The best-known businesses in West Bend have historically been in the manufacturing and financial services sectors – companies such as Regal Ware, West Bend Mutual Insurance, Serigraph and Gehl Co.
However, now West Bend’s business community has a new player, a company that opened its doors in early 2009 with a handful of employees and has quickly grown to more than 100 workers.
And it’s just getting going.
Spaulding Clinical is located in the 200,000-square-foot former St. Joseph’s Hospital at 525 S. Silverbrook Drive. The hospital was vacated in 2005 when the new St. Joseph’s Hospital opened at Highway 45 and Pleasant Valley Road in the Town of Polk.
The former hospital building owned by Spaulding Clinical has seven floors in two separate buildings on the eight-acre campus.
Based in a residential neighborhood on the near west side of West Bend, Spaulding Clinical Research is becoming a national force in the pharmaceutical testing industry.
Spaulding Clinical specializes in phase one testing of new drugs. Phase one clinical trials are the first in-human tests of new drugs that pharmaceutical companies hope to bring to market.
The company is a specialist in cardiac safety – making sure that the drugs being developed do not interrupt normal heart rhythms, blood pressure and other cardiac functions.
“Phase one (tests) are done with normal, healthy volunteers,” said Randol Spaulding, founder and chief executive officer of Spaulding Clinical. “They have to be extremely healthy. They’re tested in many ways with blood tests, urine (samples), cardiac tests, medical exams, and they’re asked about family history and any medications. Volunteers also get a complete cardiac workup. They have to fit a defined definition of healthy.”
At build-out, Spaulding Clinical will be able to host up to 300 patients at one time.
When it began its first clinical trial with patients in February, 2009, Spaulding Clinical operated on a single floor of the hospital building with 48 available beds. This year, the company expanded into a second floor, where it has another 53 available beds.
Next year, the company plans to expand into another floor. The company’s business model calls for it to open an additional floor every year until it occupies all of the seven available floors in the former hospital.
“Each floor adds 40 to 50 beds,” Spaulding said. “It will lead up to us having a total of 300 available beds for phase one testing.”
The company’s administrative and IT workers, its pharmacist and some nurses are full-time employees, while most of its physicians and some nurses are part-time or work flexible schedules, Spaulding said.
Spaulding Clinical is growing rapidly. The company expects to have about 130 total employees by the end of the year. It is hiring both full-time and flexible schedule employees now.
High tech solutions
Spaulding Clinical is growing because it is the first pharmaceutical testing firm to automate the testing process, Spaulding said.
When volunteers enroll in a clinical study, they are fitted with a blood pressure cuff and heart rate monitor, which stay on them for the duration of the study. The equipment is connected to the company’s servers and monitoring software wirelessly, so that heart rate and blood pressure can be constantly monitored.
“(The system) automatically pulls data from (volunteers) when it needs it,” Spaulding said. “The patient doesn’t even realize that it is pulling data.”
Volunteers are also given wristbands similar to those used by hospitals. When a nurse or physician scans the wristband’s bar code, that patient’s file is automatically called up on the computer.
“(The patient’s) whole schedule is on the scan. It’s got everything that the patient will do for the time they’re here,” Spaulding said. “(The system) automatically pulls data from me when it needs it. We have eliminated almost all paper (records). The evolution of hospitals moving into electronic medical records (EMR) wasn’t happening in clinical trials before we started. We did it. And we’re more advanced on EMR than most hospitals.”
The pharmaceutical industry is embracing Spaulding Clinical’s automated approach because it can minimize errors made in gathering data, administering doses or other variables in the clinical trial process.
“Variability is bad in a scientific experiment,” Spaulding said. “We’ve got no variability and our errors are way down. That’s what makes us attractive to pharma companies.”
Cytochroma Inc., a specialty pharmaceutical company that designs, develops and commercializes drugs for Vitamin D insufficiency and secondary hyperparathyroidism associated with chronic kidney disease, has been working with Spaulding Clinical since it began offering phase one trials. Cytrochroma is headquartered in Markham, Ontario, and also has an office in Bannockburn, Ill.
