In the mid-1990s, three 3M engineers saw that many med-tech companies, both large and small, were reluctant—or, in some cases, financially unable—to build engineering and manufacturing capability from the ground up.
In 1996, the 3M trio—Rich Nazarian, Dirk Smith, and Jon Pierce—founded Minnetronix, a St. Paul–based company that brings together design, development, and manufacturing of medical devices for other companies. The founders believe that Minnetronix’s unity of disciplines has been a key to its success.
“To be a really good engineering firm and effectively design top-quality world-class products, you need to understand what it’s going to take to manufacture them; and if you’re not manufacturing any of them, it’s hard for you to gain that understanding,” asserts Nazarian, who is Minnetronix’s CEO. “Likewise, if you’re going to manufacture, maintain, support, upgrade, and sustain sophisticated instruments, you have to understand how they operate and how they’re designed. So if you don’t have a strong engineering arm, you’re limited in what you can do in terms of manufacturing.”
This synergistic approach has fueled Minnetronix’s growth into a leading medical device outsourcing company with 135 employees, more than $30 million in annual revenue, and no long-term debt. “We financed the company ourselves, have taken on no outside investors, and have been profitable since the beginning,” Nazarian says.
Minnetonix’s first project was a subcontract with 3M for artificial heart development. “Our backgrounds were mostly in blood pumps and infusion pumps—equipment that’s used in cardiovascular surgery or equipment that’s used to aid a failing heart,” Nazarian says. “So in the beginning, we inevitably got business that was in the areas we were familiar with.”
Since then, Minnetronix has completed more than 100 development and manufacturing projects for 75 different medical device companies. Projects range from implantable nerve stimulators to surgical ablation systems to cardiovascular support products.
“That’s part of the great fun of what we do—the variety and spectrum of things we get to work on,” Nazarian says. “We have worked on devices that treat everything from cerebral aneurysms to peripheral vascular disease to arrhythmia treatment devices for the heart.” (Minnetronix also remains active in blood pump technology, by the way.)
Minnetronix believes it can offer its customers a higher level of expertise than the typical offshore company can. “The more complicated the device, the more likely it is to make sense to be involved with a company like us rather than go to Asia,” Nazarian says. “The more complicated devices need constant care and feeding, continuous customer communication, a more sophisticated level of assembler or technician, and a more flexible supply chain. And that’s hard to do with offshoring.”
Another differentiator is Minnetronix’s distributed management approach. “We have a number of people, even at the next tier below senior management, who have important responsibilities and are capable of doing great things for the company.” Nazarian says. “That is quite different from a lot of the small design companies that we compete with. Many of those firms rely heavily on a founder, a smart visionary who drives their business. If that person were to go away, those companies would be damaged considerably and might even cease to exist. That’s definitely not the case here.”
After building out Minnetronix’s facilities to 45,000 square feet in 2006, Nazarian’s management team is strategizing about its next expansion. “We think there’s an enormous amount of opportunity for what we do,” Nazarian says.
