Company Profile: Broadley-James

 Thanks to a distribution decision made by Beckman Instruments back in the late 1960's, Orange County-based Broadley-James was able to penetrate the pH sensor market and become a leading manufacturer over the next three decades. A recent CalTIP grant will hopefully jump-start the company's next phase of growth, as it explores the possibility of utilizing microfluidics to advance its industry even further.

A new spin on spinoff

When asked to describe the origins of his family's company, Scott Broadley, now the Vice President of Broadley-James, says it could be considered a spinoff of Beckman Instruments, although not in the traditional sense. While Broadley's uncle worked for Beckman in 1967 making pH electrode instruments, the corporation had been benefiting from a 98 percent share of the US sensor market. That was until Beckman decided to eliminate its existing distribution network in the expectation of continuing and broadening its success by selling its products directly. Seizing the opportunity, Broadley's uncle started his family's corporation (with the help of Scott's parents), and decided to invest in the pH electrodes business. This jump-started not only Broadley-James, but an industry of competing companies.

"The opportunity for a little company like ours was huge," say Broadley. "Every catalog house and every distributor of every sort of catalog type now wanted a private label that made electrodes to take the place and compete with Beckman."

The next leg, and way, up

As Broadley-James entered the electrodes market in 1967, it turned out that Beckman's change of distribution wouldn't be the only remunerative circumstance to come to its door. The entire pH industry received its most significant boost in 1971, when the US government, after the national political climate rapidly became environmentally-conscious, passed a groundbreaking federal regulation in respect to clean air and clean water. For the first time in American history, it became illegal to dump toxic pollutants in the water, particularly anything into a stream, lake or pond, unless the pH was adjusted to pH7, the same pH as drinking water.

"When the government passed these laws, it changed life in the country and helped up companies like ours which made these sensors," Broadley says. Broadley-James has enjoyed over 20 years of uninterrupted profitability, yet not without a series of difficult and risky choices along its path. In the early 80's, shortly after Scott had joined his family's business following his chemistry studies at UC Davis, the company was at a difficult turning point. It could no longer compete with smaller competitors because those businesses had the advantage of significantly lower overhead costs. On the flip side of the coin, the bigger corporations naturally had the leverage of more established marketing and sales networks. Thus, Broadley-James had to explore the new terrain of producing products for the most challenging applications. The bet paid off, as the company met the needs of clients that were always willing to forgo the premium cost for the very toughest sensors.

"We went into applications where clients needed to make these measurements under high pressure conditions," Broadley says. "This actually differentiated clients that really knew what they were doing from those that were just guessing about it. We distinguished ourselves and went after that work, so the company consequently grew by going after the hardest applications."

Broadley-James now has the kind of business dilemma that most companies would gladly take on--supplying a heavy demand for its product. It has positioned itself advatangeously by entering the biotech-pharmaceutical market, an industry that has increased production drastically. On average, there are approximately six drugs a year that have hit the biotech market, while 126 are now waiting for final approval with the FDA. Yet Broadley points out that even if only 30 or 40 percent are approved, this will double the number of biotech-based products today.

"For companies exploring pharmaceuticals for combating everything from multiple sclerosis to cancer, their R&D facilities need these types of sensors, and we've got to make them in large quantities," Broadley says. "So we've got our hands full just servicing these clients. There's a large backlog of projects that people would want us to participate in. So it's a good problem."

Breaking new ground

Currently, industrial pH sensors have a useful lifetime that can be measured in months and sometimes weeks depending on the process application. Broadley-James perceives that this limitation can be overcome with molecular-sized devices, and has been conducting original research with nanomaterials called nano channelled glass. In order to reach its next stepping stone, Broadley-James was awarded a Larta-facilitated CalTIP grant last year, and will use those funds, as well as SBIR and UC grant support, to work towards improving and creating a new generation of pH sensors. The funds, still being budgeted for the project, will go towards marketing, promotional and production engineering.

"Working in this kind of business, there's no guesswork involved. It's a lot of science and it takes time and it takes testing. Without this kind of funding, everything goes slower," says Broadley. "What CalTIP has allowed me to do is put extra people on the job for long hours. It's more than the finessing of the product. Things don't sell themselves. If you had a better mousetrap tomorrow, people will still just look at you like, why do I need this? The CalTIP funds in particular are coming in handy just to commercialize the product along, and jump-start that needed effort."

by Wendy Hall
Larta Staff Writer

CalTIP 2002 solicitation deadline is May 15!
California technology companies can receive up to $250,000 to bring their products to market. If you have been awarded or have applied for a federal R&D grant you are eligible for the California Technology Investment Partnership (CalTIP) venture funds. Last year, Larta helped award $2.4 million in grants. There is no cost to apply and Larta can assist you with your application.
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