Good Chemistry Positioning Microtest to Be‘the Future of Western Mass.’

Thanksgiving came early at Microtest, a testing and research lab based in Agawam.

Employees clad in white coats and protective goggles streamed out of doors and hallways following the smell of turkey and gravy in the break room, where a feast had been provided for the facility’s 100-plus employees. It was a small show of gratitude as the holidays commence, signaling the close of a substantial growth year for the lab, in terms of both revenue and workforce, and the beginning of a new period that promises more of the same.

This track record for expansion and job creation was lauded this year with a Massachusetts Economic Impact Award from the Mass. Alliance for Economic Development, an honor that came on the heels of Microtest’s completion of a $7.5 million capital improvement program that doubled the firm’s footprint.

But Steven Richter, Microtest’s founder, president, and CEO, said 2007 has done more to whet his appetite for success than to satisfy it.

“We started looking toward the future some time ago, and looking at what was happening in pharmaceuticals and biologics in particular,” he said. “We knew we wanted to develop and leverage what we had.”

Thus, Richter didn’t have time for turkey dinner with his staff; he was in morning meetings that ran long, giving tours to prospective clients, and, in general, working to advance the vision he began to devise for his company in 1984: to be a leader in testing services and contract manufacturing for the medical device, pharmaceutical, and biotechnology industries, and in turn to make an significant impact on the well-being of the human race.

“There’s a large amount of clinical trial work being done in the state, and we expect to continue working within that area for many years,” he said. “This is the future of Western Mass.; this type of work does not go offshore.”

Fast approaching its 25th year in business, Microtest has already been involved with several medical breakthroughs as a testing facility; Richter said the lab worked with the inventors of the AbioCor artificial heart, for instance, and, early in the company’s existence, evaluated AIDS testing kits. Most recently, Microtest has contracted with a U.K.-based firm called Antisoma to manufacture its newest cancer-fighting drug, now in clinical trials.

There’s little time to rest on laurels, though. Richter said that even in the wake of a multi-million-dollar expansion, physical transformations and workforce development continues at Microtest to keep up with the constant need for workspace.

“We’re pretty much out of room,” he said, pausing at a window behind which construction workers were scoring a wall, readying to knock it down. “I’d say over the next five years, facilities planning is going to be our biggest challenge.”

Testing, Testing

That’s a weighty statement for a business that’s hard for many outsiders to understand. Its capabilities include things like ‘gamma/EO sterilization validation’ and ‘membrane filtration,’ and pair manufacturing processes with highly regulated scientific testing and production that requires a skilled workforce — another challenge for Richter.

When he founded Microtest, the company’s core service was medical-device testing, ensuring the safety and sterility of various tools and equipment.

The business model continued to evolve from year to year, however, as client requests created new opportunities, and Richter’s vision continued to broaden along with medical and technological advances.

Microtest launched its ‘clean-room testing’ division, a consultancy that evaluates compliance with industry regulations, in 1989. This aspect of the business sends employees who are experts in microbiology to labs, hospitals, pharmacies, and other controlled environments to evaluate the overall quality of an area in terms of water, air, and other variables; perform certifications; and search for contaminants such as yeast, mold, and bacteria. Similar testing can also be performed on-site at Microtest.

These two prongs of the company alone necessitated a move to a larger space in 1992, when Microtest relocated from a small, 3,000-square-foot ‘cottage lab’ in Feeding Hills to its current headquarters on Gold Street in Agawam. At that time, the lab expanded its analytical chemistry research and testing, which is used to test various pharmaceuticals, biotechnology components, and medical devices.

Today, there are five major areas in which Microtest employs its expertise, and more than 20 services are offered as part of these disciplines, many of which overlap.

In addition to analytical chemistry and medical-device testing, the lab also conducts virology and biosafety testing (the former was added to the suite of services in 2006 as part of Microtest’s capital improvement campaign), as well as pharmaceuticals testing and contract manufacturing, which includes ‘fill-and-finish’ services for pharmaceutical companies in all three phases of clinical trials.

Richter said the drug-manufacturing aspect — as of yet, Microtest doesn’t develop the drugs, but instead provides key elements of the development process — is the busiest area of the growing lab, which now encompasses four buildings on Gold, Silver, and St. Jacques streets.

“If we complete one fill-and-finish job for the government, for example, that could very easily lead to 30 more clients,” said Richter, noting that Western Mass. is well-positioned for such work due to its close proximity to one of the world’s biggest biotech hubs. “We’re close enough to the medical, biotech, and life sciences activity in Cambridge, so we feel the effect of the work being done there.”

This has necessitated a strong focus on creating a pipeline of qualified staff, and Richter has taken on this challenge too. He’s forged relationships with colleges such as Springfield Technical Community College to prepare students in science-driven programs for careers in biotechnology (19 graduates have moved on to positions at Microtest since the partnership began in 1996). And in March, Richter was appointed to the Robert H. Goddard Council, which advises the Commonwealth’s Board of Education regarding workforce development initiatives associated with the Science, Technology, Engineering, and Math (STEM) Pipeline Fund. The fund was created in 2003, and received a $4 million shot in the arm in 2006.

