The State: Big business potential in little Lexington County? Nephron saw promise – and it paid offMay 26, 2022
BY BRISTOW MARCHANT
Bill and Lou Kennedy consider their first date to be a trip to Blue Marlin in Columbia’s Vista, after a Georgia-South Carolina football game where they first met. While at the restaurant, Lou started asking about Bill’s business, a Florida-based manufacturer called Nephron Pharmaceuticals.
“I asked how many customers he had, and he said ‘three, my old company and two people who used to work for me’,” Lou Kennedy remembers. “And I said, ‘don’t you think you ought to diversify?’ That was the first time we ever met.”
Today, they have been married 20 years, and Nephron is based in Lou Kennedy’s home county, operating on a 715,000-square-foot campus in a Lexington County industrial park. Thousands of workers develop, produce and distribute a wide range of medical products.
Lou Kennedy went from an interested outsider to the majority owner, now overseeing the company’s latest expansion during a time of growing needs in the medical field and a global pandemic.
“I had no science background, just a great work effort,” Lou Kennedy said.
Lou Kennedy, the company’s CEO since 2007, prides herself on being involved in every facet of the business, including its growing range of products.
Bill Kennedy bought the company in 1991.
At the time he was the owner of a home care company and was interested in manufacturing his own drugs. The company received its first FDA approval in 1997, for an albuterol inhalation solution that provided a more affordable alternative for delivering anti-asthma medication. “I consider that the beginning of Nephron,” said Bill Kennedy. But the Orlando-based company blossomed once the two South Carolina natives — Bill grew up in Spartanburg County — decided to shift their operations back to the Palmetto State.
COMING HOME TO SOUTH CAROLINA
The idea of moving Nephron to South Carolina developed because of a chance comment from the state’s governor. In October 2011, the Kennedys were awarded the Order of the Palmetto, the state’s highest civilian honor, for their work with the College of Pharmacy at the University of South Carolina.
When Gov. Nikki Haley presented the couple with the award, she asked Lou Kennedy why the two South Carolina natives couldn’t move back to their home state, and bring their company with them. “I just said, ‘stranger things have happened,’” Lou Kennedy said.
Lou Kennedy later became frustrated with the regulatory environment in Orlando, Florida, where Nephron was based at the time. Kennedy felt regulators mandated even minor aspects of the company’s building and campus.
She remembers telling her husband, “Why don’t we build in South Carolina? They love manufacturing, they actually want us there, and they have incentives.”
A day or two after the award ceremony, then-S.C. Commerce Secretary Bobby Hitt was eating dinner with the Kennedys at the president’s house at USC when Lou aired her complaints about doing business in Florida. “Then we became very interested,” Hitt said. “We had so little pharmaceuticals in South Carolina, that we had no real experience” in what it would take to build Nephron here.
But “Lou is indefatigable. She’s a remarkable person with a remarkable drive. In that, she and Gov. Haley share similar traits,” he said.
Sam Konduros is a long-time figure in S.C. economic development who also happened to have gone to elementary school with Lou Kennedy. One day when he was working as a consultant for the Greenville Health System, he got a call from his old childhood friend about the business environment in South Carolina. “We both have pretty strong sense of humor, but I knew she was serious,” Konduros said. “She was dealing with a lot of bureaucracy that seemed cumbersome and unnecessary, when she was trying to create jobs, invest capital, grow, and she felt like she’d get a bigger welcome mat in South Carolina.
“That’s what reconnected us, and produced this storyline in Columbia for the past decade,” he said
Within months of the couple’s meeting with Haley, they had announced their intention to build a Nephron facility in the Palmetto State. And despite looking at sites in Charleston, Fairfield and Richland counties, the company chose its current location in Lexington County’s Saxe Gotha Industrial Park on 12th Street Extension south of Interstate 77.
The site appealed to the Kennedys because of its proximity to USC, a rail spur for moving material and products, and its easy access to both Interstates 26 and 77. Plus, Lou Kennedy had a more personal reason for wanting to set up shop in Lexington County. “This is my hood,” she said.
EXPANDING NEPHRON’S WORKFORCE
The company had around 200 employees when it opened its Lexington County location in the fall of 2015.
Today, Nephron has 1,200 full-time and around 3,000 part-time employees. In the meantime, Nephron has expanded their offerings to include a plant for making medical gloves, a syringe manufacturer and, in response to the COVID-19 pandemic, the rapid production of new test kits. Each new step has not only enlarged the range of products Nephron makes – it’s also expanded the company’s local workforce.
Some of those new employees are in flexible part-time positions, filled by seniors, retirees, young people or even school teachers working a second job.
