Aegis Sciences Corp., an 18-year-old company, finds itself in a growth industry. It tests for drug use in the business and sports worlds, working with employers on pre-employment screening and with sports teams to prove drug abuse or clear an athlete's name.
Business has been good. In the past two years, Aegis has seen its revenue soar from $4 million to $24 million a year. Credit goes to a new business plan and to a more businesslike approach, says David Black, CEO and president.
The company recently moved into a 35,000-square-foot headquarters and laboratory in MetroCenter. Aegis also has a second, smaller facility at 345 Hill Ave.
Black's company operates in a complex field. Drug use at work, or doping to enhance athletic performance, remains rampant. There are more than 3,500 medications that can be used by athletes alone to enhance performance, and unscrupulous people — some of them pharmacologists or physicians — strive to beat the system.
Black discussed staying one step ahead of the pack and Aegis' expansion with Business Editor Randy McClain.
Aegis, or its predecessor, started two decades ago on the Vanderbilt campus and has since grown into a private company with $24 million a year in revenue. Describe its current ownership.
Aegis grew out of a program that began at Vanderbilt in 1986 based on an athletic steroid scandal there at the time.
In response to that, the school decided to establish a laboratory for testing athletes — what's known as a doping laboratory — to detect anyone using drugs to enhance performance. I was brought in to develop and direct that program. But after almost five years, funding for the program was discontinued. Rather than leave Nashville or join some other company, I decided to take (the doping lab) off campus, and provide the same services privately. It was initially incorporated as Aegis Analytical Laboratories.
In 1998, we reincorporated under the name Aegis Sciences Corp. and we restructured a good bit. By 2002, we really began to structure our company more as a business and not just as scientists.
What services did Aegis focus on at the beginning?
We opened our doors on July 1, 1990. The basic services were all in the area of athletic drug testing or doping analysis. Also, a part of it was providing specialty toxicology services to medical examiners, coroners and law enforcement agencies. We also later became certified by the U.S. Department of Health and Human Services for workplace drug testing.
We focused mainly on the workplace and the world of sport until about 1997.
Then, we established a relationship with Forensic Medical, a firm that had been contracted by the city of Nashville to provide death investigations and other medical examiner duties. We provided the forensic toxicology, or post-mortem analysis. My doctorate degree, which is a Ph.D and not a medical degree, was from the University of Maryland School of Medicine, specifically in the area of legal medicine, post-mortem toxicology. So, the new relationship fit very well with my education and the original intent for my career.
When did Aegis get more serious about growth, seeking out new clients and focusing on specific research niches?
Our board adopted a new business plan in spring 2006. And since then, we have grown from about $4 million a year in revenue to $24 million. In a little more than two years, we've greatly increased the revenue base. The business plan looked at our greatest strengths and the most advantageous market segments. We wanted to be in markets that had relatively few contact points to land the sale … and we picked three that we'd operate in almost exclusively. One, post-mortem crime scene investigation, drunk driving lab work and other areas with a high probability of litigation. We provide laboratory analysis and courtroom testimony. Two, doping analysis, drug testing in sports; and three, pain management (testing patients to make sure that they take a wide assortment of painkillers only as a doctor has prescribed).
You've moved into new lab space this month and beefed up testing equipment. What does that mean for the volume of samples you can test — mainly blood and urine samples?
We've made a lot of improvements in the past 18 months in our processes and how many different types of drugs we can measure and test. We can test for more drugs in samples that are smaller in size, and we can do it a lot more efficiently than ever before.
One of the tests we use with our pain management clients, for example … the older equipment we had … it might take 40 minutes to do a particular test. Our new equipment does the same test in four minutes. Productivity goes up. The older equipment, which was leading edge 15 years ago, might have cost $80,000 per unit. The new equipment costs as much as $400,000 for a unit. It's more expensive, but we process samples much more efficiently.
