Applied Digital’s Verichip™, Laboratory Corp. of America


IT’S A DEVELOPMENT THAT INVOKES images from both George Orwell’s 1984 and Aldous Huxley’s Brave New World. An implantable radio frequency identification microchip (RFID) for human use was cleared by the U.S. Food and Drug Administration (FDA) for medical applications in the United States.

On October 13, Applied Digital announced FDA clearance of its VeriChip™ Health Information Microtransponder. About the size of a single grain of rice, the device is inserted under the skin, usually in the triceps area of the upper arm. Each VeriChip has a unique 16-digit number that can be read when a radio scanner is passed over the skin. The 16-digit number is linked to a database through encrypted Internet access.

One human use of the VeriChip is to make a patient’s healthcare information—via the VeriChip data base—available to healthcare providers. After accessing the 16-digit number code from the chip, physicians could then use the Internet to access those medical records. Because a major component of any patient’s medical record is laboratory test data, lab executives and pathologists may want to track the market development of VeriChip.

In recent years, VeriChips have been used to identify pets and live-stock. In one medical demonstration project, 1,000 patients in Mexico received VeriChips. Their blood type and other medical information was included in the database linked to their VeriChip. One unusual use was the implantation of VeriChips in 200 individuals working in the Attorney General’s office in Mexico. The VeriChips were used to grant assess to secure areas where confidential documents and information was stored.

VeriChip is one demonstration of RFID technology. Because it is a device to be implanted in the human body, acceptance by patients and physicians may take some time. However, THE DARK REPORT believes that radio- frequency identification tags will eventually supplant bar code systems in many healthcare applications, including labeling and tracking lab specimens, patient identification, inventory management, and pharmacy uses. The rate of adoption will depend on how fast vendors can reduce the unit cost of the individual RFID tags.


ON OCTOBER 21, 2004, Laboratory Corporation of America announced its earnings for the most recent quarter.

Revenues were up 3.9%, from $752 million in Q3-2003 to $781.5 million in Q3-2004. LabCorp explained that 2% of the growth in revenue was due to increased specimen volume and about 2% was due to higher pricing. It also noted that the four hurricanes which struck across the Southeast during the quarter had impacted the expected volume of business for third quarter.

For the first nine months of 2004, LabCorp’s revenues totaled $2.32 billion, which was a 5% increase over the first nine months of 2003. It stated that “testing volume, measured by accessions, increased approximately 4% and price increased approximately 1%” over the first nine months of 2003.


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