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Future Trends in the Rubber Glove and Condom Industries: an R&D Perspective

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Future Trends in the Rubber Glove and Condom Industries: an R&D Perspective Future Trends in the Rubber Glove and Condom Industries: An R&D Perspective David M. Lucas, PhD - Vice President, Science & Technology Topics Overview of Ansell ° Operations ° Research and Development (Science and Technology) Current Manufacturing Technologies ° Medical Gloves ° Condoms Increasing NR Costs ° Immediate Reactions from the Manufacturers ° Move to Synthetics? ° Cost Reduction ° Move to “Value-added” and “Active” Products Some Possible Future Technology Trends ° Medical Gloves ° Industrial Gloves ° Condoms Global Operations 2007 North America U.K. Germany Poland • Coshocton • Redditch (Condomi) (Unimil) • Thomasville • Tamworth • Tarboro • Dothan India Thailand • Bangalore (2) • Bangkok • Aurangabad • Surat Thani Malaysia • Melaka Mexico • Kedah • Salvacar • Shah Alam • Bermudez Sri Lanka Brazil • Colombo (Blowtex) Employees 18 Plants / 2 Packing Operations • > 80% in Asia • 11 in Western Hemisphere • 9 in Asia • > 10,000 people Global Science and Technology 2007 U.K. • Redditch U.S.A (Occupational Gloves) • Pendleton, SC Thailand (Fibre Technology & •Surat Thani Knitted Gloves) (Condoms) •Bangkok (Occupational Gloves) Malaysia • Shah Alam Mexico (Occupational & • Salvacar Medical Gloves, (Knitted Gloves) Sri Lanka Condoms & • Bermudez • Colombo Lubricants) (Occupational Gloves) (Surgical Gloves & Occupational Glove) Manufacture and Post Processing of Powdered Medical Glove Manufacturing Former Coagulant Coagulant Latex Latex Cleaning Dipping Drying Dipping Gelling Stripping Drying Powdering Leaching Curing Leaching Post Processing High Temp Tumble Post Washing Drying Powdering Drying Manufacture and Post Processing of Powder-Free Medical Glove Manufacturing Former Coagulant Coagulant Latex Latex Cleaning Dipping Drying Dipping Gelling Siliconization Polymer Stripping Leaching Curing Leaching Drying Coating Post Processing High Temp Chlorination Tumble Post Washing Drying Siliconization Drying Manufacture of NR Condoms Manufacturing Former Former Latex Latex Latex Cleaning Drying Dipping (1) Drying Dipping (2) Film Stripping Leaching Drying/ Bead Latex Curing Rolling Drying Post Processing Washing/ Electronic Drying Foiling Powdering Testing Condom Dipping Rising Natural Rubber Costs: Immediate Reactions from the Manufacturers Malaysia Latex Price Jan 2004 - Apr 2007 12.00 MRB Latex Price (RM/dry kg) 11.00 10.00 9.00 g k y r d 8.00 / M R 7.00 6.00 5.00 4.00 J'04 F M A M J J A S O N D J'05 F M A M J J A S O N D J'06 F M A M J J A S O N D J'07 F M A Year 2004-2007 What has caused the increases? Strong demand (China), high oil prices (production, transport, higher synthetic latex prices) and lower yields (weather). What is expected ? Continued strong demand for NR and high prices. What are the manufactures doing? Raising selling prices, evaluating cost saving initiatives (materials, process) and rationalization of product portfolios. Trends in Natural and Synthetic Rubber Usage for Glove Production (Ansell Data) Trends in Latex usage NR vs. Synthetic Trends in Medical Exam Gloves Volume NR vs. Synthetic e e m u m l o u l V o V 2002 2003 2004 2005 2006 2007 F02 F03 F04 F05 F06 F07 Year Financial Year Latex Disposable Gloves Nitrile Disposable Gloves Other Synthetic Disposable Gloves Vinyl Disposable Gloves NR Latex SR Latex (CR & NBR) Total Synthetic Gloves Latex Usage ° Overall volumes for NR latex remain significantly higher than the combined synthetic latex demand (this includes use for HHG’s, Surgical Gloves, Exam Gloves and coatings for Occupational Gloves). ° Still high demand for NR Surgical gloves, NR exam gloves and NR HHG’s. Disposable Exam Glove Demand ° Increasing demand for NR gloves and (most) Synthetic gloves from FY02 to FY07. • 150% increase in NR glove demand • >500% increase in Nitrile glove demand • 50% increase in Vinyl demand. • 1% decrease in ‘other’ synthetics. • Overall Synthetics have increased by 94%. ° No real evidence that Synthetic glove Sales are increasing at the expense of NR glove sales (94% increase – Synthetics vs. 150% increase - NR). Cost Reduction Materials ° Reduce product thickness/weight and still meet customer requirements and international standards. ° Add “lower cost” additives into formulations. Calcium carbonate, mica, clays, etc. ° Move to lower/broader specification latex. Consider single centrifuged latex vs. double centrifuged latex. With broader specification able to procure latex at periods during season when prices are lower. ° Become vertically integrated with main raw materials (e.g. rubber plantation and concentration, nitrile manufacture). Utility Costs ° Investigate most cost effective energy provider (Biofuel? Cogeneration?) ° Improve film curing/drying efficiencies. ° Improve leaching efficiencies. ° Remove non-value adding processes (off-line