DESPITE A WORSENING ECONOMY, the Cleveland Clinic will begin construction of a major new $25 million laboratory facility of 100,000 square feet this summer. The lab is expected to open by the end of 2010.
During the past two years, Cleveland Clinic has quietly laid the groundwork to create a reference and esoteric laboratory testing business that will compete nationally for the send-out testing business of hospitals, health systems, and other laboratories. Last fall, Cleveland Clinic hired Dino Kasdagly away from Mayo Medical Laboratories to be Chief Executive Officer of this new laboratory business unit.
At a press conference on February 26, David Strand, Chief Operating Officer at the Cleveland Clinic, stated that the laboratory expansion is, “… about how we can export our expertise to other markets, how we take our intellectual property and utilize it … [to] benefit the clinic.”
Resources To Compete
THE DARK REPORT observes that Cleveland Clinic has the resources to become a serious national competitor. The Pathology and Laboratory Medicine Institute at Cleveland Clinic is already among the largest clinical laboratories in the United States. It performs 10 million lab tests annually, of which only 10% are for other hospitals. It has a staff of almost 800, including 59 pathologists.
Leadership at the Cleveland Clinic is optimistic about the opportunities for a new esoteric lab in the United States. “To give you perspective on the market, the esoteric space grows between 10% and 15% a year,” stated Kasdagly in an interview with the Cleveland Plain Dealer.
That view was echoed by Kandice Kottke-Marchant, M.D., Ph.D., Chair of the Pathology and Laboratory Medicine Institute at the Clinic and President of the reference lab. “Medical knowledge now doubles practically every couple of years,” she commented. “Some small hospitals can’t bring these cutting-edge tests onto their clinical platforms fast enough.”
Formerly in charge of information management in Mayo’s department of laboratory medicine and pathology, Kasdagly will supervise the information technology infrastructure for the reference lab expansion. The new system eventually will include the ability to view digital images of pathology specimens transmitted from labs across the globe.
Cleveland Clinic is preparing to enter an intensely competitive sector of the lab testing industry. In the past 12 years, at least two other companies similarly launched efforts to grab share in the hospital/health system reference testing market. Cleveland Clinic may be banking on its national and international reputation as a source of competitive advantage that will allow it to profitably compete in this market sector.