Laboratory News

Bio-Reference Laboratories Cleans Up in New York Market During 2007

Turmoil in the New York laboratory market caused by the managed care contracting wars between the two blood brothers, LabCorp and Quest Diagnostics, certainly didn’t affect Bio-Reference Laboratories, Inc.  (NASDAQ: BRLI) of Elmwood Park, New Jersey.  The lab company just released its financial performance for its fourth quarter and year-ending October 31, 2007 and reported a 22% increase in the number of patients served over fourth quarter last year.

Overall, Bio-Reference’s key numbers were up by a factor of 20% to 30% for both the fourth quarter and the full year. Total Revenue for FY07 was $250.4 million, an increase of almost 30% over the $193.1 million in FY06. Net income for FY07 increased 24%, to $13.95 million.  BRLI also disclosed that its average revenue per requisition for fourth quarter was $71.06, an increase of 6% over the previous fourth quarter.

Bio-Reference Laboratories continues to benefit from a unique, dual business strategy.  It is a local laboratory in the Greater New York Metropolitan Area, providing routine testing services to a growing number of clients.  It maintains a productive sales program to sustain growth in this primary service market.  From this base of business, Bio-Reference Labs has incrementally developed specialty testing lines and reference/esoteric testing services. It markets these in both its home region of greater New York and nationally.  Bio-Reference maintains a separate sales force to handle these specialty testing lines both locally and across the nation.

One consequence of this blended business strategy is that Bio-Reference has a test mix that is the envy of many large laboratories. It reports that 45% of its fourth quarter revenues came from esoteric testing.  This added proportion of esoteric testing is an important reason why Bio-Reference enjoys average revenues per accession of $71.06.

For pathologists and laboratory directors looking for inspiration in how to grow their own laboratories, Bio-Reference makes a good case study.  Including FY07, Bio-Reference has posted an unbroken string of 13 consecutive years of 20% annual compound growth.  That record, which began back in 1995, is the best of any public laboratory in the past two decades.

Bio-Reference Laboratories Chairman and CEO Marc Grodman, M.D. recently discussed his lab firm’s plans for the future with a reporter from Healthcare Exec. Using information technology to deliver more value from lab test data is a major business objective noted Grodman, who then said “Clearly the main area of development for us is going to be deciding how to best use our information and utilize technology, leveraging the information and technology that is available today to clinical relevance and patient care. That is the fulfillment of our vision.”

Related Articles:

• Bio-Reference Laboratories, Inc. Announces Record-Breaking Year-End and Fourth Quarter Results 
• Bio-Reference Business Profile by Healthcare Exec