A federally imposed medical device excise tax has stopped plans for new corporate headquarters for one of the biggest manufacturers in the Greater Lehigh Valley – and is costing the company $13 million a year.
However, B. Braun Medical Inc. will expand its medical manufacturing operations in the Valley and sees strong, continued economic growth in the region despite fierce industry competition and new federal mandates.
B. Braun chairman and CEO Caroll Heinz Neubauer disclosed the decision to suspend plans for the new headquarters during an exclusive interview with Lehigh Valley Business, when he also talked about his life and career and the future of the global company.
“The medical device tax stopped that project,” Neubauer said of plans for new North American headquarters at Stabler Corporate Center in Upper Saucon Township. “We decided to put that project on hold.”
Neubauer, 59, leads more than 5,500 employees across B. Braun’s North America headquarters in Bethlehem, four manufacturing facilities in North America and 25 pharmacies nationwide. The German-owned company develops and sells infusion therapy and pain management devices, products and passive safety devices. It produces materials that are free of toxicants and in use globally in hospitals and medical facilities of all types and sizes.
In North America, B. Braun generated $1.4 billion in annual sales in 2013 and is gunning for more than $1.5 billion this year, said Neubauer, a New Jersey native who lives in Saucon Valley.
With operations in 60 nations, the 175-year-old company’s global headquarters are in Melsungen, Germany. In the U.S., B. Braun’s primary manufacturing facilities are on Marcon Boulevard in Hanover Township, Lehigh County, and in Irvine, Calif. (It is the Marcon Boulevard location that is slated for expansion.)
An attorney, Neubauer began his career with B. Braun in 1988 in Melsungen, where he was a legal assistant to the chairman of the board, CEO and owner of the company, Ludwig Georg Braun.
Today, as chairman and CEO of B. Braun of America and B. Braun Medical Inc. of Bethlehem, Neubauer has overseen all North American operations since 1996. He and his wife Ellen have a 24-year-old son who just began his career at Cardinal Health in Chicago.
In the one-on-one interview, Neubauer talks about the role of a CEO, the company’s future and the decision to halt the plan for a new headquarters.