Monday, May 2, 2011

An interesting business model

I'm surprised this article by Michael McCoy from last week's Chemical and Engineering News wasn't better covered in the chemblogosphere. Okay, so it's tomorrow's edition. It's a fairly interesting take on the "building block" business for small quantities of pharmaceutical starting materials. There was this little tidbit about a small Chinese company:
Ming Qi is all too aware of this perception. As president of Accela ChemBio, a Shanghai-based building-block supplier, Qi says he struggles to distinguish his company from fly-by-night Chinese competitors. [snip] 
Accela employs more than 90 people, Qi says, 40 of whom are chemists. The company lists about 6,000 compounds, roughly 4,000 of which are in stock at any given time. Accela chemists synthesize almost all of the compounds, Qi adds. 
Although himself a newcomer to the building-block business, Qi is amazed at the stream of new players in China and elsewhere that continue to enter the business. Qi says he used to make his catalog freely available, but after seeing competitors start listing the same compounds he became more selective about posting information online. “We don’t want to make it too easy,” he says.
I've never worked in a situation with compounds that are in stock or out of stock, but it seems to me that 40 chemists to work on 2000 out-of-stock compounds is cutting it a little close. When the customer comes a callin' and it's not in stock, I'll bet it's too late.

4 comments:

  1. I don't know about you Chemjobber, but personally I would much rather have a freshly made pot of acid chloride than one that had been sitting in stock for 12 months.

    So perhaps they have a bunch of things that can be made in one step in one day (such as many acid chlorides), ready for a customer order to come in?

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  2. I worked, for a short while, for a small company in NJ that was run by mainland Chinese. Most of the compounds that were in their catalogue were not in stock. They didn't even know how to make most of them, either!

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  3. I have also had experience with the ordering / availability gap. Most of the time, ordering 50-100 g of a "listed" compound directly from China takes 3-6 weeks (1 week of that is shipping time).

    Compounds sourced from India seem to be available faster...anyone else notice this trend?

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  4. Chinese companies like that are open solely because too many companies are driven by leadership which has no knowledge or interest in chemistry. Why hire chemists, when you can buy chemicals off the internet? Oh, and they won't check if the compound is what is stated in the catalogue either! If they are thorough they may ask the company to provide a NMR. Little do they know those NMR 'reports' can be quickly faked via ChemDraw.

    But boy, those companies sure are saving money on those expensive chemists aren't they! Good thing they 'know' that drugs come from assaying tons of chemicals from fly-by-night Chinese companies!

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looks like Blogger doesn't work with anonymous comments from Chrome browsers at the moment - works in Microsoft Edge, or from Chrome with a Blogger account - sorry! CJ 3/21/20