What motivates the two brothers is building up a successful and profitable company and having fun. Jan G. quotes Richard Branson when he says that “the point is to have fun, not chase money". The vision is to build an international life-science company in niche areas backed by “intellectual property" (IP - the intellectual capital around an idea — is what can be valued as an asset and can be protected under intellectual property rights legislation). ABIGO wants to work with patents and brands, and that is precisely what they do today.
The financial crisis and the economic downturn have not affected ABIGO, which instead can pride itself on its best ever financial figures during the current year. ABIGO is thus a profitable company, with around 40 employees, 15 of whom are located in Gothenburg. “This is a company no one leaves," says Jan G., describing the spirit in the company. “We have very good staff in the company and we expect a lot of our employees. When we take on people we look for entrepreneurs who enjoy creating things and have a high level of skills, and that´s one of the reasons why we are doing so well," says Jan G. proudly.
The two brothers are joint 100% owners of the company, are the sole members of its board and do not have, and have never had, any external financial backers. The company executives believe in maintaining a strong attachment to research, principally research in cooperation with academia. “We undertake research and development ourselves, and cooperate on a broad front with academia, in Göteborg and elsewhere. But we have never received support for our research or development in our business and have always been entirely self-financed," says Jan G. As a result, they have always been able to invest as they like and as they find appropriate, which has suited the two brothers very well.
ABIGO has steadily expanded during its 20-year existence. Needs have been identified, opportunities have been seen and investments have then been made. “I see the next five years as particularly exciting as we are registering several new products, as well as we are increasing and enhancing our present-day products — good product stewardship is important," says Jan G.
Today the Abigo Group consists of ABIGO Medical AB, which owns, manufactures and markets pharmaceuticals and medical devices, and the Danish subsidiary ABIGO A/S, which markets pharmaceuticals, natural remedies and wound-healing products in Denmark. In Sweden there is also Sylak AB, which imports and markets sterile disposable products in the Nordic region. ABIGO also has a Nordic marketing office in Malmö with medical representatives certified by the Swedish pharmaceutical industry trade association LIF, who work on the selected target groups. The ABIGO group has turnover in 2009/2010 of around SEK 130 million, and every year is a year of profit, says Jan G.
Products
The company operates in two areas, pharmaceuticals and medical devices. ABIGO today has around 20 pharmaceuticals which are their own products. They do not manufacture these pharmaceuticals themselves, production instead being dealt with by subcontractors in various parts of Europe. Jan G. considers there to be surplus capacity for this production in Europe, and therefore questions the value of in-house production. At the time of writing the company has four to five drugs in Phase III studies, which it is hoped will reach the market within two years. “This is a long-term industry which in addition is bureaucratically complicated. We spend a lot of money on R&D and patents" says Jan G.
In the field of medical devices, for example wound healing, ABIGO operates in more than 60 countries. In this area the company invests heavily in research and development, and Jan G. highlights the successful and well-documented product Sorbact. “Medical devices require clinical studies, and in this part of the company we hope to be able to launch a number of new products within two years," Jan G. explains.
Abigo has its own factory in Askersund for the production of medical devices such as Sorbact. At this factory the company has its own machine workshop and someone who according to Jan G. is a highly skilled full-time engineer, who both optimises operation and builds ABIGO's machines according to need. In 2008 the manufacturing operation in Askersund was moved to larger premises, and on 15 September the Minister for Social Affairs, Göran Hägglund, officially opened the new factory.
factory in Askersund
Photo: ABIGO
As mentioned, ABIGO has production at subcontractors in 10-12 countries in the Nordic region and other parts of Europe. The company has consciously chosen not to source any production in Asia the Smith brothers feel that at closer range you obtain a better insight into production, more motivated staff, good skills and good machines. “I think the idea of moving production to Asia is over-hyped, and in the long term I anticipate that pay levels will rise and gradually catch up with our own," says Jan G.
The company´s products are sold on around 60 markets, the largest one being Germany, where it is expanding successfully. The domestic market in Sweden is obviously an important market for the company, and Jan G. also mentions Finland as an important market for expansion.
Photo: ABIGO
The company executive Jan G. Smith
Both the Smith brothers have spent nearly 10 years in the United States and Canada, where they studied and worked. Jan G. studied economics in Canada, and his first job was in a large international corporation where he gained good experience of enterprise and the world at large. “I do not have any medical studies behind me, but I surround myself with people who have industry know-how and as a result have picked up a few things along the way," says Jan G. when asked how he has learnt so much about the pharmaceutical industry.
His brother Leif was involved in the financial industry in Canada.
Jan G. describes the two brothers as positive individuals who look forwards instead of backwards and see solutions rather than problems. He likes the North American “get up and go" spirit, where people believe in themselves and are not afraid to stick out their necks, and hopes the traditional Swedish pressure to conform is fading.
According to Jan G. networking is very important in this industry. Both he and his brother have a broad network and are members of the board or chairman in a large number of organisations.
EUROPHARM SMC — Jan G was one of the people who took the initiative for this association, has been its president, and continues to be vice-president and board member — around 200 companies in Europe are members of this organisation, which has its own office and staff in Brussels. It is aimed solely at pharmaceutical companies and is concerned with business cooperation between the companies.
Three hundred business meetings were held between the participating companies at the 2009 AGM. Europharm also lobbies the EU on conditions for medium-sized European pharmaceutical companies.
Rx-Alliance — Jan G. is a member of the board — Abigo is the Nordic partner in this organisation, there is only one company per country. Rx-Alliance is a form of cooperation between successful medium-sized companies with a good knowledge of their respective markets.
IML — Jan G. is the chairman of the industry association IML and was one of its co-founders twenty years ago. IML is a selective association that aims to establish networks between small and medium-sized Swedish life-science companies active in Sweden in research and development.
By Sandra Nordström
April 6, 2009
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