News - Midlands
Clinical precision
The blind leading the doubly blind - it doesn't sound promising, but Clinphone has built a £3100m business on the idea. Double blind testing - organising drug trials so that neither patient, doctor nor distributor knows who is taking what - sounds like chaos. But it is key to the way drugs are tested before they are launched on the market.
And with a typical trial costing $1m per day, any system that makes testing quicker and more accurate will be welcomed rather warmly by pharmaceutical giants.
Clinphone may not be the biggest brand name in the firmament of Midlands businesses, but in 13 years it has become the star player in its field, holding something like 40 per cent of its world market, most of the top-20 pharma-giants as customers, hundreds of staff and a £335m turnover.
When pundits bang on about the need for Midlands businesses to become global leaders in innovative technologies, Clinphone is already there.
And double-blind testing is a principle that, if Steve Kent has his way, is set to grow rapidly. Armed with the £394m-odd they raised from June 2006's successful stock market flotation, he and his colleagues plan to use the cash to fund a major buying spree as well as opening offices in Europe and the Far East.
Although Kent is clear that the company's base will remain in Nottingham, where it employs two thirds of its 580-odd staff, Clinphone is looking increasingly Anglo-American in its makeup. It now has sizable operations in New Jersey and Chicago - and in the past 12 months has opened up in North Carolina and San Francisco.
"We didn't float because we wanted money, we did it to safeguard our future," says Kent. "We provide technology services for key areas of clinical trials, but our clients buy a range of services from different vendors. If we're to progress we need to provide other services, giving a more holistic offering. We can't develop the sort of technology we need in-house, at least not in the time needed, which means acquisitions."
Kent isn't prepared to say who he might approach, but he obviously knows most companies in his sector.
After a few minutes with Kent you get the idea this is a man who takes a deliberate and - forgive the pun - clinical approach to business. He not only gives a concise description of why Clinphone needed to go public, but why it took the fund-raising path it did.
"We realised from the balance sheet that we didn't have the funds or capacity for growth," says Kent. "We looked at going to a venture capitalist but realised although we'd get a lot of money, we'd lose a lot of independence. So we decided to float and go for a full listing rather than one on AIM [Alternative Investment Market] because we needed the credibility. There were 150-odd AIM listings last year, but the average amount raised was less than £32m. A full listing gives us a paper credibility that simply wouldn't be there with AIM."
Most of Clinphone's operations concentrate on Phase III of drug trials - the part when a compound has got past small-scale tests and moves on to trials on those who might actually benefit from the new drug. At this point the emphasis is on discovering a drug's efficacy and what the correct dosage levels should be via double blind testing.
This is how it works. After recruiting enough volunteers to ensure results are valid, Clinphone randomly selects patients to be sent tablets containing either the compound being trialled or harmless placebos. Neither the patient nor the doctor overseeing the trial knows what is contained in any batch, so that the results cannot be rigged.
Clinphone remains unaware of volunteers' identities, although it knows a great deal about their medical backgrounds - age, gender, weight, ethnicity, medical history and so on. Anonymity is only broken in case of emergency.
If this sounds simple, it's anything but. With tests for any new drug typically running to $100m, the pressure is on to speed up the process and make trials as watertight as possible. By careful selection, Clinphone can keep the number of people being tested and time of the trials to the minimum valid for licensing. The business has collected data from more than 90,000 people in 88 countries and provided its systems in more than 70 languages and dialects.
The day of our lunch at Nottingham's Living Room restaurant could not be more apt. As we meet, news is breaking that TeGenero, the German company behind the recent trials which went disastrously wrong and led to six people suffering multiple organ failure, declared itself insolvent.
Surprisingly, Kent says that while the media may have been shocked by the accident, most people in the pharmaceutical industry were relieved such events did not happen more often. Perversely the incident helped the industry.
"TeGenero showed the public just how important proper drug trials are," he says. "I'm not sure people who have a pop at pharmaceutical companies realise how rigorous the testing procedure is. There have only been 17 major drug withdrawals in as many years, often for basic reasons like the compounds reacting when people drank wine.
"Ironically, it hasn't put people off. There's been a big rise in the number of applicants because people realised how much money can be made from taking part in tests. It's that usual joke of medical students paying for college by taking part in drug tests."
Clinphone was founded by two former Boots employees, doctors Neil Rotherham and Jonathan Engler, 13 years ago. The business was founded on the principle of codebreaking - breaching the codes that hide the identity of a compound or placebo - in emergencies.
Kent came in three years ago as the founders were gradually making voluntary exits (one of whom by all accounts went on to set up a surfboard business).
It's easy to see why they alighted on Kent as heir apparent, a man who has a broad background in IT, retail and pharmaceuticals. But it's more than his CV. While Kent is affable and accommodating - he agreed to be interviewed at short notice - he's not big on talking about himself. The focus of our discussion is clearly on business. It's notable that at the end he gets a phone call and, with sincere apologies, leaves without waiting for his coffee to arrive.
"When I came for interviews as finance director at Clinphone I was struck by how well it was run for what was then a small company," says Kent. "But it was also clear the founders didn't want to be the ones who took it to the next step. They wanted to do other things. It was a clever move.
