|Quest Diagnostics CEO Stephen Rusckowski|
Quest Diagnostics ($DGX) has been working hard to diversify its offerings, beefing up its presence in diagnostics as it delivers on plans for growth. In its latest move, the company is teaming up with health IT outfit Inovalon ($INOV) to roll out a cloud-based analytics platform for healthcare providers.
The companies' Data Diagnostics tool will combine clinical, claims and lab data sets to offer physicians, hospitals and other healthcare organizations information about patients in real time. Quest and Inovalon will kick off their 5-year exclusive deal during Q4 2015 and will split revenues evenly, Quest said in a statement. Neither side is revealing additional financial terms.
Through Data Diagnostics, healthcare professionals can request information about patients through certain categories. For example, a Historical Data-Related Data Diagnostics category allows clinicians to look at an individual's disease progression, lab results, medication adherence, cardiac tests and other factors that could impact their health, the companies said in a statement. Organizations can also ask for custom reports on patients, potentially cutting down on costs by allowing doctors to rule out additional procedures or tests in point-of-care settings.
"This solution is a game-changer for healthcare," Quest CEO Steve Rusckowski said in a statement. "Our collaboration with Inovalon also demonstrates how we are executing on our long-term strategy to generate value and differentiation from our data assets as well as our national scale and information technology."
The deal plays into Quest's 5-point plan to refocus on its diagnostics business and bolster its presence in clinical trials. Last year, the Madison, NJ-based company decided it would clean up shop by implementing a series of job cuts, managerial changes and reorganization. Quest also started shopping around for deals, snatching up Solstas Lab Partners for $570 million to expand its geographical footprint. In March, the company said it would launch a JV with global CRO Quintiles ($Q) to provide lab services for clinical trials.
At least so far, the company's hard work seems to be paying off. In May, Quest's shares hit a record high after takeover speculation surfaced on Twitter elsewhere, with stock jumping as much as 20.5% before briefly halting on the New York Stock Exchange. And Quest is counting on more success in the year ahead, forecasting 2% to 3% growth in 2015. "We're pleased with the continued progress we're making against our 5-point strategy," Rusckowski said earlier this year.
- read Quest's statement