Laboratory Automation & Instrumentation Power Protection Systems Case Study Baxter Healthcare

Baxter’s Benefits Lower Operating Cost Increased Productivity Happier Investigators/Managers/Staff Higher Revenue & Profit Potential

The Lab and Operating Environment Key challenges and issues: Profitability in the laboratory and automation environments On time delivery of reportable results Overall customer satisfaction Internal and external

The Lab and Operating Environment Key issues and distracters: Instrumentation performance Regulatory compliance (FDA GLP, GMP, CLIA…) Availability and reliability Environmental conditions

The Laboratory Key issues - Environmental: Quality of power from the utility Other equipment sharing the line Centrifuges Auto loaders / robotics Pumps and heaters Bar code readers (lasers)

The Laboratory Quality of power directly from the utility: Desired waveform

The Laboratory The reality of laboratory and production power: Harmonic distortion and frequency variation waveform is typical Power Interrupt Line Sag SurgeUnder Voltage Over Voltage Line Noise Variable Frequency Switching Transient Harmonic Distortion

The Lab and Operating Environment Key issues - Environmental: Challenges for a Laboratory Productivity- Protection System (LPS) Each application must be qualified Peak loads Other instrumentation line interference (transient) Inrush currents and load (Power) factors Power connection and distribution Waveform (Volts, Hz, harmonic distortion, et al)

Franek Technologies, Inc. (FTI) The Leader in Power Protection for Medical and Scientific Instrumentation

Applications  Automation  Biotechnology  Drug discovery  DNA, human Genomics and Proteomics research  Pharmaceutical production  Clinical chemistry  Diagnostic imaging  Immunology and cytometry  Oncology  Hematology and blood banking  FDA 510(k) patient contact applications  Forensics  Scientific research  Other commercial laboratory instrumentation

LPS Economics “LPS Application Rules of Thumb”  LPS systems are very affordable  Service costs are $1,000 to $2,000 / Hr, or more  LPS systems have proven ROI – Instrumentation operating costs drop – Instrumentation availability is very high – Overall productivity is maximized  Instrumentation and internal customer satisfaction performance improves

FTI Case Studies Baxter Healthcare Corporation Diagnostics Group – over $40 million invested in instrumentation Goals  Successful launch of clinical chemistry, immunology and microbiology systems as a new closed system instrumentation manufacturer Strategy:  Place units as rapidly as possible as a result of DRG legislation  Partner with Scientific Products for distribution and service Challenges:  Secure acceptance in mid range laboratories  Reduce warranty and service costs by at least 60%  Re-establish laboratory perception of reliable and accurate Dx results

FTI Case Studies Baxter Healthcare Corporation Laboratory Challenges and Issues  Laboratory’s perception of Baxter’s reliability and performance - at an all time low – Minimize service support infrastructure while improving effectiveness and customers perceptions Strategy:  FTI Consulted as laboratory power engineering specialists  FTI’s partnership with Clinical Chemistry Systems group lead to sole source orders for qualified LPS units throughout SP Challenges:  LPS system design to meet Clinical Chemistry, Immunology and Microbiology systems integrity  Delivery and servicing of over 1000 LPS units in 36 months

FTI Case Studies Baxter Healthcare Corporation Baxter Diagnostic Results  Significantly reduced field service costs and improved reliability  Allowed Baxter to successfully place “reagent rental systems” while maintaining profit goals  LPS applications reduced service calls on clinical chemistry systems from 13 to 5 per year  Established Baxter Diagnostics / SP and FTI as key business partners  Lab operators provided FTI referrals to all clinical lab types – Hospital, clinic and reference labs All economic and goodwill goals for Baxter attained  Annual savings for Baxter at over $32 K / unit

FTI Case Studies Baxter Healthcare Corporation clinical chemistry systems Detailed Analysis - FTI cost savings for Baxter  Failure rate dropped to 1 / instrument / 90 day period  1800 system incidents at peak placement w/o LPS = 23,400 operational service calls  Baxter down time cost per incident $4,000 – Service Costs per episode: $1,500 – Replacement parts cost: $1,750 – Reagent revenue (estimate): $ 750  Annual down time savings for Clinical Chemistry: $7,200,000 – 225 Systems / $32K per unit Tangible Benefit to Cost = 10:1

Engineered Laboratory Instrumentation Protection Systems /