Jabil is a global engineering, supply chain, and manufacturing solutions provider. Its healthcare division specializes in the design, development, and production of medical devices, orthopedic, diagnostics, pharmaceutical development and delivery systems, and digital health technologies for healthcare and life sciences companies.
Mike, given your extensive industry experience, what would you highlight as the most significant changes you have observed in recent years?
Since the pandemic, we have seen a major acceleration in technology adoption across healthcare. Before the pandemic, technologies like telehealth and home testing were available, but there was a natural reluctance to use them. People preferred in-person doctor visits. However, when forced to rely on these tools, they realized their efficiency and effectiveness, which catalyzed growth in home testing, monitoring, and remote care.
At Jabil, our ability to leverage expertise from other sectors, such as consumer and mobility markets, has been instrumental. We have helped healthcare OEMs (Original Equipment Manufacturers) develop products that are smarter, more connected, and compact. Additionally, the rise of robotic-assisted surgery and minimally invasive procedures is shifting healthcare delivery from large hospital settings to more specialized acute care. AI is playing a growing role in life sciences, from imaging to blood tests, and even accelerating pharmaceutical R&D. These macro trends shape our investment strategy and how we support customers in bringing innovations to market.
Can you give examples of how you assist companies in their AI transition?
We enable innovation by integrating AI into product design and hardware. While we are not traditionally a software company, we manufacture and design the hardware that unlocks AI’s capabilities. For example, in imaging and genomics, AI is helping map genomes and refine precision medicine, and we support customers by delivering the hardware infrastructure that makes these advancements possible.
Our contributions are evident in areas such as MRI, genomics, and AI-enhanced diagnostic tools. We believe we are only at the beginning of unlocking AI’s full potential in healthcare, and our expertise in hardware development ensures our customers are well-equipped to integrate cutting-edge AI solutions into their products.
Jabil recently acquired Pharmaceutics International, Inc. (Pii). Does this signal an expansion into the CDMO (Contract Development and Manufacturing Organization) sector?
Yes, we are expanding our capabilities into the CDMO space. The pharmaceutical market is rapidly evolving, with an increasing number of biologic drugs, peptides, and tripeptides coming to market. As the world’s largest contract manufacturer of auto-injectors, producing over 500 million units annually, this move was a natural progression for us.
Traditionally, we have been on the "dry side," manufacturing the devices. Now, with the Pii acquisition, we are moving into the "wet side," handling aseptic filling of drug cartridges. By integrating Pii’s capabilities, we can co-locate device manufacturing and drug filling, streamlining the supply chain for pharmaceutical companies. This enhances efficiency, reduces costs, and aligns with the rising demand for biologic drug delivery solutions.
With the booming demand for GLP-1 drugs, how much of that market does Jabil aim to capture?
We are already a major player in the auto-injector space, with our devices used for insulin, GLP-1 drugs, and other biologics. Our entry into the CDMO market strengthens our position further. The industry saw a significant shift when one of the leading pharmaceutical companies acquired Catalent, taking a large portion of CDMO capacity in-house. This has created opportunities for manufacturing partners like Jabil and Pii to fill the gap.
Additionally, Pii's expertise extends beyond aseptic filling to include oral solid dose manufacturing. As GLP-1 drugs potentially transition from injectables to oral formulations, we are well-positioned to support customers on both fronts. We see this as a strategic advantage that will allow us to capture a meaningful share of the market as it continues to grow.
Are you considering further M&A opportunities?
In the CDMO space, we feel confident with the Pii acquisition. Now, our focus is on leveraging that expertise to expand organically. However, we are actively exploring opportunities in three key areas: minimally invasive devices, sterilization services, and medical device reprocessing.
The demand for complex catheters in electrophysiology and other minimally invasive procedures is growing at 15-20% annually, and we want to strengthen our capabilities there. Medical device reprocessing is another area of interest, driven by sustainability goals and cost efficiency—being able to safely reprocess a catheter three to five times significantly reduces costs and environmental impact. Lastly, sterilization is a critical need, and we see an opportunity to integrate sterilization services with manufacturing and packaging under one roof. We are not only looking at acquisitions in this area, but we are already investing in expanding our sterilization services. We are building an ethylene oxide (EtO) sterilization facility in the Dominican Republic, co-located with our existing healthcare manufacturing site. We are also investing in an X-ray sterilization facility in the U.S. to supplement the GAMMA sterilization capability that we already have at our Albuquerque, New Mexico, site. These areas align with market trends and will guide our next strategic moves.
Jabil is a global company with manufacturing facilities across multiple regions. How concerned are you about current geopolitical changes?
We are well-positioned to navigate geopolitical shifts and meet changing customer demand as it happens. Our diversified global manufacturing and supply chain footprint allows us to quickly adapt to changes in trade policies, tariffs, or supply chain disruptions. During the previous U.S. administration, when tariffs were imposed on China, we successfully helped customers shift production across our network to mitigate the impact. We expect to do the same if new tariffs come into play. Our ability to move operations flexibly and deliver consistent quality and replicable manufacturing processes across all of our sites gives us a strong competitive advantage in uncertain trade environments.
Where do you see Jabil’s healthcare division in three years?
Our goal is to execute on the capabilities we have been building and continue to expand our capabilities in areas that will help to simplify supply chains for our customers. By then, we expect to have fully integrated Pii’s capabilities globally, offering aseptic fill, oral solid dose, and lyophilization solutions to our customers, existing and new. We aim to have expanded sterilization services, strengthened our position in minimally invasive devices, and developed a robust medical device reprocessing business.
Ultimately, our vision is to provide a complete supply chain solution for our customers, simplifying their operations while reducing healthcare costs. Growth in these areas will allow us to positively impact more patients worldwide by making medical innovations more accessible and affordable.
