Quest Diagnostics Acquires 2 Texas Labs, Creates Precision Medicine Cancer Dx Center

June 13, 2017
Quest Diagnostics Acquires 2 Texas Labs, Creates Precision Medicine Cancer Dx Center
Quest Diagnostics says its planned acquisition of MedFusion and Clear Point will enable it to accelerate its growth in cancer diagnostics. [iStock/jarun011]

Quest Diagnostics has agreed to acquire two laboratory businesses in Lewisville, TX, for an undisclosed price, in a deal that will enable the buyer to create a center for cancer precision medicine diagnostic services in the Southwest.

Quest plans to acquire MedFusion and Clear Point from co-owners that include Baylor Scott & White Health (BSWH), Texas’ largest not-for-profit health care system; The US Oncology Network (The Network), supported by McKesson Specialty Health, a division of McKesson Corp.; Texas Oncology; and Pathologists Bio-Medical Laboratories (PBM).

Upon completion of the deal, Quest will become a preferred provider of advanced oncology diagnostics for The Network, including Texas Oncology. The Network consists of more than 400 locations across the U.S., with more than 1,400 independent, community-based physicians.

“This transaction will not only accelerate Quest's growth in cancer diagnostics, but also holds the promise of improving care for patients with cancer in Texas and the entire United States,” Quest Diagnostics Chairman, President, and CEO Steve Rusckowski said in a statement yesterday.

Quest said it will provide diagnostics services that include tumor sequencing and other genomic and pathology testing through which oncologists select and monitor treatment and predict disease progression. Quest’s preferred provider relationship will not include testing for inherited genetic conditions typically offered by non-oncologists, such as for BRCA breast cancer screening.

However, Quest will be a preferred provider of a full range of inpatient and outpatient diagnostic services for 12 North Texas hospitals of BSWH, formed in 2013 from the merger of Baylor Health Care System and Scott & White Healthcare. The services will be offered from the center of excellence site in Lewisville upon close of the transaction. Quest and PBM will also have a preferred provider relationship for several services once the deal is completed.

The deal is expected to be completed in the third quarter, subject to the satisfaction of customary closing conditions, including regulatory approvals.

Following the closing of the transaction, Quest Diagnostics will collaborate with McKesson Specialty Health, The Network, and Texas Oncology on developing standardized, evidence-based services for guiding treatment decisions within the providers’ electronic patient record and care plan workflow, through a model applied by Med Fusion.

“By joining forces with Quest Diagnostics, Med Fusion will speed the development and adoption of its novel framework for precision medicine diagnostics developed in recent years by our team,” Med Fusion CEO Jon L. Hart added.

Once these services are developed, Quest said, it expects to be able to offer versions of them to other U.S. providers, with the goal of improving cancer outcomes.

The center will be designed to complement Quest's existing centers of excellence in San Juan Capistrano, CA; Valencia, CA; Chantilly, VA; and Marlborough, MA. The laboratories generally specialize in advanced diagnostic services for marquee health systems and specialty physicians. In Texas, Quest Diagnostics also operates full-service labs in Irving and Houston.