The closing this week of Oread Inc. apparently brings to an end what once was the state's premiere partnership between university research and industry.
This week's bankruptcy filings by Oread Inc. mark what appears to be a sad final chapter in a company that once was looked upon as the high-technology gem of Lawrence and even the state of Kansas.
The pharmaceutical company got its start at Kansas University. Oread Laboratories was founded in 1983 by KU professor Takeru Higuchi, a world renowned pharmaceutical chemist with a vision of building a research company that would pay dividends to the state of Kansas and its residents. It was intended as a commercial outlet for technologies developed at KU's Higuchi Biosciences Center. The firm was considered a model partnership between university research and industry applications. It received financial support from many state, university and city sources.
It was just the sort of company Lawrence wants. It provided professional jobs and the salaries that accompany them in a clean, high-tech industry.
But, after Higuchi's death, the company did not grow and develop as Higuchi and his close associates had hoped. It was in a slump when it was purchased and restructured by David Kimbrell to become Oread Inc. in December 1994. For a time, its future looked bright. Through a series of acquisitions and internal expansions, the company grew over the next four years from 80 employees to more than 800 employees.
It built a new 12,000-square-foot plant near 15th Street and Wakarusa Drive and had operations in Lawrence, Palo Alto, Calif., Farmington, Conn., Fairfield, N.J., and Atlanta. In July 1998, Kimbrell was honored as the regional winner in the annual Ernst & Young Entrepreneur of the Year competition.
However, the turbulent times were not over. In December 1998, Kimbrell was ousted as president and chief executive officer of Oread Inc., in a management shuffle intended to bring a new focus to the company. He remained as a director of the company, however, and eight months later regained control of the company.
On Monday, the doors at the Lawrence offices of Oread Inc. were locked. Employees were told to report to the nearby Mustard Seed Fellowship where many were told they were out of a job. About half of the company's remaining 225 employees nationwide were told they could remain employed on contract on a week-to-week basis to wrap up projects. Six Chapter 11 bankruptcy cases were filed on Tuesday listing hundreds of creditors; the 20 largest creditors are owed about $48 million.
It's difficult to know exactly why this company failed. Was it overextended? Poorly managed? Simply caught in a volatile pharmaceutical industry?
Whatever the reason, it is a loss for Lawrence. Efforts will begin immediately to try to fill the Oread property with another business, hopefully a pharmaceutical firm, but it would have been far better if the community had been able to retain and build on the Oread base.
It's a sad end to Takeru Higuchi's dream.