Susie in Shanghai

A few weeks ago I visited a company located outside of Shanghai and had the opportunity to tour the facility and speak with the founder.  I have been waiting for feedback from him on our interview for a while now, so I decided I will at least post the interview anonymously below, and when I hear back I will put the company’s title etc.

What I will say now is that the company is a CRO providing fully integrated pharmaceutical services to the global pharmaceutical community.  It has been recognized as one of the top drug discovery contract research organizations (CROs) in China and is managed by a team of scientists with many years of experience in US-based pharmaceutical and biotechnology companies. This is the third founder of a life science company I have met with, so it is interesting to see their unique perspectives on business in China. Enjoy!

Q: Tell me a little bit about your background and the path that led you to your current position?

A: I graduated from China Pharmaceutical University in Nanjing. I spend 12 years there before coming to the United States in 1991 to complete my PhD in pharmacology and toxicology. Then I spent three years on my post-doc at St. Jude Children’s Research Hospital in Memphis, Tennessee.

Q: Did you always know you wanted to do business versus continue research?

A: No actually, my family nudged me in the direction of business. And I didn’t even know I would be back to China originally, but I enjoy both China and the U.S. I like to be able to be back here now because I have learned a lot.

Q: I’ve done some research on your company, but I know things in China can change quickly, so can you provide me an update of what your company has been doing and what it has been specifically focused on in the past couple of years?

A: My company was founded in 2004 to provide fully integrated pharmaceutical services to the global pharmaceutical community. The company’s integrated services across biology, chemistry and preclinical services are specially designed to help clients develop their research and discovery programs from the initial idea stage to the IND filing phase. Most companies only focus on one area of expertise, but we look at the big picture and combine biology, chemistry, and preclinical research.

Q: Is an integrated approach more difficult than focusing on only one area of research?

A: There is a little bit of a challenge in conducting research in multiple fields, but our company is in many ways like one-stop shopping for our customers. And our preclinical focus also differentiates us because we have an entire animal facility. Some other companies have not met the requirements and guidelines for an animal facility yet, so we have an edge in that way.

Q: As a small businessperson, what have been some of your biggest challenges?

A: I would say the main challenge is phasing into the international market. To do that you need to hire people with international experience and proficiency in English. It is important to understand what customers outside of China want and having people on your staff that do is very important.

Q: So how do you get enough employees for your companies that speak English and have the same level of customer service as in the west?

A: Most of our higher-level managers have experience in the West. We have about three hundred employees across biology, chemistry and preclinical research. Over 50% of those employees have MS and PhD degrees, over 10% have foreign education and/or working experiences.

Q: How else do you convince people of your quality?

A: Other than our employees, we also have excellent equipment and facilities. All of our certifications are AAA, which shows customers everything is up to international standards.

Q: What are some of the trends you see for businesses like yours in the future?

A: A lot of companies will work to become international. Right now the U.S. is the biggest market so companies want to be able to work with the U.S. I think overall everyone would like to go internationally; unfortunately not every company can get to that level. At my company we want a combination of business in the West and in China, 50/50. We have the international market, now we want to increase our business with the Chinese market.

Q: What about shipping your products outside of China? How are the import/export regulations and what are some distribution challenges?

A: Overall distribution is ok because we have broad experience. With customs, you just have to make sure everything is reputable, honest, and up to quality standards. There is still room for improvement and I think that will come through more openness. Sometimes we have to deal with issues shipping dry ice and things of that nature, but chemicals are easy to send. Shipping biologicals like plasma is more difficult because of the strict safety regulations.

Q: How do you go up against the really big companies both in China and the U.S.?

A: Competing with the U.S. companies we have the advantage of our quick turnaround time and low-cost. We emphasize our capability in China to appeal to the U.S. market. Competing with Chinese companies can be more difficult because we can’t really compete on cost. All the prices in China are lower, so we have to find other ways to differentiate ourselves, such as our animal facility and niche integrated business.

Q: I read that you had partnered with a U.S. company recently, but that partnership recently ended. Can you tell me a little about that? How has it been since the split?

A: One of the main issues when you join with another company is who should “take over.” We did well together but sometimes management and decision-making was problematic. There has to be a balance where you don’t do things 100% the Chinese way or 100% the American way. In many ways our companies were just too similar and it was almost like we were competing. Since the buy-back it has been much better. I think our service is better overall and it has been more cost-effective for us. We still bring business to them now.

Q: As a recent graduate, can you offer me any advice in terms of business and which direction to head? Would you recommend working in China?

Absolutely 100% I would recommend working in China to get some experience. There is a biotechnology boom in China and if you are really interested in that field, it could be a great opportunity. I think that China is going to be #2 to the U.S. market soon because the population is so big and more and more people can afford higher medicines and care. I would suggest getting U.S. experience as well, but the combination could be very beneficial. Usually when I see someone from the west work for a big company in China and then go back to the U.S., they will get promoted. Obviously learning more Chinese is important as well, but knowing both languages will be a huge advantage.

If you have the chance and want a challenge, you should definitely start your own business one day. You start small and grow, increasing your management skills, getting investments, etc. It is a lot of work, but it is more fun. In China, once you are established, the government will also help by contributing money to your business to attract people.