The birth and growth of Burroughs Wellcome & Co.
4 November 2008. By Penny Bailey
When Silas Burroughs invited Henry Wellcome to join him in business in London in 1879, modern drug production was an undeveloped field. But the discoveries of Pasteur, Lister and Fleming were just around the corner - and just over a decade later, Burroughs Wellcome & Co. would be the first drug company to employ research scientists to develop new therapies. For the time being, however, there was a more immediate opportunity to hand.
Over 20 years previously, the British artist and explorer William Brockedon, exasperated by the poor quality of the graphite in the pencils he used for his sketches, had invented a mechanised method of crushing graphite to a fine powder then compressing it to produce better-quality lead. In 1843, he was granted a patent for his invention, and the drug firm John Wyeth and Brother hired him to make compressed medicines using the same technique.
The compressed pills made by Brockedon’s machine offered a much safer, standardised dose than medicines prepared by pestle and mortar, and soon became popular. Other American manufacturers jumped on the bandwagon and attempted to improve production methods.
A marketing opportunity
Across the Atlantic, things were very different. There were few manufacturing drug companies in England, very few medicines were produced on a large scale, and pharmacists still used the traditional, time-consuming and less precise pestle-and-mortar method to prepare medicines.
Here was a virgin market, and Burroughs - who was Wyeth’s sole agent in London and had been importing and marketing pharmaceuticals since 1878 - realised that he might be able to make his fortune by importing the compressed pills and marketing them in England and Europe. He wrote to Wellcome to invite him to join the venture. Ever cautious and attentive to detail, Wellcome insisted that Burroughs obtain Wyeth’s consent to the partnership before signing. In April 1880 he received a contract from McKesson & Robbins giving him exclusive agency to sell their products in “Europe, Asia, Africa, East Indies and Australia”. He arrived in London in May 1880.
The deed of partnership between the two men was executed on 27 September 1880, and they set up offices in Snow Hill. Burroughs and Wellcome were both consummate salesmen and publicists, and the company flourished in its first year of trading.
In 1883, the expanding firm acquired larger offices in Snow Hill, which was one of the first business houses in London to introduce the new 'Edison Electric Light'. These premises remained the headquarters of the new drugs company for nearly 60 years, until they were destroyed by bombs during the Blitz in 1941.
Heavy stamp duty on imports from America made importing the pills costly, so the partners took another novel step - at a time when there were few manufacturing pharmacists in Britain - in deciding to manufacture their own pills.
In 1883, they purchased their first factory at Bell Lane Wharf in Wandsworth, and Wellcome bought the machinery needed for making compressed medicine tablets from Wyeth in America to produce pills for the British and European markets. By 1882 Burroughs Wellcome & Co. were up and running as drug manufacturers, and by his 30th birthday Wellcome was a wealthy man.
The company's compressed drugs were an instant success in Britain, and Burroughs and Wellcome soon needed a bigger factory. They purchased the Phoenix Paper Mills site at Dartford, and used Thames barges for transport. This site remained the firm’s production centre until the 1980s.
In 1888, frustrated by the limitations of Wyeth's machine, which was slow and unreliable, Wellcome put together a team of engineers to design a better one. The result was machinery that could produce 600 compressed pills per minute, each pill bearing an unprecedented standard of precision and giving Burroughs Wellcome & Co. a clear lead over their competitors.
The British competition soon woke up to the success of Burroughs Wellcome & Co., and other manufacturers began to make imitations of compressed convenience products.
To eliminate the competition, in 1884, Wellcome registered as a trademark one of the most famous and powerful brand names in business history, 'Tabloid' - a word he coined by blending the words 'tablet' and 'alkaloid' - to denote his firm’s pills.
Over the next few years Burroughs Wellcome & Co. fought and won legal battles to prevent other firms using the same name. In 1904 Burroughs Wellcome & Co. v. Thompson & Capper made history as the ‘Tabloid’ case. The prosecution argued that doctors prescribed ‘tabloid’ products because they had faith in the purity and accuracy of Burroughs Wellcome & Co products. And the judge ruled that ‘tabloid’ specifically referred to the products of that firm.
Not only did the ‘Tabloid’ brand name prevent the competition from taking a slice of the market, its associations with quality and precision also made it an effective marketing tool. The name was applied to the full range of the company's products, including 'Tabloid' first aid kits and medicine chests, the 'Tabloid' photographic developer and even 'Tabloid' Tea.
The term has now passed into general use to mean anything in compact form, in particular a ‘condensed’ newspaper format. But it is still technically the property of Burroughs Wellcome & Co.
Silas Burroughs died of pneumonia in 1895 and full control of the business passed into the hands of Wellcome, who could now shape the company according to his own wishes. The next 20 years, until the outbreak of World War I, were a period of massive expansion for the company.
The first overseas branch had opened in Sydney in 1898. By 1912 another seven branches had opened in New York, Montreal, Buenos Aires, Cape Town, Milan, Shanghai and Bombay.
The success of the company, and the pioneering research laboratories he set up in England and Africa, ensured that Wellcome became the leading figure in the British pharmaceutical industry.
From the start, Burroughs and Wellcome took a keen interest in the welfare of their employees, and introduced an eight-hour working day. This meant employees could take time off to attend evening classes in any subject of their choice, paid for by the company.
To encourage his employees to enjoy their leisure time and develop healthy interests, Wellcome established the Wellcome Club and Institute in 1898, in Acacia Hall, a spacious manor house in nine acres of land in Dartford. Acacia Hall was equipped with a library, gymnasium, events hall, tennis courts and a lake, and housed clubs and societies catering for a wide range of interests, including football, cricket, tennis, swimming, photography and literature. An especially created Entertainments Committee arranged an annual events programme, which included musical and literary evenings, and day trips to the seaside.