Spaulding Clinical’s cutting-edge technology, which allows for real-time patient monitoring by drug companies, is unique, said Peg Pepping, manager of clinical trials at Cytrochroma.
“I was monitoring subjects last night, at home in my pajamas,” she said. “Their technology is phenomenal.”
Joel Melnick, vice president of clinical research and development with Cytrochroma, said Spaulding Clinical has been able to handle studies that needed to be developed quickly and several last-minute changes.
“They’ve been wonderful to work with,” he said. “They’re flexible and the outcomes seem to be fabulous.”
During the Spaulding Clinical’s phase one clinical trials, participants are confined to one floor of the former hospital. If a participant wants to leave during the study, they are disqualified from the pool of participants.
Patients share rooms, which have privacy curtains, a shared bathroom, two televisions that receive hundreds of channels via satellite and available wireless Internet. Each floor of Spaulding Clinical has a common room with a large-screen television, video game systems, a pool table, a selection of board games and puzzles and a quiet room that has a computer.
In addition to laptop computers, participants are able to bring cell phones. Some participants are able to continue their normal jobs during the studies, Spaulding said.
Food and drink are carefully monitored during the studies. All participants are given prescribed portions of food and drink.
Participants who complete clinical trials are paid for their time. The payment varies from about $1,200 to more than $4,000, depending on the study, Spaulding said.
High-growth potential
Earlier this year, Spaulding Clinical began participation in phase three clinical trials, which are some of the final trials done before a new drug is granted federal approval. Phase three trials are done in populations that have the diseases or conditions that the drugs are designed to treat.
When Spaulding Clinical participates in phase three trials, it sends cardiac monitoring equipment to other drug testing firms that are hosting phase three trials. The company’s equipment sends cardiac information about patients back to its West Bend headquarters, where physicians and other health care workers monitor and analyze the information.
“The FDA still requires (drug companies) to continue safety testing while they are testing (the drugs) in sick populations,” Spaulding said. “As trials are being conducted all over the world, we send our cardiac monitoring equipment to the sites that are doing the trials, teach them to use it and connect their patients to our equipment. We manage the collection and analysis of the cardiac safety data.”
Because Spaulding Clinical has built its expertise in cardiac testing, it already has physicians and nurses to analyze cardiac data for phase three testing, as well as the technology to host, store and categorize the data, Spaulding said. The company contracts with more than 20 cardiologists around the world.
Spaulding Clinical will participate in two phase three trials this year. Although phase three trials are a small part of the company’s business now, they present a significant growth opportunity for the future, Spaulding said.
“These are both very large markets (phase one and phase three trials),” he said. “The pharmaceutical market as a whole does about $750 billion in global revenue every year. They spend about 18 percent of that to develop drugs, (or) about $150 billion. Of that $150 billion, about $10 billion to $15 billion is in phase one research. At least $100 billion is in phase three. There is tremendous opportunity for growth in both areas. We’re growing phase one testing here, but we can grow phase three testing in more clinics, worldwide.”
Spaulding Clinical has built a large data center on its campus to handle its own phase one and phase three data needs. That data center also is capable of handling medical data from hospitals, clinics and individual physicians’ offices, Spaulding said, giving the company another growth opportunity.
“It’s a natural for us, with all of the data we’re collecting,” he said. “We’re just piggybacking on our existing servers. There’s massive amounts of data flying around (with the studies), and we’ve got to funnel it down specific paths to get studied. This is terabytes of data, and it’s a big industry to manage that.”
Spaulding Clinical was one of the first companies launched by BizStarts Milwaukee Inc., a nonprofit organization dedicated to helping entrepreneurs form, launch and fund new, high-growth companies. The company is an example of the type of firms the group wants to get off the ground, said Dan Steininger, vice president and one of the founders of BizStarts.
“Spaulding (Clinical) is exactly what we hoped it would be,” Steininger said. “It’s a high-growth company, the investors will make money and it’s generating a significant number of high-paying jobs for the region.”
