His success leads to donation of private stock worth $223,000 to College of Education
How many small businesses undergo transition from parent to child? Twenty-three years ago, James “Jim” Ratcliff, MA ’72, PhD ’76 (above), was named chairman and CEO of Rowpar Pharmaceuticals, a privately held corporation founded by Jim’s father, Perry.
Perry Ratcliff had been a professor and founding chair of the division of periodontology at the University of California San Francisco School of Dentistry and had a private dental practice before founding Rowpar in 1991. He and his colleagues developed the ClōSYS oral care product line, praised for its effectiveness and sold through dental offices across the country.
The mission of Rowpar was “to help people get well and stay well through better oral health,” but when the senior Ratcliff was facing health challenges of his own, the board of directors approached his son, Jim, about leading the company.
Jim Ratcliff had been a member of the board from the company’s inception, and both his father and the other board members believed he could turn the company around and realize its mission.
At the time, Rowpar was facing several challenges, including an expensive intellectual property suit. Plus, there was an urgent need to conduct research supporting product claims and to expand markets.
Timing was fortuitous
When the offer to take the reins came in 2000, Jim had a distinguished career of 25 years in higher education. At the time, he was a senior scientist and professor at Penn State University, serving as director of the Center for the Study of Higher Education (CSHE).
But he was ready to consider a career change.. “At that time, new senior leadership at Penn State was reorganizing research units such as CSHE, taking away funding and reassigning staff to academic colleges,” said Ratcliff, “so I gladly took on this new challenge.”
The company settled the intellectual property suit in 2000 and was ready to move forward. As the new CEO, Jim hired a professional management team to further develop and market Rowpar’s products, expanding beyond dental offices into the fast-moving world of consumer goods—first online, then through national retailers such as Walgreens, CVS, Rite-Aid, and Target.
As Ratcliff explains: Executives often receive compensation in forms other than salary, including stock and stock options, to encourage their stake in the future of the companies they run. For privately held companies, like Rowpar, there is no marketable value to the stock. Instead, stock and options accumulate with no immediate way to liquidate them, purposefully encouraging long-term commitment to the company.
But little did he know that the stock and options he received as the new CEO would eventually result in a gift of $223,000 to WSU’s College of Education.
Waiting to realize full value
As former university administrators, both Jim and his wife Barbara were lifelong believers in higher education as a force for good. “Barbara and I often discussed giving back. We were among Rowpar’s largest shareholders of privately held stock, and we wanted to donate stock to WSU,” said Ratcliff. “We also knew that the stock would have marginal value until Rowpar was acquired or became a public company.”
In 2017, Jim and Barbara met with WSU Foundation Planned Giving staff and decided to gift a large number of their Rowpar shares to the university. Key in the decision was the Foundation’s willingness to hold the stock until the company was sold or taken public, thereby realizing full value for the shares. In 2020, the Ratcliffs donated additional shares.
Under Jim’s leadership, the ClōSYS product line grew. Their toothpastes were shown superior in fighting dental caries. Their oral rinses were shown helpful in combating periodontal disease. Patients undergoing cancer treatment found they mitigated the oral sore side effects of chemotherapy. These enhanced products were widely praised by dental professionals and received the Seals of Acceptance from the Council on Scientific Affairs of the American Dental Association. In addition, in 2019 Rowpar introduced the first oral care system for people 55 and older.
During the Covid-19 pandemic, patients stopped visiting their dentists, and many offices closed due to the health risks to staff and patients. Rowpar developed products mitigating Covid risk in the dental office. In 2020, two independent laboratory studies found that ClōSYS Ultra-Sensitive Oral Rinse reduced the Covid-19 virus by 98.4 percent in 30 seconds, and dental professionals began using it prior to performing dental procedures.
By 2022, Ratcliff had indeed revitalized the company, taking it from a $500,000-per-year business to annual sales of $14 million. In fact, because of its growth, “Rowpar was at a crossroads,” said Ratcliff. “To go to the next level of developing new products required a major investment in research—the clinical trials process takes at least five years before a company can make any consumer claims about a product. Also, ClōSYS products needed a substantial boost in resources to be marketed nationally.”
What to do with the windfall?
In 2022 Ratcliff and the Rowpar board agreed to be acquired by Arcadia Consumer Health Care. The opportunity was ideal for both companies as Arcadia had the investment resources to develop new Rowpar products that would advance oral health and overall health care.
As a result of this acquisition, Arcadia bought the outstanding shares of Rowpar stock, including those held by the WSU Foundation, resulting in $223,000 in cash.
While the gifts of stock in 2017 and 2020 had been made to the benefit of the WSU College of Education, there had not been any discussion of the specific use of the funds. Following the sale of Rowpar to Arcadia, Jim and Barbara met with Mike Trevisan, dean of the College of Education, to discuss how the funds might be best put to use. Following the meeting, Barbara and Jim designated the cash to be used for 1) supporting the College of Education’s Dean’s Excellence Fund and 2) funding an endowment supporting international collaborations within the college.
Their support for the Dean’s Excellence Fund was inspired by Jim’s and Barbara’s previous careers in higher education. They understood the importance of discretionary funds that allowed deans or department heads to pursue research projects, faculty career development, teaching awards, special events, and other needs. “We believe not only in WSU but also in the people who lead and labor there every day to make it the great institution it is,” said Ratcliff.
The other designation in support of international collaborations within the College of Education is about “bringing together learners from different countries and cultures to better help us all to work together to make learning a priority in this new global world we live in,” he said.
Along with his wife and other donors, Ratcliff also created an endowed chair in periodontology at the University of California San Francisco to honor his father. Like the WSU gifts, this was supported by donated stock, the value of which was also realized when the company was sold.
Jim’s father would be very proud of his generosity and legacy. WSU certainly is.
Learn more about making a gift of privately held stock—including tax advantages—by contacting our Planned Giving staff at firstname.lastname@example.org.