Pharmax Limited’s production plant is located in Toronto.  It was there that company principals Gary Hodgins and Martha Wilson were interviewed and photos of the Pharmax team were taken.

Let’s start with…  Who are Gary Hodgins and Martha Wilson?
We both grew up in Toronto; both went to the University of Toronto and both earned Bachelor of Science degrees, although we hardly knew each other at the time.  Gary went on to do post-graduate work in radiation biology and subsequently completed a master’s program in Business Administration.

Did a career in science follow?
Actually, no, neither of us pursued a career in science after we earned our degrees.  Martha went on to raise three children and teach for the Toronto Catholic District School Board.  Gary became a senior executive in the building and development industry, and later became a consultant in company restructuring and re-organization.  In the late 1990s, one of the assignments that Gary’s consulting group, Technology, Management & Funding Inc. (TMF), undertook was the re-organization of Pharmax, after the founder passed away unexpectedly.

So who actually created Pharmax?
Stanley Cowan created Pharmax.  He was a renowned pharmaceutical chemist and inventor who originated Pharmax back in the early 70s.  Dr. Cowan invented the first chemistry to compete with Johnson & Johnson’s breakthrough product, Cidex^®.  The catch was that Dr. Cowan was a better chemist than a marketer, so his new chemistry languished in relative oblivion until the mid-90s.  Some believe his early death was due to frustration because of the industry’s lack of acceptance of his novel formulation.

What were the startup years like?
The startup years at Pharmax were driven by a collateral business called Polytechnic Laboratories, also owned by Dr. Cowan.  The laboratory provided research and product validation for many of the leading pharmaceutical and food manufacturers in North America.  Pharmax was a spin-off on products researched, developed, and invented by Dr. Cowan.  The staff and resources of Polytechnic Laboratories were utilized to produce the Pharmax chemistry.  Pharmax’ big break came when Germiphene, a leading Canadian manufacturer of dental products, made Glutacide^® part of their own infection control suite for the dental market. 

That must have been good for sales?
Yes, Pharmax’ sales soared, however Dr. Cowan remained frustrated because the medical community continued to overlook the potential for Glutacide^®.  After Dr. Cowan’s death, his widow tried to sell the company, which is how Technology, Management and Funding Inc. became involved.

How did the takeover go?
Well, at first, it was a bit of a rough ride.  Almost at the same time as TMF got involved with Pharmax, the patents on Glutacide expired.  Within a few months, Germiphene launched a similar-use product under the Germiphene brand name.  Pharmax’ sales collapsed.  During the same period of time, the regulatory, political and competitive structure of the laboratory market, which TMF inherited in the reorganization, required significant capital to update both equipment and facilities.  In 1999, an evaluation of the business confirmed that Pharmax/Polytechnic was insolvent, and there was no market for the company, other than the value of the real estate.

That’s when TMF really stepped in?
TMF agreed to take a minority interest in the overall enterprise – fund the business for twelve months in an attempt to make the business viable.  TMF did this because Pharmax’ product development is world-class.

What were the steps taken?
In the initial period, the TMF team, headed by Gary Hodgins and Dr. Dennis Beatty, recaptured significant business and allowed the overall operation to break-even.  In 2000, TMF bought out the existing shareholder, Dr. Cowan’s widow, hired Martha Wilson to replace Dr. Beatty, downsized the business by two thirds, and created a new five-year plan. 

Then what?
This initial five-year plan was completed in 2006.  It involved rebranding all existing Pharmax products, as well as the creation of a suite of products to compete with all of the major competitors.  We also initiated research and development projects based largely on partnering with two universities (Buffalo and Calgary) and with private companies.  Polytechnic Laboratories became “virtual”, but continued its role with key customers.  The emphasis was on the “Pharmax opportunity”.

What came next?
In 2006, Pharmax initiated a new five-year plan based largely on global expansion.  This plan anticipates structuring licensing deals in at least 3 or 4 countries to service major markets around the globe.  The result of these licensing deals will be the evolution of an insolvent, technically accomplished SME into a global leader in infection prevention and management, with licensing sales in the $75 to $100 million dollar range by 2015. 

You did all of this on your own?
Yes, Pharmax remains a small closely held corporation with a staff of 12 people.  70% of our staff is made up of university graduates with science degrees.  Pharmax achieves success thanks to its highly motivated employees, all of whom take pride in the company’s successes.

How do you keep people motivated?
Each staff person has multiple duties and responsibilities, but the primary job objective is to perform as a team member.  Although there are basic job descriptions, each staff member relishes the team member philosophy, the diversity of their roles, and the challenges of projects.

So everyone wears many hats?
Yes, they definitely do.  With Pharmax as an emerging global player that has strategic partnerships on four continents, our president, Gary Hodgins, spends about 25% to 30% of his time out of the office.  On a day-to-day basis, Gary is the technical consultant, the marketing director, the human resources coordinator, and the strategic planner, depending on the immediate need. 

