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Esoteric testing

Esoteric testing allows the analysis of rare substances or molecules that are not performed in a routine clinical lab. Many large commercial lab companies outsource complex tests to reference and esoteric testing labs. However, as technology continues to expand laboratory testing, tests that are considered esoteric today may become routine in just a few years. This is often the result of work performed by dedicated research and development scientists.

These tests are ordered when a physician requires additional detailed information, outside routine lab testing, to complete a diagnosis, establish a prognosis or choose and monitor a therapeutic regimen. Esoteric testing generally requires sophisticated instruments and materials as well as specialized personnel to perform and analyze results. The tests are typically outsourced to independent, specialized clinical reference laboratories because it is not cost effective for hospitals and physician office laboratories to perform the tests in-house.

These tests are ordered less frequently than routine tests and are generally priced higher than the routine tests. Esoteric testing is typically related to the medical fields such as endocrinology, genetics, immunology, microbiology, molecular diagnostics, oncology, serology and toxicology. Molecular diagnostics is the fastest growing segment of esoteric clinical testing.

The American Chemical Society publishes the Directory of Rare Analyses (DORA) which catalogues rarely ordered clinical tests and provides details on the labs performing them.

The challenges for labs performing such tests include not only finding qualified medical technologists, but also paying them the higher salaries they command because of the scarcity of their skill sets. In addition, materials used in these tests can also be costly, particularly because they are not usually purchased in large enough quantities to qualify for economies of scale.

Labs that perform these tests have capabilities including:

• Allergy
• Complex anatomic pathology with board-certified pathologist
• Bone markers
• Genetic analysis
• HLA testing
• Functional assays of the immune system
• Toxicology

In the U.S., labs that perform these tests range from ARUP Laboratories, Mayo Medical Laboratories, Quest Diagnostics Incorporated, and Laboratory Corporation of America to a growing number of specialty esoteric testing laboratories that offer proprietary esoteric assays. Examples of such specialty testing lab companies include Myriad Genetics, Genomic Health, and Foundation Medicine.

Opko Pays $1.47 Billion to Buy Bio-Reference Lab

CEO SUMMARY: It’s a case of the little fish gobbling the big fish, as Opko Health – with revenue of $91 million – will be acquiring Bio-Reference Laboratories, with revenue of $832 million. But the more interesting aspect of the story is that the CEO of Opko Health is a physi…

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LabCorp, Quest Diagnostics Both Say 2014 Revenue Was Up

BOTH OF THE NATION’S LARGEST clinical laboratory companies reported increased specimen volume as a result of the Accountable Care Act (ACA), as noted in their respective fourth quarter and full-year earnings reports. First to issue its earning statement was Quest Diagnostics Incorporated. On…

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Early ACO Experience Has Lessons for Pathologists

CEO SUMMARY: To date, many of the nation’s 500 accountable care organizations have launched with little involvement by independent pathology groups and clinical laboratories. That was not the case with an ACO in Alabama, however. From its inception in 2012, the ACO has contract…

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Is PAML to Be Sold? ‘No Comment!’ Say Execs

CEO SUMMARY: It is one of the 10 largest lab companies in the United States. Thus, if Pathology Associates Medical Laboratories in Spokane, Washington, were to be sold, it would trigger a major shift in the competitive market for lab testing service…

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Alberta Picks Sonic Health for $3 Billion Lab Contract

CEO SUMMARY: For more than a year, Alberta’s C$3 billion RFP to develop an integrated laboratory testing service for Edmonton and surrounding regions has been the focus of intense interest. On October 17, health officials announced that Sonic Healthcare Limited was the preferred propone…

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In this Philadelphia Story, LabCorp Uses 2007 Script

CEO SUMMARY: There’s a managed care contracting play-book that seems to be working better for Laboratory Corporation of America than it does for Quest Diagnostics Inc. On July 1, LabCorp became the exclusive national lab provider for Independence Blue Cross of Philadelphia. For the past…

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Labs Wary of BeaconLBS, Express Major Concerns

CEO SUMMARY: Lab executives asked to join UnitedHealth’s new BeaconLBS lab benefit management system soon to launch in Florida have multiple and serious concerns. The primary issue is that BeaconLBS is a subsidiary of LabCorp—their major competitor. These executives understand why a p…

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UCLA, Centre to Open Lab in China to Offer High Quality Testing

CEO SUMMARY: To fill the unmet demand for quality clinical laboratory testing in China, a partnership between pathologists at UCLA and Centre Testing International Corp. of Shenzen have built and will operate a lab facility in Shanghai. The new lab will open by late September and…

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Hospitals Recognize Need for Uniform Lab Test Data

CEO SUMMARY: Hospitals may soon insist that payers allow their in-house labs to provide outpatient testing regardless of exclusive managed care contracts with national lab companies. The migration to accountable care organizations (ACOs) and medical homes makes it essential that physician…

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Dartmouth Builds New Lab to Serve Growth in Testing

CEO SUMMARY: Demand for specialized reference and esoteric testing is so robust at Dartmouth Hitchcock Medical Center in New Hampshire that the academic center is building an expanded laboratory facility to accommodate the increased volume of tests it handles each year. A favorable trend …

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