“The staffing issue we face is a need for skilled people with experience, and that’s a need that’s only going to get bigger as we continue to grow,” he said. “We’re lucky to be in a state with a think tank that includes MIT, Harvard, and a number of research hospitals, but if there aren’t enough people in the pipeline — starting now, at the middle-school level — that think tank is something we could lose.”

In short, Richter said he’s preparing for the future based on his own present-day success. The lab’s ever-expanding size and range of specialties allows clients to complete various aspects of a product or drug’s development in one location, said Richter, adding that he made a conscious effort to create such an operating model.

“It’s very atypical for a lab to do so much, but that’s always been part of our vision,” he said. “One of Microtest’s core abilities is managing our infrastructure, and all of our divisions coexist nicely. It’s a synergistic effect that allows us to complete things more quickly.”

There are also new additions to the business that are gaining speed, but more notably, some that didn’t even exist in the marketplace until recently. That’s a testament, said Richter, to how quickly the medical and technological fields are changing.

“We spent considerable money to add virus testing of biotechnology products, and that’s something we didn’t have three years ago,” he offered as an example. “It’s a new business unit that tests for animal viruses in biologics, such as vaccines, and with more drugs being created with animal components, it’s an important type of testing for our clients because they must meet FDA standards.”

Richter said the U.S. Food and Drug Administration (FDA) drives much of Microtest’s growth, differentiating the lab from those that test primarily consumer products.

“Most of our testing is done with FDA regulations in mind,” he said. “It keeps things more stable than most consumer testing labs, which are going crazy right now in the wake of media reports about unsafe products like those that came out of China.

“We have our crazy spurts too, when the FDA finds something,” he continued. “But for the most part, the guidelines are stable, and we know the work can’t be sent to another country.”

Prescription for Progress

Moving forward with that belief, Richter said Microtest will become more deeply involved in a number of emerging fields, including drug-delivery devices and stem-cell research and testing, as a greater number of companies and medical facilities search for new therapies.

“We have the knowledge to manufacture and test drug-device combinations; we understand the drug regulations, and we understand the regulations associated with medical devices,” he said. “Early on, we saw an integration of sciences as a strong possibility, and that foresight has given us a competitive edge.”

In the area of stem-cell research, which has been strengthened somewhat in the Commonwealth by Governor Patrick’s proposed $1 billion life sciences initiative announced this year, Richter said he also hopes to leverage Microtest’s existing strengths.

“We’re working on ways now to meet specific client needs in this area, and to work with stem-cell researchers who require testing,” he said, noting that his timeline for such services is ‘as soon as possible.’ “Life sciences is everything right now, and we need to be involved.”

Richter said there are a number of reasons why he supports stem-cell research, which is currently underway in the Commonwealth, using animal-derived cells only. First, it’s in keeping with Microtest’s mission, which is centered on doing no harm, helping clients help themselves, and in turn, helping people move themselves forward in many ways.

But it’s also an economic development strategy that Richter believes will be a major part of the region’s future as stem cell-fueled findings become more prevalent in the health care landscape.

“Stem cells will be a tool before they’re a therapy, helping us understand more and eventually eliminating animal testing,” said Richter, noting Microtest has never tested —and will never test — on animals. “And think of the drug discoveries we can make. It will increase the number of available drugs, and reduce their costs.

“Stem cells will also help us position ourselves in the stream of business created by the life sciences,” he continued. “The more Western Mass. is involved with biotech, the more the economy will grow.”

Richter said he’s also a proponent of research on human stem cells, for similar reasons.

“It’s important that the public be knowledgeable about what’s going on,” he said. “Applying the results we see in animals to humans is a leap of faith, but research involving human cells provides irrefutable evidence, and fewer mistakes.”

But in addition to evolving areas of research, Richter said he’s also aiming to broaden the firm’s work in other realms, including contamination control, an ongoing issue in the medical field that becomes more pressing as drugs and devices become more complex.

“In the future, contamination just shouldn’t happen,” he said. “We want to get more active in contamination control, not just in clinical areas, but at the bedside too, in hospitals and in other therapeutic environments.”

Stuffed to the Gills

Physical changes and expansions to the Gold Street property, which Richter owns (the other locations are leased), continue, but he said further expansion is needed — fast. However, so are millions in funding that the lab has yet to secure. Microtest typically adds staff at a rate of 10{06cf2b9696b159f874511d23dbc893eb1ac83014175ed30550cfff22781411e5} a year, and with the new capabilities added recently, that percentage could rise to 25{06cf2b9696b159f874511d23dbc893eb1ac83014175ed30550cfff22781411e5} next year. Further, just one small addition to the complicated lab environment can require a substantial influx of funds.

“Our biggest hurdle is financing for additional growth,” said Richter. “We’re looking for $7 million in funding now, for 5,000 square feet of space for commercial fill-and-finish work. We’ve needed to expand in those areas for about three years now.”

With ambitious plans like these, it’s easy to see why Richter has little time for turkey and all the trimmings — however, he is focused somewhat on next year’s holiday, and how many more places he’ll have to set at the table.
At this rate, there could very well be two seatings.