Phenomenex Inc.
Location:
Torrance
Founded:
1982
Core Business:
Supplies for chromatography chemical analysis
Employees in 2007:
500
Employees in 2006:
325
Goal:
To be the world leader in supplies for solid, liquid and gas chromatography
Driving Force:
Growing demand for quicker and more accurate ways to identify unknown chemical compounds in a wide variety of industries, including drug testing, food and beverage safety and petrochemical analysis
Chemical testing hardly seems like a dynamic business. But in a day when athletes are routinely tested for drugs and entrepreneurs are racing to produce alternative fuels out of exotic substances, think again.
Technologies that can rapidly and accurately identify chemical compounds whether they are in human fluids, agricultural products or synthetic solutions are in high demand.
And that’s why Phenomenex Inc. is a busy place these days.
The Torrance company has grown into a leader in the field of chromatography, which involves separating molecules to identify the content, purity and quantity of chemicals in a solid, liquid or gas substance.
Phenomenex doesn’t make the machines that perform that complicated task, but it is a leading supplier of the disposable components that are used to prepare samples for testing.
“What we provide is really the heart of the machine,” said founder and Chief Executive Fasha Mahjoor, a British-educated Iranian immigrant originally trained as an architect.
Phenomenex products are bought by laboratories run by the government, private industry and academia. And they are used to test a wide variety of substances, from petrochemicals, to biotechnology products to food and beverages.
The company is particularly known for working with its customers to develop products that can test for a wider array of substances, in higher volume and at greater sensitivity. This year Phenomenex won a spot on R & D; Magazine’s R & D; 100 list for a technological advance in the testing gaseous substances.
Locally, customers range from biotech giant Amgen Inc. and nutritional supplement maker Herbalife Inc. to the City of Hope cancer research center and UCLA’s Olympic Testing Lab, the only internationally accredited sports-testing lab of its type in the country.
The UCLA lab has seen its business grow as more athletic governing bodies require regular mandatory drug testing, even at the high school level. Aside from the Olympics, the lab’s biggest customers are the National Collegiate Athletic Association, the National Football League and Minor League Baseball.
“We need products that are more sensitive because the cheaters are getting better. Products that can be used multiple times in an automatic system also are important,” said Borislav Starcevic, a staff scientist at the lab for 16 years. “The faster we can process more samples with the same machine, the less likely we are to need to buy a new machine as the demand grows.”
Black art
According to Mahjoor, chromatography is “60 percent black art and 40 percent science” particularly when it comes to preparing the silica or plastic polymers that are critical to any sort of testing.
The silica, or in some cases plastic polymer, functions as a filter that enables substances to be broken into core components as they pass through it. The chromatography machine can then perform the analysis.
Phenomenex’s products range from simple plastic cartridges that are used to prepare samples and only cost $1, to its bread-and-butter silica-filled cartridges that are attached to the chromatography machine. Those cartridges can cost $400 to $500 each and can be used multiple times, with some larger cartridges running into the thousands of dollars.
As more uses for chromatography are discovered, Phenomenex has averaged 20 percent sales growth over the last few years, and gradually has been taking over more and more buildings surrounding its corporate headquarters at the Torrance Technology Park. A ninth building is now being renovated.
The company also grew through acquisition, gaining gas chromatography expertise by buying a competitor in Sutter Creek eight years ago. Phenomenex in the past year alone has grown from 325 people worldwide to more than 500 this year. Production is centered at the Torrance and Sutter Creek facilities, with sales offices and distributors in 58 countries.
If you asked Mahjoor 25 years ago whether he would be running a technology company with sales expected to surpass $100 million this year, he would have thought you were crazy. “I was a bit of a failure in chemistry,” he admits. “I come from a family of doctors and was a black sheep for going into architecture.”
But a best friend from his British boarding school days, Dr. Robert Gray, was establishing a small chromatography company in Great Britain and convinced him to become the U.S. distributor for his products. Mahjoor at the time was struggling to establish an architect’s practice on Wilshire Boulevard after moving the Los Angeles area.
Artistic side
“I discovered I had a business finesse that I had never explored, to the extent that within months I was selling more product here than he had been able to do in years,” said Mahjoor, who started out importing his friend’s products, then moved to developing and producing his own.
Mahjoor indulged his artistic side along the way. He has done the interior design on all his buildings, filling them with designer colors and antiques collected from around the world. It gives the small private company the look and feel of a much larger firm.
Today, big growth areas for the company are in bio-fuels, and food and drug testing. Genomics (the study of human genes) and proteomics (the study of proteins), are seen as emerging markets. With sports doping scandals and food contamination scandals now reaching crisis proportions, Mahjoor said customers are increasingly asking for technologies that not only can handle large quantities of samples quickly, but also detect new cutting-edge performance enhancers whose chemical composition is not well known.
His researchers also are working with the pharmaceutical industry to develop products that can be adapted quickly as new substances are discovered. One of those was the Zebron Inferno, a cylinder of thin, wound wires that enable gases to be processed at greater pressures and higher temperatures than ever before possible. That device is what garnered the company a spot on R & D; Magazine’s top 100 list.
Mahjoor is proud that owners of chromatography machines at Aligent Technologies and Waters Corp. will use a Phenomenex cartridge with their machine rather than the manufacturer’s own cartridge. He sees this as evidence of Phenomenex’s technological edge.
Nevertheless, he is always concerned about the potential for his company to be overtaken by competitors. The chromatography equipment industry was comprised of more than 400 mostly mom-and-pop companies 25 years ago, but has consolidated into around 50 companies worldwide, with 20 of them in the United States.
