When Dave Scholl moved here in 1977 as a young family man and graduate student, he had no idea what Athens County had in store for him. He couldn’t have imagined getting a ringside seat to the birth of the biotech industry — wouldn’t have guessed he’d preside over the explosive growth of an Inc. 500 company. And he gives all the credit to his Diagnostic Hybrids co-workers, Ohio University and the Athens community.
Commitment to Enterprise
You don’t live anywhere for over 30 years without picking up on some local history. According to Dave, Ohio University President Vernon Alden’s tenure (1962-1969) marked the beginning of the university’s ongoing commitment to entrepreneurship and economic development in Southeast Ohio. The mid-1970s saw a push to develop technologies that could, in turn, spawn companies.
Will Konneker was a chemist-turned-nuclear physics pioneer and Athens’ first venture capitalist. He created or co-founded seven companies, was the first director of the Innovation Center and just happens to be Dave’s mentor.
As a Ph.D. candidate in microbiology, Dave worked with Konneker and professors Joseph Jollick and Tom Wagner on the team that developed the first transgenic animal. The scientists injected rabbit DNA into a mouse at precisely the right stage of fertilization for recombination to occur – a huge breakthrough that spurred the biotech revolution. It was the technique that started a windfall of opportunities for Diagnostic Hybrids, Inc.
Growing DHI
Diagnostic Hybrids was founded in 1983. It took nine years and $5 million in seed capital before DHI saw its first commercial project with FDA approval. With Konneker, Jollick and Wagner at the helm, DHI moved into Phase II, developing products and a customer base. Scholl served as the Director of Research from 1983 to ’87 and then VP for Research until he took over as CEO in 1995.
“Athens proved to be fertile ground for us,” Dave remembers. “We were given the opportunity to fail and accidentally succeeded.”
From 2000 to 2003, DHI saw a 165% annual growth rate. That was a 663% overall growth rate, up to over $17 million in revenues. They’ve doubled again since that time.
“If Konneker, Jollick & Morgan were the funding team, the Scholl, Brown & Goodrum group has been the working team,” Dave says of himself, EVP/COO James L. Brown and VP of Regulatory and Quality Affairs Gail Goodrum. “The three of us grew up together, professionally, and we naturally evolved toward the executive roles that suited us best.”
Of the three, Dave was most oriented toward sales and product presentation. “A Ph.D. is an atypical candidate for CEO. Nobody expected that the business would stay around long enough or that I would develop enough for this to happen,” Dave says. He attributes his professional growth largely to Konneker’s mentoring; “Will was a brilliant nuclear physicist who learned business ‘on the hoof.’ He’s a good, common-sense businessman who searches out technology with commercial overtones. I just hope I can be a Will Konneker to someone else, to some bright, young talent from this upcoming generation.”
A Community Company
When Dave talks about the past, present and future of Diagnostic Hybrids, there are two recurring themes: Ohio University’s nurturing and Athens community’s support. “They’ve allowed us to recreate ourselves every day, every quarter, every year. We’ve diversified and grown to meet new challenges and new demands,” he says.
DHI is now in a position to give back to its home community. It’s a major sponsor of the Copperheads, Athens’ summer collegiate league baseball team, and supports public education with its A+ Program that encourages kids to excel in academics, athletics and the arts. Via internships, the company has trained some 750 OU students over the past 25 years and hired several of them back upon graduation.
“We’re not a bank, store or hotel; the people of Athens aren’t our customers, but they notice and appreciate our collateral impact – the jobs, visitors and facilities we bring to the area,” Dave says. “We don’t take that appreciation for granted.”
DHI now has a facility in Cleveland working on an HIV program; it’s a highly specialized area of virology. Scholl sees the new undertaking as a way to attract pharmaceutical dollars to the company. Hospital and clinical labs are the primary customers for the cellular and molecular diagnostic kits that are DHI’s main products right now, but branching out to pharma users will likely be the company’s next frontier.
“We are the manufacturer for anything the Cleveland group develops, so their growth is our growth,” Dave explains. “Our Athens facility provides products for worldwide consumption.” And that’s good news for the local economy.
Athens: An Inc. 500 City?
Just as Diagnostic Hybrids won national acclaim for its record growth, Dave Scholl predicts Athens County will follow in its footsteps. He points out the window of his office, across the rolling front lawn of State Side Technology Park, to the roadside construction. The city is extending the already-19-mile-long Hockhocking Adena Bikeway to run right past DHI headquarters.
“There’s something symbolic about that,” he muses. “It speaks to the work/pleasure coexistence that’s so prevalent here in Athens. It’s certainly something people are drawn to these days.”
Dave sees OU’s unwavering entrepreneurial commitment and the burgeoning alternative energy industry as forces that will drive Athens’ growth spurt, but the raw tools for success are inherent in the spirit of the county.
“Athens County has an unbeatable work ethic. This was all coal mining territory. If you’re willing to go two miles down into the ground to work, you’ve got tenacity and commitment that any employer will benefit from,” Scholl declares.
