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The boutique, family-owned laboratory has taken on industry Goliaths, powered by “tenacity, foresight, and a little crazy.”
When discussing the success of Alkemist Labs (Garden Grove, CA), its CEO Elan Sudberg likes to invoke the Old Testament story of David and Goliath, driving home the industry dynamics between boutique, family-owned testing laboratories such as Alkemist, and the giants that dominate the industry. These Goliaths, as Sudberg likes to call them, have a wealth of resources that allows them to offer a huge array of services while also undercutting their more modest competitors on price. Of course, to Sudberg, Alkemist is David in this analogy, thriving despite seemingly insurmountable challenges because Alkemist is great at what it does, prioritizing quality over quantity with a service-oriented approach that benefits its clients.
“Starting a lab requires some of the most expensive equipment as well as highest-paid employees, which would give any entrepreneur pause. The global testing arena is composed of many little labs of varying proficiency and a handful of Goliaths buying up the little labs. Even 24 years ago this was true. Still, we are here, and we owe that to tenacity, foresight, and a little crazy,” says Sudberg.
Alkemist Labs was originally founded in the early 1980s by Sidney Sudberg, Elan’s father and current Chief Scientific Officer of the company, as the manufacturing division of Cooperative Healing Arts. At Cooperative Healing Arts, patients would see a chiropractor, receive allergy testing and live blood cell analysis, and get prescribed herbal tinctures by practitioners. Alkemist Pharmaceuticals produced high-quality tinctures for these practitioners. Eventually in 1996, major problems with adulteration led the U.S. FDA to offer manufacturers courses in microscopy and high-performance thin-layer chromatography (HPTLC) to help them self-regulate. Alkemist began using these methods for quality control, rejecting adulterated materials they received—and vendors took notice. From there, Alkemist Labs was born.
“We found a niche early on, dug our heels in, and have remained the plant analysis lab,” says Sudberg. “Most other labs uninspiringly and with no personal touch offered every service under the sun while we evolved into the friendly experts we are. We’ve also had a loyal core group of clients through the years, really the best of the best in the industry, and they’ve provided some stability.”
Specializing in botanical identity testing and phytochemical potency testing, Alkemist only believes in using fit-for-purpose technology such as microscopy and HPTLC. These tried-and-true methods have remained a constant in the industry while other methods and plug-and-play devices Sudberg calls “tricorders” come and go with little success. This insistence on using validated methods and an emphasis on good company culture has helped Alkemist build its reputation these 24 years as a trusted testing partner and a company with ethical business practices.
“We began the company with culture in mind and have always desired to create an entity that we would want to work for, and a management style that we would want to serve alongside. Over that time, critical issues have boiled over, like equality and justice, and we take those opportunities to get introspective and to look at our own organization to assess if we are being beyond fair and equitable,” explains Sudberg. “This attention to traditionally not-profit-making details has built a culture in which our loyal, hardworking team truly cares about our product. Couple that with our unmatched expertise in plant analysis, and the other labs can’t touch us.”
With its superb reputation, Alkemist is working hard to push transparency in the industry and demonstrate the importance of botanical testing by bringing to light unethical practices that could hurt stakeholders and put consumers in danger. For example, in May of this year, Alkemist raised the flag that suppliers of so-called elderberry extracts were circulating doctored lab reports. These practices are likely motivated by the unprecedented demand brought on by the COVID-19 pandemic for immune health ingredients such as elderberry. Problems like this are not particularly new, but when they crop up every so often, they reinforce the importance of testing and transparency.
“We have been pushing the transparency envelope since inception and after two decades are finally seeing the needle moving in the direction to best support the consumer. I’ve been encouraging companies to make their test results public, and we’re starting to see that happen,” says Sudberg. “If you’re using an excellent lab to confirm you are producing high-quality products, that information should be a marketing asset, not sitting in a drawer waiting for your next FDA inspection.”
Next Generation Transparency Initiative
Taking this concept to the next level, at the end of 2019 Alkemist unveiled its Next Generation Transparency initiative which provides consumer-friendly certificates of analysis for botanical testing. So, not only is Alkemist encouraging its clients to share their lab data, it is also making those lab reports comprehensible to the everyday shopper. What’s clear is that customers want to make educated decisions. That’s why third-party certifications have become so popular. However, even those have limitations, says Sudberg.
“Third-party certifications and seals are a dime a dozen these days, especially when some companies just concoct their own. While some require audits, others don’t, and I am not sure the discerning consumers are guided by them,” he explains. “Frankly, I don’t think those certifications or seals go far enough for the next-generation consumer. Younger consumers of herbs, of which there are many, are not satisfied with ‘just trust me on this,’ which in a way is what a seal says. Our efforts are to make transparent the actual test results for the ingredients in the product in hand, which is why our consumer version of a certificate of analysis explains what we tested for and what we found, so you don’t need a chemistry degree to read it.”
If you’re asking yourself whether anyone will bother to make this sort of effort toward consumer transparency, especially when it isn’t required, Sudberg has some news. “I am excited to state that I have one of the biggest players in the industry beginning to post our Consumer-Friendly Certificates of Analysis on their website for the raw ingredients going into their finished product,” he says. “It has not been announced just yet so I can’t share who, but I assure you it will not only turn heads but set the standard for Next Generation Transparency. It will raise the bar exponentially for those seeking to sell substandard products.”
It only takes one person to make a difference, to become the benchmark and set the stage for others. By reaching a major industry player, Alkemist might have changed the way transparency will be viewed going forward. While consumers are rapidly educating themselves, the consumer-friendly certificates of analysis extend this knowledge even further, giving them more autonomy and control over what they put in their bodies. While this may not be as popular of an idea in the industry as we wish it were, the more companies that share their certificates of analysis puts more pressure on others to do the same.
Having spent 24 years establishing itself as the go-to independent lab for botanical identity and potency testing, Alkemist Labs is finally comfortable expanding its service offerings. Much of this is due to demand from its existing customers.
“For years we have been leaving the other required tests—pesticide analysis, heavy metals analysis, and microbial analysis—‘on the table,’ and that work has gone to other labs. After years of our best clients, who send us plants for ID and potency testing daily, begging us to tool up so they don’t have to use a Goliath lab, we have finally begun another round of tooling up to be more full-service starting in 2021,” says Sudberg. “We also plan to expand our Next Generation Transparency efforts, and you will soon see the Alkemist logo as a trusted symbol of quality and ingredient integrity on the labels of the best of the best.”
Growing a small business takes patience and vision, which Alkemist has in spades—the patience to understand one’s limitations and the vision to take those limitations and make them a virtue. Alkemist Labs is already pushing the envelope, but now the time has come to push the envelope even further and go toe-to-toe with the Goliaths. As our 2020 Best of the Industry Service Provider, Alkemist Labs represents where our industry started, how far it has come, and the potential for growth that still exists.
“For us, the last two years have been about settling into a facility nearly four times larger than our previous one and fine-tuning our call to action around transparency in lab testing,” says Sudberg. “Now we are able to respond to the needs of our clients to expand the scope of services. We’re well positioned for this, with a very solid client base and an amazing staff.”