Particularly countries like ours, it is a very large industry, and packagers are coming in and stealing the market. The European government — and I am sure that it is the same here in the United States — are looking for cheaper methods.
All of that means cost reduction, improved productivity, and achieve packaging as an element of that. That is the major change that we see. The other of course is on the bio-pharma side.
We believe that, in the future, bio is going to become more and more common. We are involved in packaging on the bio-side as well, and it has become much more substantial side to our business.
Now, compared to five years ago, it is a three-fold increase and that is just a very comparative in the pharmaceutical how bio-pharma has changed that rapidly.
Todd Y: John, I want to take you back to the counterfeiting issue that Todd raised a little bit ago. How bit of a problem is it in terms of costs and maybe more importantly…maybe not maybe more importantly, but absolutely more importantly the health risks?
John: The health risk is very significant. If you are getting any incorrect drug, patients aren’t getting the proper medication. That is huge in terms of keeping reputation with the customer. Big companies want to keep their reputation.
It is not a good idea to have counterfeit of a high profile drug. Our customers, when they are coming to us requesting packaging as a counterfeiting measure, they say to make it difficult and make it challenging. We want to be able to package it quickly and economically.
We will suggest various pharma and blister packs; how are they shaped, and how are they packaged? We automatically put in there challenges and make it difficult for a counterfeiter to repeat that.
There are measures in place like how you locate them and how do you see them? The gap between one tablet to another — you make it very narrow and tighten it up from one blister to the other and that is very hard to do.
We have been able to reduce that to 0.2 millimeters.
Todd S: You and I are going that is an octagonal shaped drug.
Todd Y: Just to see if we can stump him?
Todd S: I don’t think that is going to happen.
John: That is the type of design.
Todd Y: This is the first time that I ever thought it is like printing money. From the Federal Reserve; I guess you have to be constantly innovating and changing.
John: We send out pharma designs — 20 or 30 of them— every week. We are in constant communication with the marketing, and they come back and say that is what we want, proceed with that particular design of the blister pack.
It is a much more effective way of doing that than putting it into a bottle.
Todd S: I am convinced. John, I hate to say it, but we are out of time. Before we let you go, how can people get in touch with you, and where can they learn more about TEG?
John: Our website is very simple: www.TEG.com. Everything is there on the website. We would be happy to answer queries. We are Irish. We are very flexible.
Todd S: John Hunt is the CEO of TEG. John, it was great to have you. Thanks for stopping by and joining us.
John: It was my pleasure.
Todd S: That wraps this broadcast. On behalf of our guest John Hunt, my co-host Todd Youngblood, I am Todd Schnick. Life Science Connect Radio exclusives live coverage from Interphex will be right back.