Neo Medical was welcomed to the northern Nevada business community Thursday evening in Sparks as city officials and business leaders joined Duvall and his team in John Ascuaga’s Nugget Rose Ballroom. Neo Medical, known primarily for its high-value safety needle technologies, has made strides in the neonatal and pediatric vascular departments of the medical supply field.
Duvall said the implementation of the Medical Device Excise tax, which is part of the Affordable Care Act, had much to do with the company’s decision to come to Nevada. The tax goes into effect on Jan. 1 of next year.
“(The new tax) has been all the rage here in the last few days and it would affect half of our revenue,” Duvall said. “We are trying to offset that revenue hit while maintaining our growth projections for the next five years. There were a few reasons for us to come to Nevada but the new tax and cost of manufacturing in California were big ones.”
Duvall said leaving California for Nevada will reduce his fixed costs on manufacturing by 35 percent, which he said is a huge number when 100 percent of your manufacturing is done in the United States.
Neo Medical is projected to open in March of 2013 and has made a capital investment of $2.8 million in northern Nevada, which will hold its manufacturing, headquarters and distribution centers. The company projects to open five new jobs upon its initial opening and expand to create 12-15 more jobs within the next five years through an increased focus in product marketing, according to Duvall.
“We have spent the last three years working on a series of new products for our key sectors, one of them being the premature and pediatric markets,” he said, “We committed to a lot of time and energy during the recession and that is how a lot of these smaller companies get ahead is we keep working on things.”
Duvall said when the company began exploring the option of leaving California for Nevada he contacted the Economic Development Authority of Northern Nevada (EDAWN) early in his search. He said EDAWN helped welcome him for a visit and understand the benefits of doing business in the region.
“(EDAWN) was one of the first calls I made because I figured there would be some sort of group to help out business who want to come to the region,” he said. “They told me about some of the great stuff going on and told me about what I could look forward to from the area.”
Mike Kazmierski, president and CEO of EDAWN, said adding Neo Medical to its list of business partners will only help strengthen the economy of northern Nevada. He said EDAWN gives the community has a reliable shoulder to lean on in times of need.
“I think it is really important to have this kind of celebration because (business leaders) are the ones who network and talk to and are the ones who sell this community, we just help connect the dots,” he said. “It is about adding quality jobs to this community.
When you get a headquarters, like the one Tim talked about, you get those decision makers, philanthropic giving, involvement and engagement from somebody who has become a part of the EDAWN marketing team.”
Kazmierski said everyone at the reception inside the Nugget, from Gov. Brian Sandoval down, becomes a part of the EDAWN marketing team “whether they realize it or not because they will tell people what a great place this is to be.” He said becoming a part of this region, as Neo Medical will soon discover, comes with a shared passion to help expand it.
“We bring in partners through the process that makes the case for this region. When these partners speak from the heart you have people who will tell you what it’s like here,” he said. “Every morning the EDAWN team wakes up and wants to support quality job creation. We want to keep talent in this community and we want to keep jobs right here.”
Duvall said the move to northern Nevada will provide a small fresh start for his company. He said he is looking forward to the welcoming environment and attitude he has perceived during his time in the region.
“I have found there is a real positive attitude over here. Even though Nevada has suffered greatly during the recession there is a great attitude in the young folks and the business people who all seem to be looking forward and not looking back,” Duvall said. Everybody seems to have a pro-business and pro-Nevada strategy and I’m looking forward to being here. I have worked in California for a lot of years and I have never had a mayor come and say hello to me. That adds a little ‘wow’ and a huge plus to coming over here. That really makes it special for us.”