Dive Brief:
- Labcorp said it will expand its diagnostic testing and laboratory services offerings in eastern Massachusetts with the acquisition of Tufts Medicine’s outreach lab business and related operating assets.
- The organizations, which did not disclose financial terms of the transaction, characterized the deal as the first step toward a larger strategic partnership.
- The sale of the Boston-based academic health system’s laboratory outreach testing business, which serves area physicians, coincides with the elimination of 574 jobs across Tufts Medical Center, Lowell General Hospital and MelroseWakefield Hospital, according to a Worker Adjustment and Retraining Notification Act notice in Massachusetts. The layoffs are effective in October, when the Labcorp acquisition is expected to be finalized.
Dive Insight:
Laboratory services company Labcorp has accelerated a strategy to drive growth through a string of healthcare system acquisitions and partnerships as its COVID PCR testing volumes have tapered off.
The company, which completed the spinoff of the Fortrea clinical trial management business in June, is working to integrate the operations of St. Louis-based health system Ascension after acquiring part of its outreach laboratory segment in a $400 million deal announced last year.
In April, Labcorp said it was managing laboratories in nearly 100 Ascension hospitals, and CEO Adam Schechter said the company was in active talks with other potential partners. “The pipeline for hospital and local lab acquisition and investment is robust,” he told analysts at the time.
The company subsequently announced deals to acquire the outreach laboratory businesses of two healthcare providers in Oregon: Providence Health and Services and Legacy Health.
The Tufts transaction will expand patient specimen collection access in the communities served by the hospital system, Labcorp said. The partnership is intended to standardize lab testing across the system and reduce wait-times for patients. Clinicians and patients will gain access to Labcorp's scientific expertise and advanced diagnostics in areas including oncology, neurology and women's health, according to the announcement.
Tufts Medicine spokesperson Jeremy Lechan said the health system is working with Labcorp to develop a comprehensive plan to optimize lab testing services in inpatient, outpatient and ambulatory settings.
“At this time, we are quite certain the majority of laboratory employees supporting ambulatory laboratory services will receive comparable job offers with Labcorp,” Lechan said.
