Medicine for the masses

Phoenix Pharmaceuticals markets prescription drugs to underserved communities

Most urban dwellers who see black physicians probably aren’t aware that the money generated from their prescriptions benefits the pharmaceutical industry to the tune of $100 million per week. Few of those dollars are recycled directly back into their communities.

However, Parran Foster, president and CEO of Phoenix Pharmaceuticals Inc., a four-year-old, 14-employee pharmaceutical company in Waldorf, Maryland, vowed that his firm would return a minimum of 10% of its earnings to the community in the form of college scholarships. “We’ve actually returned closer to between 30% and 50%,” says Foster. Last year, Phoenix gave $300,000 in scholarships.

To start Phoenix, Foster used $220,000 culled from personal savings and investments by family and friends in the medical community. The privately held corporation, with nine stockholders, took no loans, so it’s debt-free.

“I liked his idea of turning over 10% of the profits back to the community,” says Dr. Charles Curry, chief of cardiology at Howard University in Washington, D.C., and a Phoenix stockholder.

Armed with 20 years of experience in the pharmaceutical industry and the support of family and friends, Foster set out to become the first black owner of a pharmaceutical company to play a major role in that industry. To make his venture successful, Foster had to form a coalition with the minority physicians he’d done business with, securing many of them as his customers. He also had to align himself with a major pharmaceutical manufacturer with products that would serve the medical needs of urban communities.

In 1993, Foster contacted Parke-Davis, maker of the contraceptive Loestrin and the anti-hypersensitive drug Accupril. The two companies developed a partnership in which Phoenix would market and sell Parke-Davis’ products. Under the agreement, Phoenix would work to boost the number of prescriptions of those products in specific area codes. Phoenix and Parke-Davis would then share revenues generated by those increases. Phoenix has had a market share growth of between 4% to 7% over the past three years. Last year, Phoenix stopped marketing Loestrin and picked up Parke-Davis’ diabetic drug, Rezulin.

Foster used his seed money to conduct testing in Baltimore, Washington, D.C., and Richmond, Virginia, to determine how viable those areas were for use of Parke-Davis’ products. By the end of the first year, Phoenix had grown from three to 12 employees and revenues were $450,000.

Foster, whose customers include physicians and hospitals in nine major cities, expects Phoenix to earn $2.5
million to $3 million this year.

Phoenix Pharmaceuticals, 3162 Old Washington Rd., Waldorf, MD 20602; 301-870-0001

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