Sep 2, 2009 | Laboratory News, Laboratory Pathology, Managed Care Contracts & Payer Reimbursement
Labtests succeeds Sonic’s DML as the primary lab test provider in Auckland area
One of the world’s most interest experiments in government contracting for clinical laboratory testing services is unfolding in Auckland, New Zealand. Next Monday, September 7, Labtests will assume full responsibility for testing approximately 12,000 patients per day in a brand-new laboratory facility that has only conducted testing on a limited basis since August 10, 2008.
On that same day, Diagnostic Medlab’s (DML) existing contract with the District Health Boards in greater Auckland will terminate. Earlier, on August 18, DML’s parent company, Sonic Healthcare Ltd. (ASX:SHL) of Sydney, Australia, announced plans to shutter DML’s laboratory facility and write-off its Auckland-based business division.
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Aug 21, 2009 | Laboratory Management and Operations, Laboratory News, Management & Operations
It’s the second acquisition of a hospital lab outreach program in past six days
Several days ago, a two-part deal was announced between Quest Diagnostics Incorporated (NYSE:DGX) and Caritas Christi Health Care of Boston, Massachusetts. Caritas sold its clinical laboratory outreach business to Quest Diagnostics and both parties formed a “strategic alliance” going forward that centers upon laboratory testing and informatics integration. Caritas will continue to own and manage the laboratories in its six hospitals.
This is the second sale of a hospital laboratory outreach business in the past two weeks. On August 12, Sonic Healthcare (SYD:SHL) acquired Piedmont Medical Laboratories (PML) of Winchester, Virginia. PML was owned by Valley Health, an eight-hospital health system. (See Dark Daily, ‘Sonic Healthcare’s Latest Lab Buying Spree Nets Two U.S. Labs for $20 Million”, August 13, 2009.)
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Aug 13, 2009 | Laboratory Management and Operations, Management & Operations
Sonic purchased Piedmont Medical Laboratory of Winchester, Virginia, and Axiom Laboratories, of Tampa, Florida
Yesterday, Sonic Healthcare, Ltd., of Sydney, Australia, officially recognized the acquisition of two clinical laboratories in the United States: Piedmont Medical Laboratory of Winchester, Virginia, and Axiom Laboratories, of Tampa. The Axiom transaction was closed earlier this summer.
For both labs, Sonic will pay $20 million in cash and could pay $2.5 million more in performance-based bonuses over the next two years. As an indication of current pricing for laboratory services, the $20 million purchase price bought Sonic a total of approximately $16 million in annual revenue.
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Aug 22, 2008 | Laboratory News, Laboratory Pathology
For the third time in the past ten years, laboratory industry entrepreneur Brian Carr is heading up a new laboratory company he helped found. Earlier this week, OralDNALabs, Inc. of Brentwood, Tennessee, announced it was open for business. Carr will be its President and Chief Executive Officer.
OralDNALabs has a unique strategy. It plans to offer genetic tests to dentists. It is starting with two proprietary molecular assays. One test, MyPerioPath, uses DNA to identify both the presence and bacterial load of pathogens associated with periodontal disease. The second test, My PerioID PST, uses technology licensed from Interleukin Genetics Inc. (AMEX:ILI) of Waltham, Massachusetts. This test is predictive of the patient’s susceptibility to periodontal disease by analyzing the Interleukin 1 genes. With these first two assays, OralDNALabs says that it will provide dentists with a more precise method for diagnosing and treating gingivitis and periodontitus.
Brian Carr was involved in starting two other laboratory companies. In 1998, he was one of the original founders of Pathology Consultants of America, Inc., (PCA) based in Brentwood, Tennessee, where he served as CEO (see The Dark Report, April 13, 1998). PCA was acquired by AmeriPath, Inc. in December 2000. Then, in April 2004, Carr formed American Esoteric Laboratories, Inc. (AEL), also headquartered in Brentwood, Tennessee (see The Dark Report, April 26, 2004). Carr was Chairman and CEO of AEL up until its acquisition by Sonic Healthcare Ltd in December 2006.