“I’ve seen teenagers setting down and working next to grandma,” Lou Kennedy said. “They can work any hour of any day assembling at-home COVID test kits. We can make 90,000 to 100,000 in a day.”
The reason the company is able to provide those part-time jobs is workers have the flexibility to work 24/7, nights or weekends, for however many hours they need to.
“We have as many people kitting out at night as during the day,” Bill Kennedy said. They come in to earn the extra money needed to buy a house, pay back student loans, and afford a vacation or presents for the holidays, he said.
Some of those workers have disabilities and were placed in their jobs by the S.C. Vocational Rehabilitation Department. Audrey Brown, the communications director for the state agency, said the partnership came about when she happened to meet a Nephron executive at a conference.
“He said they had needs to fill on kits for COVID testing,” Brown said. “I said we have people who have the skills and need the work.” The agency connected eight of its customers with jobs putting together the badly-needed testing kits, and most of them were subsequently hired full-time, Brown said.
“Like any company, we want to make sure it’s the right fit for them,” she said. “(Nephron officials) were open. They were open to hearing the story and trying something different, because what Vocational Rehabilitation stresses is that disability does not mean inability... You need somebody who can do the work, and ... everybody has a place.” And while Nephron has its part-time employees there, supervisors are looking for potential converts to full-time employees, Bill Kennedy said. The company looks for chances to build up a diverse workforce.
Lance Rogers, vice president of manufacturing and operations, said the company has found roles for high-functioning employees on the autism spectrum by harnessing their attention to detail for visual inspection of the company’s products.
The company has gained such a reputation nationally that Lou Kennedy was added to the board of the National Association of Manufacturers last year. She was even awarded the group’s Manufacturing Icon Award earlier this year.
“She’s a powerful leader on the board, and in the industry itself,” said NAM president Jay Timmons. “She leads by example. She sees a problem and she just dives right in to solve it.”
Timmons recalls a virtual meeting for manufacturers held during the COVID-19 pandemic that demonstrated Kennedy’s ability to seize a leadership role among other manufacturing leaders.
“Nephron went to a vaccine mandate early,” Timmons said. “A lot of manufacturers were struggling with what to do, but she kind of stood up to her peers and said ‘You’ve got to be fearless, even if it will be painful, even if there’s push back’ ... She has a way of finding clarity.”
Bill Kennedy touts a workforce that today is 53% female. The company also has a wall in Nephron’s headquarters that boasts 43 flags “from every country we have an employee from.”
“I have a lot of respect for women in the workplace,” Bill Kennedy said. “They seem like they’re pushing harder than young men these days.”
Zahira Cepero, the Puerto Rican-born vice president of validation, oversees each piece of equipment in the company. “The validations department makes sure everything is working properly, before it produces anything,” she said. “I know a little bit about everything.”
Tyler Barboza, Nephron’s director of logistics, went to the flag wall when he joined the company last year from UPS.
“I was born in Caracas, Venezuela, so I looked for my flag and I found it,” Barboza said. “Diversity makes you a more effective company,” Barboza said. “We’re inclusive, we’re looking for opportunities where everyone feels they can move up, and that drives productivity.”
‘COMMON SENSE’ LEXINGTON COUNTY
That kind of personal development has been a hallmark of what Lou Kennedy has tried to build the business on, starting with herself.
Despite coming into the field without a science background, Kennedy said she works hard to keep herself up to date on each aspect of the company’s business, from logistics to microbiology, determined to be able to hold her own in any conversation.
“I look at each new piece of equipment to know what we may want, what our competition is, what’s the best investment,” she said. “I sit through the purchase process to know why and what we need.”
Before she got involved with Nephron, Kennedy had worked in everything from sales to day care, even modeling fashion when she was in high school and college.
Born in Kingsport, Tenn., she grew up in Lexington County from the age of 2 while her father worked at Eastman. As she’s educated herself about the company and its products, Kennedy has also built her reputation within her industry. The presence of Nephron in South Carolina has benefited the state’s life sciences industry across the board, said Konduros, who serves on the board of SCBIO, a trade and economic development organization for the biotechnology industry in South Carolina, which Kennedy also chairs.
“What’s so cool about Lou is not only is she a champion for her own company, but a champion for so many others,” Konduros said.
That also highlights the impact the Kennedys have had on their home state over the past decade.
“She’s one of the people who came home,” Hitt said. “A lot of people go off and never come back. Lou came back. She has an impact on the state because, as a good executive, she leans into the community.”
For the couple, the decision to come back was an easy one to make, not only because of their commitment to the local community, but also because the business environment in the Midlands made it such an attractive place for Nephron to be. “I give credit to the state and Lexington County for making it easy,” Bill Kennedy said. “They have regulations, but they’re common sense. It’s easy to open a new business.”