What is the vision for Pharmax?
Our strategic vision includes a complement of 25 to 30 key people, supported by a world-class product development infrastructure that will achieve our overall growth perspective.  While Canada will continue to be our basic operating location for research and new product development, we intend to manufacture all of our products under license wherever we sell them around the world. 

Are other locations in the works?
Our expansion has already started.  In 2007, Pharmax opened an office in the United Kingdom to service Europe and the Middle East.  In 2009, we expect to open a second office in Hong Kong to service China, India, and the Asian market.  Future locations will depend on future markets, however, within our new five-year plan, we anticipate achieving our growth targets with these offices only.

 What’s the key to your success?
We believe that the opportunities, whether in Canada or elsewhere, are rooted in the ability to connect with the actual end-user.  Much of the focus on infection control is now vested in marketing and not science.  This is an unfortunate situation for which the manufacturers themselves are more to blame than anyone else.  Inappropriate claims abound.  For example, when the EPA last tested 200 products currently registered for sale in the United States, over 60% of these products could not achieve the results claimed on their own labels.

How do you plan to turn this situation around?
Pharmax is launching an initiative in Canada to link our technically-based representatives with end-users and distributors to ensure that the science is communicated so as to achieve the best possible outcomes.  We anticipate that, once developed, this program will be duplicated as part of each licensing location globally.  We believe that education is the cornerstone to successful growth and development, particularly as our product offerings are so unique. 

Can you give us a peek at what else you’ve got planned for the future?
Pharmax has the bulk of its business opportunities focused on special projects.  Many of these projects are proprietary and confidential, so I can’t tell you much about them.  Several projects will involve the public in ways that will directly impact people’s lives.  For instance, we are working with the Boeing Company, an aircraft manufacturer, to develop products for rapidly and effectively decontaminating aircrafts between flights.  We’re also planning to enter the marketplace with products to decontaminate makeup and other cosmetics.  Our biggest project involves creating the first chemistry to eradicate prions from healthcare facilities.  This will go a long way towards reducing the incidence of opportunistic infections.

Tell me about your HR policy...
Our “HR” philosophy is deceptively simple.  It is based on Pharmax’ core values, as mentioned in our Core Value Statement.  Potential employees are screened for their ability to function effectively in our unique environment.  In key positions, we have experienced virtually no turnover, except in cases where we’ve pushed employees to take time off from work to either broaden their work experience or enhance their academic training.  We subscribe to the “anyone veto” principle.  Every one of our staff members can interview potential hires, and they must approve of all hires so that no conflicts arise. 

Who is your market?
Our targets for growth in international markets are companies that have established distribution channels and a willingness or a current capability to perform the role of a GMP manufacturer.  Our limitation on licensing requires the licensee to guarantee a minimum of $10 million USD in sales within 3 years of start-up.

Tell us more about your team…  Who are they?  Why is the atmosphere so casual, playful, and creative?  What’s your secret to finding and retaining a team that seems to be happy to work together?
We have a very eclectic group of employees, with very different cultural backgrounds.  This is a huge benefit when dealing internationally, since certain employees may be able to communicate in a target company’s native tongue.  You can’t imagine the impact.  Collectively, I believe we can speak 12 to 15 different languages.  The other huge advantage is our weekly barbeques in the summer.  We get to sample global cuisine, since everyone brings a dish from his or her country.  The barbeque grill is divided – half for vegetarians and half for non-vegetarians.  We are a democracy in every aspect.  We celebrate our “Christmas” as a nondenominational event in February.  Each new milestone in our business plan is celebrated at an outside luncheon.  We are also organizing an afternoon canoe trip down the Humber.  I hope that we never get so big as to lose this flexible and informal, yet highly-demanding, approach to business.

The rising cost of fuel…  What kind of impact is it having on Pharmax? 
The rising cost of fuel has little or no impact on Pharmax, as we are sourcing and manufacturing our products under license where they are sold.  I should also mention that Pharmax will always retain a minority position in these licenses, as well as a seat on the Board of Directors.

The China Mission:
Several China missions have resulted in our advanced negotiations for a license in China with a very substantial, highly reputable pharmaceutical company.  It may seem obvious, however, without these missions by Industry Canada and TMTA to major trade events, companies like ours would never have the visibility to even be considered as a potential candidate.  If there is one initiative that Industry Canada should continue to support, it’s their trade mission to high-profile exhibitions located in the “BRICK” countries (where now we have added “K” to the list, which stands for Korea).

TMTA:
No other organization, including MEDEC, has accomplished as much as TMTA in keeping the SMEs plugged into the political, regulatory, and market conditions that impact all of us.  I love the idea that TMTA is beginning to showcase its members, as we can all benefit from each other’s successes and share the experiences that better equip us to cope.

This text is taken from an article written by Marcel Lafleur and published in the 2009 edition of BioSpheres magazine.