Now, with the launch of his third laboratory company in the past ten years, Carr will attempt to bring molecular diagnostics to the dental profession. As careful readers of Dark Daily will recall, we have written in recent months about research studies that are using saliva specimens to diagnose a variety of diseases, including cancer (see Advances in Salivary Diagnostics Point to New Ways to Detect Cancer and Other Diseases). Experts predict that many of these emerging diagnostic technologies will find ready application in oral health. Newly-formed OralDNALabs may be the first laboratory company organized specifically to serve dentists and other oral health professionals. As they do, they must answer a fundamental question: are dentists ready to order laboratory tests as a regular part of their daily routine?
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Dental and Laboratory Veterans Form Specialty Diagnostics Laboratory Focusing on Dental Related Disease
Jul 8, 2008 | Laboratory Management and Operations, Laboratory Pathology
With demand driving prices to record levels for clinical laboratory companies and anatomic pathology practices, merger and acquisition (M&A) activity in the lab industry continues to grow across the United States.
Just two weeks ago, Sonic Healthcare, Ltd. announced that it was purchasing Clinical Laboratories of Hawaii, LLP for an estimated $121 million dollars. That sale is expected to be completed by the end of third quarter this year. (See Dark Daily, June 30, 2008)
Still unannounced as of this date are the winning bidders for the laboratory outreach business of Stanford University Medical Center and the laboratory testing division of Carilion Clinic. Earlier this year, officials from both institutions disclosed that their laboratory businesses were up for sale. (See Dark Daily, April 15, 2008)
At this year’s Executive War College in May, attendees participated in the lab industry’s first-ever conference on “Mergers & Acquisitions in Clinical Laboratories and Anatomic Pathology,” a program designed to bring potential sellers of clinical labs, pathology groups, and hospital lab outreach programs together with experts in law, valuation, negotiation, and financial planning.
Two speakers attracted particular attention: Doug Brown, Managing Director of Wachovia Securities and attorney Antony Konkoly, Esquire, of McDonald Hopkins.
Brown provided a concise review of the factors supporting higher valuations for laboratory assets and discussed details of some recent noteworthy lab acquisitions. According to Brown, lab owners need to recognize that there is no simple way to establish a single value for their laboratories because different buyers will place different values on a lab company’s existing assets and future growth prospects.
Brown also discussed details of the 2007 acquisition of AmeriPath, Inc. by Quest Diagnostics, Inc. for approximately $2 billion. With annual revenue of $750 million, it was estimated that the multiple paid in this transaction was as high as 17 times EBITDA (earnings before interest, taxes, depreciation, and amortization). Brown pointed to several unique factors, including market timing, that supported AmeriPath’s top-of-market valuation at the moment the deal was inked. He also explained that these same factors were not likely to be seen in the laboratory industry again anytime soon.
In this same session, Antony Konkoly offered some important M&A do’s and don’ts based on his considerable experience representing various parties in the sale of laboratory businesses, the establishment of laboratory joint ventures and the formation of new lab companies.
If you weren’t able to participate in this exciting new M&A conference, here’s another opportunity to hear Doug Brown’s take on the current state of mergers and acquisitions in laboratory and pathology.
Attorney Antony Konkoly, Esq. will once again join Doug Brown in this discussion. From Konkoly, you’ll learn about the mistakes lab sellers often make, and how you can fix those issues before offering your laboratory for sale. You’ll also get several proven recommendations on how to minimize tax consequences and maximize the net proceeds from the sale.
Whether you’re a lab owner or pathologist, you won’t want to miss this comprehensive new audio conference. Join Dark Daily and The Dark Report as they present, “Lab and Pathology Mergers & Acquisitions: Must-Have Essentials To Learn Before You Buy Or Sell A Lab,” on Wednesday July 30, beginning at 1:00 p.m. EDT (10:00 a.m. Pacific) and running for 90 minutes.
Don’t miss this special audio conference and your chance to listen to and ask questions of these two veteran lab industry dealmakers.
Register on or before July 18, 2008 and you’ll save $50. So don’t wait-Register today! http://www.darkreport.com/Audio/7.30.08/audio-register.htm