From the moment Aegis was incorporated, our focus has always been working very hard to eliminate the possibility of false negatives. Negatives go through the system very quickly. It is the positives … a sample that contains some drugs … that requires this $400,000 piece of equipment to catch it.
We test at lower detection limits, (we) test for more drugs, and we guard against people who try to beat the drug test. If you go to Google, and type in "beat the drug test," you're going to find over 16 million Web pages devoted to telling people how to defeat a drug test. But all the products you can buy out there aren't likely to protect against the kind of testing we do — because it's so precise.
Who are among your top corporate clients?
In workplace drug testing, we work with quality companies such as Nissan North America, Bridgestone Firestone … we have Fortune 500 companies, and then we have very small employers, too.
In sports testing, we have the University of Tennessee, Vanderbilt, Penn State, the University of Florida, Texas A&M; we have about 80 Division I schools where we provide services to the athletic departments for their on-campus drug testing.
For medical examiners and crime scene work, we have government relationships. We also provide services to private coroners and private medical examiners for death investigations. We do forensic toxicology for much of the state of Tennessee, coroners in Texas. …
In our pain management practice, we focus primarily in the Southeast. We have very good relationships with various pain management clinics in the region.
What's one of the biggest growth areas in the world of sport, when it comes to a need for better drug testing?
Cycling and the Tour de France has had terrible press on the degree of drug use in that sport. We're working with the Agency for Cycling Ethics (ACE) … to do close monitoring of every cyclist that is engaged in that sport in the United States. We monitor these individuals through both blood and urine testing to make sure they're not using any doping or performance-enhancing drugs.
This is one new development that began about 18 months ago to be proactive in terms of identifying use. We are monitoring a number of natural indicators for body function … and if the individual who is being tracked has their normal values markedly change over a short period of time … we'll just know there is something abnormal that is more likely than not to be associated with a prohibited practice. And they'd no longer have the opportunity to compete.
Why is drug testing such an emphasis for U.S. and, perhaps, world cycling?
The sport really is on the verge of losing all credibility, and the Tour de France after many, many years of being a major worldwide event is on the verge of going out of existence, if drug use in that sport cannot be addressed successfully. This is a worldwide problem — drug use in sports and drug use overall.
In sports, a big problem is the volume of new drugs that are being developed.
The way drug abuse in sports takes place … is typically a new drug is developed for medicine to help people with a particular condition, and then somewhere a creative doctor or pharmacologist thinks, "Oh, you might take this and use it on a healthy individual, and it will allow them to perform at greater than their normal ability."
The newer drugs that are being developed today, like human growth hormone, or others … that help carry more oxygen through the blood to the muscle … these drugs are different than the traditional drugs of abuse, and they're far more difficult to detect.
In fact, today there is not a good, reliable test for human growth hormone or some of these other drugs that are found naturally in the body … but now you can take them through a pharmaceutical and suddenly you can have super amounts of these drugs. So, we have new challenges.
What other sports does Aegis have a relationship with other than cycling? Baseball is one that has had its share of problems with steroid use.
We have a relationship with the Major League Baseball Players Association that goes back at least four years. Our role is to provide both the expertise … and a laboratory service when appropriate to determine whether or not a baseball player, who may be about to be charged with an infraction, has truly done something or whether there's an explanation.
We provide a service to the players association so they may negotiate with the league and properly address the issue, as well as defend the rights of the players.
One problem is that there are many products on the market that can be purchased by you or me today that contain chemicals not identified on the label but which are on the banned list of almost every sport.
You could very innocently go into a supermarket or a health food store and buy a product you intend to use as a supplement … and without realizing it, it contains a chemical that will then show up as a banned drug.
Part of what we do is sort through the data to figure out if someone innocently purchased a product … and now they're about to be publicly identified as a drug abuser and perhaps get suspended. Our role is to protect and defend.
We also review the work of the drug lab in Montreal, Canada, that has contracted with Major League Baseball to ensure that their tests are done properly.
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