USA – Labcorp, a global life sciences company, announced that it has signed agreements to form a comprehensive strategic partnership with Ascension, a non-profit health system.
Labcorp will manage Ascension’s hospital-based laboratories in ten states and purchase select assets from the health system’s outreach laboratory business as part of the collaboration.
This long-term partnership will expand Labcorp’s clinical laboratory services in several states across the country, while also providing opportunities to improve care in all clinical areas.
As a result of the partnership, Ascension will be able to benefit from Labcorp’s scientific expertise, technology, and scale in therapeutic areas such as oncology, neurology, and women’s health, enhancing existing laboratory services and offerings.
Patients and clinicians at Ascension will now have access to Labcorp’s leading diagnostics and at-home test collection services.
Labcorp will manage Ascension’s hospital laboratories in ten states, including the South and Midwest, and has paid US$400 million for some of the health system’s outreach laboratory assets.
Labcorp anticipates that the first-year revenue from this partnership will be between $550 million and US$600 million, and that it will cover its cost of capital by year two.
Labcorp will also work to improve standardization and efficiency through the use of proprietary analytic tools and processes.
The transactions represent the national rollout of a laboratory services model that has proven successful on a local and regional level in fostering innovation and creating value for patients, providers, and communities.
It establishes the foundation for a long-term relationship that is designed to adapt to a changing health-care environment.
The global clinical laboratory services market is expected to reach US$46.41 billion by 2022, up from US$113.44 billion in 2017, at a CAGR of 5.2 percent.
Rising demand for early and accurate disease diagnosis, increased public-private investments, as well as research funding and grants to develop innovative laboratory testing procedures, and advancements in clinical diagnostic techniques are the key factors driving the market.
The global clinical laboratory services market is expected to reach US$46.41 billion by 2022, up from US$113.44 billion in 2017, at a CAGR of 5.2 percent, according to a MARKETS AND MARKETS report.
The companies drew particular attention to Labcorp Drug Development, which Ascension says it can use to present physicians and patients with access to clinical trials, innovative therapies and new treatment options where appropriate.
“By connecting two mission-driven organizations delivering high-quality service and care, we can provide care teams with the information and tools needed to make the best possible decisions to improve patient outcomes,” said Adam Schechter, chairman and CEO of Labcorp, in a statement.
Although the specific transaction terms were not clarified, the companies expect the deal will close in the first half of 2022.
The announcement follows Labcorp’s announcement last week that it had launched a digital diagnostics platform to provide patients with a more convenient way to access blood and COVID-19 PCR tests.
Meanwhile, Cue Health has launched a platform that provides members with 24/7 virtual care and on-demand COVID-19 tests, as well as physician-ordered diagnostics for other needs.
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