News, Analysis, Trends, Management Innovations for
Clinical Laboratories and Pathology Groups
Hosted by Robert Michel

News, Analysis, Trends, Management Innovations for
Clinical Laboratories and Pathology Groups
Hosted by Robert Michel
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General Electric and Abbott Laboratories Cancel Their $8.13 Billion Deal

Jul 12, 2007 | Laboratory News, News From Dark Daily

After the markets closed yesterday, General Electric (NYSE: GE) and Abbott Laboratories (NYSE: ABT) released announcements that the two companies had terminated the pending sale of Abbott’s two diagnostic business units to General Electric.

Abbott’s press release made the announcement in two sentences: “Abbott and GE have mutually agreed to terminate their contract for the sale of Abbott’s core laboratory and point-of-care diagnostics businesses to GE. The two companies were unable to agree on final terms and conditions of the proposed sale.”

GE’s press release said just a bit more: “General Electric announced today that GE and Abbott have agreed to mutually terminate their agreement relating to GE’s acquisition of Abbott’s primary in vitro and point-of-care diagnostics businesses. GE and Abbott worked diligently to complete the transaction but were unable to reach agreement on final terms and conditions. As a result, they agreed it was in the best interests of both companies to mutually terminate their agreement and discussions.”

The break-up of this deal is a significant development. For General Electric, it was a major healthcare acquisition. GE was ready to purchase Abbott’s primary in vitro diagnostics (IVD) business unit, along with a point-of-care testing business. Together, these Abbott businesses were estimated to generate about $2.5 billion in revenue last year. In fact, the price to be paid for of the Abbott diagnostics purchase was only slightly less than what GE paid for Amersham PLC in 2001, which was more than $9 billion.

There will be plenty of questions about why this deal fell apart. Was this a result of a changed financial picture at General Electric? Was something uncovered during due diligence that affected the acquisition as originally priced and structured – and the two parties could not negotiate a revised set of mutually-agreeable terms? Did either buyer or seller smell out a better deal, giving them motivation to see this acquisition agreement come apart?

Last year, Siemens (NYSE: SI) made similar investments to stake out a major position in the IVD marketplace. GE’s decision to abandon its acquisition of Abbott’s IVD businesses will probably not be the end of GE’s interest in in vitro diagnostics. It is probable that, in the coming months or years, GE will find another attractive IVD company to acquire.

Related Articles:

GE Announces Termination of Contract with Abbott

Abbott Announces Termination of Contract with GE

GE, Abbott end $8 bln deal for diagnostics business

GE, Abbott nix proposed $8B deal
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Integration of Pathology and Radiology to Be Debated at Lab InfoTech Summit 2007

Feb 23, 2007 | Laboratory Management and Operations, Laboratory Pathology

With both Siemens and General Electric placing big bets on in vitro diagnostics during the past nine months, there is much speculation about plans to integrate pathology with radiology. Bruce Friedman, M.D., plans to tackle this subject at his fourth annual Lab InfoTech Summit, scheduled to take place in Las Vegas on March 5-7 at the Venetian Casino Resort Hotel.

Dark Daily asked Dr. Friedman about his thoughts on what would be the most significant change in laboratory information technology in the coming years. “The trend of merging and convergence of the clinical pathology laboratory with radiology is creating a lot of interest,” replied Friedman, “I will be speaking about it at the conference, along with a few other speakers touching on the idea.” Friedman has blogged about The Convergence of Pathology/Lab Medicine with Radiology in his LabSoftNews Blog on multiple occasions and believes it is the next necessary step in laboratory information technology.

Friedman is recognized as one of the leading authorities on clinical laboratory and anatomic pathology informatics. His Lab InfoTech Summit is designed for all clinical laboratory professionals, including pathologists, medical technologists, lab information system mangers, and lab business managers.

To complement the speakers making three days of presentations about important topics in laboratory information management solutions, the conference features two pre-conference workshops. One is titled “Assessing and Improving the Value of Lab Services” and the other is titled “Rules in the Clinical Laboratory: Design, Validation, and Process.” The use of rules in the clinical labs seems to be taking hold for functions such as autoverification of test results because this allows medical technologists to attend to higher level tasks than validating outgoing test results. Both these workshops are intended for lab professionals who want to actively participate in discussion about these topics. They will feature lecture, discussion, Q&A sessions, and networking opportunities.

Friedman went on to say that the Summit “will feature 43 exhibitors of lab software and allied products and more than 200 paid registrants. It is the largest specialized exhibition of its type in the US and is growing rapidly each year.” The Summit provides an excellent opportunity for laboratory professionals assess, compare, and contrast multiple laboratory software solutions. Conference attendees will be able to meet with multiple vendors, face-to-face, in one, convenient location.

The 2007 Lab InfoTech Summit will enable laboratory professionals to immerse themselves in the latest trends in laboratory information management for days. Don’t let this opportunity for learning and networking pass you by!

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