The Douglas family trust donated about $12 million worth of profits from their West Auckland pharmaceuticals business in the past year to charity.
Douglas Pharmaceuticals, which the late Sir Graeme Douglas started in 1967 when he was a chemist in west Auckland’s Te Atatu, is New Zealand’s largest drugs developer and manufacturer.
According to Sir Graeme’s son, Jeff Douglas, chief executive of the private company, the amount the family gives away through the trust varies slightly each year depending on how much of annual profits are invested back into the business.
He says the main charities the Douglas Charities Trust supports include the Starship Children’s Hospital, Hospice NZ, the Auckland Westpac Rescue Helicopter Trust and the Neurological Foundation. Sir Graeme was recognised for his contribution to business and philanthropy with a knighthood in 2010 after making the single largest donation, an MRI scanner, to Starship.
Jeff Douglas says his parents – Sir Graeme and Lady Ngaire – were making a tour of the hospital when they noticed a number of children with their anaesthetists having to make the trek from the children’s hospital to Auckland Hospital to do MRI scans.
They decided on the spot to donate an MRI scanner for the kids to try to lessen the trauma for them, he says, and that kicked off the family’s continued commitment to donating to good causes.
The pharmaceutical firm is owned by a family trust and its beneficiaries are Lady Ngaire and his two sons, Jeff and Richard.
Richard Douglas is an Auckland surgeon specialising in nasal, sinus and medial skull-based conditions. He is an associate professor of surgery at the University of Auckland and has published more than 60 academic publications from his research, particularly into chronic rhinosinusitis and healing after sinus surgery.
The firm celebrated its 50th birthday in late 2017 with a big party for its 685 staff and by setting an ambitious target to boost annual revenue to $500 million by 2025. Total sales in the 2018 financial year were forecast at $230m, of which $145m was from exports to 35 countries.
The US market is now the biggest earner for the company, accounting for 35% of revenue, and is the fastest-growing market. Douglas has a number of generic drugs nearing American regulatory approval that should help boost revenue in that market. The first released will be a generic for dofetilide, an antiarrhythmic agent.
It also set up a research and development lab last year in Philadelphia, mainly to attract talented staff who didn’t want to shift to New Zealand. The first product from that lab is expected to be released at the end of 2019 – a topical dermatology medication.
The company entered into a 50:50 joint venture, MyPak Solutions, with Australian-based Arrow Pharmaceuticals this year to sell automated drugs compliance systems to the Australian pharmacy and aged care market. Pharmacists are subsidised by the Australian government to provide the DAAs (Does Administration Aids) to patients and Douglas hopes to emulate its market leader status in New Zealand with the blister packs across the Tasman.
Much of the targeted uplift in revenue in the next few years is expected to come from new product development involving generics and repurposed molecules (taking an existing drug and changing its form or indication). Several repurposed drugs are nearing or have human clinical trials under way including the injectable product ketamine, which the firm in conjunction with the University of Otago, has repurposed to treat acute depression from its original use as an anaesthetic.
Two others in the pipeline are a repurposed drug to treat cervical cancer and another cancer drug.
There are no immediate plans for a public float of the company though Mr Douglas says that could be something that is considered if funds are needed for later stage clinical trials on a potentially big hit new product.
He says his “greatest fear” is squandering the legacy left by his father but the company is “growing faster than ever.”