processing?) Automation ° Automate process from compounding to final packaging. Move to “Value Added” and “Active” Products Products ° Move from standard commoditized gloves and condoms to products offering competitive advantage through added features and active ingredients. Examples: ° Powdered surgical glove to polymer coated powder-free* surgical glove. ° Standard flocklined household glove (HHG) to foamlined* HHG. ° Powder-free surgical glove to hand-moisturizing** surgical glove. ° Standard powder-free nitrile exam glove to thin nitrile glove offering moisture management coating*. ° Standard nitrile chemical resistant glove to nitrile glove offering step change in wet grip**. * Patented ** Patent pending Our Marketplace and Customers Have Demanded an Evolution of Technologies: Technology Platforms - Medical Gloves Hand Care Technology Foamlining Performance Additives Allergen Reduction Performance Modification Latex Formulation Powder Free Coagulant Thin Film Technology Surface Chlorination Modification Low Powder 1976 1983 1997 2006 Thin Film Technology glove inner surface modification PPrroodduucctt O Offfeerrininggss Soft matrix Hard domain (hydrophilic) ® (hydrophobic) Encore ®PF gloves releases lubricant Encore PF gloves minimizes friction SS8855, ,S S9955, ,S S8877, ,S S3388 & & S S8888 ® GGaammmmeexx®PPFF ® ® NNuuTTeexx®DDeerrmmaa S Shhieieldld® Derma Prene®®Ultra Synthetic Derma Prene Ultra composite Natural rubber TM polymer MMicicrrooTThhininTMPPFF 3 micron 240 micron Ansell Patented Technology Foamlining Technology glove inner surface modification FOAMLINING Product offerings: 350 MICRON Product offerings: PPaasstteel lS Skkyy B Bluluee SSaalmlmoonn P Pininkk PPaasstteel lG Grreeeenn PPicicoott Y Yeelloloww NNaattuurraal lS Seennssititivivee CCaannddyy P Pininkk GLOVE AVERAGE BBicicoololorr OUTER LAYER PORE SIZE Foamlined Care HHG 350 MICRON 50 - 100 MICRON Foamlined Care HHG Ansell Patented Technology Gammex® PF HydraSoft® Special technical features ° Skin moisturizer to prevent and treat dry skin and to improve skin health ° Polyurethane lining with hydrophilic and hydrophobic elements which facilitates damp donning and intra-operative changes ° Protein and Endogenous Allergen Reduction Leaching (P.E.R.L.) Technology that delivers a glove with extremely low extractible proteins, reducing risk of latex sensitization. FITkitTM testing shows non-detectable levels of allergenic protein (Hev b1, 3, 5 and 6). ° PV100 accelerator completely consumed during processing. Non detectable chemical accelerator residue levels and reduced risk of contact dermatitis. Ansell Patent Pending Technology Gammex® PF HydraSoft® Increase in moisturization (%) Elapsed time after glove removal Measurements are taken after wearing both gloves for one hour. The HydraSoft technology shows a significant incremental improvement of 47% – 98% within a time frame of 5 - 30 minutes versus the control glove. Independent Lab Report: Short Term Moisturizing Effect of Gammex®PF Hydrasoft® Glove Report by Malaysian Palm Oil Board (MPOB), 2005 Ansell Patent Pending Technology Virtex® Semi-Disposable Nitrile Glove: Key Performance Characteristics ° Outstanding comfort and flexibility: 9 mil glove (0.225 mm) ° AquadriTM sweat management coating ° Excellent dexterity and tactility ° A new softer nitrile which provides good performance especially in Hydro-carbon based chemicals, oils and grease ° Patterned grip feature for good Oil Grip performance ° Silicone Free and FDA food contact compliant ° Packaged with folded-over cuff for easier donning Ansell Patented Technology AlphaTec® – Chemical Resistant Nitrile Glove Laboratory tests AlphaTec® gloves confirm: ° Outperforms all major competitors on grip capabilities. ° Exceeds all other major nitrile competitor products in chemical permeation performance. ° Matches and exceeds abrasion resistance to level 4. ° Exceeds cut protection to level 1. ° Matches and exceeds tear and puncture to level 2 & 1, respectively. Ansell Patent Pending Technology AlphaTec® Grip Technology Hand Grip Force To Lift Increasing Weights Using Oily Bar e 20.0 c r o F p i 15.0 r G ) d g n k 10.0 ( a H m u 5.0 m i n i M 0.0 2.5 kg 4.5 kg 6.5 kg Weight Lifted (kg) AlphaTec Competitor 1 Competitor 2 Some Possible Future Technology Trends…. Medical Gloves ° Accelerator-free curing technologies ° New synthetic materials / coatings ° ‘Active’ surface coatings, (e.g., skin care) ° “Nano-sized” performance additives. Industrial Gloves ° Gloves targeted at unmet industrial needs (specific industrial processes) for example, cut resistance and liquid repellency. ° Enhancing current functional performance. • Cut resistance (new fibres/yarns?). • Mechanical durability (new polymers or additives) • Chemical resistance • Ergonomics (improved glove design) Condoms ° “Super-Thin” Film Technology (< 40 micron film). ° Synthetic Condoms -still an unmet need for a Synthetic Condom which performs like a NR Condom. ° ‘Active’ Condom lubricants..
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