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KENDLE INTERNATIONAL: THE $44 MILLION MOM-AND-POPCan good marriages be made in the boardroom? Candace Kendle Bryan, head of Kendle International Inc. (KNDL), a fast-growing Cincinnati drug-testing company, says so. Her secret: knowing how the personalities fit the task at hand. Bryan's husband, Christopher C. Bergen, is impulsive and well-suited to short-term operations, says Bryan. So he's president and runs testing. ''I like long-term strategy, so I'm CEO and chairman,'' says Bryan. The union seems blissful. Buoyed by a $6 billion global market for clinical drug testing, Kendle topped BUSINESS WEEK'S list of Hot Growth companies. Revenues have expanded at a stunning annual pace of 168.9% over the past three years, to $44.2 million in '97. Net income grew 158.8% annually, to $3.7 million last year. And this people-intensive business, with low equipment costs, boasts a sky-high 59.3% annual average return on invested capital. The granddaughter of a coal miner, Bryan, 51, never dreamed of such numbers 17 years ago, when she set up shop. Then the director of pharmacy at Children's Hospital of Philadelphia, she joined forces with Bergen, 49, a Wharton School MBA and administrator at the hospital. Best friends, the pair had grown tired of office politics. Bryan took the lead, and 55% of the shares. Bergen got 45%. ''Somebody has to make the decisions,'' she explains. Bryan's idea was simple. Big drugmakers were increasingly farming out research to smaller labs. Kendle offered its services overseeing clinical drug development, testing human reactions to new drugs. This data, which drug companies rely on for FDA approval, has to be bulletproof. Kendle quickly developed a reputation for reliability. ''They do thousands of things right every day,'' says J.C. Bradford & Co. analyst Andrew L. May. Bryan and Bergen were not yet married when they launched Kendle, but from the start the company was family-oriented. It located downtown in Bryan's hometown, Cincinnati, so she could be close to her two sons from a previous marriage and pursue such interests as competitive rowing. Working together eventually led to romance. Ten years into the partnership, the pair married. By the early '90s, Kendle faced exploding demand--and competition. Big drug companies, spooked by price pressures, outsourced rapidly to cut costs. But Kendle began losing business to bigger-name rivals. ''The marketplace was changing hugely,'' says Bryan. ''It was either grow or sell.'' Neither wanted to sell, but there was no plan for growth, either. Bergen had no marketing background, and Bryan's scientific know-how couldn't help. So she enrolled in a crash program at Harvard business school, which she later persuaded Bergen to attend. Afterward, they reorganized, with an emphasis on marketing. Realizing they needed to get bigger, they also set plans to go public to raise the capital to acquire other labs. The changes appear to have paid off. Kendle went public last August, and its stock has since jumped from 16 to 25. Expansion is also well under way. They bought a Dutch lab and a German lab in 1997 and this February added their first U.S. acquisition: Acer/Exel, a New Jersey tester with operations in Asia too. ''When you get a plan and stick to it, it's amazing what you can do,'' says Bryan. Kendle isn't yet among the biggest testing labs, but Wall Street thinks such moves will get it there. Analyst May sees sales nearly doubling this year, to $84.5 million, with earnings growing 148%, to $6.2 million. Bryan and Bergen don't plan to stray far from Cincinnati or her 140 nearby kinfolk. But there is one trade-off to mixing business and family: ''When I go home,'' says Bergen, ''I can't exactly bitch about my boss.''
By Peter Galuskza in Cincinnati RELATED ITEMS
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Updated May 21, 1998 by bwwebmaster
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