August 15, 2016 Intelligence: Late Breaking Lab News

One of the nation’s largest private pathology group practices completed a successful recapitalization, thus ensuring its independence for another five to seven years. On August 1, PathGroup, Inc., of Nashville, Tenn., announced an investment by Pritzker Group Private Capital and Vesey Street Capital Partners. It was in January 2010, that PathGroup had completed a $100 million investment. It is believed that the current recapitalization was needed to allow that round of investors from 2010 to cash out their equity.

MORE ON: PathGroup

PathGroup is one of a handful of regional pathology superpractices that continues to grow in a profitable manner. It has more than 50 pathologists and serves 70 hospitals. One of the hazards of a private laboratory company accepting capital from private equity companies is that these professional investors typically need to liquidate that investment after five to eight years to pay off the investment fund that was the source of their capital. If the private lab company is unable to find another source of capital to pay off that round of investors, it often finds that its only option is to sell the lab company to a public lab company. This has happened to a number of private lab companies over the past 20 years and has contributed to further consolidation of the lab testing industry.

LABCORP ACQUIRES SEQUENOM, INC.

On July 27, it was announced that Laboratory Corporation of America would pay the equivalent of $371 million to acquire Sequenom, Inc., of San Diego. Sequenom is recognized as one of the early providers of non-invasive prenatal testing for reproductive health. However, as a public company, it was under financial pressure. Its CEO had resigned last fall and the company had laid off about 20% of its staff at the beginning of the year. Sequenom had revenue of $128 million during 2015.

TRANSITIONS

  • Michael Mosunic was hired to be the new President and COO of Universal Diagnostic Laboratories, in Van Nuys, Calif. Previously, he served at Pathology, Inc., Slone Partners, and Laboratory Corporation of America.
  • Provista Diagnostics, Inc., of New York City, named Judith K. Wolf, MD, as Chief Medical Officer. Wolf previously worked at Vermillion, Inc., and MD Anderson Cancer Center.
  • COLA selected Tammy Zinsmeister to be its first Chief Innovation Officer. She formerly held positions at Transformation Systems International, LLC, and American Society of Internal Medicine.

dark_daily_logoHave you caught the latest e-briefings from DARK Daily? If so, then you’d know about …

…the findings of the Health Care Cost Institute (HCCI) that people in certain states pay double for common medical procedures as compared to patients in other states. Clinical laboratory tests were included in this study.

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That’s all the insider intelligence for this report. Look for the next briefing on Tuesday, September 6, 2016.

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