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by Jordan Green

Piedmont growing pains

Greensboro-based Piedmont Pharmaceuticals has executed deals with companies such as Bayer Animal Health and Pfizer in its veterinary pharmaceuticals business. The company also produces a head lice treatment product that recently entered the Russian market and is sold in 14 other countries, but has yet to receive approval from the Food and Drug Administration to be sold in the United States.

“We are having a phenomenal last six months,” CEO Roland Johnson told Democratic US Senator Kay Hagan during a business round table at Gateway University Research Park in Greensboro last week, adding that one challenge the company has faced is accessing capital.

“It seems that when a big company wants to move in, support groups are all over them trying to help them get incentives to help them get here,” he said. “Where I see a big vacuum is for companies in North Carolina that start here, want to stay here, trying to get the resources to build out, to build manufacturing. For example, right now we have been approached and we’re in serious discussions with Canada, with incentives to support manufacturing, that I’ve not heard anything close to what we’re being offered to do this.”

Roland said Piedmont Pharmaceuticals has increased its staff from nine to 15 in the past three months, and is looking to hire an additional half-dozen. About 80 percent of the company’s employees hold graduate-level degrees.

“We want the jobs here in North Carolina,” an emphatic Hagan said. Later, at the conclusion of a personal chat with the senator, the CEO awkwardly reciprocated a high five.

Another company represented at the round table is also in expansion mode, but its brand is probably too closely tied to Greensboro to be tempted by foreign relocation offers.

Chris Lester, a partner with Natty Greene’s Brewing Co., said his company has extended its distribution footprint from Boone in the west to Mebane in the east, and is currently expanding into the Raleigh-Durham area. By April 1, Natty Greene’s plans to have its product on grocery store shelves in every county and city across the state.

Lester said Natty Greene’s built its bottling plant on Lee Street in Greensboro in 2006, and started selling it in grocery stores the following year.

“We way exceeded expectations,” he said.

“We’ve grown our business 5 to 6 percent over the past three years. But we ran out of capital. We couldn’t expand our business fast enough for all the demand we had. Right when the economic bubble happened, we were blowing up, so it was bad timing for us. We needed access to capital and couldn’t get it, so for the last two years we haven’t grown… not because we didn’t have the demand; everyone in the state wanted our product. We didn’t have the financing.”

Ultimately, the company financed its expansion by approaching individual private investors.

“We’re finishing up our expansion of our facility at Lee Street,” Lester said. “It’s almost a $2 million expansion, and we’re going to be able to handle the whole state of North Carolina.”

Karl Robinson, president of R&R Transportation, had a number of concerns he wanted to share with the senator. For years, he said, he’s been looking for a way to open up employment opportunities to ex-felons.

“Approximately 30 percent of the residents of the state of North Carolina have some kind of criminal record, according to the North Carolina Department of Corrections,” he said. “Three of the four clusters identified as growth industries for our citizens have restrictions on employees that have a criminal record. Insurance companies control how we operate, who we hire and why we cannot hire them. Essentially, we have eliminated 30 percent of our workforce, whether the individuals committed nonviolent crimes or not.”

Hagan was recently appointed to the Senate Banking Committee, and she urged business leaders to have patience in the thawing of credit markets. She said the Small Business Administration received a $30 billion infusion of federal funding in September to create a loan pool for small banks specifically targeted to small business.

“I know in that first quarter of 2011 so far SBA lending in North Carolina has increased about 37 percent over last year,” she said. “In North Carolina, they’ve done about 400 loans, about $200 million. So hopefully the spigot is opening up.”

Hagan said she would also like to increase the state’s share of military contracting with the federal government.

“I’m on the Senate Armed Services Committee, and I do have a very proud military family, and I know that North Carolina is the most military-friendly state in the nation, but the key point I’m looking at is we’re only 26 th in the nation in defense contracts, in North Carolina,” she said. “So when we talk about new jobs, that is a huge focus that I’m concentrating on in my office.” — JG

NOTHING PLEASURABLE ABOUT TOBACCO LAWSUIT

Greensboro-based Lorillard Tobacco Co. and its Winston- Salem competitor, RJ Reynolds Tobacco Co., have locked horns in a serial litigation lawsuit over use of the word “pleasure” in adver tisements and promotions for their respective products. In July 2009, Lorillard and Reynolds entered a settlement agreement in which Lorillard trademarked the use of the word “pleasure” within cigarette advertisements. In very convoluted terms, Reynolds agreed not to use the word alone or having it stand out amongst other words in a phrase when promoting its tobacco products. Lorillard then sued Reynolds for using “pleasure” in an August 2010 advertisement for its smokeless tobacco.

In November, the dispute was brought before the NC Business Court as a “mandatory complex business case.” A court document stated that “Lorillard… expended substantial resources over the years to associate the term ‘pleasure’ with its Newport brand in advertisements and various promotions… RJ Reynolds Tobacco Company’s uses of the term ‘pleasure’… [allegedly] trades on the good will Lorillard has built into the term and gives Reynolds an unfair competitive advantage.” — CB

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