WILMINGTON – Quality Chemical Laboratories (QCL), a Wilmington company that provides contract chemistry services to the pharmaceutical and biotech industries, started modestly in 1998 with five employees working in 10,000 square feet of labs and offices.

Today the company has grown to more than 250 employees and is building a new facility that will give it 180,000 total square feet. In any given month QCL works with 100 to 120 clients, from small startups to multinational corporations.

For Michael Barron, the company’s director of business development, the explanation for QCL’s robust growth and success is simple.

“If you listen to what your customer needs, and you creatively and flexibly work to solve their problem, money just follows,” says Barron. “It’s as natural as night following day.”

Quality Chemical Labs

QCL’s chemistry expertise helps pharmaceutical and biotech clients develop new drugs, getting them to the market faster.

“That’s why we’re successful,” Barron says. “We provide what people value. In this business, time is money.”

An American dream

QCL was co-founded by Yousry Sayed, Ph.D., a former chemistry professor and university administrator who today is the company’s sole owner and president and chief executive officer.

Sayed had no trouble transitioning from academia to an entrepreneurial startup company.

“This idea of entrepreneurship, it’s just in his blood,” Barron says. “I think this came from the cradle.”

In addition to owning QCL, Sayed is a real estate investor who is as comfortable fixing a tenant’s broken air conditioner as he is running a scientific enterprise, Barron says.

Sayed’s path is a classic American success story. A native of Egypt from a family of modest means, Sayed immigrated to the United States in the 1960s to continue his education. He earned a Ph.D. from the University of Minnesota, became a naturalized citizen and then started teaching chemistry.

“He loves the science more than anything,” says Barron, who met Sayed in 1988 and has worked for him for the last 10 years. “His passion is science first, and his second passion is education.”

Sayed found his way to the University of North Carolina Wilmington, where he became an award-winning professor, mentor and researcher in the Department of Chemistry and Biochemistry and then director of the General College.

On the side he consulted with Fred Sancilio, founder and CEO of Applied Analytical Industries (known today as Alcami), a Wilmington-based contract research organization that serves the pharma and biopharma industries with drug development, manufacturing and testing services.

That experience helped Sayed figure out a business model for providing contract chemistry services, and he and a partner launched QCL in 1998. Sayed later bought out the partner to become sole owner.

QCL’s first customer was Merck, the multinational pharmaceutical giant, which remains a client today, more than two decades later.

“It’s a testament to the relationship and the quality of work we do,” Barron says.

Hands-on science, free of financial pressure

Sayed is a hands-on entrepreneur who not only runs the business but loves working on complex chemistry challenges for clients.

“He has helped customers solve some very challenging chemistry problems,” says Barron.

It’s not uncommon for Barron and his coworkers to get email messages from their boss at 3 or 4 a.m.

“This is a guy who eats, sleeps and breathes chemistry, Barron says. “His saying is chemistry never sleeps. He operates pretty much 20 hours a day. Nobody can outwork him. I’ve never met a person who’s more ‘at it’ than he is.”

That work ethic and problem-solving mentality, which flows from Sayed throughout the company, has won new customers and retained old ones, without the need for aggressive business development tactics. Barron and one other business development professional seldom travel to drum up new business.

Satisfied clients keep coming back, and new ones find QCL based on the company’s reputation for good work and trustworthiness.

“We do a lot of handshake business here,” Barron says. “We take risks on behalf of our clients. We’ll get stuff done for them before there’s a purchase order. It’s how you build trust with people.”

Sayed ensures that the company’s scientists can focus on high-quality science by not tying financial targets to their work. That’s possible because QCL is self-financed and solely owned, so it doesn’t have to yield to investor pressures.

“Everyone gets to focus on what their expertise is,” Barron says. “The scientists get to be scientists. That wouldn’t work if we were dealing with outside money – private equity.”

As a privately owned company, QCL shies away from disclosing its revenues, but Barron admits that “growth is good, efficiencies are good, the business model is working.”

The company gets frequent inquiries from would-be buyers, but the company is not for sale. Sayed “could have sold this company probably 500 times over,” Barron says.

Expanding capacity

Initially QCL focused on raw material and compendial testing, which ensures that drug ingredients meet published industry standards. Since then the company has expanded to include small- and large-molecule analytical development and validation, sample analysis, residual solvents analysis, organic/synthetic chemistry, wet chemistry, trace metals analysis, mass spectroscopy, microbiology, stability management services, formulation development, and clinical scale GMP (Good Manufacturing Practices) manufacturing.

As it adds even more capabilities, QCL is becoming “a one-stop for all things chemistry and manufacturing and quality control of products,” Barron says. “We’re quite well along that path.”

The company’s sweet spot is pre-formulation, product development and getting clinical trial materials into the clinic on aggressive timelines.

All of this work takes place in six buildings encompassing 90,000 square feet in the North Chase Parkway Industrial Park near the Michael Jordan Freeway, north of downtown Wilmington. The facilities are registered with, and inspected by, the Food and Drug Administration and the Drug Enforcement Administration.

QCL’s footprint will double in 2022 with the completion of a seventh building that will provide an additional 90,000 square feet for sterile fill and finish manufacturing of injectable drugs, and additional testing.

The facility will also provide space for Pyramid Pharmaceutical Co., a drug development company created by Sayed that has previously operated virtually, or without walls.

Pyramid has done initial development work on potential drugs and drug-delivery technologies, and the company’s co-location with QCL should accelerate that work.

Job opportunities for local graduates

QCL created about 15 new jobs over the last year, and “we’d like to hire more,” Barron says. “It’s just hard to hire fast enough.”

About 95% of the company’s workers have a college degree, most either a bachelor’s or a two-year associate’s degree, and more than a dozen have Ph.D.s. “We’re a highly educated workforce,” Barron says.

The company prefers to hire locally and has developed an employment pipeline for graduates of UNCW and Cape Fear Community College.

To help supply a trained workforce for the growing pharmaceutical industry, Sayed, his wife, Linda, an attorney who formerly taught high school chemistry, made a $5 million gift to UNCW in 2017. It was the largest philanthropic gift by a corporate donor in the university’s history.

The gift, $1 million per year over five years, is supporting the development of new programs related to pharmaceutical sciences and chemistry.

“We have hired a lot of people who went through the chemistry or biology programs there,” Barron says, and other graduates work at other life sciences companies that are clients of QCL.

Sayed also serves on UNCW’s board of trustees and is an adjunct professor who continues to teach and mentor students.

Keeping one foot in academia and one in industry allows Sayed to provide both educational and career opportunities for budding scientists and technicians.

“He does it because he loves it,” Barron says.

“As part of the substantial clinical research industry cluster in southeastern North Carolina and the Wilmington area, Quality Chemical Labs has proven to be a company with a strong community commitment and with potential for rapid, significant local growth” says Randall Johnson, executive director of the North Carolina Biotechnology Center’s Southeastern Office. “Dr. Sayed and QCL exemplify the knowledge-sector-focused entrepreneurial talent, vision, and drive our region needs, supports, and celebrates.”

(C) N.C. Biotech Center