In the face of declining demand for diagnostic tests, LabCorp ($LH) is focusing on its testing unit, signing a lab services and biomarker study deal with Bristol-Myers Squibb ($BMY).
The 5-year partnership establishes LabCorp's clinical trials business as the preferred provider of full-service global central laboratory services for Bristol's early- and late-stage pipeline drug development, building off an existing relationship between the two.
"We are excited to expand our relationship with Bristol-Myers Squibb to provide a more flexible and integrated approach to laboratory testing services in support of their innovative clinical development pipeline," LabCorp CMO Mark Brecher said in a statement.
LabCorp is staring down reimbursement cuts it expects to blunt 2013 revenue, and the company is changing its business model, slashing jobs and shifting spending to stay profitable. Boosting its clinical trials presence will help the diagnostics giant pull in cash while its core business recovers, and early-stage deals like the one with BMS could lead to companion diagnostics partnerships down the line, if the investigative therapies make it to market.
Quest Diagnostics ($DGX), the industry's other giant, is pursuing a similar strategy, this month licensing PrimeraDx's assay technology for use in its own clinical trials operation, hoping to leverage drug studies into companion deals in the future.
- read LabCorp's announcement