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Biotech puts Ashley on road to success

Feb 17 2014 16:26
Carin Smith
Cape Town - Ashley Uys, managing director of Medical Diagnostech, Real World Diagnostics and OculusID, is ranked 28th on Forbes magazine’s latest 30 Most Promising Young Entrepreneurs In Africa list.

He is a biotechnologist by trade and lives in Cape Town

He established Medical Diagnostech in 2010. It manufactures rapid diagnostic test kits for drugs, HIV, malaria and pregnancy.

His entreprise grew organically to a facility that can now produce 20 million test kits per year.

Fin24 asked Uys more about his path to success.

What made you decide that the malaria issue was something you wanted to pursue?

As an African company, we’ve decided to focus on products for African problems.

It made sense for us to develop a malaria test kit in Africa for Africa.

Distributing from Cape Town reduces logistical expenses and delivery lead times.

What was the process of its invention - and what was the one factor that set it aside as something you knew would work?

Our in-house trade secret formulations allow us to develop highly sensitive test kits. The more sensitive the test, the earlier the detection.

We’ve developed a prototype that had very promising results. After optimisation of the product, we’ve managed to get the right formulation for the product we have now.

Where did you grow up and what was one of the most significant moments that shaped your thinking about health?

I grew up in Belhar and attended Belhar High School. I’ve always enjoyed biology at school and decided to enroll in the Faculty of Science at the University of the Western Cape.

Studying biotechnology opened my mind to the possibility of developing products using science.

I felt that, as the eldest child, it was my duty to set an example and this motivated me to do the best I could.

What is most necessary in the development of health in South Africa and broader Africa?

Funding is probably the major necessity. With the necessary funds more research and development can be done to create innovative products.

Cost can also be driven down in order to make companies competitive in the public tender market when bidding against foreign companies.

What are your entrepreneurial qualities and how did they contribute to the success of your business venture?

The ability to "guestimate" risk and reward based on market information is extremely important to identify feasible opportunities for execution.

All opportunities should be filtered using general assumptions derived from "guestimates" to identify opportunity gaps in the market.

Time is money and focus is required.
 
Quality is non-negotiable. In order to be price competitive, we sell our products in different formats to cater for the respective LSM income classes.

For example, for the lower income class we don’t spend excessively on packaging and use a more cost effective outer test cassette.

This enables us to position our products without compromising quality.

Understanding marketing, project management, human resource management, and finance was important to formulate our business strategy.

To lead from the front, develop a corporate culture aligned with a vision and mission.

Understanding operational requirements were essential when we invested in setting up a manufacturing facility.

Maximising growth with limited resources and creating value according to market requirements are generated by understanding the fundamental principles of business.

Be unique, identify gaps in the market, understand the business life cycle and have contingency plans for required resources.

I retained my equity as long as possible in order to create share value before seeking investments.

I first distributed products to acquire market share, negotiated payment terms in order to ease cash flow, invested in a manufacturing facility with internal finance generated from distribution.

Because of this approach, we created a brand and substituted distributed product with in-house product.

We’re currently expanding into international markets.

Apply for grant funding, for instance from the department of trade and industry, the Industrial Development Corporation or SAB Kick Start before you sell any equity.

Your company has grown immensely since 2010.

It’s currently in the exponential growth phase. Once maturity/lag phase has been reached, I’ll execute my exit strategy of either selling to a major multinational pharmaceutical company or listing on the stock exchange.

This is dependent on future technology advancements and market needs for potential further expansion.

While securing your ISO 13485, were there any problems?

ISO 13485 is required to list products with the World Health Organization, which in turn opens up the global donor funded tender markets.

It is a quality management standard and also gives us credibility. We had to involve a consultant to assist with implementation.

Has Medical Diagnostech implemented the Employment Equity Act, including Black Economic Empowermtn (BEE)?

Our BEE rating is 110%, Level 3, EME. This is important for local tenders.

Is Medical Diagnostech currently dealing with competition?

We’re competing against mass produced products from Asia and India.

Since we’re situated in Africa and Africa is the largest market for infectious disease diagnostics, our competitive advantage is the cost saving for logistics.

We can therefore compete on price without compromising quality.

Has the drug test hit the market as yet?

Our drug test sales are taking off. We’re currently supplying all Alpha Pharm Wholesalers nationally, the department of health, the department of education, the City of Cape Town and rehabilitation centres.

We are now targeting mines, refineries, and shipping companies.

What challenges have you faced and how have you overcome them?

Due to my age, profile building was a big challenge. To be taken seriously in the science industry you have to develop something novel or innovative.

I’ve entered competitions to build this profile and showcase my innovations, for instance SAB KickStart, the SAB Innovation Awards and the Innovation Prize for Africa.

What is the most important thing you've learnt as an entrepreneur?

Manage resources and expand accordingly. If need be and the "window-of-opportunity" arises, go for a loan or sell equity.

Apply for research grant funding. Quality is a non-negotiable.

What about your work for the community?

We’re currently employing unskilled labour rather than automating any of our operations. This forms part of our growth strategy. Rather create employment instead of buying machinery.

Our products are also impacting socially: Cost effective test kits for diagnostics of disease and epidemics.

What are your future plans?

We’re planning to expand globally. Innovation plays a big part in our strategic decisions.

We will continue to look for innovative ways of doing things and creating innovative products.

What is your life motto?

Never give up, make good "guestimates", know your market, and innovate to be unique.

How do you keep a positive mind set in a difficult situation?

I don’t panic and remind myself that I just need to do the best I can. There will be light at the end of the tunnel.
 
What advice would you give to young and aspiring entrepreneurs out there?

Never give up, understand your market very well and strategize to make your company unique to competitors.

- Fin24

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forbes  |  entrepreneurship  |  biotechnology
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