Founder and CEO of AIT Laboratories , Dr. Michael Evans tells Exec Digital how the company stood at the brink of ruin a decade ago, and is now one of the nation’s largest private forensic toxicology labs
Written by Kevin Doyle and Produced by Brian Svane
Dr. Michael Evans knows all too well the business world can be an unforgiving teacher. How one responds to adversity most often determines success or failure.
Founder and CEO of AIT Laboratories in Indianapolis, IN, Evans walked away from academia after two decades to start AIT in 1990. At the time, he was Director of the Toxicology Department at the Indiana University School of Medicine.
“I felt like I could run a pretty good lab,” says Evans of a decision partially rooted in a desire to “create a legacy that would outlive me.” Wounded seriously in Vietnam and realizing he was fortunate to be alive, Evans was driven to be productive.
“I became a professor and a director, running the department that I wanted to run. I was traveling (as an international consultant), but it was no longer my passion – I wanted to do more, to do something with employees. But, I had no idea what I was doing. I never even had a business class,” he says.
When a client that accounted for 85 percent of AIT’s early business informed Evans it was going to self-perform that work, the decision left the company Evans founded with his own savings – and which, to this day, has no investors – on the verge of bankruptcy.
“The failure of the company wasn’t the failure of our people. The failure was me not knowing how to run a good business,” Evans says. “I came back and told all our lab people they were taking a 20 percent pay cut. They stayed and within three months we had restored pay. We got caught up with all our vendors in about two years. That was the transition from running a good lab to running a good business.”
AIT services forensic, clinical, pharmaceutical and pain management clients nation-wide. The company provides analysis of chemicals and biological samples (blood, tissue and urine) and is one of the largest private forensic toxicology labs in the nation. Evans notes that no single client accounts for more than three to four percent of the company’s business. Consider that lesson well-learned.
Operations
AIT provides support for doctors in clinics and hospitals by monitoring patients for drug compliance; offering forensic services that include expert courtroom testimony; and pharmaceutical services for drug companies working on Phase I and Phase II clinical trials. The pharmaceutical testing division is being spun off as a separate company under the AIT umbrella.
The company’s 3,000 clients include pain management doctors, coroners, medical examiners, attorneys and hospitals. The company recently signed a contract to handle 3,500 backlogged forensic cases for the state of Louisiana.
“The forensic lab is one of the largest in the nation and it’s ‘CSI’ stuff. People love to hear that and we get a lot of play from it,” Evans says. “We do our analysis and provide expert interpretation and understanding as to what the results mean and don’t mean. That sometimes involves going to court.”
AIT is involved in a staggering 1,600 forensic cases a month. With seven toxicologists on staff, Evans says “we have the technical capability and the knowledge – and we’re good at it.” The company is often sought out by those requiring its special services.
“We do no work in Maine but the state’s Federal Attorney there contacted us in regards to a case where there was an accident and death. They sent us a blood sample and suspected methadone. The defense attorney sent someone to watch. We did the tests and found methadone. The defense had nothing to challenge us on, so they pled guilty before they went to trial,” Evans explains.
In another case, a snitch in Texas dropped a dime on a nurse in Indiana alleged to have killed patients with morphine overdoses. Following exhumation, AIT found levels of morphine in a patient who had not been prescribed the drug and the defendant pled out.
AIT guarantees quick turnaround. “We said from the very beginning that we’re going to do this in 10 business days. We stick to that and use it as a key performance indicator.
There is no reason to take two or three months for forensic results,” Evans asserts.
The management of pain medication is a growing piece of AIT’s business. A Medical Education Program is under the direction of Todd Pedersen, the company’s Vice President of Corporate Development.
“We want to create awareness about the rampant abuse of prescription medicine, particularly the opiates. Teenagers are grabbing drugs out of medicine cabinets. We know how people are dying due to years of results we see in our forensics line. Deaths from prescription medications are outpacing those from illicit drugs,” says Pedersen.
The program is designed to help primary care physicians, who still write 50 percent of prescriptions for pain medicine and narcotics, to better monitor their patients, reduce distribution of prescriptions to those who don’t need the medicine, and serve as an advocate for patients in legitimate pain who do.
Pedersen says a speaking program involving key opinion leaders has taken off. “Physicians appreciate it and it’s created more awareness of what a lab like ours can do to help doctors as well as patients.”
Economic stability
The company grew by 106 percent in 2008 and growth in January and February of this year was up 86 percent in comparison to the same time period a year ago. Revenues increased by 106 percent and net profit jumped more than 400 percent last year.
“I’m almost embarrassed with how well we’re doing. I’m very appreciative of where we are and understand we’re very fortunate. We’re investing back into the company with new equipment and training programs. We’re investing back into the employees with bonus programs,” Evans says.
Repeat customers
AIT was the first toxicology lab in the country to achieve ISO 9000 certification. The quality management tool helps companies identify best practices as a means of generating repeat clients. Evans says AIT lives off a yearly survey it sends to its customers. Of 600 respondents last year, 98 percent graded AIT’s service from good to excellent.
“If your client is not happy, then you’re in trouble. When we add a new client, we don’t lose them. We monitor and measure every touch point we have. We document, we follow up, we take corrective action and we take preventive action. We bend over backwards for our clients to keep them happy,” he says.
It’s no surprise that AIT has been named 2009’s Small Business of the Year by the Indiana Chamber of Commerce and has made Inc. magazine’s Top 5,000 list for the fastest-growing private companies in the nation each of the last two years.
Technology
Evans jokes “the best thing about me running this company is that I’m a scientist and the worst thing about me running this company is that I’m a scientist.”
Evans eschews return on investment and focuses on enhanced results new technology may yield. If that means spending $400,000 so be it. “If better science makes us better, then that’s what we’re going to do,” he says.
The company is often used as a beta test site for new equipment and has developed its own Mass Spectrometry methodologies that Evans says are “cutting edge and produce quality results that stand up in court.”
“We take the information we generate here and provide it to the client how, when and in the manner they want it. We put the information in context to help our clients and shape it to meet their needs,” he says.
People
AIT engages its employees at every level in a ground-up relationship. For example, a Quality of Life Committee came to management with the proposal that female employees – the company is 65 percent female with an average age of 34 – be provided paid maternity leave. “They even worked out the budget on their own. It took us all of two minutes to approve that and it was a life-changing event,” says Evans.
The company provides employees in need with interest-free loans, offers tuition reimbursement regardless of course of study and gives five percent of its monthly profits to charities screened and selected by an employee committee. Last year the committee gave $81,000 in donations.
AIT has a strong internship program and reserves one slot each year for a student from the School for the Blind. “There are statistics which show that more than 70 percent of those who are vision-impaired don’t have jobs. For many, this is their first job. We want to show them they can work. They are so grateful and it’s so inspiring to us,” Evans notes.
And it all goes back to Evans’ drive and desire to make a difference.