LabCorp acquired outsourcing company Sciformix and plans to integrate it into its Covance drug-development arm. The terms of the deal were not disclosed.
The purchase of Sciformix, which focuses on regulatory and pharmacovigilance solutions in drug and device development, will strengthen Covance’s later-phase offerings, including in postmarket safety and market access, LabCorp CEO David King said in a statement.
In addition, the majority of Sciformix’s 1,100 employees are based in Asia, fueling Covance’s global expansion. Sciformix’s offerings include postmarket risk management, clinical development support, regulatory affairs support, technology services and real-world evidence solutions. The company is headquartered in Massachusetts, with operations in the U.S., India and the Philippines.
“More than ever, approved treatments must be monitored closely to demonstrate a continued favorable benefit-risk ratio in a much broader population and to safeguard patient safety. Pharmacovigilance solutions address that need,” said Bill Hanlon, Ph.D., group president of clinical development and commercialization services at Covance, describing what he called a compelling addition to the company’s portfolio.
Also internationally, LabCorp recently announced a collaboration with European clinical laboratory tester Unilabs to provide development and delivery of companion diagnostics in immuno-oncology.
Unilabs encompasses more than 230 laboratories in 15 countries and processes more than 188 million diagnostic tests each year. The project will initially focus on assays developed and validated by LabCorp and Covance. The financial terms of that agreement were undisclosed as well.
In May of last year, Covance was planning job cuts and the closing of a lab in Indiana, following lagging first-quarter revenues.
While LabCorp’s groupwide revenue saw a 4.9% increase, Covance’s revenue declined 1.8% to $690.3 million, attributed to the cancellations of two large clinical trials by sponsors, a backlog of revenue turnover and higher personnel costs. The company said it expects the restructuring initiative to produce $130 million in savings over a three-year period ending in 2020.
In a positive turnaround, LabCorp would go on to post $10.21 billion in 2017 annual net revenues, up 8.2% over 2016. And for the first quarter of 2018, Covance’s revenues topped $1 billion, primarily due to acquisitions and foreign currency translations, resulting in an increase of over 30% compared to 2017’s first quarter.