"They brought me in as FD [financial director], learning the ropes, with the aim of me eventually taking charge. If it didn't work out I'd remain FD. My biggest concern was that they'd hang around like the ghosts of Christmas past. But Neil and Jonathan were superb - they withdrew but were there to advise me if I needed them."
And with a typical trial costing $1m per day, any system that makes testing quicker and more accurate will be welcomed rather warmly by pharmaceutical giants.
Clinphone may not be the biggest brand name in the firmament of Midlands businesses, but in 13 years it has become the star player in its field, holding something like 40 per cent of its world market, most of the top-20 pharma-giants as customers, hundreds of staff and a £335m turnover.
When pundits bang on about the need for Midlands businesses to become global leaders in innovative technologies, Clinphone is already there.
And double-blind testing is a principle that, if Steve Kent has his way, is set to grow rapidly. Armed with the £394m-odd they raised from June 2006's successful stock market flotation, he and his colleagues plan to use the cash to fund a major buying spree as well as opening offices in Europe and the Far East.
Although Kent is clear that the company's base will remain in Nottingham, where it employs two thirds of its 580-odd staff, Clinphone is looking increasingly Anglo-American in its makeup. It now has sizable operations in New Jersey and Chicago - and in the past 12 months has opened up in North Carolina and San Francisco.
"We didn't float because we wanted money, we did it to safeguard our future," says Kent. "We provide technology services for key areas of clinical trials, but our clients buy a range of services from different vendors. If we're to progress we need to provide other services, giving a more holistic offering. We can't develop the sort of technology we need in-house, at least not in the time needed, which means acquisitions."
Kent isn't prepared to say who he might approach, but he obviously knows most companies in his sector.
After a few minutes with Kent you get the idea this is a man who takes a deliberate and - forgive the pun - clinical approach to business. He not only gives a concise description of why Clinphone needed to go public, but why it took the fund-raising path it did.
"We realised from the balance sheet that we didn't have the funds or capacity for growth," says Kent. "We looked at going to a venture capitalist but realised although we'd get a lot of money, we'd lose a lot of independence. So we decided to float and go for a full listing rather than one on AIM [Alternative Investment Market] because we needed the credibility. There were 150-odd AIM listings last year, but the average amount raised was less than £32m. A full listing gives us a paper credibility that simply wouldn't be there with AIM."
Most of Clinphone's operations concentrate on Phase III of drug trials - the part when a compound has got past small-scale tests and moves on to trials on those who might actually benefit from the new drug. At this point the emphasis is on discovering a drug's efficacy and what the correct dosage levels should be via double blind testing.
This is how it works. After recruiting enough volunteers to ensure results are valid, Clinphone randomly selects patients to be sent tablets containing either the compound being trialled or harmless placebos. Neither the patient nor the doctor overseeing the trial knows what is contained in any batch, so that the results cannot be rigged.
Clinphone remains unaware of volunteers' identities, although it knows a great deal about their medical backgrounds - age, gender, weight, ethnicity, medical history and so on. Anonymity is only broken in case of emergency.
If this sounds simple, it's anything but. With tests for any new drug typically running to $100m, the pressure is on to speed up the process and make trials as watertight as possible. By careful selection, Clinphone can keep the number of people being tested and time of the trials to the minimum valid for licensing. The business has collected data from more than 90,000 people in 88 countries and provided its systems in more than 70 languages and dialects.
The day of our lunch at Nottingham's Living Room restaurant could not be more apt. As we meet, news is breaking that TeGenero, the German company behind the recent trials which went disastrously wrong and led to six people suffering multiple organ failure, declared itself insolvent.
Surprisingly, Kent says that while the media may have been shocked by the accident, most people in the pharmaceutical industry were relieved such events did not happen more often. Perversely the incident helped the industry.
"TeGenero showed the public just how important proper drug trials are," he says. "I'm not sure people who have a pop at pharmaceutical companies realise how rigorous the testing procedure is. There have only been 17 major drug withdrawals in as many years, often for basic reasons like the compounds reacting when people drank wine.
"Ironically, it hasn't put people off. There's been a big rise in the number of applicants because people realised how much money can be made from taking part in tests. It's that usual joke of medical students paying for college by taking part in drug tests."
Clinphone was founded by two former Boots employees, doctors Neil Rotherham and Jonathan Engler, 13 years ago. The business was founded on the principle of codebreaking - breaching the codes that hide the identity of a compound or placebo - in emergencies.
Kent came in three years ago as the founders were gradually making voluntary exits (one of whom by all accounts went on to set up a surfboard business).
It's easy to see why they alighted on Kent as heir apparent, a man who has a broad background in IT, retail and pharmaceuticals. But it's more than his CV. While Kent is affable and accommodating - he agreed to be interviewed at short notice - he's not big on talking about himself. The focus of our discussion is clearly on business. It's notable that at the end he gets a phone call and, with sincere apologies, leaves without waiting for his coffee to arrive.
"When I came for interviews as finance director at Clinphone I was struck by how well it was run for what was then a small company," says Kent. "But it was also clear the founders didn't want to be the ones who took it to the next step. They wanted to do other things. It was a clever move.
"They brought me in as FD [financial director], learning the ropes, with the aim of me eventually taking charge. If it didn't work out I'd remain FD. My biggest concern was that they'd hang around like the ghosts of Christmas past. But Neil and Jonathan were superb - they withdrew but were there to advise me if I needed them."