Dive Brief:

• Quest Diagnostics is closing a lab in Pennsylvania and laying off 121 employees at the site, the company said in a recent Worker Adjustment and Retraining Notification letter filed with the state.
• The Norristown lab performs workforce drug testing on urine specimens. Quest is consolidating its capabilities at a facility in Lenexa, Kansas, that tests urine, hair and oral fluid specimens, according to a statement from the company.
• Lenexa is expanding to handle the extra work, and Quest is offering people laid off at Norristown priority job application review. Quest will continue to provide other services from Norristown, the company wrote in the statement to MedTech Dive.

Dive Insight:

Quest has expanded through acquisitions in recent months, buying PathAI’s diagnostic laboratory to add artificial intelligence capabilities and growing in Canada through its $985 million takeover of Lifelabs. The company is also focused on reducing spending, with an initiative aiming to find 3% in cost savings and productivity improvements every year.

Consolidation drove growth of the Norristown site in 2021, when Quest relocated an operation in another part of Pennsylvania to the facility, according to a report in the Philadelphia Business Journal.

Quest will continue to house a rapid response laboratory, pathology and IT operations at Norristown. The company is offering relocation packages to affected Norristown employees who find roles at Lenexa and severance benefits to people who leave the company.

Quest plans to start laying off people in August and complete the process by the end of 2024, the WARN notice said. In its statement, Quest said urine testing is moving from Norristown to the full-service workforce drug testing laboratory in Lenexa.

“The consolidation will enable us to concentrate innovation and automation at a single laboratory site and better meet the evolving needs of employers, many of which are increasingly seeking the convenience of oral fluid and hair specimen testing over urine as part of their employee drug screening programs,” a Quest spokesperson said via email.

Urine testing remained the dominant method of checking for drugs in 2023. Quest performed more than 8.4 million urine tests in 2023, compared to more than 1.3 million oral fluid tests and nearly 73,000 hair tests. In 2016, Quest performed around 9 million urine tests, 1.3 million oral fluid tests and more than 170,000 hair tests.